Company Law Reform Bill [HL]

House of Commons

Session 2005 - 06
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Other Bills before Parliament

Company Law Reform Bill [HL]

Company Law Reform Bill [HL]
Part 5 — A company’s name
Chapter 5 — Change of name
34

78
Change of name by special resolution
(1)
Where a change of name has been agreed to by a company by special
resolution, the company must give notice to the registrar.

This is in addition to the obligation to forward a copy of the resolution to the
registrar.
5
(2)
Where a change of name by special resolution is conditional on the occurrence
of an event, the notice given to the registrar of the change must—
(a)
specify that the change is conditional, and
(b)
state whether the event has occurred.
(3)
If the notice states that the event has not occurred—
10
(a)
the registrar is not required to act under section 80 (registration and
issue of new certificate of incorporation) until further notice,
(b)
when the event occurs, the company must give notice to the registrar
stating that it has occurred, and
(c)
the registrar may rely on the statement as sufficient evidence of the
15
matters stated in it.
79
Change of name by means provided for in company’s articles
(1)
Where a change of a company’s name has been made by other means provided
for by its articles—
(a)
the company must give notice to the registrar, and
20
(b)
the notice must be accompanied by a statement that the change of name
has been made by means provided for by the company’s articles.
(2)
The registrar may rely on the statement as sufficient evidence of the matters
stated in it.
80
Change of name: registration and issue of new certificate of incorporation
25
(1)
This section applies where the registrar receives notice of a change of a
company’s name.
(2)
If the registrar is satisfied—
(a)
that the new name complies with the requirements of this Part, and
(b)
that the requirements of the Companies Acts, and any relevant
30
requirements of the company’s articles, with respect to a change of
name are complied with,

the registrar must enter the new name on the register in place of the former
name.
(3)
On the registration of the new name, the registrar must issue a certificate of
35
incorporation altered to meet the circumstances of the case.
81
Change of name: effect
(1)
A change of a company’s name has effect from the date on which the new
certificate of incorporation is issued.
(2)
The change does not affect any rights or obligations of the company or render
40
defective any legal proceedings by or against it.

Company Law Reform Bill [HL]
Part 5 — A company’s name
Chapter 6 — Trading disclosures
35

(3)
Any legal proceedings that might have been continued or commenced against
it by its former name may be continued or commenced against it by its new
name.
Chapter 6
Trading disclosures
5
82
Requirement to disclose company name etc
(1)
The Secretary of State may by regulations make provision requiring
companies—
(a)
to display specified information in specified locations,
(b)
to state specified information in specified descriptions of document or
10
communication, and
(c)
to provide specified information on request to those they deal with in
the course of their business.
(2)
The regulations—
(a)
must in every case require disclosure of the name of the company, and
15
(b)
may make provision as to the manner in which any specified
information is to be displayed, stated or provided.
(3)
The regulations may provide that, for the purposes of any requirement to
disclose a company’s name, any variation between a word or words required
to be part of the name and a permitted abbreviation of that word or those
20
words (or vice versa) shall be disregarded.
(4)
In this section “specified” means specified in the regulations.
(5)
Regulations under this section are subject to affirmative resolution procedure.
83
Civil consequences of failure to make required disclosure
(1)
This section applies to any legal proceedings brought by a company to which
25
section 82 applies (requirement to disclose company name etc) to enforce a
right arising out of a contract made in the course of a business in respect of
which the company was, at the time the contract was made, in breach of
regulations under that section.
(2)
The proceedings shall be dismissed if the defendant (in Scotland, the defender)
30
to the proceedings shows—
(a)
that he has a claim against the claimant (pursuer) arising out of the
contract that he has been unable to pursue by reason of the latter’s
breach of the regulations, or
(b)
that he has suffered some financial loss in connection with the contract
35
by reason of the claimant’s (pursuer’s) breach of the regulations,

unless the court before which the proceedings are brought is satisfied that it is
just and equitable to permit the proceedings to continue.
(3)
This section does not affect the right of any person to enforce such rights as he
may have against another person in any proceedings brought by that person.
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Company Law Reform Bill [HL]
Part 6 — A company’s registered office
36

84
Criminal consequences of failure to make required disclosures
(1)
Regulations under section 82 may provide—
(a)
that where a company fails, without reasonable excuse, to comply with
any specified requirement of regulations under that section an offence
is committed by—
5
(i)
the company, and
(ii)
every officer of the company who is in default;
(b)
that a person guilty of such an offence is liable on summary conviction
to a fine not exceeding level 3 on the standard scale and, in the case of
continued contravention, to a daily default fine not exceeding one-
10
tenth of level 3 on the standard scale.
(2)
In subsection (1)(a) “specified” means specified in the regulations.
85
Minor variations in form of name to be left out of account
(1)
For the purposes of this Chapter, in considering a company’s name no account
is to be taken of—
15
(a)
whether upper or lower case characters (or a combination of the two)
are used,
(b)
whether diacritical marks or punctuation are present or absent,
(c)
whether the name is in the same format or style as is specified under
section 58(1)(b) for the purposes of registration,
20

provided there is no real likelihood of names differing only in those respects
being taken to be different names.
(2)
This does not affect the operation of regulations under section 58(1)(a)
permitting only specified characters, diacritical marks or punctuation.
Part 6
25
A company’s registered office
General
86
A company’s registered office

