The UK company law regulates companies formed under the companies act 2006. The UK company law has two parts. Corporate Governance in the UK manages the duties and rights of the employees, shareholders, directors and creditors. Usually the Board of Directors within a company has the power to manage and control the company, this also ensures that the Director’s accountability within the company.
If you’re preparing to specialise as a corporate lawyer, getting help from a private law tutor can be helpful, in supporting your law studies and exams. Let’s look in to 4 key things that you must know, regarding UK company law.
Company Formations
Formations of companies are done in various ways.
- Unlimited companies are responsible for all debts and losses under Private law.
- Limited companies are divided in two types
- Limited by guarantee
- Limited by shares.
The later being most poplar for most general businesses.
Director’s responsibility under the law
Company director must follow the rules, shown in its articles of association
- Keep company records and report changes
- File accounts and Company Tax Return
- Inform other shareholders if the Director might personally benefit from a transaction the company makes
- Pay Corporation Tax
- Register for Self Assessment and send a personal Self Assessment tax return every year
General Meeting
General meeting is held normally once a year, also known as AGM or annual general meeting. This is done so that, the company can elect new board member/s, making important announcement and decisions regarding the company and its past performances, future plans, etc.
Shareholders
Generally people or organisations who buys shares in a company. The rights of shareholders can be different based on types of share they hold within a company, which is defined within shareholder’s agreement.
UK company law gives the shareholders ability to
- Remove the board of directors with a simple majority of votes
- Change the company constitution with a three quarter vote (unless a higher figure is in the constitution)
- Wind up or liquidate the company with a three quarter vote
- Veto any sale of a significant percentage of company assets
- Veto by a majority any restriction on ability to freely trade their shares, such as a poison pill
Need to explore more regarding company law or any other areas of law? Our team of law tutors can be very helpful in meeting your needs. Get in touch with us when you have more queries.
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