Companies (Address Information) Amendment Bill

Members, we now come to clause 3A. This is the debate on the amendment to section 2, which is the interpretation section. The question is that clause 3A stand part.

Thank you very much, Mr Chair. I might just seek your guidance for a moment, actually, if that’s OK. I actually want to pay credit firstly to the Hon Dr Deborah Russell for returning to the Chamber with answers to those questions I posed about four weeks ago. I had been actually sitting on the edge of my seat here for the last four weeks waiting with bated breath for those responses. So I appreciate her seeking those answers and getting the clarity for me.

Mr Chair, I was just wondering if you can just clarify for me: we’re looking at section 4—sorry, Part 4. No, clause 4, clause 3A—clause 2A, the transitional savings and related clause provisions?

CHAIRPERSON (Teanau Tuiono): No, no, clause 3A—this is the debate on the amendments to section 2, interpretation. That was on page—

Hon Dr Deborah Russell: Got the right bill there, Mr Rutherford?

TOM RUTHERFORD: Yes.

CHAIRPERSON (Teanau Tuiono): It’s on page 2.

TOM RUTHERFORD: Thank you very much—that’s what I was looking for. Thank you very much for clarifying, Mr Chair. While I’m on my feet, I will take the opportunity, then. I’m keen to understand: if we look here, where it says “appropriate alphabetical order”, I want to clarify from the member in charge, firstly, why that was decided upon. Then it says: “ ‘alternative address’, in relation to the person, means—(a) the address given for the person in an application under section 360D(3)(c); or (b) a new alternative address given in a notice under section 159(1)”.

Can the member in charge just clarify what both of those sections actually are, for those who are potentially watching along from the gallery up the top, or watching along at home. It would be really interesting to get some clarity—

Suze Redmayne: There’s no one up the top.

TOM RUTHERFORD: Suze Redmayne says there’s no one up there. She can’t see behind me—she can’t see what’s behind me.

I’m just keen if the member in charge could just clarify for us around those particular sections and what they’re getting at in there, because it is really important to understand so we know, actually, what this slight amendment around the interpretation is actually looking to achieve. So I’d ask if the member could clarify that, please.

The member Tom Rutherford asked, really, about what this clause is amending in the original Act. The principal Act here is the Companies Act. Section 159 of the Companies Act is to do with the notice of change of directors, and in order to give a change of directors, you have to specify a number of things that are listed. So that’s what it amends there.

So inserting the term “alternative address” in its appropriate alphabetical order—of course, this is amending the interpretation section of the Act, and, as I’m sure Mr Rutherford actually knows, we don’t just randomly bung terms in there, but we actually do list them in alphabetical order. So there you are. It’s specifying “alternative address” and it flows through into effects on section 159 of the original Act.

Mr Rutherford also asked about, I think, sections 215(1A) and 215(1B), or sections 360D to—

Tom Rutherford: No, I didn’t get to that yet.

Hon Dr DEBORAH RUSSELL: Oh, well. Just so—

Tom Rutherford: That’s for my next call.

Hon Dr DEBORAH RUSSELL: When you do, those are actually new clauses in this particular bill, so you can read further through the bill, and we will end up discussing them later in the bill.

Thank you, Mr Chair. It’s good to see you back in the chair there, Dr Russell. You’ve been great at giving us some back and forward so rapidly. You almost seem to have really pre-empted and thought ahead of what my questions were going to be. Oh, look at that! You’ve got a matrix—you’ve got a matrix of all the possible things that we could ask. Wouldn’t it be wonderful if I could get a copy of that? That would be just amazing and really helpful. But these are the things where, as new MPs, we’re actually learning a great deal on these members’ days about how we debate these issues and the very important elements. Even seeing your matrix there has given me great inspiration for the next time we go ahead with these.

It will help as we go through this section by section and clause, almost, by clause. You’ve taken us to clause 5A, which looks at—

CHAIRPERSON (Teanau Tuiono): No, no. We’re on clause 3A.

Dr VANESSA WEENINK: New subsection 2(5A), yes. So it says that subsection (5) does not affect section 215(1A). But when we’re just flicking through this bill here, it’s quite hard to see—and that must be in the original Act, in the Companies Act, because I can’t—“Public inspection of company records”. Because I don’t have the full original Act in front of me, I’m just wondering if new section 215(1A) must refer to the original Act. If it doesn’t affect that, which is about public access to it, I just wonder, not being able to look at it, how that is actually going to be a functional thing.

If you are wanting to provide an alternative address, part of what we’re trying to ensure is some privacy around that, that there’d be a way that people can say what their address is, other than their home address for those directors or shareholders. So I’m just wondering if you could explain a little bit more about what that new section 215(1A) is about. I can understand a little bit—and we can read through for new section 360D and where those apply, because this subsection doesn’t affect section 360D, which is about alterations of entries on the New Zealand Register. So that’s where the registrar can actually, in accordance with this Act or with other regulations—and, as you pointed out just in your previous answer, the other regulations are not going to be required, but I’m assuming other regulations mean other regulations similar or around this that could be caught up.

