The Large and Medium-sized Companies and Groups (Accounts and Reports) (Amendment) Regulations 2013

Made: 6th August 2013

Coming into force: 1st October 2013

In accordance with sections 473(3) and 1290 of that Act, a draft of this instrument was laid before Parliament and approved by a resolution of each House of Parliament.

Citation and commencement

1

These Regulations may be cited as the Large and Medium-sized Companies and Groups (Accounts and Reports) (Amendment) Regulations 2013 and come into force on 1st October 2013.

Amendment of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008

2

• (1) The Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008[^f00002] (“the 2008 Regulations”) are amended as follows.

• (2) Regulation 11 (directors’ remuneration report (quoted companies)) is amended as follows—

• (a) after paragraph (1) insert—

(1A) The document setting out a revised directors’ remuneration policy in accordance with section 422A of the 2006 Act must contain the information specified in Schedule 8 to these Regulations, and must comply with any requirements in that Schedule as to how that information is to be set out.

• (b) omit paragraph (2); and

• (c) in regulation 11(3) for the words from “the part” to “Part 3” substitute “the information set out in the report as identified in Part 5”.

Substitution of Schedule 8 to the 2008 Regulations

3

For Schedule 8 to the 2008 Regulations (Quoted companies: Directors’ Remuneration Report) substitute the Schedule set out in the Schedule to these Regulations.

Application and transitional provision

4

• (1) The amendments made by these Regulations to the 2008 Regulations do not apply to a company in respect of a financial year ending before 30th September 2013.

• (2) The provisions of the 2008 Regulations as they stood immediately before 1st October 2013 continue to apply in respect of a financial year ending before 30th September 2013.

• (3) The provisions of Part 6 of Schedule 8 apply to a revised directors’ remuneration policy set out in a document in accordance with section 422A (3) of the Companies Act 2006 on or after 1st October 2013.

SCHEDULE

Signed

Jo Swinson — Parliamentary Under Secretary of State for Employment Relations and Consumer Affairs — Department for Business, Innovation and Skills — 6th August 2013

Explanatory note

(This note is not part of the Regulations)

EXPLANATORY NOTE

These Regulations are made under section 421 and 422A of the Companies Act 2006 (c.46) (“the Act”) and substitute Schedule 8 of the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (S.I. 2008/410) (“the 2008 Regulations”).

Regulation 2 makes consequential amendments to regulation 11 of the 2008 Regulations.

Regulation 3 substitutes the Schedule to these Regulations for Schedule 8 of the 2008 Regulations.

Schedule 8 specifies the information to be included in the directors’ remuneration report which the directors of a quoted company are required to prepare under section 420 of the Act.

Part 2 of Schedule 8 provides that the report shall contain a summary statement by the chair of the remuneration committee.

Part 3 of Schedule 8 requires the report to contain information about the remuneration of the directors in the financial year being reported on (“the relevant financial year”), including a single total figure table of remuneration in respect of each person who was a director during the relevant financial year, payments made to directors for loss of office, a performance graph which sets out the total shareholder return of the company on the class of equity share capital, if any, which caused the company to fall within the definition of “quoted company” in section 385 of the Act, the percentage change in the remuneration of the chief executive officer, the relative importance of spend on pay, a statement of how the directors’ remuneration policy of the company will be implemented in the financial year following the relevant financial year , the consideration given by directors to the matter of remuneration and a statement of the result of the voting on any resolutions in respect of the directors’ remuneration report or policy at the last general meeting of the company.

Part 4 of Schedule 8 sets out the requirements relating to the company’s future directors’ remuneration policy and requires a future remuneration policy table, an illustration of the application of that policy to the directors, the company’s policy on payment for loss of office and a statement regarding consideration of the company’s overall pay policy and the views of shareholders in the formulation of the policy.

Part 6 of Schedule 8 sets out the requirements for a revised directors’ remuneration policy, and Part 5 defines the auditable part of the report.

A full regulatory impact assessment of the effect that this instrument will have on the costs of business and the voluntary sector is available from the Business Environment Directorate, Department for Business, Innovation and Skills, 1 Victoria Street, London SW1H OET or from www.gov.uk/bis and is annexed to the Explanatory Memorandum which is available alongside the instrument at www.legislation.gov.uk.

Footnotes

[^f00001]: 2006 c.46. Section 421 was amended by section 79(1) of the Enterprise and Regulatory Reform Act 2013 (c.24). Section 422A was inserted into the Companies Act 2006 by section 79(2) of the Enterprise and Regulatory Reform Act 2013.

[^f00002]: S.I. 2008/410 to which there are amendments not relevant to these Regulations.

[^f00003]: 2004 c.12.

[^f00004]: 2000 c.8. Section 96B was inserted by paragraph 6 of Schedule 1 to S.I. 2005/381. Subsection 96B(2) was substituted by regulation 2(1) of S.I. 2009/2461.

[^f00005]: Chapter 4A was inserted into the Companies Act 2006 (c.46) by section 80 of the Enterprise and Regulatory Reform Act 2013 (c.24).

[^f00006]: 2003 c.1. Substituted by section 249 of the Finance Act 2004 (c.12) and amended by paragraph 629 of Schedule 1 to the Income Tax (Trading and Other Income) Act 2005 (c.5).