2015 saw the enactment of the Small Business, Enterprise and Employment Act 2015, introduced to simplify and explain the rules in relation to UK Companies.
The ActÂs main aim was to create transparency and create a new filling system for companies. Its impact will affect companies of all sizes.
Another function of the Act was to amend some sections in the Companies Act 2006 and create additional sections.
After Royal Assent was given in March 2015, procedures were put in place to enact the statute.
October 2015 saw the enactment of some of the key provisions of the act. A key change came in relation to the disqualification of directors.
The Secretary of State can now apply to the courts to disqualify a director if they have been convicted of certain offences overseas. The court also now has a number of new factors to consider when they are considering the disqualification of a director. There has also been an extension to the time period in which you can apply to the courts to disqualify a director. Previously, it was two years now it is three.
Changes were also introduced in relation to directorsÂ date of birth, the company strike off procedure and the appointment of directors and secretaries.
Previously, the full date of birth of a director was shown on the public register along with their other details. Now only the month and year is will be posted on the public register, even though the full date is still required to be submitted to Companies House. However, a private company can only suppress their full date of birth if they maintain their own register of details.
In relation to the appointment of new directors, they no longer need to give consent to act. The duty is now on the company to assure Companies House that consent has been given to them. This will then allow Companies Houses to notify the new director of their duties and responsibilities. Companies House does recommend that written consent is sought by the company from the new director as a safeguard.
The last key provision introduced in October made changes to the company strike off procedure. Previously, it had been a laborious procedure that could take up to 6 months for the Registrar of Companies to strike off a company if it no longer carried on its business. It should now take between 3- 4 months. Also the time period in relation to a voluntary strike off of a company has been reduced to 2-3 months.
Two months later, in December 2015, saw the enactment of further provisions. These were in relation to disputes arising with a companyÂs registered office. The Companies Act 2006 was amended to give the Registrar of Companies the power to change a companyÂs registered office to another address if they are not satisfied there is correct authorisation to use the original address. Therefore, the advice would be to ensure you have permission to occupy your registered office and to indicate to the Registrar if you have reason to believe another company does not have authorisation.
The next release of provisions will be in April 2016. In April, the requirement for a company to start a register indicating the people involved in the company with significant control will be enacted. This register known as the PSC register needs to include details of any person that is ÂregistrableÂ as well as the details of any registrable legal entities. The requirement to file this with Companies House will come later, in June 2016. The register should be available for inspection at the companyÂs registered office.
An individual or legal entity is non-registrable if they hold no interest in the company.
There is a number of categories in which a person with significant control must fall under. These are:
-Â Â Â Â Â Â Â Â Â The individual holds, directly or indirectly, more than 25% of the voting rights in the company
-Â Â Â Â Â Â Â Â Â The individual holds, directly or indirectly, more than 25% of the shares in the company
-Â Â Â Â Â Â Â Â Â The individual has the right to exercise significant influence or control over the company
-Â Â Â Â Â Â Â Â Â The individual holds the right to appoint and remove a majority of the board of directors of the company
The required details for the registerable person include their name, address for service, nationality, date of birth, usual residential address, the date of appointment and the nature of their control over the company. These details will be published to the public through Companies House, apart from their address and the day of their birth that will be kept private.
Following this, in June 2016, the requirement for this register to be maintained and submitted to Companies House through an Annual Confirmation Statement will replace the need to submit an Annual Return Statement. In addition, a company will have an obligation to identify any PSC that is present in their company and to ensure they are on the register. Failure to investigate will have an offence which has a fine or imprisonment attached.
Private companies will then have the option to keep information about PSCÂs lodged at Companies House instead of having to create a separate register.
The provisions outlined above have and will effect most businesses. Therefore, it is essential your company secretary is clear to the changes already enacted and through coming in April and June of this year. It is always best to get advice from either a solicitor or an accountant if you have any queries regarding these new changes.