5 After section 12 insert—

“12A Statement of initial significant control

(1) The statement of initial significant control required to be delivered to
the registrar must—

(a) 5state whether, on incorporation, there will be anyone who
will count for the purposes of section 790M (register of
people with significant control over a company) as either a
registrable person or a registrable relevant legal entity in
relation to the company,

(b) 10include the required particulars of anyone who will count as
such, and

(c) include any other matters that on incorporation will be
required (or, in the absence of an election under section
790W, would be required) to be entered in the company’s
15PSC register by virtue of section 790M.

(2) It is not necessary to include under subsection (1)(b) the date on
which someone becomes a registrable person or a registrable
relevant legal entity in relation to the company.

(3) If the statement includes required particulars of an individual, it
20must also contain a statement that those particulars are included
with the knowledge of that individual.

(4) “Registrable person”, “registrable relevant legal entity” and
“required particulars” have the meanings given in Part 21A (see
sections 790C and 790K).”

6 25In section 120 (information as to state of register and index), in subsection
(1), for “there were no” substitute “whether there are”.

7 In section 1068 (registrar’s requirements as to form, authentication and
manner of delivery), in subsection (6A) (inserted by Schedule 5 to this Act),
after “central register)” insert “or Chapter 4 of Part 21A (option to keep PSC
30information on central register)”.

8 In section 1087 (material not available for public inspection), in subsection
(1), after paragraph (ba) insert—

“(bb) information to which sections 240 to 244 are applied by
section 790ZE(1) (residential addresses of people with
35significant control over the company) or any corresponding
provision of regulations under section 1046 (overseas
companies);

(bc) information that, by virtue of regulations under section
790ZF or any corresponding provision of regulations under
40section 1046, the registrar must omit from the material on the
register that is available for inspection;”.

9 (1) Section 1126 (consents required for certain prosecutions) is amended as
follows.

(2) In subsection (1), at the end insert—

• 45“section 1112 of this Act (general false statement offence);

• paragraph 5 or 6 of Schedule 1B to this Act (breach of certain
  restrictions imposed under that Schedule)”.

(3) In subsection (2)(a)—

(a) omit the “or” at the end of sub-paragraph (ii), and

(b) after sub-paragraph (iii) insert “or

(iv) section 1112 of this Act,”.

(4) 5In subsection (2)(b), after “section 798 of” insert “, or paragraph 5 or 6 of
Schedule 1B to,”.

(5) In subsection (3)(a)—

(a) omit the “or” at the end of sub-paragraph (ii), and

(b) after sub-paragraph (iii) insert “or

(iv) 10section 1112 of this Act,”.

(6) In subsection (3)(b), after “section 798 of” insert “, or paragraph 5 or 6 of
Schedule 1B to,”.

10 In section 1136 (regulations about where certain company records to be kept
available for inspection), in subsection (2), after the entry for section 743
15insert—

• “section 790M (register of people with significant control over a
  company);

• section 790Y (historic PSC register);”.

11 In Schedule 8 (index of defined expressions), in the appropriate places
20insert—

Section 78

SCHEDULE 4 Abolition of share warrants to bearer

Part 1 Arrangements for conversion and cancellation of existing share warrants

35Right of surrender during surrender period

1 (1) This paragraph applies in relation to a company which has issued a share
warrant which has not been surrendered for cancellation before the day on
which section 78 comes into force (the “commencement date”).

(2) During the period of 9 months beginning with the commencement date (the
40“surrender period”) the bearer of the share warrant has a right of surrender
in relation to the warrant.

(3) For the purposes of this Schedule, if the bearer of a share warrant has a right
of surrender in relation to the warrant, the bearer is entitled on surrendering
the warrant for cancellation—

(a) 45to have the bearer’s name entered as a member in the register of
members of the company concerned, or

(b) where an election is in force under section 128B of the Companies Act
2006 (option to keep membership information on central register) in
respect of the company, to have the bearer’s name and other
50particulars delivered to the registrar, and the document containing
that information registered by the registrar and the date recorded, as
if the information were information required to be delivered under
section 128E of that Act.

(4) A company must, as soon as reasonably practicable and in any event before
55the end of the period of 2 months beginning with the day on which a share
warrant is surrendered for cancellation pursuant to a right of surrender,
complete and have ready for delivery the certificates of the shares specified
in the warrant.

