Companies Act 2006 - what's in the Act?

When it's fully in force, the Act completely replaces the Companies Act 1985. Only about 1/3 of the 1985 Act is re-enacted without changes. There's a lot for your lawyers to learn.

The practical changes for the day to day running of private companies are limited. As the Act comes in, there are transitional rules to make sure existing companies can continue to function without major upheavals. For example, existing companies will be able to stick with their existing memorandum and articles indefinitely. On the other hand, if you have a director under 16, he or she will be removed from 1 October 2008.

On these pages we have tried to identify the points likely to be of most interest to emw's clients. Following the policy behind the Act, we have tried to 'think small first' and concentrate on the implications for private companies. We have grouped them into issues most likely to be of interest to three audiences. Click on a heading to go to the summary page:

• directors (new codified directors' duties; relaxation of conflict of interest rules; abolition of share dealings disclosure; minimum age 16, no upper age limit, privacy for home addresses; loans to directors permitted with shareholder approval)

• Secretaries (no requirement for a Secretary; new formation procedures; abolition of long-form memorandum of assocation; new model form articles; electronic communications; withholding of public inspection of registers)

• Shareholders, including private equity investors and joint ventures (written resolutions signed by a majority, not all voting members; relaxed restrictions on directors issuing shares; abolition of financial assistance rule and relaxation of capital maintenance; clarification of dividends in specie)

The implementation dates on this site are those announced by the Government on 17 December 2007; they may yet change.

The new model articles of association have been published in draft, but could be changed again. Be sure to register for email updates so we can keep you up to date.

These pages are only to provide generalised information and do not constitute legal advice. emw law should be consulted over the effect of the Act on any particular company or situation.