Companies House is the governing body that deals with companies. More detialed information is available from its website, at: http://www.companies-house.gov.uk/about/gbhtml/gbf1.shtmlÂ , but here’s a brief overview of the main aspects of a Company:
What is a Company?
A company is a legal entity formed to conduct business or other activities in the name of the association. Because it is incorporated, it has a legal personality distinct from those of its members.
Companies are primarily governed by the following legislation:
- Companies Act 1985
- Companies Act 2006
- The Companies Act 2006 (Commencement No. 6, Saving and
- Commencement No. 3 and No. 5 (Amendment)) Order 2008 – SI 2008/674
- The Companies (Trading Disclosures) Regulations – 2008 SI 2008/495
Types of Company
There are four main types of Company:
1. Private Company limited by shares
This type of company has a share capital, and the liability of each member is limited to the amount unpaid on shares that a member holds. A private company cannot offer its shares for sale to the general public.
2. Private Company limited by guarantee
Here, its members do not make any contribution to the capital during its lifetime as they do not purchase any shares. The members’ liability is limited to the amount that they each agree to contribute to the company’s assets if it is wound up.
3. Private unlimited Company
This type of company may or may not have a share capital and there is no limit to the members’ liability. Because there’s no limitation on the members’ liability, the company has to disclose less information than other types of company.
4. Public limited Company
This type of company has a share capital and the liability of each member is limited to the amount unpaid on shares that a member holds. A public limited company may offer its shares for sale to the general public and may also be quoted on the stock exchange.
Note: The first three company types described above are forms of private company. There are still a few “companies limited by guarantee with a share capital”, though it’s not been possible to form these since 1981.
Who can form a Company?
Companies’ legislation generally allows one or more persons to form a company for any lawful purpose by subscribing to its memorandum of association. However, a public company or an unlimited company must have at least two subscribers (this rule will disappear when the Companies Act 2006 comes fully into force on 1 October 2009).
How we can help you form a Company?
Over the years, we have formed many types of companies for clients. We are therefore very experienced in this field. If you are interested in setting up a business or pursuing a certain business venture, then speak to one of our Company Law specialists who can advise on the best options. When you have decided which type of company will best suit you, we can then deal with all the formalities of setting up the company for as little as Â£250 plus VAT.