Changes to company law which may impact on your business
From 6 April 2016 all limited companies must keep a public register detailing those with “significant control” over the business. This will require more than a list of shareholders and must include a description of the structure of the company and each individual’s actual control. This means that shares held by others, through trusts or nominee companies to secure the beneficiary’s anonymity will no longer be effective. From 30 June 2016, a company’s annual return to Companies House must also contain these details.
What does this mean for you?
The public register is being introduced to make company ownership more transparent. The information will be used by suppliers and customers as well as professional service organisations to help with customer credit ratings and by HMRC and other government departments to support their investigations. Failure to comply may result in sanctions on the directors and the suspension of the shareholders’ right to vote, which could bring the company to a grinding halt with no decisions being valid. In addition, restrictions may be placed on the drawing of dividends, and the transfer or issue of shares, preventing cash realisation and investment.
What should you do about it?
As the requirement comes into force in 2 weeks, to begin with we would recommend reviewing the register of members in your company records. We can then work with you to investigate, ensure compliance and create the new register required by the regulations from 6 April.
For more information please contact Nikki Ashfield, Solicitor, Corporate Finance.
Published: 22 Mar 2016