246.The general purpose of section 139 and Schedule 19 is to require directors of companies to seek the approval of the company in general meeting to the making of political donations to political parties or organisations or to the incurring of expenditure for political purposes. At present the making of political donations and expenditure by a company on other political purposes is left to the general discretion of the directors and the management of the company. As a result of the Act the detailed arrangements will continue to lie with the directors, but it will not be lawful for such action to be taken unless approved in advance by the company in general meeting.
247.Part IX of the Act goes further than the regulation of political funding in the United Kingdom and covers the approval of company donations to political parties and organisations in other member states of the European Union. This reflects the potential for the views of political parties based in other member states to have a direct impact on the commercial climate in the UK through bodies such as the European Parliament.
248.The regime for the control of political donations and expenditure is set out in Schedule 19 of the Act, which inserts new Part XA (comprising new sections 347A to 347K) into the Companies Act 1985.
249.Part IX of the Act does not extend to Northern Ireland, which has separate company law.
Commentary on Sections Part IX : Political donations and expenditure by companies Section 139 and Schedule 19 : Control of political donations by companies