Standards & Guidance
Companies Act timetable published
The full implementation timetable for the UK's
Companies Act 2006
was announced last month. The government also published a
consultation paper
on how the new regime can be implemented for existing companies and how the
government proposes to deal with secondary legislation under the Act.
The areas coming into effect in October this year include the provisions in
Part 9 of the Act relating to the rights of indirect investors. For example,
under the Act shareholders of listed companies who hold shares on behalf of
another person may nominate that person to receive communications from the
companies. Most of the provisions relating to directors’ general duties, the
provisions for the enhanced business review and derivative claims will also be
implemented this October.
The parts of the Act relating to accounts and reports, audit and statutory
auditors will commence in April 2008. The government said this meant that it
could implement European Union company law requirements alongside the
implementation of the Act in a way that minimised the number of changes for
business.
The provisions relating to directors’ conflict of interest duties will take
effect from October 2008. The government said this would give companies the
opportunity to change their articles of association before commencement of the
provisions. The Act allows authorisation of conflicts of interest by independent
directors, subject to the company’s articles of association.
Margaret Hodge, industry and regions minister at the Department of Trade &
Industry (DTI) said “The Companies Act is a major achievement, bringing major
benefits to business by modernising and simplifying company law. Throughout its
passage the Government consulted and listened carefully to a range of views. We
have maintained this approach for the commencement timetable. We have been
guided by a desire to see the benefits for business introduced as quickly as
possible and observing common commencement dates.
“We have had further extensive discussions with a wide range of interested
parties to make sure we have a timetable that gives business certainty, time to
prepare, and where possible, early savings and administrative benefits.”
In respect of secondary legislation, draft regulations are to be placed on the
DTI website for comment as they become available and any changes to policy
decided in the light of the consultation will be reflected in revised drafting
of the regulations. The DTI is also preparing checklists on the Act – the first
of these to be published was for small private companies.
Responses to the consultation should be returned to the DTI by 31 May, except
for any issues relating to political donations and expenditure, which should be
returned by 1 May.
Links
Companies Act 2006
DTI Consultation
Paper
May, 2007 |
