Companies
(Demerger) (Jersey) Regulations 2018
Made 10th July 2018
Coming into force 1st
September 2018
THE STATES, in pursuance of Regulation 127GB of the Companies (Jersey) Law 1991[1], have made the following
Regulations –
1 Interpretation
(1) In
these Regulations, unless the context otherwise requires –
“completion date”, in
relation to a demerger, shall be construed in accordance with Article 12(2);
“Comptroller” has the meaning given by the Income Tax (Jersey) Law 1961[2];
“demerged company” means a relevant
Jersey company resulting from a demerger under these Regulations;
“demerger instrument” shall
be construed in accordance with Regulation 3;
“demerging company” means a
relevant Jersey company that demerges into 2 or more relevant Jersey companies under
these Regulations;
“employee” has the meaning
given by Article 1A(1) of the Employment (Jersey) Law 2003[3];
“employer” has the meaning
given by Article 1A(1) of the Employment (Jersey) Law 2003;
“Law” means the Companies
(Jersey) Law 1991[4];
“new company” means a relevant
Jersey company incorporated as a result of a demerger;
“relevant Jersey company”
means a company that is not a cell company or a cell and does not have
unlimited shares or guarantor members;
“solvency statement” shall
be construed in accordance with Regulation 4(2);
“survivor company” means a
demerging company which, on completion of a demerger, continues as a demerged
company.
(2) Nothing
in these Regulations is to be read as preventing –
(a) more
than one person from signing the same certificate under these Regulations; or
(b) more
than one certificate signed under these Regulations from being included in the
same document,
and references to a certificate are to be construed accordingly.
2 Companies eligible and not
eligible to demerge and be demerged
(1) Subject
to paragraphs (2), (3) and (4) and to the requirements of these Regulations,
a relevant Jersey company may demerge into 2 or more relevant Jersey companies –
(a) one of which is a
survivor company; or
(b) all of which are new
companies.
(2) A
company that is registered under the Banking Business (Jersey) Law 1991[5] or a permit holder within
the meaning of the Insurance Business (Jersey) Law 1996[6] shall not be eligible to
demerge or to become a demerged company.
(3) The
following companies shall not be eligible to demerge or to become a demerged
company –
(a) a
financial services company within the meaning given in Article 3(1) of the
Income Tax (Jersey) Law 1961[7] that is subject to tax under
Article 123D of that Law;
(b) a utility
company within the meaning given in Article 123C(3) of the Income Tax
(Jersey) Law 1961;
(c) a company
with profits or gains chargeable to tax from the importation and supply of
hydrocarbon oil under Article 123CAA of the Income Tax (Jersey) Law 1961;
(d) a company
with profits or gains chargeable to tax under Schedule A under Article 51(1)(a),
(b) or (c) of the Income Tax (Jersey) Law 1961;
(e) a
company to which Article 123C of the Income Tax (Jersey) Law 1961 applies
by virtue of paragraph (1) of that Article where an individual resident in
Jersey owns (whether directly or indirectly) more than 2% of the ordinary share
capital of the company;
(f) a
company required to deduct tax from the earnings payable by the employer to an employee
under Article 41B(1) of the Income Tax (Jersey) Law 1961;
(g) a
company required to deduct tax from a payment made to a sub-contractor or to a
person nominated by the sub-contractor for the purpose under Article 41E(1)
of the Income Tax (Jersey) Law 1961;
(h) a
“large corporate retailer” within the meaning given by Article 123I
of the Income Tax (Jersey) Law 1961; and
(i) a
company registered under Part 3 of the Goods and Services Tax (Jersey) Law 2007[8].
(4) Subject
to an order of the court, a company that –
(a) is under
investigation in relation to an offence; or
(b) has
been charged with an offence and against which there is a criminal prosecution
pending,
shall not be eligible to demerge or to become a demerged company
until the conclusion of the investigation without a criminal prosecution; or
the criminal prosecution, as the case may be.
