This Supplementary Order Paper amends new Part 6A of the Statutes Amendment Bill. New Part 6A was included in the Bill at the committee of the whole House stage on 2 November 2016 to amend provisions in the Companies Act 1993. New Part 6A would implement the changes proposed in the Member’s Bill, the Companies (Annual Report Notice Requirements) Amendment Bill. The purpose of new Part 6A is to reduce compliance costs for listed and other issuers in relation to the way in which annual reports must be made available (including by electronic means).

New Part 6A applies more widely than was intended. The General Policy Statement of the Member’s Bill identified “listed and other issuers” as the class of companies that would obtain the benefits of the reform. However, new Part 6A also applies to the 4 other classes of companies that are required to prepare an annual report under section 208 of the Companies Act 1993. The proposed section 209B in new Part 6A would have created unnecessary obligations for those 4 other classes of companies.

In addition, new Part 6A is unclear in a number of respects. There is a lack of clarity about what boards of companies need to do to comply with certain obligations, unclear terminology, and inconsistencies between provisions.

The Government now proposes instead to give effect to the purpose of new Part 6A in a way that is more workable for the range of issuers to which it should apply by making regulations under the Financial Markets Conduct Act 2013 to regulate how that group of issuers (namely, FMC reporting entities) must make their annual reports available. If the company is an issuer of regulated products that must comply with the new regulations, those annual report requirements of the Companies Act 1993 will no longer apply to the company. If the company is not an issuer of regulated products, then the company will be able to choose whether to comply with those annual report requirements of the Companies Act 1993 or with the new regulations.