(5) If a company fails to comply with sub-paragraph (4) an offence is committed
60by every officer of the company who is in default.

2 (1) A company must, as soon as reasonably practicable and in any event before
the end of the period of 1 month beginning with the commencement date,
give notice to the bearer of a share warrant issued by the company of—

(a) the bearer’s right of surrender,

(b) 65the consequences of not exercising that right before the end of the
period of 7 months beginning with the commencement date (see
paragraph 3),

(c) the fact that the right will cease to be exercisable at the end of the
surrender period, and

(d) 70the consequences of not exercising the right before the end of that
period (see in particular paragraphs 5, 6 and 9 to 12).

(2) If a company fails to comply with this paragraph an offence is committed by
every officer of the company who is in default.

Consequences of failure to surrender during first 7 months of surrender period

3 (1) This paragraph applies in relation to a share warrant of a company which
has not been surrendered by the bearer for cancellation before the end of the
period of 7 months beginning with the commencement date.

(2) 5Any transfer of, or agreement to transfer, the share warrant made after the
end of that period is void.

(3) With effect from the end of that period, all rights which are attached to the
shares specified in the warrant are suspended (including any voting rights
and any right to receive a dividend or other distribution).

(4) 10The company must pay into a separate bank account that complies with sub-
paragraph (5) any dividend or other distribution which the bearer of the
share warrant would, but for the suspension, have been entitled to receive.

(5) A bank account complies with this sub-paragraph if the balance of the
account—

(a) 15bears interest at an appropriate rate, and

(b) can be withdrawn by such notice (if any) as is appropriate.

(6) If the share warrant is subsequently surrendered in accordance with this
Schedule—

(a) the suspension ceases to have effect on surrender, and

(b) 20the suspension period amount must be paid to the bearer by the
company.

(7) The “suspension period amount”, in relation to a share warrant, is—

(a) the aggregate amount of any dividends or other distributions which
the bearer of the warrant would, but for the suspension, have been
25entitled to receive, plus

(b) any interest accrued on that amount.

Second notice of right to surrender

4 (1) A company must, before the end of the period of 8 months beginning with
the commencement date, give further notice to the bearer of a share warrant
30of the company of—

(a) the bearer’s right of surrender,

(b) the consequences of not having exercised the right of surrender
before the end of the period of 7 months beginning with the
commencement date (see paragraph 3), and

(c) 35the matters referred to in paragraph 2(1)(c) and (d).

(2) If a company fails to comply with this paragraph an offence is committed by
every officer of the company who is in default.

Expiry of right to surrender and applications for cancellation of outstanding share warrants

5 (1) This paragraph applies in relation to a company which has issued a share
40warrant which has not been surrendered for cancellation before the end of
the surrender period.

(2) The company must, as soon as reasonably practicable and in any event
before the end of the period of 3 months beginning with the day after the end

of the surrender period, apply to the court for an order (referred to in this
Schedule as a “cancellation order”) cancelling with effect from the date of the
order—

(a) the share warrant, and

(b) 5the shares specified in it.

(3) The company must give notice to the bearer of the share warrant of the fact
that an application has been made under this paragraph before the end of
the period of 14 days beginning with the day on which it is made; and the
notice must include a copy of the application.

(4) 10If a company fails to comply with sub-paragraph (2) or (3) an offence is
committed by every officer of the company who is in default.

(5) A company must, on making an application for a cancellation order,
immediately give notice to the registrar.

(6) If a company fails to comply with sub-paragraph (5) an offence is committed
15by—

(a) the company, and

(b) every officer of the company who is in default.

Cancellation orders and suspended cancellation orders

6 (1) The court must make a cancellation order in respect of a share warrant if, on
20an application under paragraph 5, it is satisfied that—

(a) the company has given notice to the bearer of the share warrant as
required by paragraphs 2 and 4, or

(b) the bearer had actual notice by other means of the matters mentioned
in paragraph 2(1).

(2) 25If, on such an application, the court is not so satisfied, it must instead make
a suspended cancellation order in respect of the share warrant.

(3) A “suspended cancellation order” is an order—

(a) requiring the company to give notice to the bearer of the share
warrant containing the information set out in sub-paragraph (4)
30before the end of the period of 5 working days beginning with the
day the order is made,

(b) providing that the bearer of the share warrant has a right of
surrender during the period of 2 months beginning with the day the
order is made (referred to in this Schedule as “the grace period”), and

(c) 35if the share warrant is not so surrendered, cancelling it and the shares
specified in it with effect from the end of the grace period.