3 Demerger
instrument
(1) A relevant
Jersey company proposing to demerge shall execute a demerger instrument in
accordance with this Regulation.
(2) A demerger
instrument shall state the terms and means of effecting the demerger and, in
particular, the following information –
(a) details
of the proposed demerging company, including –
(i) whether
or not it is to be a survivor company, and
(ii) the
names and addresses of the persons who are the directors of the demerging
company;
(b) details
of any arrangements necessary to complete the demerger;
(c) details
of any payment, other than of a kind described in paragraph (3)(b),
proposed to be made to a member or director of the demerging company; and
(d) in
relation to any securities of a demerging company, the information specified in
paragraph (3).
(3) The
information referred to in paragraph (2)(d) is –
(a) if
the securities are to be converted into securities of a demerged company, the
manner in which that conversion is to be done; or
(b) otherwise,
the kind of the payment that the holders of any securities in the demerging
company are to receive instead of the securities of a demerged company and the
manner in which and the time at which they are to receive it.
(4) If a
demerged company is to be a new company, the demerger instrument shall, in
addition to the information required under paragraph (2) –
(a) set
out –
(i) the
proposed memorandum and articles of the demerged company, and
(ii) the
name and address of any person who will become a director of the demerged company;
and
(b) have
attached to it a draft of any other document or information that would be
required by Part 2 of the Law to be delivered to the registrar if the demerged
company was being incorporated under the Law otherwise than by demerger.
(5) If a
demerging company is to be a survivor company, the demerger instrument shall,
in addition to the information required under paragraph (2) state –
(a) whether
any amendments to the memorandum and articles of the demerging company are
proposed to take effect on the demerger and, if so, details of those
amendments; and
(b) whether
it is proposed that, on the demerger, any person will become, or cease to be a
director of the survivor company and, if so, the name and address of each such
person.
(6) A demerger
instrument may provide that, at any time before the completion date of the demerger,
the demerger instrument may be revoked by the demerging company.
(7) If a
demerger instrument is revoked under a provision included in it under paragraph (6),
nothing in these Regulations requires or authorizes any further steps to be
taken to complete the demerger.
(8) A demerger
instrument must identify the undertaking, property, rights and liabilities of
the demerging company and must state, in respect of each demerged company,
which part of the undertaking, property, rights and liabilities of the demerging
company is to become the undertaking, property, rights and liabilities of each demerged
company, except that a liability attached to any property of a demerging
company must not be separated from that property.
4 Resolutions
and certificates
(1) Before
notice is given of a meeting of a demerging company to approve a demerger
instrument under Regulation 5, the directors of the demerging company
shall pass a resolution that, in the opinion of the directors voting for the
resolution, the demerger is in the best interests of the demerging company.
(2) For
the purposes of this Regulation, a solvency statement is a statement that,
having made full inquiry into the affairs of the demerging company, the person
making the statement reasonably believes that the demerging company is, and
will remain until the demerger is completed, able to discharge its liabilities
as they fall due.
(3) If
the directors voting for the resolution are satisfied on reasonable grounds
that they can properly make a solvency statement in respect of the demerging company,
the resolution shall in addition state that they are so satisfied.
(4) If paragraph (3)
does not apply, the resolution shall instead state that the directors voting
for it are satisfied on reasonable grounds that there is a reasonable prospect
of obtaining the permission of the court under Regulation 9 for the
demerger.
(5) After
a resolution is passed under paragraph (1), but before notice is given as
mentioned in that paragraph, each director who voted in favour of it shall sign
a certificate –
(a) containing –
(i) if
paragraph (3) applies, a solvency statement, or
(ii) if
paragraph (3) does not apply, a statement that the director is satisfied
on reasonable grounds that there is a reasonable prospect of obtaining the
permission of the court under Regulation 9; and
(b) setting
out the grounds for making the solvency statement under sub-paragraph (a)(i)
or statement under sub-paragraph (a)(ii).
