Key changes under Companies Act 2006

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20 November 2009

Key changes under Companies Act 2006

The Companies Act 2006 (CA 2006) introduced a new form of 'model' articles of association (replacing Table A) for private limited companies having a share capital incorporated on or after 1 October 2009. Separate forms of 'model articles' were introduced for public limited companies and companies limited by guarantee. 

How are existing companies affected?

For companies already existing on 1 October 2009, their existing articles continue to apply. While there is no obligation for an existing company to change its current articles, these should be reviewed and amended as necessary in order to take full advantage of the de-regulation introduced by CA 2006 and to ensure that the articles do not conflict with any provision of CA 2006.

What changes to existing companies articles should be considered?

A number of amendments to a company's articles should be considered including:

  • removing the objects clause. The objects are automatically imported from the memorandum into the articles under CA 2006 from 1 October 2009. Removing them will give the company unrestricted objects, which otherwise continue to be a limit on the company under the articles
  • removing the statement of authorised share capital. The concept of authorised share capital is abolished under CA 2006, but where an existing statement of authorised share capital in the memorandum is imported into the articles under CA 2006, it will continue to act as a limit on the amount of share capital which can be issued. The advantage of this amendment is that the company will not need to check that it has sufficient 'headroom' in its authorised share capital before issuing further shares
  • giving the directors authority to change the company name, which otherwise requires a shareholder special resolution

This is by no means an exhaustive list and there are various other amendments which should be considered depending on what the company's current articles provide for and whether it is a private company or a public company.

How can we help?

Our Company Secretarial Unit can:

  • review current articles and report on recommended changes
  • provide amending documentation and assist you with implementing the changes

For further assistance with amending your company's articles and all company secretarial enquiries, please contact Sarah Dann on 0117 902 7741 or email sarah.dann@burges-salmon.com.

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