Our view - November 2008
Things are settling down at Jordans after the latest changes brought in on 1 October 2008. Our latest round of breakfast seminars proved very popular with our clients and gave us some useful feedback on how they are adjusting to the latest changes. Here, we highlight how the reduction of share capital, removal of the requirement for a company secretary and amendments to corporate directors are affecting companies on a practical level.
In October's"Our View" we set out the October changes in detail. Here, we highlight how the reduction of share capital, removal of the requirement for a company secretary and amendments to corporate directors are affecting companies on a practical level.
Reduction of share capital
We have received numerous enquiries about the new “do-it-yourself” reduction of share capital procedure. The government’s intention here was to make it easier for companies to reduce share capital. From what we have seen so far this certainly does seem to be the case. We have already successfully completed this process for clients. We understand that at the last count Companies House had received approximately 30 applications for reduction. With economic conditions worsening some companies may wish to take this step soon as it will make more capital available. Read more about the reduction of share capital process.
The Eighth Commencement Order
The Companies Act 2006 (Commencement No. 8, Transitional Provisions and Savings) Order 2008 was passed on 5 November 2008. This brings into force the changes coming in on 1 October 2009 with the exception of certain sections which will no longer come into force. More information can be found on the OPSI website.
Company secretary
We are seeing a high proportion of new private companies being incorporated without a company secretary. We understand that at Companies House it is now estimated that more than half of new private company incorporations are made without a secretary being appointed. The work that a secretary would normally carry out does still need to be done. More directors are contacting us with queries about their new obligations as a result. Read more about what is required of directors now that the requirement for a company secretary has been removed.
Corporate directors
Companies must now (unless the concession applies) have at least one individual director appointed. There are other practical issues to consider here as well. Service addresses for directors do not come into force until 1 October 2009. In the meantime the confidentiality order regime still applies. Companies need to consider if this would be applicable in their case. In addition, it is vital to contact the company’s insurers prior to any change to ensure the appropriate level of cover.
New model articles
BERR recently updated its website in relation to planned changes to the model articles which will come in on 1 October 2009. Read more...
Trading disclosures - an update
The Government has laid the draft Companies (Trading Disclosures) (Amendment) Regulations 2008 before Parliament. This will bring in two further exceptions to the requirement to display a company's name at its registered office, place of business or inspection place. Read more...
We will continue to assess the impact of the changes in our regular emails over the coming months, in particular in relation to directors and their duties.