(6) If paragraph (3)
applies, before notice is given as mentioned in paragraph (1), each person
who will become a director of a demerged company as set out in the demerger
instrument under Regulation 3(4)(a)(ii) shall sign a certificate stating –
(a) that,
in that person’s opinion, the demerged company of which the person will
be a director is in a position to carry on business and discharge its liabilities
as they fall due for the 12 months immediately following the demerger; and
(b) the
grounds for that opinion, having particular regard to –
(i) the
prospects of the demerged company,
(ii) the
proposals in the demerger instrument with respect to the management of the businesses
of the demerged company, and
(iii) the
amount and character of the financial resources that will, in the view of the
person signing, be available to the demerged company.
(7) If
none of the persons referred to in paragraph (6) are directors of the
demerging company, the certificate under paragraph (6) must also be signed
by a director referred to in paragraph (5).
5 Approval
of demerger instrument
(1) The
directors of a demerging company shall submit the demerger instrument for
approval by a special resolution of that demerging company and, where there is
more than one class of members, for approval by a special resolution of a
separate meeting of each class.
(2) Notice
of each meeting referred to in paragraph (1), shall be given and –
(a) shall
be accompanied by –
(i) a
copy or summary of the demerger instrument,
(ii) a
copy of the proposed memorandum and articles of association for each demerged company,
or a summary of the principal provisions of the memorandum and articles,
(iii) if
a summary is supplied under clause (i) or (ii), information as to how a
copy of the document summarized may, from the date that the notice is given, be
inspected free of charge by members either electronically (at all times) or at the
demerging company’s registered office during normal office hours in
accordance with paragraph (3),
(iv) a
copy of the certificates signed under Regulation 4(5) and (6) in
respect of that demerging company,
(v) a
statement of the material interests in the demerger of the directors of the demerging
company and of the persons who will become directors of the demerged companies,
and
(vi) such
further information as a member would reasonably require to reach an informed
decision on the demerger; and
(b) shall
contain sufficient information to alert members to their right to apply to the
court under Regulation 6.
(3) A
demerging company shall, from the date that notice of a meeting is given under paragraph (2),
make the demerger instrument and copies of the proposed memorandum and articles
of each demerged company available for inspection free of charge by its members
either electronically at any time or at its registered office during normal
office hours.
(4) A demerger
is approved under this Regulation when all of the special resolutions required
under paragraph (1) have been passed in respect of the demerging company.
(5) A demerger
shall not be completed unless it is approved under this Regulation.
6 Objection
by member
(1) A
member of a demerging company may –
(a) within
21 days after the date on which the demerger is approved under Regulation 5(4),
serve notice on the demerging company of the member’s objection to the
demerger; and
(b) within
21 days after the date on which the member of the demerging company served
notice of his or her objection under sub-paragraph (a), apply to the court
for an order on the ground that the demerger would unfairly prejudice the
interests of the member.
(2) An objection
or application under paragraph (1) may not be made by a member who
voted in favour of the demerger under Regulation 5.
(3) If
the court is satisfied that an application under paragraph (1)(b) is well
founded, it may make such order as it thinks fit for giving relief in respect
of the matters complained of.
(4) Without
prejudice to the generality of paragraph (3), the court’s order may –
(a) regulate
the conduct of the demerging company’s affairs in the future;
(b) require
the demerging company to refrain from doing or continuing an act complained of
by the member or to do an act which the member has complained it has omitted to
do;
(c) authorize
civil proceedings to be brought in the name and on behalf of the demerging company
by such person or persons and on such terms as the court may direct; and
(d) provide
for the purchase of the rights of any members of the demerging company by other
members or by the demerging company itself and, in the case of a purchase by
the demerging company itself, the reduction of the demerging company’s
capital accounts accordingly.
(5) If
an order under this Regulation requires the demerging company not to make any,
or any specified, alterations in its memorandum or articles, the demerging company
shall not then without leave of the court make such alterations in breach of
that requirement.
