Tanczos Nandor: Business Law Reform Bill — First Reading 
Tanczos Nandor: Business Law Reform Bill — First Reading 
[Volume:632;Page:4244] 
NANDOR TANCZOS (Green) 
: 
 I intend to take only a very short call simply to indicate that the Green Party is supporting the bill to the select committee and to draw attention to a couple of things we have an interest in and support. As a general comment I think the bill is useful. Perhaps it does not go as far as some members would like but it does make at least some attempt to reduce some of the unnecessary compliance costs for business. That is always a useful thing to do. I draw attention to Part 4 “Friendly Societies and Credit Unions Act 1982”. It makes some fairly modest changes but useful changes that will be of benefit to credit unions and friendly societies. That is good because those organisations have played quite an important part in the economic life of our communities. 
Part 4 amends various sections to enable charitable entities and incorporated societies to be members of credit unions and that seems to be a sensible thing. It talks about removing the current requirement for the registrar to be satisfied that a credit union has a common bond and replaces it with an objective test requiring that the credit unions’ rules specify a common bond. That is good because there has to be objectivity. In particular in terms of winding-up provisions it is important that those things can be measured objectively rather than depending on the subjective test of the registrar of the day. 
It provides that members need have no more than $10 in paid-up shares although a credit union’s rules may allow for a minimum deposit of more or less than $10. That introduces some flexibility and is helpful. It is a modest change but will probably be welcomed by those organisations. 
I draw attention to some changes made to the Companies Act which were referred to by Mr Woolerton and perhaps some other members as well. New section 209in clause 8 changes the reporting requirements particularly in relation to shareholders. It provides that the board of a company may instead of sending a full annual report send a notice that contains a statement that the shareholders have a right to request free of charge a copy of the annual report; that they may receive it by electronic means; and that they may receive a statement as to whether the board has prepared a concise annual report. 
Those of us who have been involved in business will know that not all shareholders are interested in reading the full annual report. They just want a bit of a summary to get a sense of how things are going. To me it is quite sensible that it should be available in that way—and providing it electronically is simply catching up with the times. And of course the Greens support that change because of the potential for waste minimisation; that is an obvious added benefit. 
New section 211Ain clause 10 provides that the obligations to prepare and make available annual reports and financial statements do not apply in relation to non-active companies under new section 10Aof the Financial Reporting Act 1993. I have been involved in companies that have been temporarily inactive and to not have to prepare those reports seems again to be quite sensible. It is obviously a good thing to reduce some of that unnecessary burden where there is no real benefit. 
Clause 6 amends section 151(2) in respect of qualifications of directors. It disqualifies a person who is prohibited from being a director or a promoter or taking part in the management of an overseas company under an order made or a notice given under a law of a prescribed overseas jurisdiction. It simply means that someone who is disqualified under a law of a prescribed overseas jurisdiction should be disqualified in New Zealand. Obviously that makes good sense. I cannot see that anyone would have any issue with that. If we compare it with clause 15 we see that the court can disqualify a person if the person has been prohibited in an overseas jurisdiction from carrying on activities that the court is satisfied are substantially similar to being a director or promoter of or being concerned or taking part in the management of a body corporate. I think that creating some synergy between New Zealand and overseas jurisdictions in those regards makes good sense. Without those kinds of provisions it seems clear that it is open to abuse so that seems to be quite a sensible measure. 
As I said at the beginning the bill is a fairly modest attempt to reduce compliance costs but I think it does that. I think it is useful and the Greens will be supporting it.