The Companies Act 2006 - December 2007
The new Companies Act 2006 was given Royal Assent in November 2006. The majority of the provisions within it will come into force by October 2009, however, some have, or will become, law sooner than this.
Electronic Disclosure of Company details (effective 31 December 2006)
Company websites, and electronic order forms must now state the company's name, number, registered office and place of registration. If they do not currently do this, then they must be amended immediately.
Accounts & Reports (effective for accounting periods beginning on/after 6th April 2008)
There is to be a reduction in the time limit for private companies to file their annual accounts at Companies House from ten months after the year end to nine months. This is in line with the taxation regime, as currently, taxation due is payable nine months following the year end. Thereby in the majority of cases, accounts should be prepared by this new deadline anyway.
Directors (effective October 2009)
At least one director for a company must be a natural person. Additionally there is now a minimum age limit of 16. There is no upper age limit on directors.
New Duties of Directors (effective October 2007)
The duties of the directors have been amended by the Act. Specifically, a new duty has been introduced which is "a director must act in a way he considers, in good faith, would be most likely to promote the success of the company for the benefit of its members of a whole". With regard to this, when decisions for the company are being made, consideration should be given to the following:
- long term consequences of that decision
- effect on the company employees
- effect on the company's reputation
- effect on the company's suppliers and customers
- effect on the community
The government will, in the future, be publishing non-statutory guidance for directors regarding this new duty.
The directors must also exercise due care skill and diligence to a level which would be expected of a director in their position.
Finally the directors have a duty to avoid conflicts of interest with that of the company.
Directors Residential Addresses (effective October 2009)
The Act introduces a new requirement for a register of director's usual residential addresses to be kept. This will, however, not be available to the public. The existing register which may contain only a service address will continue to be maintained and publicly available.
Abolition of the need for a company secretary (effective 6 April 2008)
Private companies will no longer need to have a company secretary. A company, may, however, choose to have one, and their authority within the company will remain unchanged. If a company does choose to maintain its company secretary, their details must continue to be recorded at Companies House.
AGMs (effective October 2007)
Private companies no longer need to hold an AGM.
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