A company must at all times have a registered office to which all
communications and notices may be addressed.
30
87
Change of address of registered office
(1)
A company may change the address of its registered office by giving notice to
the registrar.
(2)
The change takes effect upon the notice being registered by the registrar, but
until the end of the period of 14 days beginning with the date on which it is
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registered a person may validly serve any document on the company at the
address previously registered.
(3)
For the purposes of any duty of a company—
(a)
to keep available for inspection at its registered office any register,
index or other document, or
40

Company Law Reform Bill [HL]
Part 7 — Re-registration as a means of altering a company’s status
37

(b)
to mention the address of its registered office in any document,
a company that has given notice to the registrar of a change in the address of
its registered office may act on the change as from such date, not more than 14
days after the notice is given, as it may determine.
(4)
Where a company unavoidably ceases to perform at its registered office any
5
such duty as is mentioned in subsection (3)(a) in circumstances in which it was
not practicable to give prior notice to the registrar of a change in the address of
its registered office, but—
(a)
resumes performance of that duty at other premises as soon as
practicable, and
10
(b)
gives notice accordingly to the registrar of a change in the situation of
its registered office within 14 days of doing so,

it is not to be treated as having failed to comply with that duty.
Welsh companies
88
Welsh companies
15
(1)
In the Companies Acts a “Welsh company” means a company as to which it is
stated in the register that its registered office is to be situated in Wales.
(2)
A company—
(a)
whose registered office is in Wales, and
(b)
as to which it is stated in the register that its registered office is to be
20
situated in England and Wales,

may by special resolution require the register to be amended so that it states
that the company’s registered office is to be situated in Wales.
(3)
A company—
(a)
whose registered office is in Wales, and
25
(b)
as to which it is stated in the register that its registered office is to be
situated in Wales,

may by special resolution require the register to be amended so that it states
that the company’s registered office is to be situated in England and Wales.
(4)
Where a company passes a resolution under this section it must give notice to
30
the registrar, who shall—
(a)
amend the register accordingly, and
(b)
issue a new certificate of incorporation altered to meet the
circumstances of the case.
Part 7
35
Re-registration as a means of altering a company’s status
Introductory
89
Alteration of status by re-registration
A company may by re-registration under this Part alter its status—
(a)
from a private company to a public company (see sections 90 to 96);
40
(b)
from a public company to a private company (see sections 97 to 101);

Company Law Reform Bill [HL]
Part 7 — Re-registration as a means of altering a company’s status
38

(c)
from a private limited company to an unlimited company (see sections
102 to 104);
(d)
from an unlimited private company to a limited company (see sections
105 to 107);
(e)
from a public company to an unlimited private company (see sections
5
108 to 110).
Private company becoming public
90
Re-registration of private company as public
(1)
A private company (whether limited or unlimited) may be re-registered as a
public company limited by shares if—
10
(a)
a special resolution that it should be so re-registered is passed,
(b)
the conditions specified below are met, and
(c)
an application for re-registration is delivered to the registrar in
accordance with section 94, together with—
(i)
the other documents required by that section, and
15
(ii)
a statement of compliance.
(2)
The conditions are—
(a)
that the company has a share capital;
(b)
that the requirements of section 91 are met as regards its share capital;
(c)
that the requirements of section 92 are met as regards its net assets;
20
(d)
if section 93 applies (recent allotment of shares for non-cash
consideration), the requirements of that section are met; and
(e)
that the company has not previously been re-registered as unlimited.
(3)
The company must make such changes—
(a)
in its name, and
25
(b)
in its articles,

as are necessary in connection with its becoming a public company.
(4)
If the company is unlimited it must also make such changes in its articles as are
necessary in connection with its becoming a company limited by shares.
91
Requirements as to share capital
30
(1)
The following requirements must be met at the time the special resolution is
passed that the company should be re-registered as a public company—
(a)
the nominal value of the company’s allotted share capital must be not
less than the authorised minimum;
(b)
each of the company’s allotted shares must be paid up at least as to one-
35
quarter of the nominal value of that share and the whole of any
premium on it;
(c)
if any shares in the company or any premium on them have been fully
or partly paid up by an undertaking given by any person that he or
another should do work or perform services (whether for the company
40
or any other person), the undertaking must have been performed or
otherwise discharged;
(d)
if shares have been allotted as fully or partly paid up as to their nominal
value or any premium on them otherwise than in cash, and the