(6) An
alteration in the demerging company’s memorandum or articles made by
virtue of an order under this Regulation is of the same effect as if duly made
by resolution of the demerging company, and the provisions of the Law apply to
the memorandum or articles as so altered accordingly.
(7) The
demerging company shall, within 14 days after an order is made under this Regulation
or such longer period as the court may allow, deliver to the registrar for the registration
of the Act of court recording the making of the order under this Regulation –
(a) if
the order is altering, or giving leave to alter, a demerging company’s
memorandum or articles; or
(b) if
the court otherwise sees fit.
(8) If the
demerging company fails to comply with paragraph (7), the demerging company
shall be guilty of an offence and liable to a fine of level 3 on the
standard scale and a daily default fine of level 2 on the standard scale
in accordance with Article 215 of the Law.
7 Notice
to creditors
(1) During
the period beginning with the date on which the first notice is given under Regulation 5(2)
in relation to a demerger and ending 21 days after the demerger is
approved under Regulation 5(4), the demerging company shall send written
notice to each of its creditors who, after its directors have made reasonable
enquiries, is known to the directors to have a claim against the demerging company
exceeding £5,000.
(2) The
notice sent under paragraph (1) shall state –
(a) that the demerging company intends to demerge,
in accordance with these Regulations, into 2 or more relevant Jersey companies specified
in the notice; and
(b) that the demerger instrument is available to
creditors from the demerging company, on request, free of charge.
(3) If Regulation 9
applies to the demerger, the notice sent under paragraph (1) shall (in
addition to the matters in paragraph (2)) –
(a) state
that a demerging company has applied or will apply for the permission of the
court under that Regulation;
(b) state
that any creditor of the demerging company may require the demerging company
making the application to send a copy of the application to the creditor; and
(c) set
out information as to –
(i) the
means by which a creditor may contact the demerging company making the
application, or a person representing the demerging company in that
application, and
(ii) Regulation 9(4),
including the date of the hearing of the application if known at the time of
the notice.
(4) If Regulation 9
does not apply to the demerger, the notice sent under paragraph (1) shall
state (in addition to the matters in paragraph (2)) that any creditor of
the demerging company may –
(a) object
to the demerger under Regulation 10(2)(a) and apply to the court for an
order restraining the demerger or modifying the demerger instrument under Regulation 10(2)(b);
or
(b) require
the demerging company to notify the creditor if any other creditor of the demerging
company applies to the court under Regulation 10(2)(b).
(5) Where
an application is made for a court order under paragraph (4)(a), the creditor
shall serve a copy of the application on the demerging company;
(6) The
demerging company shall, within the time limit set out in paragraph (7),
publish the contents of the notice sent under paragraph (1) –
(a) once
in a newspaper circulating in Jersey; or
(b) in any
other manner –
(i) approved
by the registrar, and
(ii) published
by the Commission.
(7) The
time limit referred to in paragraph (6) is whichever is the earlier of –
(a) 21 days
after the demerger is approved under Regulation 5(4); or
(b) as
soon as practicable after the demerging company sends the last of any notices
under paragraph (1).
(8) Subject
to paragraph (9), a demerging company shall, from the date that notice of
a meeting is given under paragraph (1), make the demerger instrument and a
copy of the proposed memorandum and articles of each demerged company available
for inspection free of charge by its creditors
either electronically at any time or at its registered office during
normal office hours.
(9) A
demerging company may redact commercially sensitive information from the
demerger instrument or copy of the proposed memorandum and articles of each
demerged company prior to making it available for inspection under paragraph (8).
8 Declaration to Comptroller
(1) During the period beginning with the date on
which the first notice is given under Regulation 5(2) in relation to a
demerger and ending 21 days after the demerger is approved under Regulation 5(4),
the demerging company shall subject to paragraphs (2), make a declaration
to the Comptroller.
