The Small Business, Enterprise and Employment Act 2015: changes from 10 October 2015

The following changes introduced by the Small Business, Enterprise and Employment Act 2015 will take effect from 10 October 2015. They are part of the efforts to reduce red tape and streamline the administrative processes involving Companies House.

Consent to act as a director or secretary

The forms filed at Companies House in relation to a director or secretary appointment will no longer contain a statement by the relevant director or secretary that they consent to act. Rather this will be replaced with a statement from the company that relevant person has consented. At the same time the Registrar of Companies will notify directors that the Registrar has received notice of their appointment providing them an opportunity to object if they have not consented to act. This notification will also include information relating to the office and duties of a director which is intended to ensure directors are better educated about their role and responsibilities.

Further provisions due to come into force in December 2015 will simplify the process by which the Registrar can rectify the register if an alleged director objects to their appointment. The presumption will be that consent was not given, and the register must therefore be amended, unless the company can provide evidence that consent was given.

In terms of changes to practice as a result of these changes, where a new director is not entering into an agreement setting out the terms of his appointment at the same time as he agrees to become a director, it would be sensible to obtain a letter of consent from the new director which can be retained with the company’s records for evidential purposes.  

Director’s date of birth

The day element of a director’s date of birth will no longer be disclosed by the Registrar of Companies so that only the month and year of a director’s date of birth will be publically available. This change is hoped to reduce identity theft and fraud. However, details already on the public register as a result of historic filings will not be expunged and a company will still be required to keep a record of its directors’ full dates of birth in its register of directors. In addition a director’s full date of birth will still need to be included in relevant filings made with the Registrar of Companies and the Registrar is permitted to disclose that information to credit reference agencies and public authorities as before.

Once the provisions in the Act allowing companies to elect to maintain their statutory registers at Companies House (rather than at their registered office or other location) come into effect, companies will need to consider any sensitivity around the publication of directors’ full dates of birth before electing to hold their registers at Companies House.

Accelerated strike-off procedure

The time it takes the Registrar of Companies to strike a company from the register if it appears not to be carrying on a business will be shortened from the current time frame of up to six months, which is considered to be too long particularly where it is impossible to contact the company or directors, to approximately three months. The time allowed for a response to the two consecutive notices sent by the Registrar to the company will be reduced from a month to 14 days, and the time which must elapse from the date of the publication of the strike off notification in the Gazette until the strike off can occur will be reduced from three months to two. This change in respect of the Gazette notice will also streamline the voluntary strike off procedure (the procedure which allows directors to apply to strike a company from the register where they have concluded that its continued existence is not necessary) reducing it from three to two months.

 

For a summary of other changes being introduced over the next 12 months see:

The Small Business, Enterprise and Employment Act 2015 – key upcoming changes