Chamber and committees

Do you believe that amendment 55 is incompetent? It simply seeks to amend something within the bill. I look for clarification on that if possible, minister.

Amendment 64 is for future proofing the bill, which I hope will become an act, with regard to fees for third sector organisations. We held a helpful evidence session with a number of groups and received written evidence on the issue of the fee not having to be paid by a third sector organisation for the service if it has to go to the register. I know that the minister helpfully wrote to the committee at the beginning of this week or the end of last week to say that the Government was not persuaded of the need for such a provision. I would be interested to know a wee bit more about why the Government has gone down that road.

I accept two things. First, I accept that we want the register not to be a loss leader, if I may put it that way, but to break even. However, we also need to protect some of the most vulnerable people in our society from having an expense that might stop them being able to go forward.

Secondly, I accept that the fee that the Government imagines, which will come into force next year, is not large, comparatively speaking, but we do not know where that fee will go in future. It is possible that it could stop vulnerable people accessing a register that others can afford to access.

It is not my expectation that people from third sector organisations will use the register frequently, but I think that, when it is necessary for such an organisation to do so, the fee should be waived. I look forward to hearing what the minister has to say about amendments 64 and 81.

I move amendment 64.

I said in my opening remarks on the amendments that I did not think that this sort of thing would happen frequently. I note the minister’s use of the word “routinely”, and I agree with him; my hope is that, if we get the bill right, what we are talking about will be the exception rather than the rule.

However, I think that that leads to a slight contradiction in the minister’s argument that, because this will happen so often, it will put extra costs on others to meet. I think that the proposed provision will be used irregularly, but it might well be required from time to time as the legislation develops. This is an important message for Parliament to send out, and it is important for the Parliament to give the Scottish Government a steer on this—indeed, more than a steer—and to set out where we think that we should end up, which is that we do not think that the third sector should be involved in having to pay the fee in question.

I accept what the minister has said about consultation being carried out on the issue once the bill becomes an act, but I point out that the committee, in its report, was certainly of the view that not-for-profit third sector organisations should not be charged for such searches. We want to give the public and the Scottish Government the clear message that charging in those circumstances is not a road that we want to go down.

For that reason, I will press amendment 11.

I apologise—I meant amendment 64.

I accept what the minister has said, but is one reason for the bill not to encourage intimation to take place more regularly? I accept that people have been using English law, so intimation has not been happening but, once the bill’s provisions are in place, surely intimation will be more common.

Good morning. I will set out some context for all my amendments.

Clearly, we are supportive of the bill in principle, and I welcome the comments that the Scottish Government has made. I hope that my amendments will clarify some things and ensure that the bill will work in practice.

I am grateful to the groups that have been in touch with me and have suggested amendments. I am particularly grateful to the Law Society of Scotland, which I have had a number of conversations with and which has helped me with some of my amendments. I hope that my amendments will be dealt with in a constructive way, and I look forward to hearing what the minister has to say.

I turn to amendments 54, 67 and 74, all of which are in my name.

Amendment 54 would expressly allow the assignation document to refer to the claim by reference to another document or data that is not reproduced in the assignation document itself. That is important because a number of invoice discounting systems use online portal-based invoice discounting systems, and we need to ensure that they are able to utilise the register of assignations. Similarly, I am sure that we want to avoid lengthy documents, including customer lists, needing to be uploaded to the register. This approach is coherent with and follows the approach taken to conditions for assignation in section 2(4). I ask the committee to accept amendment 54.

If it passes, amendment 67 would expressly allow the constitutive document in a pledge to refer to the property pledged by reference to another document or data that is not reproduced in the constitutive document itself. I lodged amendment 67 because, having spoken to a number of people in practice, I found that they generally consider that a number of pledges will be composite pledges referring to a large number of the debtor’s assets, and that having to upload such asset lists might be prejudicial to debtors. Again, I hope that this is a constructive amendment that the committee can support this morning.

Amendment 74 would affect section 56 of the bill. It expressly allows for an amendment document in respect of a pledge to refer to the property pledged by reference to another document or data that is not reproduced in the constitutive document itself. Again, having spoken to those in practice, I consider that a number of pledges will be composite pledges referring to a large number of the debtor’s assets, and that having to upload such asset lists might be prejudicial to debtors. That could also apply in respect of an amendment of a pledge. Amendment 74 will make things clearer for those who are dealing with this day in and day out.

I look forward to hearing the minister’s response to my amendments.

I move amendment 54.

I thank the minister for lodging those amendments, which are helpful and will get the committee to where we want be. However, I am looking for clarification. There is a balance to be got right in the treatment of individuals as opposed to sole traders. We started our discussions on the bill by saying that the threshold here could be £1,000. Would there be any advantage in considering, at stage 3, whether the situation could be clarified further by having the figure increased to, say, £5,000 or £10,000? Would that give absolute clarity to individuals, or would it not bring them any benefit? I genuinely seek clarification on that point so that we can keep a balance between individuals and sole traders.

Amendment 61 ensures that, as the minister has outlined, the timescales for valid intimation will also be subject to a determination as to the method of service. As he has suggested, some concerns have been raised about the wording in the bill as introduced that some of the detail in respect of intimation is slightly too prescriptive, and more aspects of intimation, including how long after serving a notice should receipt of such notice be deemed, should be subject to a determination as to the method of service, too. However, I intend to reflect on what the minister has said and will not move the amendment today.

I am still inclined to move amendment 65, which seeks to change the definition of “assignee” by including the assignee’s trustees or agents. I accept what the minister has said about provision for this being made later on in the bill, but it is still my view that this amendment is helpful and will give clarity. Simply defining the assignee as

“the person to whom a claim is assigned”

lacks clarity; after all, trustees and agents of the assignee can act on the assignee’s behalf, and it is possible for creditors to hold claims and pledges as trustees and/or agents for themselves and other creditors. Amendment 65 simply makes it clear that those acting in the place of assignees are included in the definition of “assignee”. Clarity is always a good thing, and the amendment will just put into the bill something that people will be able to understand and refer to.

Finally, I will be supporting all of the minister’s amendments.

It was just over 30 years ago that I sweated blood and tears when trying to do company law. I am pleased to say that I have never practised it in my life.

However, I have had another look at the amendments in this group and had conversations about them, and I slightly disagree with the minister’s position. My view is that we need more clarity around the area of insolvency. It is, as the Law Commission has said, and as the minister has said this morning, very technical, and we should bring more clarity to very technical areas by including the amendments in the bill and enacting them. If the amendments do not achieve what I think that they will achieve, there is room to make changes at a later stage, as the minister has said. However, I think that the amendments would clarify the situation, and it is my intention to press amendment 58.

I appreciate what the minister says, but if everything is fine, the review can be a very quick process. There is concern that we do not know how this will work in practice. I would have thought that having a more formal process of carrying out a review would give stakeholders the opportunity to have input into the process. If there is not, how do stakeholders go about having that input into how it works in practice?