The Companies Act 2006 represents a major change in how Parliament views company law. The Act is generally believed to be permissive, in that it allows a more informal approach to the running and management of companies.
The Companies Act 2006 is currently the largest piece of legislation in the United Kingdom with 1300 sections. The commentary in Alcock, Bird and Gale on The Companies Act 2006 is 342 pages long. Consequently this chapter represents a brief summary of key information in the Act. The emphasis is on those parts of the Act that are most relevant to the official receiver in administering companies in compulsory liquidation. Each office has been provided with a copy of Alcock, Bird and Gale on The Companies Act 2006, which contains the Act plus the authors’ commentary which may be referred to for further information.
The Chapter is divided into 14 parts. The first three parts provide a general introduction to companies. Part 1 explains the differences between individuals and corporations, Part 2 provides some historical background, and Part 3 explains the differences between the various types of companies. The rest of chapter deals almost exclusively with companies limited by shares.
The next four parts look at how a company is formed. Part 4 looks at what documents are necessary for incorporation and the information available from Companies House. Part 5 deals with the memorandum of association and its restricted position within the new legislation. Parts 6 and 7 outline the role and contents of the articles of association. The articles of association is an important document in that it may set rigid limits as to what a company and/or its directors may do.
The Companies Act 2006 introduced statutory duties for directors. Part 8 provides an introduction to these duties. More information will be included in Chapter 31.4B, Part 4, which is to be revised and issued in 2011/12.
The next two parts look at the production of financial information and what information should be provided to the registrar of companies. Part 9 provides details of how and when financial accounts are prepared and the role of auditors. Part 10 explains what returns must be made to the registrar of companies and when. This part provides an indication of the type of information the registrar of companies may be holding which is available to the official receiver in his/her enquiries.
The final four parts deal with how decisions are taken by the company. Part 11 describes meetings and how decisions are taken; Part 12 explains what shares are and the rights of shareholders; Part 13, provides information regarding the nature of groups of companies and how they work, ; Part 14, deals with how companies cease to exist and how they may be revived.
The chapter is divided into parts as follows:
Part 1 Corporations (paragraphs 75.2 – 75.7)
Part 2 History of companies in the British Isles (paragraphs 75.8 – 75.18)
Part 3 Types of companies (paragraphs 75.19 – 75.26)
Part 4 Incorporation (paragraphs 75.27 – 75.51)
Part 5 Memorandum of association (paragraphs 75.52 – 75.55)
Part 6 Articles of association (paragraphs 75.56 – 75.60)
Part 7 Model articles of association (paragraphs 75.61 – 75.76)
Part 8 Directors, their duties and powers (paragraphs 75.77 – 75.139)
Part 9 Accounts and auditors (paragraphs 75.140 – 75.165)
Part 10 Returns to registrar of companies (paragraphs 75.166 – 75.189)
Part 11 Decision making and meetings (paragraphs 75.190 – 75.220)
Part 12 Share capital (paragraphs 75.221 – 75.261)
Part 13 Groups (paragraphs 75.262 – 75.275)
Part 14 Dissolution and restoration (paragraphs 75.276 – 75.279)
Annex A Glossary of terms
[On to Part 1 – Corporations]