Companies Act 2006 - Final Changes Effective 1 October 2009

On 1 October 2009 the final provisions of the Companies Act 2006 come into force. Trethowans Solicitors of Southampton and Salisbury have produced the following article setting out the key changes from 1 October 2009 and some considerations for existing companies.

 

Directors addresses

 

From 1 October 2009 Companies House will no longer place a director’s residential address on the public register. Instead, directors can provide a service address (which can be the company’s registered office) which will appear on the public register. All directors should be aware that this change is not retrospective, and therefore any residential addresses already showing on the public register will continue to do so. In addition, a company’s register of directors will no longer need to state the companies of which the director has been or is a director.

 

Memorandum of association

 

All companies incorporated after 1 October 2009 will have a short form memorandum of association which will detail its name, subscribers and the number of issued shares on the date of incorporation. The new style memorandum will act as a snap shot of the company on incorporation only and will not be capable of change. Therefore, the significance of the memorandum will be greatly reduced following 1 October 2009, after which time the main constitutional document of a company will be its articles of association.

 

All companies in existence on 1 October 2009 will retain the traditional long-form memorandum (including objects, statement of limited liability and statement of the authorised share capital (if applicable)), which will become part of the company’s articles. If a company wishes to change the content of its memorandum, for example to remove the restrictions in its objects clause, it can do so by passing a special resolution to amend the articles.

 

Objects of a company

 

Companies incorporated after 1 October 2009 (and therefore with a short form memorandum) will have unlimited objects, unless the objects of the company are expressly limited in the articles of association. For companies incorporated prior to 1 October 2009, however, the objects clause in the memorandum will remain effective until amended by special resolution.

 

Authorised share capital

 

Companies incorporated after 1 October 2009 will not have a statement of authorised share capital. This means that the directors of the company can allot any number of shares at their discretion (provided that the company only has one class of share) without the need for authorisation from the shareholders. Shareholder authorisation will still be required to waive pre-emption rights however.

 

For existing companies, the authorised share capital set out in its memorandum will remain a restriction on the number of shares which can be allotted. If a company would like to remove this restriction, it can do so by amending its articles by special resolution.

 

Existing articles of association

 

The articles of association of a company incorporated before 1 October 2009, will continue to be effective after 1 October 2009. However, all articles will be interpreted in line with the Companies Act 2006 and may no longer be accurate or consistent. In addition, the articles may impose unnecessary restrictions or unduly complicated procedures, which have been removed or simplified by the Companies Act 2006. As a result, now may be a good time to update your articles.

 

New articles of association

 

New model articles for private companies replace the existing Table A and C articles as the default articles for all companies incorporated on or after 1 October 2009. The new model articles are designed for small owner-managed businesses with only a small number of directors and shareholders and therefore, they may not be suitable for larger or more complex companies. In addition, the model articles do not duplicate provisions which are already in the Companies Act 2006 in order to keep them simple. This means that the articles are not a full statement of the rights and obligations of the shareholders and directors and reference must also be made to the Companies Act 2006 itself (which has 1,300 sections). This could lead to uncertainty and confusion.

 

Therefore all companies incorporated after 1 October 2009 should consider whether the model articles are suitable for their needs. If they are not, bespoke articles should be drafted and should be used in place of the default model articles.

 

What changes to your company’s constitutional documentation should you consider?

 

Since its implementation began on 1 October 2007, the Companies Act 2006 has made a great number of changes to company law. Now that the final changes are to be implemented on 1 October 2009, it may be a good time to consider whether amendments are required to your constitutional documentation, which could now be greatly out of date.

 

Companies incorporated prior to 1 October 2009 should consider the following in respect of their articles:

 

   1.      Do you still require the company’s objects to be restricted?

   2.      Do you wish for the authorised share capital of the company to be limited and for directors to require authority to allot shares?

   3.      Do you wish to have annual general meetings now that they are not required?

   4.      Do you wish to have a company secretary now that they are no longer required?

   5.      Do your articles provide for 14 days notice of a general meeting, the use of written resolutions and electronic communications with shareholders?

 

If the answer to any or all of the above is ‘no’, you may wish to consider updating your articles to bring them into line with the Companies Act 2006.

 

If you would like to discuss any of the matters raised in this article, or if you are interested in updating your company’s articles, please contact Catherine MacRae on 023 8082 0456 or Mike Watson on 023 8082 0546.

 

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thedebtadvisor's Bev Budsworth eyes up back-to-back awards

Manchester-based insolvency practitioner, Bev Budsworth, has again been shortlisted for the ‘Personal Insolvency Practitioner of the Year 2009’ award at the national ‘Insolvency & Rescue Awards 2009’ just 12 months after winning the prestigious title.

