Changes to Companies Act 2006
Law scales On 1 October 2009 virtually all sections of the Companies Act 2006 that have not yet been implemented come into force. The main areas of change are in relation to the formation of companies, the memorandum and articles, share capital, and directors’ home addresses.
Key changes include: * The objects of companies formed on or after 1 October 2009 (New Companies) are unrestricted unless restrictions are specifically inserted into the articles. Companies formed before that date (Existing Companies) can avoid future concerns that they are acting ultra vires by deleting all of their existing objects. * There are three new sets of Model Articles: for a public company limited by shares; a private company limited by shares; and a private company limited by guarantee. The relevant Model Articles apply to a New Company unless its members choose to exclude or modify them. * Table A 1985 (and earlier versions) remain in force, so Existing Companies with Table A-based articles do not need to adopt new articles. They may, however, choose to update their articles by adopting some or all of the Model Articles. Other changes should also be considered. * Existing Companies should consider removing the limit on allotting shares derived from their pre-October authorised share capital. * An Existing Company that is private and with only one class of shares can give the directors unlimited power to allot new shares. * Technical changes to definitions relating to share capital. The wording of shareholder resolutions to authorise directors to allot shares, and to disapply pre-emption rights, will need to be brought into line with the new terminology. * The protection currently afforded to directors who have a confidentiality order is, in general terms, extended automatically to directors of all companies. All directors should provide a service address (such as the company’s registered office) to the company secretary. Those at serious risk of violence or intimidation should consider applying for an order to remove their residential address from post-2002 documents filed at Companies House and/or an order to prevent their home address being disclosed to a credit reference agency.
This article first appeared in Law-Now, CMS Cameron McKenna's free online information service, and has been reproduced with their permission.
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