New company law for charitable companies

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30 January 2009

A charitable company is a company limited by guarantee, and the trustees of charitable companies are also company directors subject to the Companies Acts.

The Companies Act 2006 has 1300 sections and was the longest Bill ever to pass through Parliament. Most of the Act is now in force with some remaining provisions (mainly relating to share capital companies) to come into effect in October 2009.

The Act consolidates and replaces existing company legislation and the aim is to simplify and modernise company law – although given the Act's length the achievement of that aim has been questioned! It was also enacted on the same day as the Charities Act 2006 so charity trustees have had to cope with two major pieces of legislation coming into force in stages over the last two years .

You can read more about four main areas which are relevant to the trustees of charitable companies in their capacity as company directors:

Our Charities Unit at Burges Salmon has already assisted several charities in undertaking governance and constitutional reviews to ensure that their trustees and staff are complying with this new legislation, and to update their constitutions if appropriate. We also deliver trustee training seminars to charities, at their own premises, tailored to meet their specific objectives and circumstances.

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