Legislation – Finance Act 2024

“277AOffences relating to stop notices

(1)

A person who, without reasonable excuse, fails to comply with a duty imposed under section 236B(1) is guilty of an offence.

(2)

The recipient of a stop notice (“R”) is guilty of an offence if—

(a)

R fails, without reasonable excuse, to comply with a duty imposed under section 236B(3)(a), (4)(a) or (5)(a) to give a copy of the notice to another person (“P”),

(b)

P subsequently fails to comply with a duty imposed under section 236B(1) in relation to the notice, and

(c)

at the time of P’s failure the stop notice continues to have effect in relation to R.

(3)

For the purposes of this section—

(a)

an insufficiency of funds is not a reasonable excuse unless attributable to events outside the person’s control,

(b)

if the person relies on any other person to do anything, that is not a reasonable excuse unless the first person took reasonable care to avoid the failure,

(c)

if the person had a reasonable excuse for the failure but the excuse has ceased, the person is to be treated as having continued to have the excuse if the failure is remedied without unreasonable delay after the excuse ceased, and

(d)

reliance on legal advice is to be taken automatically not to constitute a reasonable excuse where the person is a monitored promoter if either—

(i)

the advice was not based on a full and accurate description of the facts, or

(ii)

the conclusions in the advice that the person relied on were unreasonable.

277BLiability for offences under section 277A committed by a body

(1)

If an offence under section 277A is committed by a body corporate or a partnership and—

(a)

is committed with the consent or connivance of a relevant person in relation to the body or partnership, or

(b)

is attributable to neglect on the part of such a person,

the person (as well as the body or partnership) commits the offence and is liable to be proceeded against and punished accordingly.

(2)

A “relevant person” is—

(a)

in relation to a body corporate other than one whose affairs are managed by its members—

(i)

a director, manager, secretary or other similar officer of the body, or a person purporting to act in such a capacity, or

(ii)

a shadow director within the meaning of section 251 of the Companies Act 2006;

(b)

in relation to a limited liability partnership or other body corporate whose affairs are managed by its members—

(i)

a member who exercises functions of management with respect to it, or a person purporting to act in such a capacity, or

(ii)

in the case of a limited liability partnership, a shadow member within the meaning of regulation 2 of the Limited Liability Partnerships Regulations 2001 (S.I. 2001/1090);

(c)

in relation to a partnership, a partner or a person purporting to act in such a capacity.”