Also, subsection (5) doesn’t affect the fact that the registrar must take reasonable steps. Now, one of those things is: what is “reasonable” and what are “reasonable steps”, and is there anywhere where that’s defined or is there any potential challenge that could come from the definition or working out what reasonable steps are and whether or not that creates any difficulties for those who are trying to use this law change to be able to protect their privacy—if there are any barriers that that might then put in the place of a swift passage of changes on the part of the registrar so that people can be protected? Because as we were working through this process, we know that the real reasons why we’re doing this change, this amendment to the Companies Act, is that we really want to protect those people who have put themselves forward to be directors of companies, who are going ahead and are part of, really, the economic drivers of this country. They need to be able to feel safe in their own homes and their privacy is protected. We heard so many submissions about this. So it would be a shame if there was a process reason why things could be slowed down because of those reasonable steps of having to include extra steps in the process for the registrar to be able to make changes so that they prove that it was reasonable, because, you know, when it comes to these things, people are always trying to protect themselves from future issues and problems that might come up as a result of exercising their duties and their roles.

When it comes to people who are of the legal profession or with a background in anything to do with law, I’ve noticed that they can be quite pedantic in their interpretations. Also, sometimes they take different understandings and different interpretations than we may have expected when we are drafting the law. It’s one of those issues where it can seem really sensible to us, and for all of the time and care that we as a committee have taken, I just hope that there is not any problem that we’re going to be putting in there with that “reasonable” word in there. So just thank you in advance for that and also for your inspiration on that matrix.

I thank the member Dr Vanessa Weenink for her speech. A large part of what she referred to is to do with the new sections 360D to 360G—I think they are. I’m going to suggest that the member defers those questions until we come to clause 5, because that’s actually the operative section of this bill, which actually does all the work. This clause 3A is a pretty technical one.

The member asked what section 215 is about. Section 215 is about the “Public inspection of company records”. The member will see that it’s dealt with in clause 4 of this bill. So that discussion could wait until then. Sections 215(1A) and (1B) are new subsections in the Act, and they are introduced later in the bill. So I’m going to suggest that we just defer that discussion until we actually reach that point.

Thank you, Mr Chair, though—now that I’ve stood up and made that—I might be a little bit ahead. I was wanting to look at new section 360F and take it down that track. Is that—

CHAIRPERSON (Teanau Tuiono): We’re on clause 3A.

MARIAMENO KAPA-KINGI: Ah, all right. Dang!

CHAIRPERSON (Teanau Tuiono): You can wait until then, if that works?

MARIAMENO KAPA-KINGI: Wait a while? All right.

Excellent, brilliant—and I also want to thank the member for the very useful contributions that we’ve heard. I appreciate that we’re focusing on clause 3A here, around the alternative address. Clause 3A(1) says, “In section 2(1), insert in its appropriate alphabetical order: ‘alternative address’, in relation to a person, means—”, because, of course, section 2, the interpretation, is amended. The “alternative address” is “(a) the address given for a person in an application under section 360D(3)(c); or (b) a new alternative address given in a notice under section 159(1)”.

This is really important, and I do want just to kind of note what we’re trying to do here. Unfortunately, there are safety concerns for some of these addresses, and, of course, we’ve even seen people in this House having issues with their addresses being made public. There is a reason why we want to have alternative addresses. It is to make sure that there is some sort of accountability for people, and, really, my question is around the interpretation of alternative addresses, and what kinds of mechanisms will be in place to ensure that substitute addresses, or, as they’re called, alternative addresses—I suppose it could have been called substitute addresses—are still functional for legal and services purposes, because, of course, we’d want to make sure that any director is held accountable.

Of course, there’s phoenixing, when businesses may go a little bit sideways and then they’re reborn—I think that’s quite a clever kind of analogy there.

Hon Member: What’s phoenixing?

Dr HAMISH CAMPBELL: Yeah, rising from the ashes is where it comes from, but, of course, we want to make sure that the directors are accountable. Really, it’s about what mechanisms are in place in this interpretation to ensure that the alternative addresses that are given are still functional for legal and services purposes.

Members, the time has come from me to leave the Chair. The House will resume at 7.30.

Sitting suspended from 6 p.m. to 7.30 p.m.

Members, when we broke for the dinner break, we were debating clause 3A of the Companies (Address Information) Amendment Bill.

I just want to answer some of the questions that members asked previously. One of the members was asking about new sections 215(1A) and 215(1B). I’m just going to direct the member’s attention to clause 4 of this bill. That’s where those particular sections are. They’re new sections. They’re sitting in clause 4, so we may want to have a discussion on them under clause 4 rather than this stage. Similarly, with sections 360D to 360G, which actually contain pretty much the operative work in this bill, they’re actually in clause 5 of this bill.

