The Companies Act 2006 is the largest single piece of legislation ever introduced in Europe. Whilst intended as a simplification of company law bringing in much de-regulation of small companies, it is clear to the business community at large that there is a great deal of change involved, much of which is not exactly obvious at the outset.

Over the last two or three years, various parts of the new law have been gradually introduced, but from 1st October 2009, all remaining provisions in The Companies Act 2006 (CA2006) come into force thus entirely replacing the Companies Act 1985.

Of most significance with this final implementation are the provisions relating to incorporations and articles of association. There are fundamental changes involved, which may be well known to many professional advisers but may not be so obvious to others.

The following sets out some of the key points of interest. These pages are by no means intended as a comprehensive guide and give only a brief general note on the issues covered. Further information is available on request and specific professional advice should be taken where necessary:

Incorporation

There are a number of changes, which affect the information required for most incorporations. Some of the key points are covered briefly below:

• The Memorandum of Association becomes a historic document relevant only for the process of incorporation and of no further significance. All information previously contained in the memorandum will. for companies incorporated after 1 October 2009 be contained in the Articles.
• The concept of authorised share capital is abolished. Shares will exist only upon allotment so there can be no unissued shares in a company and it will not be possible to create a class of shares where none are issued in that class.
• Directors can give a service address if required (see below)
• A company secretary is not compulsory in private companies. A secretary may be appointed, but the responsibility for duties previously undertaken by the secretary pass to the directors if no secretary is appointed.
• Corporate bodies acting as officers must indicate whether they are EEA registered, giving their principal address, place of registration and registration number. Non-EEA registered companies must also state their legal form and the governing law that applies
• Companies have unrestricted objects and there is no requirement to state any objects clause although it is still advisable for most companies limited by guarantee. Where objects are stated, this information is now contained in the Articles.
• A statement of capital is required for Companies House filings such as incorporation, share allotments and annual returns. The statement of capital includes details of share premiums paid and unpaid shares. This is a complicated matter that may necessitate professional assistance in future filings.
• Northern Ireland incorporations now fall within the CA2006 through Companies House in Cardiff and not dealt with separately as before.

Companies House Filings

We understand that Companies House will be taking a much more rigid approach to the deadlines for filing various documents with the Registrar of Companies under the CA2006. The new Act allows the Registrar to prescribe and enforce penalties in circumstances where documents are not filed on time.

For example, when a company adopts a special resolution that makes any amendment to its Articles, a consolidated set of the revised Articles must be filed with the Registrar within 14 days. If this is not done we understand that Companies House issue a reminder that if not complied with within the prescribed time period, then an automatic £200 civil penalty will be applied.

Our Managed Compliance Service will ensure that these matters are dealt with promptly and avoid these unnecessary penalties.

Company Forms

• CA2006 brings in a complete new set of Companies House forms. Follow the links in our page for downloading company forms to view the new forms.
• There are far more forms than before, for example the previous form 288a used for appointing a director or secretary has been replaced by four separate forms AP01, AP02, AP03 and AP04 used for various functions.
• The form numbers no longer refer to the relevant sections of the Act.
• Many of the forms are much longer than before, for example the annual return form AR01 is now 14 pages in length.
• Various forms require different information than the old forms, for example annual returns and share allotments require a statement of capital that gives a complete snapshot of the company’s share capital including descriptions of all share class rights.
• The return of allotment of shares form SH01 (replacing the G88(2) form) contains no requirement to notify the details of the persons to whom shares are being allotted.

The multitude of new and unfamiliar forms and the potential increased reliance on statutory registers are two reasons to place more emphasis on the maintenance of company records. You may wish to consider our Managed Compliance Service in order to assist with the maintenance of your client base of limited companies.

Electronic filing via ourselves will circumvent much of the problem, so you may wish to look at the service we can offer which is far easier and less time consuming to manage.

Service Addresses

CA2006 introduces the new concept of directors’ service addresses. All directors will be able to lodge a service address with Companies House, which will be available on the public record. In all cases, a director’s residential address must also be submitted, but this will be kept confidential if a service address is also lodged. The residential address will be available to official sources such as tax authorities, police investigations and credit reference agencies.

See our page on Directors Service Addresses for further details.

Articles

One of the most significant changes in the new law is the reorganisation of the old Memorandum & Articles of Association and the effective replacement of these with the new Articles of Association.

All provisions contained in the Memoranda of existing companies incorporated before 1 October 2009 will be deemed to be part of the Articles by virtue of the changes to the Act, and this factor alone leads many professional advisers to the decision that existing companies should strongly consider updating their Articles to benefit from the CA2006 regulations and remove potential confusion.

Our pages regarding Articles of Association contain extensive information on this important matter including explanations as to why existing companies should update their old Memorandum and Articles to comply with the CA2006.

Filing of Accounts

Companies House filing deadlines for accounts of private companies have already been reduced to 9 months for financial periods commencing on or after 6 April 2008.

Public companies now have only 6 months to file their accounts.

The unofficial 14 day concession for unsigned accounts has been removed and Companies House have advised that they will issue late filing penalties if the signed accounts are subsequently filed after the deadline.

Once again we would like to bring our CompanyView system to mind. This system provides a complete managed service to keep on top on Companies House filings, make sure that the new law is followed correctly and provides pro-active monitoring of all your client records allowing you to access your client company records online, manage filing deadlines more efficiently and allows clients to file accounts electronically from the CompanyView web site.

View a demo at www.companyview.co.uk.