369Liability of directors in case of unauthorised donation or expenditure
(1)This section applies where a company has made a political donation or incurred political expenditure without the authorisation required by this Part.
(2)The directors in default are jointly and severally liable—
(a)to make good to the company the amount of the unauthorised donation or expenditure, with interest, and
(b)to compensate the company for any loss or damage sustained by it as a result of the unauthorised donation or expenditure having been made.
(3)The directors in default are—
(a)those who, at the time the unauthorised donation was made or the unauthorised expenditure was incurred, were directors of the company by which the donation was made or the expenditure was incurred, and
(b)where—
(i)that company was a subsidiary of a relevant holding company, and
(ii)the directors of the relevant holding company failed to take all reasonable steps to prevent the donation being made or the expenditure being incurred,
the directors of the relevant holding company.
(4)For the purposes of subsection (3)(b) a “relevant holding company” means a company that, at the time the donation was made or the expenditure was incurred—
(a)was a holding company of the company by which the donation was made or the expenditure was incurred,
(b)was a UK-registered company, and
(c)was not a subsidiary of another UK-registered company.
(5)The interest referred to in subsection (2)(a) is interest on the amount of the unauthorised donation or expenditure, so far as not made good to the company—
(a)in respect of the period beginning with the date when the donation was made or the expenditure was incurred, and
(b)at such rate as the Secretary of State may prescribe by regulations.
Section 379(2) (construction of references to date when donation made or expenditure incurred) does not apply for the purposes of this subsection.
(6)Where only part of a donation or expenditure was unauthorised, this section applies only to so much of it as was unauthorised.