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March 10th 2015 / BY: Wisteria

The Small Business, Enterprise and Employment Bill

The Small Business, Enterprise and Employment Bill is due to gain royal assent in March 2015. The aim of this new legislation is to reduce the ‘red-tape’ faced by small businesses which can hamper innovation and growth. If the Bill becomes an Act it will affect not only subsequently incorporated companies, but all companies currently on the register.

Below we outline the main changes that are expected to be implemented and what they mean for you:

1. Check and Confirm: It has been proposed that the Annual Return (AR01) be abolished and replaced with a ‘Check and Confirm’ system. The new system appears similar to the Annual Return in that companies are required to check the details held by Companies House and make any necessary changes. The new system will most likely be electronic and will allow you to ‘check and confirm’ more than once a year. Presently companies can file the return using the web filing system and if there are no changes this can be done rapidly. It is therefore unclear if this will lead to significant changes. It is being implemented to ensure that the information held and accessible to the public is accurate. A charge for ‘Check and Confirm’ is likely to still apply.

2. Corporate Directors: Under the new rules Corporate Directors will not be permitted unless certain exemptions are met. All companies with a corporate director will need to remove this director unless they can prove they meet the requirements to be exempt. Companies House will need to be informed of the removal of the director.

3. Bearer Shares: will be abolished and all outstanding bearer shares will have to be surrendered to the company within 9 months of the Act coming into effect.

4. People with Significant Control: In order to make it more apparent who has significant influence over a company you will now be required to keep a ‘Register of People with Significant Control’. These are any individuals with a majority shareholding, voting rights or the ability to add and remove directors. This register must be kept up-dated and, like the Company Register, will have to be kept at the Registered office where it can be accessed by the public.

5. Accelerated Strike-Off: Presently it takes a minimum of 3 months to dissolve a company. Under the new changes this timeframe will be reduced. It is not yet know how much faster this process will be.

The Bill is still making its way through Parliament and after Royal Assent is granted all Companies will need to familiarise themselves with the new regulations to ensure they are acting within the law.

More information on The Small Business, Enterprise and Employment Bill can be found at https://www.gov.uk/government/collections/small-business-enterprise-and-employment-bill.

Small Business Bill