Small Business, Enterprise and Employment Bill (HL Bill 57)

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 91 (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 94 (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 81 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).

(6) 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) 5the 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) 10prescribed particulars of the rights attached to the
shares,

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

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

(7) Where a share warrant is cancelled in accordance with subsection (2),
15the company must, as soon as reasonably practicable—

(a) enter the date the cancellation takes effect 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
20information on central register) in respect of the company,
deliver that information to the registrar as if it were
information required to be delivered under section 128E of
that Act.

(8) Subsection (9) applies where—

(a) 25any property or right previously vested in or held on trust for
the company in respect of any share specified in a share
warrant has vested as bona vacantia (see section 1012), and

(b) the warrant and the share are cancelled on the restoration of
the company in accordance with this section.

(9) 30On restoration of the company, that property or right—

(a) may not be returned to the company, and

(b) accordingly, remains vested as bona vacantia.

(10) If default is made in complying with subsection (3) or (4), an offence
is committed by—

(a) 35the company, and

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

For this purpose a shadow director is treated as an officer of the
company.

(11) A person guilty of an offence under this section is liable—

(a) 40on 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 statutory maximum.”

(2) 45Until section 94 (contents of statements of capital) comes into force, the
section 1028A inserted by sub-paragraph (1) has effect as if in subsection
(6)—

(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
on each share (whether on account of the nominal
value of the share or by way of premium).”

(3) 5Until section 91 (option to keep information on central register) comes into
force, the section 1028A inserted by sub-paragraph (1) has effect as if, in
subsection (7), paragraph (b) (and the “or” preceding it) were omitted.

28 (1) After section 1032A insert—

“1032A Restoration by court of company with share warrants

(1) 10This section applies in relation to a company falling within section
1029(1) if, at the time it was dissolved, deemed to be dissolved or (as
the case may be) struck off, it had any share warrant in issue.

(2) If the court orders the restoration of the company to the register, the
order must also cancel the share warrant and the shares specified in
15it with effect from the date the restoration takes effect.

(3) If 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
20allotment.

(4) Subsection (6) applies in a case where—

(a) the application under section 1029 was made by a person
mentioned in subsection (2)(b) or (h) of that section, or

(b) the court order specifies that it applies.

(5) 25But subsection (6) does not apply in any case where the company is
required under subsection (3) to make an allotment (because in such
a case section 555 will apply).

(6) In a case where this subsection applies, the company must, before the
end of the period of 15 days beginning with the date the restoration
30takes effect, deliver a statement of capital to the registrar.

(7) 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) 35the 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) 40prescribed particulars of the rights attached to the
shares,

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

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

(8) Where a share warrant is cancelled by an order as mentioned in
45subsection (2), the company must, as soon as reasonably
practicable—

(a) enter the date the cancellation takes effect 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
5information on central register) in respect of the company,
deliver that information to the registrar as if it were
information required to be delivered under section 128E of
that Act.

(9) Subsection (10) applies where—

(a) 10any property or right previously vested in or held on trust for
the company in respect of any share specified in a share
warrant has vested as bona vacantia (see section 1012), and

(b) the warrant and the share are cancelled on the restoration of
the company in accordance with this section.

(10) 15On restoration of the company, that property or right—

(a) may not be returned to the company, and

(b) accordingly, remains vested as bona vacantia.

(11) If default is made in complying with subsection (3) or (6), an offence
is committed by—

(a) 20the company, and

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

For this purpose a shadow director is treated as an officer of the
company.

(12) A person guilty of an offence under this section is liable—

(a) 25on 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 statutory maximum.”

(2) 30Until section 94 (contents of statements of capital) comes into force, the
section 1032A inserted by sub-paragraph (1) has effect as if in subsection
(7)—

(a) paragraph (c) were omitted, and

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

“(e) 35the amount paid up and the amount (if any) unpaid
on each share (whether on account of the nominal
value of the share or by way of premium).”

(3) Until section 91 (option to keep information on central register) comes into
force, the section 1032A inserted by sub-paragraph (1) has effect as if, in
40subsection (8), paragraph (b) (and the “or” preceding it) were omitted.

Section 91

SCHEDULE 5 Option to keep information on central register

Part 1 Creation of the option

5Register of members

1 Part 8 of the Companies Act 2006 (a company’s members) is amended as
follows.

2 In Chapter 2 (register of members), before section 113 insert—

“112A Alternative method of record-keeping

10This Chapter must be read with Chapter 2A (which allows for an
alternative method of record-keeping in the case of private
companies).”

