Douglas Company Services Ltd

Updating to the new Companies Act 2006 Articles of Association

The Companies Act 2006 introduces one of the most fundamental changes in company law for many years by replacing the previous Memorandum & Articles of Association based on Table A Regulations with what is now simply the Articles of Association. Table A regulations cease to exist and are replaced by the Model Articles prescribed in the Act, and the Memorandum now contains nothing more than a statement of intent to register a company and is a historic document of no further value following the incorporation of a company.

Whilst the model Articles now prescribed in the Act can be adopted in full, we believe this leaves much to be desired for the sake of the proper conduct and management of a company. Having taken top-level legal advice on this issue, ACRA (the Association of Company Registration Agents) has commissioned comprehensive bespoke Articles of Association that are fully compliant with the Companies Act 2006. The ACRA approved Articles expand on the model Articles prescribed in the Companies Act 2006 so as to ensure companies using these Articles are properly equipped to benefit from the new Act as far as is practicable. The Articles are prepared by senior lawyers at Hill Dickinson with over twenty years’ experience as members of the Law Society Standing Committee on Company Law.

We will use the ACRA Approved Articles for incorporating all new companies as well as recommending them for existing companies wishing to update their old Memorandum and Articles of Association drawn up under the 1985 Companies Act or previous Acts.

So whats been left out of the Model Articles?

They no longer provide for a director to appoint an alternate to attend meetings and vote in his/her absence.

Directors can now take unanimous decisions informally, for example by text message.

The Model Articles prevent a director who is interested in a contract with the company from participating in the meeting at which the contract is discussed for quorum or voting purposes, except in very limited circumstances. They are also more restrictive than the provisons in the new Companies Act 2006 itself.

They only provide for a company to issue fully paid shares, not nil or partly paid shares.

They assume that a company will only have one class of shares, and therefore don't include any authority for directors to allot shares. If you wish now or in the future to for the company to have more than one class of shares, you will need to include express authority for the directors to allot shares.

Provisions dealing with the calling and operating of general meetings are now set out in the Act rather than the Model Articles.

The Model Articles no longer provide for companies to hold Annual General Meetings.

As members of ACRA we are pleased to offer you the opportunity to adopt the new bespoke Articles. The fee for this is £75.00 + VAT per company . We can also provide discounts for larger volumes of companies.

We will draft the resolution and deliver the new Articles to Companies House, and provide a bound copy of the new Articles to you by post and email. Extra printed and bound copies can be provided for an extra charge.

We will of course, be providing these bespoke Articles as standard with all new formations.

for more information call us now on 01883 625077

Douglas Company Services Ltd : 44a The Green : Warlingham : Surrey : CR6 9NA Tel.01883 625077 : Fax.01883 626452