Commentary on Sections Schedule 1: Transfer Schemes
393.This Schedule contains further provision about transfer schemes under section 8.
394.Paragraph 1 defines various terms used in Schedule 1.
395.Paragraph 2 provides that a transfer scheme may identify property, rights and liabilities to be transferred by specifying or describing them, and may specify the way in which property, rights or liabilities of any description may be identified.
396.Paragraph 3 contains further provisions as to the property, rights and liabilities that may be transferred under a scheme and the basis on which they are to be transferred.
397.Paragraph 4 provides that the transfer scheme may contain provision for the creation or transfer of an interest or a right in, or in relation to, property transferred and property retained. It may also contain provision for the creation of new rights and liabilities between different transferees and as between a transferee and a transferor. It also allows for the transfer scheme to contain provision to cover the interests, rights or liabilities of third parties.
398.Paragraph 5 provides that an obligation may be imposed on a transferee or transferor to enter into an agreement to effect the transfer(s) and allows for this to be enforced by an injunction or any other appropriate remedy.
399.Paragraph 6 provides that the transfer and creation of the relevant property, interests, rights and liabilities vest in the transferee at the time specified in the scheme, save where it is to be effected by an agreement or instrument entered into or executed pursuant to an obligation imposed under paragraph 5(1).
400.Paragraph 7 provides that where a person would be entitled to terminate, modify, acquire or claim an interest or right, or treat an interest or right as modified or terminated by virtue of anything done or likely to be done in connection with a transfer scheme, then that right is not enforceable until after the transfer of the interest or right under the scheme and only to the extent that the scheme provides for the interest or right to have been transferred subject to that person’s entitlement.
401.Paragraph 8 provides that a transfer scheme may contain incidental, supplementary, consequential and transitional provision, and that different provision may be made for different purposes.
402.Under Paragraph 9, a transfer scheme may provide, in relation to transfers in accordance with the scheme, that the transferee is treated as the same person in law as the transferor, for things done by the transferor to be treated as done by the transferee and for proceedings commenced by or against the transferor to be continued by or against the transferee.
403.Paragraph 10 makes provision for the transfer of foreign property. Paragraph 11 provides that a transfer scheme may make provision for and in connection with the payment of compensation to third parties whose property, rights, interests or liabilities have been affected by (or by virtue of) a transfer scheme. It also provides for the appointment of an arbitrator to determine disputes about compensation.
404.Paragraph 12 provides that a transfer scheme may make provision for certain disputes to be resolved by arbitration.
405.Paragraph 13 makes provision for persons entitled, in consequence of a transfer scheme, to possession of a document relating in part to the title to land or other property or the management of such property or land to have been treated as having given another person an acknowledgement in writing of the right of that other person to production of the document and to delivery of copies of it.
406.Paragraph 14 provides for proof of title by certificate issued by the Secretary of State.
407.Paragraph 15 provides that the Transfer of Undertakings (Protection of Employment) Regulations 2006 apply to the transfer under a transfer scheme of rights or liabilities under a contract of employment. Paragraph 16 provides that where an employee of the transferor becomes an employee of the transferee the period of employment with the transferor is to be treated as a period of employment of the transferee and the transfer is not to be treated as a break in service.
408.Paragraph 17 allows for modification of a transfer scheme within three years of the vesting of a transfer, provided it is agreed by the transferor and transferee and approved by the Secretary of State.
409.Paragraph 18 disapplies certain provisions of the Companies Act 2006 (distributions), together with rules of law relating to distributions or the maintenance of capital by companies, in relation to transfers by or under a transfer scheme.
410.Paragraph 19 provides that in relation to anything done by or under a transfer scheme the Secretary of State, the Treasury, anyone employed by or acting on their behalf or their nominees are not to be regarded as shadow directors of a transferor or transferee.