THE final parts of the Companies Act 2006 were implemented on 1st October 2009. These changes affect all companies in the United Kingdom.

The Act has been implemented in several stages. Some changes have already occurred but the majority became effective on the 1st October 2009.

Focussing on the changes for private companies limited by shares;

We have already seen the demise of;

  • the necessity to hold Annual General Meetings

  • the ability for a company to be formed with:

    • only another company as a director

    • minor directors (under age 16)

  • extraordinary and elective resolutions

  • written resolutions requiring unanimous consent

  • a 10 month period to file annual accounts

  • the need to have a company secretary

  • the prohibition on a private company giving financial assistance

We have already seen the introduction of;

  • a statutory code of director’s duties

  • written resolutions being passed by the requisite majority of eligible voting shareholders

  • electronic communication between companies and their shareholders including resolutions being passed by electronic means

  • single director/single shareholder companies

  • capital reductions supported by a solvency statement from directors, rather than a court order

  • a 9 month period to file annual accounts

  • easier methods for shareholders to take action against a director for breach of duty, negligence or default

From October 1st we said hello to;

  • directors being able to provide a service address rather than their home address to Companies House

  • new Model Articles of Association

  • the ability to entrench provisions within Articles of Association

  • new methods of forming a company

  • a much simpler one-page Memorandum of Association

  • all provisions previously in the Memorandum of Association becoming part of the Articles

  • over 200 new company forms (with new form names)

  • new rules and regulation on Company names

  • a simplified regime for the issue of shares

From October 1st we said goodbye to;

  • Table A (as we know it!)

  • detailed object clauses in a company’s Memorandum of Association

  • all existing company forms

  • authorised share capital

  • detailed rules on share liens and share forfeiture

The Act aims to give private companies more freedom. However, such companies will not receive the benefit of these changes unless they review and amend their Articles of Association to adopt the new model articles and remove inconsistent provisions.

For a free review of your existing Memorandum and Articles of Association contact Farleys Commercial Corporate law team on 0845 050 1958 or you can e-mail us.