(4) A notice required to be given by a suspended cancellation order must—

(a) inform the bearer of the share warrant of the fact that the bearer has
a right of surrender during the grace period,

(b) 40inform the bearer of the consequences of not having exercised that
right before the end of the period of 7 months beginning with the
commencement date (see paragraph 3), and

(c) explain that the share warrant will be cancelled with effect from the
end of the grace period if it is not surrendered before then.

(5) 45Where a share warrant is cancelled by an order under this paragraph, the
company concerned must, as soon as reasonably practicable—

(a) enter the cancellation date in its register of members, or

(b) where an election is in force under section 128B of the Companies Act
2006 (option to keep membership information on central register) in
respect of the company, deliver that information to the registrar as if
5it were information required to be delivered under section 128E of
that Act.

(6) In this Schedule “the cancellation date”, in relation to a share warrant, means
the day its cancellation by a cancellation order or suspended cancellation
order takes effect.

10Registration of reduction of share capital

7 (1) This paragraph applies in relation to a company if a share warrant of the
company and the shares specified in it are cancelled by a cancellation order
or a suspended cancellation order.

(2) The company must, before the end of the period of 15 days beginning with
15the cancellation date, deliver to the registrar—

(a) a copy of the order,

(b) in the case of a suspended cancellation order, a statement confirming
that the share warrant and the shares specified in it have been
cancelled by the order with effect from the cancellation date, and

(c) 20a statement of capital.

(3) The statement of capital must state with respect to the company’s share
capital as reduced by the cancellation of the share warrant and the shares
specified in it—

(a) the total number of shares of the company,

(b) 25the aggregate nominal value of those shares,

(c) the aggregate amount (if any) unpaid on those shares (whether on
account of their nominal value or by way of premium), and

(d) for each class of shares—

(i) such particulars of the rights attached to the shares as are
30prescribed by the Secretary of State under section 644(2)(c)(i)
of the Companies Act 2006,

(ii) the total number of shares of that class, and

(iii) the aggregate nominal value of shares of that class.

(4) If the company fails to comply with this paragraph an offence is committed
35by—

(a) the company, and

(b) every officer of the company who is in default.

(5) In the case of a public company, a statement of capital delivered under this
paragraph is to be treated as a document subject to the Directive disclosure
40requirements for the purposes of the Companies Act 2006 (see section 1078
of that Act).

Reduction of share capital below authorised minimum in case of public company

8 (1) This paragraph applies where the court makes a cancellation order or a
suspended cancellation order in relation to a public company and—

(a) in the case of a cancellation order, the order has the effect of bringing
the nominal value of its allotted share capital below the authorised
minimum, or

(b) in the case of a suspended cancellation order, the order may have
5that effect from the end of the grace period.

(2) The registrar must not register the cancellation order or (as the case may be)
the suspended cancellation order if it has that effect from the end of the grace
period unless—

(a) the court so directs in the order concerned, or

(b) 10the company is first re-registered as a private company.

(3) The expedited procedure for re-registration provided by section 651 of the
Companies Act 2006 applies for the purposes of this paragraph as it applies
for the purposes of section 650 of that Act.

(4) Where the court makes an order under section 651 of that Act in connection
15with a suspended cancellation order, the order under section 651 must be
conditional on the suspended cancellation order having the effect
mentioned in sub-paragraph (1)(b) from the end of the grace period.

Payment into court in connection with cancellation

9 (1) Where a share warrant is cancelled by a cancellation order or suspended
20cancellation order, the company concerned must, before the end of the
period of 14 days beginning with the cancellation date, make a payment into
court of an amount equal to—

(a) the aggregate nominal value of the shares specified in the warrant
and the whole of any premium paid on them, plus

(b) 25the suspension period amount.

(2) If a company fails to comply with sub-paragraph (1) an offence is committed
by every officer of the company who is in default.

10 (1) A person who, at the end of the period of 7 months beginning with the
commencement date, was the bearer of a share warrant which has been
30cancelled by a cancellation order or a suspended cancellation order may
apply to the court for the sum paid into court under paragraph 9(1) in
respect of the shares specified in the warrant to be paid to that person.

(2) Such an application may only be made during the period—

(a) beginning with the day which is 6 months after the cancellation date,
35and

(b) ending with the day which is 3 years after the cancellation date.

