THE HOUSE of Representatives is expected to start debating the Companies Act when it resumes sitting this afternoon.
The debate will centre on the report of a Joint Select Committee of Parliament which had been looking at the proposals and will be piloted by Minister of Industry, Commerce and Technology, Phillip Paulwell.
It brings to an end almost two years of work on the 462-page Bill which seeks to overhaul the existing legislation which dates back to the 1960s.
In summing up the work of the Committee on the Bill recently, Mr. Paulwell noted that the new legislation was an important precursor to the establishment of commercial courts which have been proposed by the Government.
He said that his Ministry, in association with the Registrar of Companies, would be undertaking a public education programme and would solicit the support of "our friends in" the private sector. But the Private Sector Organisation of Jamaica (PSOJ) is not satisfied that the Minister is debating the matter before members have concluded their study of the committee's report.
Among the major issues which the committee had to grapple with was the question of whether the legislation should treat a "shadow director" of a company in the same way as a regular company director. This issue arose from a submission made by the Jamaican Bar Association questioning the rationale of introducing into the legislation the term "shadow director".
A shadow director, as defined in the Bill, is a person in accordance with whose instructions, the board of a company is accustomed to act. The committee was split on whether the same liabilities should be imposed on the shadow director as the a regular director.
Another submission, calling for foreign investors to be exempt from issuing a prospectus when making a private share offer in Jamaica was a major issue. Under the existing Act, foreign investors have to issue a prospectus whether they are making a private or public offer of shares or debentures locally. On the other hand, local companies are only required to issue a prospectus when they are making a public offer.