This is only the second time that Credit Today has run these awards, aimed specifically at the personal and corporate insolvency and rescue sectors. The awards aim to honour the industry's high achievers, and celebrate best practice and the raising of standards across the entire rescue industry.

Commenting on her shortlist for the award, Bev said: “It’s a great to see that the fantastic work we are doing at The Debt Advisor has been recognised for the second year running - this nomination is a real achievement in itself. All the heavyweights from the insolvency and rescue world will be in attendance; Delloite, KPMG, PwC – so we’ll certainly have some tough competition!

“The nomination in the personal insolvency category is testament to the incredible effort that my team and I have put in over the last few years. We won the award last year and, since then, have been tenacious in our crusade to promote an innovative approach to personal insolvency whilst continually aiding the rescue process.

“We have managed to establish ourselves as a major, ethical player within the debt management industry through our commitment to fully understanding the root cause of the debt problem and helping our customers through it.

“We are all looking forward to the awards evening and are keeping our fingers crossed!”

Bev Budsworth is the managing director of IVA & Debt management firm The Debt Advisor and, for a number of years, has been an active campaigner for a more innovative and holistic approach to debt. She is a staunch supporter of the rescue culture, believing that everyone deserves access to professional advice to help them become debt-free. Her membership of the influential Personal Insolvency Committee (PIC) and the Debt Resolution Forum (DRF) further allow her to help develop a debt management industry that is based on ethics and transparency.

The 2009 Insolvency & Rescue award ceremony will take place on Wednesday 21 October at the Tower Hotel in London and is expected to attract over 500 insolvency and rescue professionals. The ceremony will be hosted by comedian, Ed Byrne.

Signs of economic recovery

The Bank of England has announced that it will keep interest rates at the record low level of 0.5% for the sixth month in a row. The rate was 3% in December 2008 but was brought down steeply to it's current level in the first quarter of 2009. Since then the rate has held steady during the worst months of the economic downturn. The Bank Of England has also said it would continue with it's program of quantitative easing by pumping around £175bn into the economy as well as the planned purchase of £50bn worth of gilts over the next three months.

The news comes against a back drop of more optimistice financial news that is suggesting theed that the UK economy is beginning to crawl out of recession.

Gross domestic product (GDP) has been revised to a fall of 0.7% from 0.8% compared with the previous quarter.

The Bank of England has however warned recovery will be a "slow and protracted" one.

As if to underline this an article in the FT today reports criticism of quantitative easing programme because it appears to have failed prompt banks resume lend to households and businesses.

The article highlight several signs that that credit is still not easily available. This month the Bank of England released data showing that the level of outstanding loans declined at a record pace in July.

Despite these reservations we are seeing more and more signs that gradually the economy is picking up. This week the National Institute of Economic and Social Research announces it's seen a return to UK economic growth in the three months to July. Official manufacturing figures suggested the sector has shown strong growth during July and the Recruitment and Employment Confederation said it has found "marginal increases" in both permanent and temporary job appointments in August.Office for National Statistics has revealed that the rate of contraction of the UK economy in the three months from April to June has been reduced by the.

Whilst it would seem that recovery is underway the effect of the recession will be felt for a long time however and with credit still difficult to come by the numbers of people visiting IVA and debt consolidation websites such as debtcare.co.uk & debtcounsellors.co.uk is still high levels.

Levels of repossessions falling

Figures published today by the Council of Mortgage Lenders (CML) show that the number of repossessions in the second quarter of 2009 reached 11,400 – down from 12,700 in the previous quarter but an increase of 14% on the corresponding quarter of 2008.

Bev Budsworth, managing director of The Debt Advisor, commented: “It’s encouraging to see that factors in place to curtail the level of repossessions are obviously having a positive effect. The new government pre-action protocol offering people with mortgage arrears a six-month ‘cushion’ before action is taken will have certainly stemmed some of the flow. A record low base rate will also give borrowers in trouble more scope to repay their debts.

“However, we cannot afford to be complacent, other statistics released in the last few weeks point to a depressed economy that is seeing record levels of personal debt and the highest levels of unemployment for over a decade. Levels of repossessions are still high and I believe that this could be a momentary reprieve as signs point to levels increasing once again throughout 2009.”

Employment figures out this week showed the highest levels of unemployment since 1995 with 2.43 million people now out of work. The British Chambers of Commerce also predicted that this level could rise sharply with unemployment topping the three million mark. “It’s clear to me that too many people are still debt laden and simply cannot afford to repay their bills and end up defaulting on their mortgage, or worse, losing their house”, continued Bev.

This inability to repay debt was also echoed in the latest personal insolvency figures which were released by the Insolvency Service last week. Levels of personal insolvency rose to a record high for England and Wales with over 33,000 people being declared insolvent.

