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Companies Act update
Welcome to the first in depth edition of our Companies Act
update. Since the Act received royal assent last year, a number of
measures have already been implemented. The next phase of changes
will take effect on 1 October 2007.
In this update, we look at the key changes to be implemented in
the next phase and also look ahead to the changes due to be
implemented next year. I hope that you will find these articles
topical.
Should you require any further information on any of the issues
or events in this edition, please feel free to contact us. We would
also be very pleased to hear from you with any views you have in
relation to the update generally.
In this issue
Resolutions and
meetings
Company meetings and resolutions will be streamlined thus
reducing the need for physical shareholder meetings, making written
resolutions easier to pass and standardising notice periods.
Read
more
Directors’ duties
Some of the new provisions on directors’ duties will be brought
into force, including the new and widely debated duty to promote
the success of the company. Read
more
Business review
Section 417 will come into force, requiring the directors’
report of all companies (other than those subject to the small
companies regime) to contain a business review. This must
contain a review of the company’s business and a description of the
principal risks and uncertainties facing the company. The Act
requires a balanced and comprehensive analysis of the development
and performance of the company’s business during the year and the
position at the year end, consistent with the size and complexity
of the business.
Transactions with
directors
The rules on transactions between a company and its directors
have been relaxed and made more consistent. For example, the
current restrictions on loans to directors will be abolished and it
will be possible for companies to make loans of any amount to its
directors, subject to shareholder approval.
Timetable for remaining
changes
After October 1st 2007, the next key date for
implementation is 6 April 2008 when a number of provisions, most
notably those relating to audit and accounts, will take
effect. A further update will follow shortly before that
time. All of the Act will be in force by 1 October
2008. For a detailed implementation
timetable, click here.
Download this update
Click
here if you would like to download this version in pdf
format