So there we have it. With a remarkable sprint to the finishing line, the last piece in the deregulatory measures tapestry, the local authority influence regulations, came in to force today.
The draft regulations were only published in late September. Less than two months later they are in force. Private RPs and local authorities to whom the regulations apply now have 6 months in which to effect the changes required by the regulations. These include:
- (a) a duty on affected RPs to reassign any voting rights held by a local authority (in its capacity as a shareholder (or member) of the RP) pro rata amongst the remaining shareholders/members; and
- (b) A cap on the number of persons who can be appointed by one or more local authorities on to the RP’s board – including a requirement for local authorities to nominate those that are to be removed from office (to ensure the cap is not breached after the 6 month grace period is up).
For more details and assistance on how best to implement the changes, please contact Jonathan Jarvis , Partner in our Banking, Governance & Corporate Team.