(2) The declaration made under paragraph (1)
shall state that the demerging company is eligible to demerge in accordance
with Regulation 2(1) as none of the conditions as set out in Regulation 2(3)
apply to the demerging company.
(3) If a demerging company makes a declaration
under paragraph (1), the Comptroller shall issue a tax certificate (showing
a lodgement number) to the demerging company.
(4) If the Comptroller discovers that the
demerging company is not eligible to demerge, the Comptroller shall advise the
registrar of that discovery.
9 Company
to apply to court if solvency statement not made
(1) This
Regulation applies to a demerger if any certificate signed by a director of the
demerging company under Regulation 4(5) does not contain a solvency
statement.
(2) A demerger
to which this Regulation applies shall not be completed unless an order of the
court has been obtained permitting the demerger on the ground that the demerger
would not be unfairly prejudicial to the interests of any creditor or member of
the demerging company.
(3) A demerging
company in respect of which a certificate referred to in paragraph (1) has
been signed shall, as soon as is practicable after the demerger is approved
under Regulation 5(4) –
(a) apply
to the court for an order permitting the demerger under paragraph (2); and
(b) send
a copy of the application referred to in sub-paragraph (a) –
(i) to
any creditor who, after the directors have made reasonable enquiries, is known
to the directors to have a claim against the demerging company exceeding
£5,000,
(ii) to
any other creditor of the demerging company who requests a copy from the
demerging company,
(iii) to
any member of the demerging company who requests a copy of the application, and
(iv) to
the registrar.
(4) The
court shall not hear an application made under paragraph (3) until at
least 28 days after it is made to the court unless the creditors and
members mentioned in paragraph (3)(b) consent to a shorter period.
(5) On
the hearing by the court of an application under this Regulation, a person
mentioned in paragraph (3)(b) shall have a right to be heard.
10 Objection
by creditor if solvency statement made
(1) This
Regulation applies to a demerger to which Regulation 9 does not apply.
(2) A
creditor of a demerging company who has a claim against the demerging company
exceeding £5,000 and who objects to the demerger may –
(a) within
21 days after the date of the publication of the contents of the notice
under Regulation 7(6), serve notice of the creditor’s objection to
the demerging company; and
(b) within
21 days after the date on which the notice of the creditor’s
objection was given under sub-paragraph (a), if the creditor’s claim
against the demerging company has not been discharged, apply to the court for
an order restraining the demerger or modifying the demerger instrument and
serve a copy of the application on the demerging company.
(3) If
a creditor makes an application under paragraph (2)(b), the demerging company
shall, as soon as is practicable after being served with a copy of the
application under paragraph (2)(b), give a copy of it to each other
creditor –
(a) to
whom a notice was given under Regulation 7(1);
(b) who
has required notification under Regulation 7(4)(b);
(c) who
has given notice of objection under paragraph (2)(a); or
(d) to
whom the court orders that a copy should be sent.
(4) If
on an application under paragraph (2)(b) the court is satisfied that the demerger
would unfairly prejudice the interests of the applicant, or of any other
creditor of the demerging company, the court may make such order as it thinks
fit in relation to the demerger, including an order –
(a) restraining
the demerger; or
(b) modifying
the demerger instrument in such manner as may be specified in the order.
(5) The
court shall not make an order under paragraph (4)(b) to modify a demerger instrument
that does not contain a provision in accordance with Regulation 3(6)
allowing the demerging company to revoke the demerger instrument following the
modification unless –
(a) the
order also inserts such a provision in the demerger instrument; and
(b) the
court is satisfied that the demerging company will have an adequate opportunity
to reconsider whether to proceed with the demerger following the modification.
11 Pre-registration
steps
(1) The
demerging company shall apply, in the published form and manner (if any), to
the registrar to complete the demerger.