(3) The court may grant an application under sub-paragraph (1) only if it is
satisfied that there are exceptional circumstances justifying the failure of the
bearer of the share warrant to exercise the right of surrender—

(a) 40in the case of a warrant cancelled by a cancellation order, before the
end of the surrender period, or

(b) in the case of a warrant cancelled by a suspended cancellation order,
before the end of the grace period.

11 (1) This paragraph applies in relation to a company in respect of which a
45cancellation order or suspended cancellation order has been made if any of

the following is appointed in relation to the company after the cancellation
date—

(a) an administrator;

(b) an administrative receiver;

(c) 5a liquidator;

and that person is referred to in this paragraph as the “office-holder”.

(2) The office-holder may apply to the court for the sum paid into court under
paragraph 9(1)(a) to be paid to the office-holder by way of a contribution to
the company’s assets.

(3) 10Such an application may only be made during the period—

(a) beginning with the cancellation date, and

(b) ending with the day which is 3 years after that date.

12 (1) Anything left of a sum paid into court under paragraph 9(1) immediately
after the end of the period mentioned in paragraph 11(3) must be paid into
15the Consolidated Fund.

(2) Sub-paragraph (1) does not apply to any amount in respect of which an
application under paragraph 10(1) or 11(2) has been made but not yet
determined before the end of that period unless and until the application is
dismissed and either—

(a) 20the period for bringing an appeal against the dismissal has expired,
or

(b) in a case where an appeal is brought before the end of that period, the
appeal is dismissed, abandoned or otherwise ceases to have effect.

Company with outstanding share warrants: prohibition on striking off

13 (1) 25An application under section 1003 of the Companies Act 2006 (application
for voluntary striking off) on behalf of a company must not be made at a time
when there is a share warrant issued by the company.

(2) It is an offence for a person to make an application in contravention of this
section.

(3) 30In proceedings for such an offence it is a defence for the accused to prove
that the accused did not know, and could not reasonably have known, of the
existence of the share warrant.

Notices

14 (1) A notice required by virtue of any provision of this Schedule to be given to
35the bearer of a share warrant must be—

(a) published in the Gazette,

(b) communicated to that person in the same way (if any) as the
company concerned normally communicates with that person for
other purposes relating to the shares specified in the warrant, and

(c) 40made available in a prominent position on the company’s website (if
it has one) during the period mentioned in sub-paragraph (2) (and
see sub-paragraph (3)).

(2) That period is the period beginning with the day on which the notice is
published in the Gazette and ending with—

(a) in the case of a notice required by paragraph 2, the day on which a
notice required by paragraph 4 is made available on the company’s
website;

(b) in the case of a notice required by paragraph 4, the day on which a
5notice required by paragraph 5(3) is made available on the
company’s website;

(c) in the case of a notice required by paragraph 5(3), the day on which
the court makes a cancellation order or (as the case may be)
suspended cancellation order in respect of the share warrant;

(d) 10in the case of a notice required by virtue of paragraph 6(3)(a), the end
of the grace period.

(3) Nothing in this paragraph requires a notice to be made available on the
company’s website after the day on which the last of the share warrants
issued by the company to be surrendered is surrendered.

(4) 15Sections 1143 to 1148 of the Companies Act 2006 (company communications
provisions) apply for the purposes of this Part of this Schedule as they apply
for the purposes of the Companies Acts.

Company filings: language requirements

15 Sections 1103, 1104 and 1107 of the Companies Act 2006 (language
20requirements) apply to all documents required to be delivered to the
registrar under this Part of this Schedule.

Application of sections 1112 and 1113 of the Companies Act 2006

16 Sections 1112 (general false statement offence) and 1113 (enforcement of
company’s filing obligations) of the Companies Act 2006 apply for the
25purposes of this Part of this Schedule as they apply for the purposes of the
Companies Acts.

Offences

17 For the purposes of any offence under this Part of this Schedule a shadow
director is treated as an officer of the company.

18 (1) 30A person guilty of an offence under paragraph 1(5) of this Schedule is liable
on summary conviction to a fine not exceeding level 3 on the standard scale
and, for continued contravention, a daily default fine not exceeding one-
tenth of level 3 on the standard scale.

(2) A person guilty of an offence under any other provision of this Schedule is
35liable—

(a) on conviction on indictment, to a fine;

(b) on summary conviction—

(i) in England and Wales, to a fine;

(ii) in Scotland or Northern Ireland, to a fine not exceeding the
40statutory maximum.

