Transport Act 1985

61 Division of undertakings of companies formed under section 59. E+W+S

(1) Where in the case of any passenger transport area the transfer required under section 59(8) of this Act of shares in or other securities of the initial company to the Passenger Transport Authority for that area has taken place, the Secretary of State may by a direction given to that Authority require the Authority to submit to him in accordance with the following provisions of this section written proposals for the division of the undertaking of the initial company among two or more companies to be formed in pursuance of the proposals.

(2) Where the initial company has any wholly-owned subsidiaries, the proposals may, instead of or (as the case may be) in addition to providing for the transfer to any one or more of those companies of the shares in or other securities of any such subsidiary comprised in the initial company’s undertaking, provide for—

(a) the division among those companies; or

(b) the transfer to any one of them;

of the whole or any part of the undertaking, or of any property, rights or liabilities, of that subsidiary.

(3) The proposals shall be submitted to the Secretary of State before the end of such period as may be specified in the direction.

(4) The proposals shall—

(a) provide for each company to be formed in pursuance of the proposals (referred to below in this section as a transferee company) to be a company limited by shares and registered under the M1 Companies Act 1985;

(b) broadly describe the manner in which the undertaking of the initial company, and the whole or any part of the undertaking of any wholly-owned subsidiary of the initial company to which the proposals relate, is to be divided among the transferee companies or (as the case may be) transferred in accordance with the proposals to any one of those companies; and

(c) provide for the winding up of the initial company, and of any wholly-owned subsidiary of the initial company the whole of whose undertaking is to be transferred in accordance with the proposals to any one or more of the transferee companies, on completion of the transfer of that company’s or (as the case may be) of that subsidiary’s undertaking.

(5) In preparing their proposals the Authority shall take into account any advice given by the Secretary of State as to the provisions he regards as appropriate for inclusion in the proposals (and in particular, but without prejudice to the generality of that, as to the description of property, rights and liabilities of the initial company and of any wholly-owned subsidiary of the initial company it is in his view appropriate to transfer to each of the transferee companies).

(6) The Secretary of State may approve the proposals either without modifications or with such modifications as, after consultation with the Authority, he thinks fit.

(7) If the Secretary of State is not satisfied that the proposals accord with any such advice given by him as is mentioned in subsection (5) above, or would do so with appropriate modifications, he may, after consultation with the Authority, instead of approving the proposals substitute for them a plan of his own.

(8) When the Secretary of State has approved the proposals or substituted for them a plan of his own, the Authority shall form each transferee company in accordance with the proposals as approved by the Secretary of State or (as the case may be) in accordance with the Secretary of State’s plan, and secure the registration of that company under the M2 Companies Act 1985, before such date as the Secretary of State may specify in relation to that company in giving his approval to the proposals or (as the case may be) in that plan.

(9) When all the transferee companies have been formed in accordance with the proposals as so approved or (as the case may be) in accordance with the Secretary of State’s plan, the Authority shall, before such date as the Secretary of State may specify in a direction given to the Authority, submit to the Secretary of State a scheme providing for the transfer to each transferee company of any property, rights and liabilities—

(a) of the initial company; and

(b) of any wholly-owned subsidiary of the initial company;

which are to be transferred in accordance with those proposals or (as the case may be) in accordance with that plan to that transferee company.

(10) A scheme under subsection (9) above shall not come into force until it has been approved by the Secretary of State or until such date as the Secretary of State may, in giving his approval, specify; and the Secretary of State may approve a scheme either without modifications or with such modifications as, after consultation with the Authority, he thinks fit.

(11) On the coming into force of a scheme under subsection (9) above the property, rights and liabilities affected by the scheme shall, subject to section 129 of this Act, be transferred and vest in accordance with the scheme.

(12) When it appears to the Authority that no further action is required on the part of the initial company to perfect any transfer effected by the scheme, the Authority shall secure that the initial company is wound up in accordance with the proposals as approved by the Secretary of State or (as the case may be) in accordance with the Secretary of State’s plan.

(13) Subsection (12) above shall apply in relation to any subsidiary of the initial company the whole of whose undertaking is transferred under the scheme to one or more of the transferee companies as it applies in relation to the initial company.

Marginal Citations

M1 1985 c. 6.

M2 1985 c. 6.