Company Law Reform Bill [HL]
Part 7 — Re-registration as a means of altering a company’s status
39

consideration for the allotment consists of or includes an undertaking
to the company (other than one to which paragraph (c) applies), then
either—
(i)
the undertaking must have been performed or otherwise
discharged, or
5
(ii)
there must be a contract between the company and some person
pursuant to which the undertaking is to be performed within
five years from the time the special resolution is passed.
(2)
For the purpose of determining whether the requirements in subsection (1)(b),
(c) and (d) are met, the following may be disregarded—
10
(a)
shares allotted—
(i)
before 22nd June 1982 in the case of a company then registered
in Great Britain, or
(ii)
before 31st December 1984 in the case of a company then
registered in Northern Ireland;
15
(b)
shares allotted in pursuance of an employees’ share scheme by reason
of which the company would, but for this subsection, be precluded
under subsection (1)(b) (but not otherwise) from being re-registered as
a public company.
(3)
No more than one-tenth of the nominal value of the company’s allotted share
20
capital is to be disregarded under subsection (2)(a).

For this purpose the allotted share capital is treated as not including shares
disregarded under subsection (2)(b).
(4)
Shares disregarded under subsection (2) are treated as not forming part of the
allotted share capital for the purposes of subsection (1)(a).
25
(5)
A company must not be re-registered as a public company if it appears to the
registrar that—
(a)
the company has resolved to reduce its share capital,
(b)
the reduction—
(i)
is supported by a solvency statement in accordance with section
30
135B of the Companies Act 1985 (c. 6),
(ii)
has been confirmed by an order of the court under section 137
of that Act, or
(iii)
is made under section 590 of this Act (reduction in connection
with redenomination of share capital), and
35
(c)
the effect of the reduction is, or will be, that the nominal value of the
company’s allotted share capital is below the authorised minimum.
(6)
In this section “the authorised minimum” has the meaning given by section
538.
92
Requirements as to net assets
40
(1)
A company applying to re-register as a public company must obtain—
(a)
a balance sheet prepared as at a date not more than seven months
before the date on which the application is delivered to the registrar,
(b)
an unqualified report by the company’s auditor on that balance sheet,
and
45
(c)
a written statement by the company’s auditor that in his opinion at the
balance sheet date the amount of the company’s net assets was not less

Company Law Reform Bill [HL]
Part 7 — Re-registration as a means of altering a company’s status
40

than the aggregate of its called-up share capital and undistributable
reserves.
(2)
Between the balance sheet date and the date on which the application for re-
registration is delivered to the registrar, there must be no change in the
company’s financial position that results in the amount of its net assets
5
becoming less than the aggregate of its called-up share capital and
undistributable reserves.
(3)
In subsection (1)(b) an “unqualified report” means—
(a)
if the balance sheet was prepared for a financial year of the company, a
report stating without material qualification the auditor’s opinion that
10
the balance sheet has been properly prepared in accordance with the
requirements of this Act;
(b)
if the balance sheet was not prepared for a financial year of the
company, a report stating without material qualification the auditor’s
opinion that the balance sheet has been properly prepared in
15
accordance with the provisions of this Act which would have applied
if it had been prepared for a financial year of the company.
(4)
For the purposes of an auditor’s report on a balance sheet that was not
prepared for a financial year of the company, the provisions of this Act apply
with such modifications as are necessary by reason of that fact.
20
(5)
For the purposes of subsection (3) a qualification is material unless the auditor
states in his report that the matter giving rise to the qualification is not material
for the purpose of determining (by reference to the company’s balance sheet)
whether at the balance sheet date the amount of the company’s net assets was
not less than the aggregate of its called-up share capital and undistributable
25
reserves.
(6)
In this Part “net assets” and “undistributable reserves” have the meanings
given by section 264(2) and (3) of the Companies Act 1985 (c. 6).
93
Recent allotment of shares for non-cash consideration
(1)
This section applies where—
30
(a)
shares are allotted by the company in the period between the date as at
which the balance sheet required by section 92 is prepared and the
passing of the resolution that the company should re-register as a
public company, and
(b)
the shares are allotted as fully or partly paid up as to their nominal
35
value or any premium on them otherwise than in cash.
(2)
The registrar shall not entertain an application by the company for re-
registration as a public company unless—
(a)
the consideration for the allotment has been valued in accordance with
section 108 of the Companies Act 1985 and a report with respect to the
40
value of the consideration has been made to the company (in
accordance with that section) during the six months immediately
preceding the allotment, or
(b)
the allotment is in connection with—
(i)
a share exchange (see subsections (3) to (5) below), or
45
(ii)
a proposed merger with another company (see subsection (6)
below).