3 After Chapter 2 insert—

“CHAPTER 2A Option to keep information on central register

128A 15Introduction

(1) This Chapter sets out rules allowing private companies to keep
information on the register kept by the registrar instead of entering
it in their register of members.

(2) The register kept by the registrar (see section 1080) is referred to in
20this Chapter as “the central register”.

128B Right to make an election

(1) An election may be made under this section—

(a) by the subscribers wishing to form a private company under
this Act, or

(b) 25by the private company itself once it is formed and
registered.

(2) In the latter case, the election is of no effect unless, before it is made—

(a) all the members of the company have assented to the making
of the election, and

(b) 30any overseas branch registers that the company was keeping
under Chapter 3 have been discontinued and all the entries in
those registers transferred to the company’s register of
members in accordance with section 135.

(3) An election under this section is made by giving notice of election to
35the registrar.

(4) If the notice is given by subscribers wishing to form a private
company—

(a) it must be given when the documents required to be
delivered under section 9 are delivered to the registrar, and

(b) it must be accompanied by a statement containing all the
information that—

(i) 5would be required (in the absence of the notice) to be
entered in the company’s register of members on
incorporation of the company, and

(ii) is not otherwise included in the documents delivered
under section 9.

(5) 10If the notice is given by the company, it must be accompanied by—

(a) a statement by the company—

(i) that all the members of the company have assented to
the making of the election, and

(ii) if the company was keeping any overseas branch
15registers, that all such registers have been
discontinued and all the entries in them transferred to
the company’s register of members in accordance
with section 135, and

(b) a statement containing all the information that is required to
20be contained in the company’s register of members as at the
date of the notice in respect of matters that are current as at
that date.

(6) The company must where necessary update the statement sent
under subsection (5)(b) to ensure that the final version delivered to
25the registrar contains all the information that is required to be
contained in the company’s register of members as at the time
immediately before the election takes effect (see section 128C) in
respect of matters that are current as at that time.

(7) The obligation in subsection (6) to update the statement includes an
30obligation to rectify it (where necessary) in consequence of the
company’s register of members being rectified (whether before or
after the election takes effect).

(8) If default is made in complying with subsection (6), an offence is
committed by—

(a) 35the company, and

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

For this purpose a shadow director is treated as an officer of the
company.

(9) A person guilty of an offence under this section is liable on summary
40conviction—

(a) in England and Wales, to a fine and, for continued
contravention, a daily default fine not exceeding one-tenth of
level 4 on the standard scale;

(b) in Scotland or Northern Ireland, to a fine not exceeding level
455 on the standard scale and, for continued contravention, a
daily default fine not exceeding one-tenth of level 5 on the
standard scale.

(10) A reference in this Chapter to matters that are current as at a given
date or time is a reference to—

(a) persons who are members of the company as at that date or
time, and

(b) any other matters that are current as at that date or time.

128C Effective date of election

(1) 5An election made under section 128B takes effect when the notice of
election is registered by the registrar.

(2) The election remains in force until either—

(a) the company ceases to be a private company, or

(b) a notice of withdrawal sent by the company under section
10128J is registered by the registrar,

whichever occurs first.

128D Effect of election on obligations under Chapter 2

(1) The effect of an election under section 128B on a company’s
obligations under Chapter 2 is as follows.

(2) 15The company’s obligation to maintain a register of members does
not apply with respect to the period when the election is in force.

(3) This means that, during that period—

(a) the company must continue to keep a register of members in
accordance with Chapter 2 (a “historic” register) containing
20all the information that was required to be stated in that
register as at the time immediately before the election took
effect, but

(b) the company does not have to update that register to reflect
any changes that occur after that time.

(4) 25Subsections (2) and (3) apply to the index of members (if the
company is obliged to keep an index of members) as they apply to
the register of members.

(5) The provisions of Chapter 2 (including the rights to inspect or
require copies of the register and to inspect the index) continue to
30apply to the historic register and, if applicable, the historic index
during the period when the election is in force.

(6) The company must place a note in its historic register—

(a) stating that an election under section 128B is in force,

(b) recording when that election took effect, and

(c) 35indicating that up-to-date information about its members is
available for public inspection on the central register.

(7) Subsections (7) and (8) of section 113 apply if a company makes
default in complying with subsection (6) as they apply if a company
makes default in complying with that section.

(8) 40The obligations under this section with respect to a historic register
and historic index do not apply in a case where the election was
made by subscribers wishing to form a private company.