(2) Except
where all the members of the demerging company and all of its creditors, who,
after its directors have made reasonable enquiries, are known to the directors
to have a claim against the demerging company exceeding £5,000, otherwise
agree in writing, the application under paragraph (1) shall not be made
until after whichever is the latest of the following dates –
(a) if
any application was made to the court under Regulation 6, the last date on
which such an application is disposed of otherwise than by an order restraining
the demerger;
(b) if Regulation 9
applies to the demerger, the date of the order permitting the demerger;
(c) if Regulation 9
does not apply to the demerger –
(i) 21 days
after the last date on which a notice was published under Regulation 7(6),
if by then no creditor has given notice of objection under Regulation 10(2)(a),
(ii) 21 days
after the date on which the last notice of objection by a creditor was given
under Regulation 10(2)(a), if by then no creditor has applied to the court
under Regulation 10(2)(b), or
(iii) if
any application was made to the court under Regulation 10(2)(b), the last
date on which such an application is disposed of otherwise than by an order
restraining the demerger.
(3) An application
under paragraph (1) shall be accompanied by –
(a) a
copy of the demerger instrument;
(b) a
copy of –
(i) if
a demerged company is to be a new company, its memorandum and articles and any
other document required for the incorporation of a new company under the Law,
or
(ii) if
a demerged company is to be a survivor company, any amendment to its memorandum
or articles provided for under Regulation 3(5)(a);
(c) a
copy, in respect of the demerging company, of –
(i) the
resolution passed under Regulation 4(1), together with, if that
information is not contained in the resolution, a list identifying the
directors who voted in favour of that resolution, and
(ii) the
certificates signed under Regulation 4(5) and (6);
(d) a
further certificate, signed by each director who signed a certificate under Regulation 4(5),
stating –
(i) that
the director, and the demerging company of which he or she is a director, have
complied with the requirements of these Regulations in respect of the demerger,
(ii) if
Regulation 9 does not apply to the demerger, that in the director’s
opinion there has been no material change to the position stated in the
solvency statement; and
(e) the
special resolution passed under Regulation 5(1);
(f) a
copy of any order of the court under Regulation 6, 9 or 10;
(g) proof
that a declaration has been made by the demerging company under Regulation 8
in the form of a tax certificate (showing a lodgement number) issued by the
Comptroller to the demerging company under Regulation 8(3); and
(h) any
other document or information required by the registrar, including documents or
information which may be required by the registrar to establish that the
requirements of paragraph (2) have been met.
(4) The
registrar shall register notices as to the demerger in accordance with Regulation 12
if he or she is satisfied –
(a) that
the application complies with paragraphs (1) and (2) and is accompanied by
the documents and information required under paragraph (3) and that the
documents provided under paragraph (3) comply with that paragraph and with
the provisions mentioned in it; and
(b) if
the demerger instrument provides for a demerged company to be a new company,
that he or she would have registered the memorandum and articles of the company
under Article 8 of the Law if it had been incorporated otherwise than by demerger.
12 Registration
of notices as to demerger
(1) This
Regulation applies where the registrar is to register notices as to a demerger
under Regulation 11.
(2) The
completion date of a demerger is the date the last entry on the register is
made under this Regulation in relation to the demerger.
(3) The
registrar shall enter in the register, in respect of a demerging company that
is not a survivor company, a notice that states that the company has ceased to
be incorporated as a separate company because it has demerged into the demerged
companies specified in the notice.
(4) If a
demerged company is a survivor company, the registrar shall enter in the
register, in respect of that company, a notice that states that the company has
demerged, and has been continued as a survivor company together with the new
company or companies specified in the notice.
(5) If a
demerged company is a new company, the registrar shall, if he or she would have
registered the new company under the Law if it had been incorporated otherwise
than as the result of a demerger, register the new company by –
(a) registering
the memorandum and articles of the new company under Article 8 of the Law,
and issuing a certificate of its incorporation under Article 9 of the Law,
as if the registrar had received an application for the creation of the new company
under Part 2 of the Law with the memorandum and articles provided for in
the demerger instrument; and
(b) entering
in the register, in respect of that new company, a notice that states that the new
company is the result of a completed demerger of the demerging company
specified in the notice,
and the fee payable under Article 201 of the Law in respect of
the registration of a company shall be payable in respect of the registration
of the new company.