Bev explained: “This double whammy is proof that people are still finding it extremely tough as income streams dry up, debt mounts up and the cost of living seems to be continually rising. I think that these factors combined will increase the levels of repossessions for the remainder of the year. People need to remember that their mortgage is secured against their house and if they fail to pay their mortgage, they risk possible repossession and losing their homes.

“Times are tough but help is available. The key to combating mortgage arrears is by engaging your lender at an early stage and not just giving up and handing the keys back. There is help out there and options available to ease the pressure and keep the roof over your head.

“Speak to your lender as early as possible. Do your homework, work out what you can afford to repay with a simple income / expenditure calculation and present them with a solution, not just a problem. It’s always worth remembering that you can reduce your outgoings on unsecured debt by considering an Individual Voluntary Arrangement (IVA) or debt management plan – you must always prioritise your secured debts such as your mortgage and any arrears!

“There are signs that the housing market is beginning to pick up. In June, the number of mortgages granted to homebuyers was up by 23%, a figure that has been buoyed by the record low base rate. House prices are also marginally up month on month meaning that there will still be a vast amount of people with a healthy level of equity in their property. We are still seeing these ‘asset rich but cash poor’ people struggling with their household expenditure and simply giving up – a scenario made worse when you consider that the types of property with a good level of equity tend to be high-end detached houses that are simply not selling in a depressed housing market.

“My advice would be to always seek professional help and see if a tailored debt solution, such as an IVA, can help avoid bankruptcy and the potential loss of your home. Bankruptcy is a growing worry with the Insolvency Service recently reporting nearly 19,000 bankruptcies from April to June – a 15% increase on the same quarter in 2008. The most worrying aspect is the area of bankruptcy on the biggest increase is the debtor’s petitions where people are simply throwing in the towel.

“If you have a property with equity, you need to avoid bankruptcy at all costs as, not only may you lose your home, but the really frightening part is that bankruptcy could cost you thousands for the privilege and only 20% of all bankruptcies return any funds to creditors!”

thedebtadvisors outline their simple, easy to follow debt management tips

The majority of people slide into debt through circumstances beyond their control, they really want to repay their debts but often lack the professional guidance they need to get back to a life free from debt. Without help, debt consumes their whole lives, allowing the onset of the wider effects; including depression, relationship breakdown, poor work performance and associated psychological and physical problems.

Recent figures show that UK households have run up a debt mountain to the tune of £1.4 trillion with the average UK household owing over £9,000 in unsecured debt with nearly 300 people a day being declared bankrupt or insolvent. Staying out of debt just isn’t easy!

Nearly five million of us regularly spend more than we earn each month which has prompted insolvency practitioner and managing director of The Debt Advisor, Bev Budsworth to offer her advice to make sure your finances add up this year.

If you do find yourself with unmanageable debt, you need to take responsibility and, above all, don’t panic; there is lots of help and guidance available. I have outlined my top tips to control your spending and effectively manage your finances:

Prioritise

Make sure you pay your mortgage and / or secured loans first. If you don’t pay these, then your house may be at risk of repossession – mortgage, rent, council tax and utility payments have got to be the priority. However, don’t get yourself into trouble with creditors, or the law, and only treat paying off the minimum balance as a short-term measure. If you are having difficulties paying the bills, pick up the phone to your creditors and explain the situation, they may be able to reduce your payments or give you a short payment break.

Keep a tight budget

This will allow you to keep an accurate picture of your financial position. It will show you how your money is being spent, allowing you to set spending priorities and highlight where savings can be made. An effective budget will also show you how much spare cash, ‘spends’, you have each week, after paying your bills. Make sure you don’t draw out more than your weekly ‘spend’ amount and, if tempted, leave your credit / debit card at home.

Work out your spending

If you are spending too much on clothes, holidays, household goods or entertainment you need to cut back and get rid of unnecessary expenses. Look at expensive gym memberships and regularly check your bank statements to identify any standing orders or direct debits for services you no longer use. Work out a realistic budget for yourself and think ahead to anticipate spending peaks.

Save, save, save

Look at ways you can save in everyday life. For example: when out shopping, make a list and stick to it, use money off coupons and take advantage of multi-buy offers. Other ideas include taking a packed lunch to work. Quitting smoking - this isn’t just bad for you health, it is very bad for your pocket too! Remember, the more you can save on your daily living costs, the more you will have to treat yourself every now and then.

Get moneywise!

OK, it’s not the most riveting subject in the world, but having a greater understanding of how money works and what you are signing can pay real dividends. All finance agreements are now regulated which means you must be treated fairly. By understanding how you are being charged, you can make real savings. For example, by transferring your credit card balance to an interest-free card and cutting up your old one and looking at your current utility providers, looking to reduce the amount you have and switching to cheaper ones.

