Chamber and committees

Good morning. My question leads on from what we have heard already. I ask Colin Borland to answer first, and others can come in if they want.

At the moment, under Scots law, small businesses, individuals and partnerships cannot grant floating charges. I think that they are a bit of a blunt instrument and are perhaps not used as much as they were previously. Are your members saying that they would like the opportunity to grant floating charges over their assets, or will the proposals replace that?

The other area that I want to cover is how the new registers will work in practice. This question is for both of you. Are you satisfied that the registers that are set out in the bill will provide the information that is needed by lenders and those who will grant charges? Do you have any suggestions for how they could be improved?

I have a follow-up question, which, again, is to both of you. At the moment, the bill suggests that information updates to the register of statutory pledges will be voluntary. That means that, when a pledge is paid off, it will not necessarily show up automatically, because someone has to do it. Is that realistic for businesses? Will people do it, or will we end up with lists and lists of pledges that have been paid off but have never been taken off the register?

Good morning. You will have heard that I asked the first panel of witnesses about the voluntary nature of updating the register when a pledge has been discharged. Will that happen or will the register just build up more and more? Do you think that the voluntary approach will work, or would you like to see some statutory element to it?

I want to move on to another area. Perhaps one or both of the witnesses will want to take this question. At the moment, the bill does not deal with shares and other assets such as that, because of the Government’s view that it does not have the legal competence to grant that. Do you have a view? Should the bill be extended to cover shares?

It is several decades since I practised law, but, when I was practising, we discharged a standard security, or put the document forward to do so, only when we were selling a property. Often, a mortgage would be paid off but it would only be years later that the discharge would be done.

On Jon Hodge’s final point, my fear is that we end up with a register that is so large that it is almost impossible to find anything. Is that a danger?

The Scottish ministers will have the power to set the duration of registration for statutory pledges. In its submission, the Faculty of Advocates has suggested that asking creditors to set the timescale when they register would be a better approach. If the bill were changed, could you facilitate that?

Mirka Skrzypczak, among the partnerships and individuals you deal with, is there any appetite for allowing floating charges to be granted by them?

I want to come back to a point that Jennifer Henderson made, just to clarify what powers you have. When the land register was rolled out initially, there were arguments about whether the right piece of land was being registered, who owned what and where the boundaries were. With the registers under the bill, if somebody said that they did not take a security over something or that there had been fraudulent behaviour, would you have powers to investigate that or would you refer it to another body?

That is helpful. Obviously, people might register something and then discharge the debt, but forget to go back and take it off. That would be a due diligence exercise that would have to be carried out.