XN000022-1987-01-07 — Page 19

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WEDNESDAY, JANUARY 7, 1987

+TO ALLOW FOR A REASONABLE TRANSITION, IT IS PROPOSED THAT THESE NEW REQUIREMENTS SHOULD NOT APPLY TO ANY PERICO PRIOR TO THE FINANCIAL YEAR BEGINNING AFTER THE COMMENCEMENT OF THE ORDINANCE

#FENACTED,+ HE SAID.

AS TO INSPECTORS' POWERS, MR JACOBS SAID THE COMPANIES ORDINANCE IMPOSED A DUTY ON OFFICERS AND AGENTS OF A COMPANY UNDER INVESTIGATION BY AN INSPECTOR TO PRODUCE THE COMPANY'S BOOKS AND DOCUMENTS TO THE INSPECTOR.

HE SAID THE INSPECTOR WAS GIVEN CERTAIN POWERS TO EXAMINE THOSE PERSONS UNDER OATH, BUT EXPERIENCE HAD REVEALED THAT THESE POWERS WERE INADEQUATE.

+FIRST, THE INSPECTOR HAS TO GO THROUGH THE TIME CONSUMING PROCESS OF APPLYING TO THE COURT IF HE WANTS TO EXAMINE ON OATH THIRD PARTIES WHO ARE NOT OFFICERS, AGENTS OR EMPLOYEES OF THE COMPANY, HE SAID,

+SECOND. THE COURT DOES NOT HAVE EXPRESS POWERS TO ORDER THIRD PARTIES TO HAND ANY BOOKS OR DOCUMENTS TO THE INSPECTOR,+ HE ADDED.

THE PROPOSED AMENDMENT, IF ENACTED, WOULD GIVE THE INSPECTOR AUTHORITY TO EXAMINE ON OATH ANY PERSON HE THOUGHT WAS, OR MIGHT BE, IN POSSESSION OF RELEVANT INFORMATION, AND TO REQUIRE SUCH PERSON TO PRODUCE BOOKS AND DOCUMENTS TO ASSIST IN THE INVESTIGATION.

THE BILL ALSO ADDED A NEW SECTION TO ENABLE THE INSPECTOR TO REQUIRE A DIRECTOR OF A COMPANY UNDER INVESTIGATION TO PRODUCE DOCUMENTS RELATING TO ACCOUNTS WHICH HE HELD IN A FINANCIAL

INSTITUTION WHEN THE INSPECTOR HAD REASONABLE GROUNDS FOR BELIEVING THAT ANY UNDISCLOSED BUT RELEVANT TRANSACTIONS MIGHT HAVE TAKEN PLACE, MR JACOBS SAID.

ANOTHER PROPOSED AMENDMENT WOULD ENABLE AN INSPECTOR TO INFORM THE FINANCIAL SECRETARY OF MATTERS TENDING TO SHOW THAT ANY CIVIL PROCEEDINGS OUGHT, IN THE PUBLIC INTEREST, TO BE BROUGHT BY ANY BODY CORPORATE.

ON PRIORITIES FOR THE PAYMENT OF DEBTS IN THE WINDING UP OF A COMAPNY, MR JACOBS NOTED THAT THESE PRIORITIES WERE SET OUT IN THE EXISTING LEGISLATION AND THESE SHOULD BE FOLLOWED IN CIRCUMSTANCES WHERE A RECEIVER WAS APPOINTED UNDER A DEBENTURE SECURED BY A FLOATING CHARGE.

THERE WAS DOUBT, HOWEVER, AS TO WHETHER THE SAME PRIORITIES CONTINUED TO APPLY. AS THEY SHOULD, WHEN. UPON THE CESSATION OF A BUSINESS, THE FLOATING CHARGE CRYSTALLISED AND BECAME A FIXED CHARGE, HE SAID.

/THE BILL.