19 The following sections of the Companies Act 2006 apply for the purposes of
this Part of this Schedule as they apply for the purposes of the Companies
Acts—

(a) sections 1121 and 1122 (liability of officer in default);

(b) section 1125 (meaning of “daily default fine”);

(c) sections 1127 and 1128 (general provision about summary
proceedings);

(d) section 1129 (legal professional privilege);

(e) 5section 1132 (production and inspection of documents).

Interpretation

20 (1) In this Part of this Schedule—

• “cancellation date” has the meaning given by paragraph 6(6);

• “cancellation order” has the meaning given by paragraph 5(2);

• 10“commencement date” has the meaning given by paragraph 1(1);

• “Companies Acts” has the same meaning as in the Companies Act 2006
  (see section 2 of that Act);

• “grace period” has the meaning given by paragraph 6(3)(b);

• “surrender period” has the meaning given by paragraph 1(2);

• 15“suspended cancellation order” has the meaning given by paragraph
  6(3);

• “suspension period amount” has the meaning given by paragraph 3(7);

• “right of surrender” has the meaning given by paragraph 1(3).

(2) Expressions defined for the purposes of the Companies Acts have the same
20meaning in this Part of this Schedule as in those Acts.

Transitory provision

21 (1) Until section 88 (option to keep information on central register) comes into
force, this Schedule has effect as if, in each of paragraphs 1(3) and 6(5),
paragraph (b) (and the “or” preceding it) were omitted.

(2) 25Until section 91 (contents of statements of capital) comes into force,
paragraph 7(3) of this Schedule has effect as if—

(a) paragraph (c) were omitted, and

(b) after paragraph (d) there were inserted “, and

“(e) the amount paid up and the amount (if any) unpaid
30on each share (whether on account of the nominal
value of the share or by way of premium).”

Part 2 Consequential amendments

22 The Companies Act 2006 is amended as follows.

23 35In section 122 (share warrants)—

(a) for subsections (1) and (2) substitute—

“(1) Until a share warrant issued by a company is surrendered the
following are deemed to be the particulars required to be
entered in the register of members in respect of the warrant—

(a) 40the fact of the issue of the warrant,

(b) a statement of the shares included in the warrant,
distinguishing each share by its number so long as the
share has a number, and

(c) the date of the issue of the warrant.”, and

(b) 5omit subsection (4).

24 In section 617 (alteration of share capital of limited company), in subsection
(5), after paragraph (e) insert—

“(f) the cancellation of a share warrant issued by the company
and of the shares specified in it by a cancellation order or
10suspended cancellation order made under paragraph 6 of
Schedule 4 to the Small Business, Enterprise and
Employment Act 2015 (cancellation where share warrants
not surrendered in accordance with that Schedule);

(g) the cancellation of a share warrant issued by the company
15and of the shares specified in it pursuant to section 1028A(2)
or 1032A(2) (cancellation of share warrants on restoration of
a company).”

25 In section 652 (liability of members following reduction of capital), in
subsection (1)(a), for “or 649” substitute “, 649, 1028A or 1032A of this Act or
20paragraph 7 of Schedule 4 to the Small Business, Enterprise and
Employment Act 2015”.

26 (1) Omit section 780 (duty of company as to issue of share certificates on
surrender of share warrant).

(2) The repeal of section 780 has no effect in relation to a share warrant
25surrendered for cancellation before the day on which section 78 comes into
force.

27 (1) After section 1028 insert—

“1028A Administrative restoration of company with share warrants

(1) This section applies in relation to a company which has been struck
30off the register under section 1000 or 1001 and which, at the time it
was struck off, had any share warrant in issue.

(2) If the registrar restores the company to the register under section
1025, the share warrant and the shares specified in it are cancelled
with effect from the date the restoration takes effect.

(3) 35If as a result of subsection (2) the company has no issued share
capital, the company must, before the end of the period of one month
beginning with the date the restoration takes effect, allot at least one
share in the company; and section 549(1) does not apply to such an
allotment.

(4) 40The company must, before the end of the period of 15 days beginning
with the date the restoration takes effect, deliver a statement of
capital to the registrar.

(5) Subsection (4) does not apply in a case where the company is
required under subsection (3) to make an allotment (because in such
45a case section 555 will apply).