Further protest Saturday, as city council stays silent and as public interest legal firm points out ownership of ACC means council could sack entire ‘disgraceful’ board to cancel weapons event
Liverpool City Council has been silent for almost two weeks as the clock ticks down to a controversial arms fair in the city, after lawyers acting for a resident pointed out that the city mayor’s claims to be powerless to cancel the event fall apart on inspection of the papers drawn up to create the council-owned venue company.
The Labour party whipped its majority on the council to vote against the event, but legal advice shown to the council describes the legal challenge to the arms fair as ‘credible’.
The Public Interest Law Centre (PILC) wrote to the council again on 22 September with a detailed dismantling of the claimed helplessness, based on the ACC’s ‘articles of association’ that give the council the power to sack the company’s entire board if it chooses – and the comments of the councillor responsible for the council’s link with the business that the board had behaved ‘disgracefully’.
PILC’s five-page letter to the council’s legal adviser points out:
Nature of ACC Liverpool Group Ltd.
First, the Articles of Association at Companies House state that the controlling or sole shareholder can control the composition of the Board:
1. That a member with a majority of the voting rights in the company has the power at any time to appoint or remove any person as a director (article 13.2).
2. That, with the approval of a sole member, the directors may appoint someone as a director.
This gives the City Council the power to replace directors who will not follow the policies of its owner with directors who will.
The letter goes on to remind the council that its cabinet member responsible for the company’s business described its conduct as ‘disgraceful’ in a public comment on its decision to proceed with the event after last year’s was cancelled:
Our letter of 27 August quoted Cllr Harry Doyle as stating:
“Whilst LCC is the shareholder, it does not have all, or even the majority of board members. Out of the 7 board members, only 2 are appointed by LCC. This particular event was agreed by the ACC board at some point last year I believe and both of the LCC appointed board members, which included Cllr Wendy Simon, voted against the event taking place. Disgracefully, they were in the minority.”..
Cllr Harry Doyle states that LCC is “the” shareholder, ie that there is only one shareholder. In any event it is clearly the majority shareholder. However it seems either that Cllr Harry Doyle is not aware of the system for appointing directors or is it that the Council has allowed control of the company to be taken by other people? Whilst we are concerned that Cllr Harry Doyle considers that the people running ACC behave “disgracefully” why have they been left in place?
[As the articles allow the shareholder to take any decision it wants] Do you accept that the Council therefore had the power both to control the Board of Directors and to take any decision which ACC Liverpool Group Ltd could take? If not, please confirm what decisions the Council cannot take and how those decisions have to be taken.
The letter also explicitly addresses Mayor Anderson’s statement:
In addition to the comments of Cllr Harry Doyle, set out above, Mayor Joanne Anderson stated on 27 August 2021:
“…the inescapable fact is that it is lawful and we have no public powers to stop it … The bottom line is that the council has no power to interfere with bookings taken by ACC Liverpool, and has no member representatives on its board.”
It seems that the Mayor has also misunderstood her powers and the make up of the Board when making her decision. Please confirm that the statements by the Mayor and Cllr Harry Doyle are incorrect, or whether the City Council as a whole and those advising them stand by the statements.
PILC then lists the actions that would persuade its client to withdraw his action:
i) The Council will ensure that the ACC Liverpool Group Limited will adopt an ethical events policy during 2021 and that they will do this after consulting with campaigners from Liverpool, and also Liverpool City Councillors.
ii) The Council concedes that it was wrong to assert that it could do nothing to stop the ‘Electronic Arms Fair’ being held in Liverpool – for the reasons outlined above.
iii) Further to point ii) a public apology is made by the Mayor of Liverpool to the effect above, and that further to litigation brought on behalf of [redacted], it is now clear that the City Council as the major shareholder could have dismissed the Directors who made the decision to accept the booking from AOC Europe.
iv) Further to point iii) the apology is made on the Liverpool City Council website and in the Liverpool Echo – taking out a full page advert.
Despite the clarity of PILC’s case and the short time remaining until the arms fair goes ahead, Skwawkbox understands that the council has made no response in the almost two weeks since the letter was sent and that PILC yesterday warned the city’s authorities that it is seeking its client’s instructions on taking the matter to the High Court.
A further protest against the event and the council’s inaction is taking place at 12.30pm this Saturday in the city:
The city has also claimed it can’t afford to cancel the event. However, iconic band Massive Attack has already cancelled its planned gig at the same venue in protest and unions and others are likely to follow.
Update: giant union Unite has announced it will make no further bookings at the venue without consulting with the local community, unless the event is cancelled.
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