Debt and chronic stress are linked, studies have proved this. That’s why The Debt Advisor not only sorts out the practical issues of repaying the debt, but also addresses the wider aspects. We work with a resident psychologist to offer trained help and counselling to tackle the associated physical and psychological problems.

If you are in debt and simply cannot manage, seek help. The Debt Advisor has a team of advisors dedicated to providing sensible advice on debt issues and offering various solutions such as Individual Voluntary Arrangements (IVAs), debt management plans, debt consolidation and bankruptcy. The right solution will be based on your individual financial circumstances and level of debt.

For more information on these solutions or to use the handy debt calculator to help with budgeting, visit the website at www.thedebtadvisor.co.uk or freephone 0800 085 1825.

Debt consolidation usage rising

Just received this press release from Moneyway which I promised I'd pass on :

As the Council of Mortgage Lenders estimates that 75,000 people will have their homes repossessed this year, Moneyway’s bill management service has become more vital than ever for people seeking efficient money management.

The bank’s OneBill service sees an expert team handle customers’ household bills and search for ways to reduce them, saving people hundreds of pounds a year.

Owen Woodley, Deputy CEO of Moneyway said: “The recession is affecting everyone and people are reviewing every penny they spend to see if savings can be made.

“Our OneBill product has proved a big hit in the past couple of years as people want to spend the time they have enjoying life, not trawling through an endless ‘to do’ list. With the economic climate in its current state, any expertise aimed at saving money is welcome.
“Our team of experts take on responsibility for a customer’s bills – ensuring the mortgage is paid, that the customer has the most economical energy supplier, the best phone and internet provider for their needs and that any other essential payments, from car insurance to SKY and Broadband, are taken care of
“But they don’t just pay the bills on a customer’s behalf, they negotiate better deals and benefits on their behalf too, reducing payments and overheads to save the customer money,” he said.

Moneyway could potentially save OneBill customers up to £500 a year.
Owen said: “Not everyone will benefit from that kind of saving of course; but in the present climate, people can ill afford to spend money unnecessarily and any savings we can make will help.

“The recession is bringing home to some people that they spend too recklessly. OneBill from Moneyway allows those who struggle with making their money last all month, ensure that the essentials are managed and that they know what they have left to last for the rest of the month.

“But it also brings home to those who pay out unnecessarily for policies, have too high insurance premiums or expensive energy bills just how much money they have been wasting because their time is too precious to spend shopping for cost effective alternatives,” he said.

“Everyone knows that there are savings to be made if you have the time to compare providers, but it can be a minefield. It is our team’s job to treat each customer as an individual and to seek out the best solutions to suit them. If they can save every customer a few hundred pounds, then that is a little help in a bleak economy,” said Owen.

Microsoft Job losses

Amidst the storm of job cut stories there are certain ones that make you stop and stare...Today's is the redundancies at Micrsoft.

Microsoft Announce job losses

1,400 staff to lose their jobs immediately with 5000 going over the next 18 months.

Big news but this, along with the layoffs at Google show that no-one is immune to all this.

Article about online retail

It seems that even the most depressing figure have a bright side...amidst the carnage on the High Street there was this little gem hidden away. Despite the terrible trading figures and closures many retailers are still see large growth in their online retail markets.

It seems that that is where people are doing their bargain hunting nowadays.

Article tackling the subject it great depth here : Online retail growth increasing despite the gloom

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Lend says Brown

Gordon Brown tells banks "Get lending again". Fundamentally that's what we need. Responsible lending n order to get the wheels moving again.

As interest rates were slashed to their lowest ever level by the Bank of England, the Prime Minister and Chancellor Alistair Darling again said it was essential that mortgage and business lending was stepped up.

At a "listening" event in Liverpool designed to show that ministers are in touch with a recession-hit country, they acknowledged that further Government action was necessary.

Businesses were "worried" and homeowners needed more security, the Prime Minister said.

"That's why we had to take urgent action a few weeks ago, when we had to recapitalise the banks - and we were the first country in the world to do it, but others have followed us.

"And that's why in the next few weeks we are looking at the measures we can take to take the next step, and take it with effect, and that is to get the banks to resume the lending that is necessary.

We keep our fingers crossed!

Next & Debenhams figures show decline not plummet

The BBC are highlighting the sales figures at Next and Debenhams

Two of the UK's biggest High Street names have announced falling like-for-like sales over the Christmas period.

Clothing retailer Next announced that its sales had dropped 7% in the six months to Christmas Eve. It added there had been a good start to its sale.

Meanwhile, Debenhams said its sales in the past 12 weeks had fallen 3.3%.

It said this had been a "creditable sales performance, given the extremely difficult and volatile conditions seen across the High Street".

I know falling sales are never a good sign but they certainly were the cataclysm people were expecting. Coming in the backdrop of the utter carnage on the high-street they are basically to be filed under "Not too bad".