(6) Each
entry on the register under this Regulation –
(a) shall
in addition include a note specifying the completion date of the demerger to
which it relates; and
(b) may
in addition include a note of any further information that the registrar
considers useful in relation to the demerger.
13 Effect of
completion of demerger generally
(1) On
the completion date of a demerger –
(a) if
the demerging company is a survivor company it continues as a demerged company together
with one or more demerged companies that are new companies; or
(b) if
the demerging company is not a survivor company it ceases to be incorporated as
a separate company and continues as 2 or more demerged companies that are new
companies.
(2) Subject
to paragraph (3), when a demerger is completed –
(a) all
property and rights to which the demerging company was entitled immediately
before the demerger was completed become the property and rights of the demerged
companies in the parts stated in the demerger instrument under Regulation 3(8)
or jointly in common in equal parts if not stated in the demerger instrument;
(b) subject
to an order of the court, the demerged companies become jointly and severally
subject to all financial penalties which the demerging company was subject to immediately
before the demerger was completed;
(c) the
demerged companies become subject to all civil liabilities and all contracts,
debts and other obligations which the demerging company was subject to immediately
before the demerger was completed in the parts stated in the demerger
instrument under Regulation 3(8) or jointly and severally if not stated in
the demerger instrument; and
(d) subject
to an order of the court, all actions and other legal proceedings which,
immediately before the demerger was completed, were pending by or against the demerging
company may be continued by or against all or any of the demerged companies.
(3) A
licence held by a demerging company shall not be transferred to a demerged
company on completion of the demerger unless with the permission of the
authority that granted the licence.
(4) Entries
made on the register under Regulation 12 are conclusive evidence of the
following matters to which they refer –
(a) that
on the completion date of the demerger specified in the entry, the demerging company
demerged and was continued as the demerged companies; and
(b) that
the requirements of these Regulations and the Law have been complied with in
respect of –
(i) the
demerger of the demerging company under these Regulations, and
(ii) all
matters precedent to and incidental to the demerger.
(5) The
operation of this Regulation shall not be regarded –
(a) as
a breach of contract or confidence or otherwise as a civil wrong;
(b) as
a breach of any contractual provision prohibiting, restricting or regulating
the assignment or transfer of rights or liabilities; or
(c) as
giving rise to any remedy by a party to a contract or other instrument, as an
event of default under any contract or other instrument, or as causing or
permitting the termination of any contract or other instrument, or of any
obligation or relationship.
(6) In
this Regulation “licence” includes an authorization, a certificate,
a consent, a permit, a registration or any other permission.
14 Effect
of demerger on employment
(1) During the period beginning with the date on
which the first notice is given under Regulation 5(2) in relation to a
demerger and ending 21 days after the demerger is approved under Regulation 5(4),
the demerging company shall send written notice to each of its employees.
(2) The notice sent under paragraph (1) shall
state –
(a) that the demerging company intends to
demerge, in accordance with these Regulations, into 2 or more relevant Jersey
companies specified in the notice; and
(b) that the demerger instrument is available to
employees from the demerging company, on request, free of charge.
(3) A demerging company shall in accordance with
paragraph (2)(b) make the demerger instrument available to employees free
of charge and may redact commercially sensitive information from the demerger
instrument prior to making it available to employees.
(4) Where any duty, right or liability
transferred from a demerging company to a demerged company under a demerger is
a duty, right or liability under a contract of employment –
(a) the contract –
(i) shall not be terminated by the
demerger, unless express provision is made to that effect, or unless paragraph (5)
applies, and
(ii) shall have effect from the completion
date of the demerger as if between the employee and the demerged company;
(b) any act done or omitted to be done before
the completion date of the demerger by or in relation to the demerging company
in respect of the contract of employment or employee is to be treated from that
date as having been done or omitted to be done, as the case may be, by or in
relation to the demerged company;
(c) a period of employment with the demerging
company is to be treated as a period of employment with the demerged company,
and the demerger is not to be treated as interrupting the continuity of that
period.