Clause 3A amends the interpretation section, so it’s pretty technical, and it really is just technical, linking bits and pieces of the bill back and forth. If members wish to discuss the issues of what is reasonable and so on, I genuinely suggest that they save it for clause 5.

Thank you very much, Madam Chair. Just on clause 3A, I had a look through the select committee report on this bill, and it had in it that the select committee recommended replacing “address for service” with “alternative address”, which, from my understanding—I wasn’t from a member of the select committee—was to avoid confusion with the existing definition in the Companies Act.

Hon Dr Duncan Webb: Filibustering members—outrageous!

TOM RUTHERFORD: Interesting. Dr Duncan Webb seems to have an issue with members of this Chamber scrutinising legislation as it comes through the passage of Parliament. Isn’t that a novelty as to the role of what parliamentarians do on a day-to-day basis—holding those who bring legislation to the House accountable and trying in the committee of the whole House stage—

Hon Jan Tinetti: It’s a pity you don’t do it on other days!

TOM RUTHERFORD: Jan Tinetti pipes up.

Hon Jan Tinetti: That’s right!

TOM RUTHERFORD: Jan Tinetti pipes up. She might finally have something meaningful to contribute to this Chamber.

CHAIRPERSON (Maureen Pugh): Can we address the bill, not each other, please? We don’t need the cross-Chamber debate going on.

TOM RUTHERFORD: Thank you very much, Madam Chair. I just want to finish the point there because I am on my feet and I do have the call. The role of the committee of the whole House—particularly in this bill because it is just one part, and we’re going clause by clause—is to dive into the minutiae of the details of the legislation. Being a clause-by-clause debate, we’re on clause 3A, and I’m asking a question about clause 3A. Before I was rudely interrupted—

Hon Jan Tinetti: I can’t wait until the next time you take a closure motion.

TOM RUTHERFORD: See, here we go. This is brilliant. Why don’t you take one now, Jan Tinetti, and try your luck with a closure motion, and I will see how I will, potentially, vote on it. Just keep going. Keep oiling me up. This is great. I’m having a good time.

Clause 3A, around the definition of “alternative address”: the select committee recommended replacing “address for service” with “alternative address” to avoid confusion with the existing definition in the Companies Act, hence why there’s clause 3A, which we’re talking about here, which inserts a definition of “alternative address”, while new section 360E sets requirements that mirror, but also differ from, existing section 192, “Address for service”, requirements.

The select committee amendments created new section 3A to define “alternative address” rather than use the existing “address for service” concept. I am keen to first understand, from the member in charge, why they thought it was important to shift from the previously used “address for service”, as is the case in, say, the Companies Act, to the change, which was the “alternative address”. Can the member also explain why new section 360E was necessary when section 192 already provides address for service requirements? How do the requirements in new section 360E differ from section 192? Why couldn’t the existing framework have been used? This seems, in my view, to create unnecessary complexity in the Act.

Dr Vanessa Weenink: Duplication.

TOM RUTHERFORD: Yeah, a bit of duplication, Vanessa Weenink says. I would agree with her around “address for service”, but now we’re creating an entirely new term and calling it “alternative address”—for some reason—to avoid confusion. If the member could clarify that for me, I would appreciate it.

I note that a large part of the member’s discourse was related to clause 5 and the new sections that are introduced under that. He did ask one question that is quite interesting and is worth speaking about in relation to this clause, the interpretation section. As he’s pointed out, during the select committee process, it was realised that the term “address for service” is used in the Companies Act and, actually, used elsewhere for a whole variety of technical purposes like serving papers, as a place to contact directors, and so on. The point of having a director’s home address in the Companies Office records is, at least in part, to ensure that people can identify who a director is and where they’re located. It’s not to do with having a place where papers can be served—papers can always be served at the company’s office and so on—it’s to do with locating the individual director.

However, this bill has a different purpose. The purpose of this bill is to ensure that, in some cases, a director doesn’t have to put their own personal address in the Companies Office records; they can use an alternative address. Calling it an “address for service” would confuse it with the legal reason of having a place where papers can be served. It is to do with enabling the director to have an alternative address so that she or he is not subject to stalking and is not subject to people standing out in the street and protesting at their home address, and so on. It has particularly been requested by women who have been stalked by people who obtained their home address through the Companies Office records.

That is the purpose of this bill. It is quite a separate purpose from the legal service of documents, hence the different term that is introduced in this bill: the alternative address. The other thing is that using the term “alternative address” does quite clearly mark out a particular set of circumstances, which is relevant in this case, rather than confusing it with all the other reasons one might need an address for companies.

Clause 3A agreed to.

Clause 3B Section 159 amended (Notice of change of directors)