(5) Where an employee
objects to a transfer of his or her rights and liabilities under a contract of
employment, the employee must give notice of his or her objection to the
demerging company in writing prior to the completion date of the demerger and
where such notice is given and has not been withdrawn prior to that date –
(a) subject to sub-paragraph (d), the
rights and liabilities of the employee under the contract of employment are not
transferred by the demerger;
(b) subject to sub-paragraph (d), the
employee is not to be treated, for any purpose, as having been either employed
by the demerged company or dismissed by the demerging company;
(c) the employee’s contract of employment
shall terminate on the completion date of the demerger and the demerging
company may make a payment to the employee in lieu of notice in respect of all
or part of the relevant unexpired notice period; and
(d) any liability of the demerging company to
pay the employee upon termination of the employee’s contract of
employment under sub-paragraph (c) shall be a liability of the demerged
companies in the parts stated in the demerger instrument under Regulation 3(8)
or jointly and severally if not stated in the demerger instrument.
(6) Any collective agreement which is –
(a) made by the demerging company with a
representative body recognized by the demerging company; and
(b) in force in relation to an employee
immediately before the completion date of the demerger,
shall continue to have
effect in respect of that employee as if made by or on behalf of the demerged
company to which the rights and liabilities under the collective agreement are
transferred.
(7) Changes to an employee’s terms and
conditions of employment may, after the expiry of one year after the completion
date of the demerger, be negotiated between a demerged company and an employee
of that demerged company (whose contract of employment was transferred from the
demerging company to the demerged company) without the risk of the changes
being declared void on the basis of terms and conditions that were in effect
between the demerging company and the employee before the demerger.
(8) A demerged company shall not within one year
after a demerger terminate the recognition of a representative body whose
recognition by the demerging company was effective immediately prior to the completion
date of the demerger.
(9) A demerging company may transfer to a demerged
company the following information regarding an employee of the demerging
company for the purpose of employment of the employee by the demerged company –
(a) the name and address of the employee;
(b) the age of the employee;
(c) educational or vocational qualification of
the employee;
(d) information regarding a collective agreement
which applies to the employee;
(e) information regarding any current
disciplinary proceedings or grievances in respect of the employee;
(f) information regarding any legal action
taken by the employee against the employer in the previous 2 years;
(g) information regarding any, annual, special, maternity,
paternity or other leave due to be taken or owed to the employee; and
(h) any other information which may reasonably be
necessary.
15 Effect of a
demerger on retirement schemes
If immediately before the
completion date of a demerger, the demerging company had a contractual
obligation to pay a contribution to a retirement scheme on behalf of an
employee, that contractual obligation shall, on the completion date of the
demerger be transferred to the demerged company, if any, which is the
employee’s employer on the completion date of the demerger.
16 Offences relating
to demerger
(1) A
person shall not, on or in connection with an application under these
Regulations, knowingly or recklessly provide to the registrar or the Comptroller –
(a) any
information which is false, misleading or deceptive in a material particular;
or
(b) any
document containing any information which is false, misleading or deceptive in
a material particular.
(2) A person
shall not sign a certificate under Regulation 4 or 11(3)(d) without having
reasonable grounds for the opinion expressed in the certificate or for the
statement made in the certificate.
(3) A
person who contravenes paragraph (1) or (2) shall be guilty of an offence
and liable to imprisonment for a term of 2 years and a fine.
17 Citation and commencement
These Regulations may be cited as the Companies (Demerger) (Jersey) Regulations 2018
and shall come into force on 1st September 2018.
dr. m. egan
Greffier of the States