Companies Limited by Guarantee
provides a complete guide to the formation, administration and winding up of companies limited by guarantee and their suitability for a diverse range of purposes. It includes full coverage of:
- The nature and purposes, the advantages and disadvantages and consideration of the circumstances in which they are used
- The company's constitution, including company names, its objects, the guarantee and the content and effect of the articles
- Methods of financing a company limited by guarantee
- Membership of the company, including admission and expulsion of members
- The directors of the company, their appointment, removal and duties
- The calling, requisition and conduct of company meetings
- Reorganisation, takeovers and winding-up of companies limited by guarantee
- Precedent clauses for the company’s constitution are also included, along with useful checklists for lawyers and company secretaries.
This new edition updates the text to take into account the provisions that have been introduced under the Charities Act 2011 including:
- The new charitable form of Charitable Incorporated Organisations under the Charities Act 2011 and the related provisions contained in CIO (General Regulations 2012) along with explanation of where existing charities can adapt the new charitable form
- Update on annual filing requirements (Charitable Companies)
- Amendments to legislation relating to Scotland and Northern Ireland
- Update of model articles of a company with additional clauses for use by a property company and a procedure for expulsion of a member.
The last edition of this book, published at the beginning of 2011, marked the implementation of the Companies Act 2006. The Act provides a single company law regime for the whole of the United Kingdom, simplifying a company’s constitutional arrangements, the way in which it communicates with its members and makes decisions. Directors’ duties were codified by statute for the first time.
The Charities Act 2006 had also been enacted, setting out a new regulatory regime for charities. This edition has been comprehensively revised to take account of the Charities Act 2011, which consolidates provisions of the earlier Acts.
These and other reforms come at a time when the company limited by guarantee is enjoying a resurgence, particularly as a vehicle for social enterprise. Academies and free schools are operated by companies limited by guarantee and they are typically the corporate structure adopted by Community Interest Companies. Commonhold Associations and ‘Right to Manage’ companies must be companies limited by guarantee, as must ‘Right to Enfranchise’ companies, although the relevant provision relating to this last category are yet to be brought into force.
Companies limited by guarantee are also proving attractive in the management and protection of private wealth, particularly as vehicles for holding trust assets. At the time of writing, the UK government has signalled a programme of intensive regulatory reform for private companies. The proposals include a central registry of beneficial ownership of companies, which may be made available to the public. It is far from clear as to how those proposals might be implemented in relation to companies limited by guarantee, which may have a shifting membership and whose assets may not be available to the members on winding up.
That the proposals do not sit easily with companies limited by guarantee may be explained by the scant attention that they receive in the company law textbooks. They may be mentioned in the introductory chapter explaining the different types of company that may be formed under the Companies Act, but with only limited consideration of the law peculiar to them. The purpose of this work is therefore to provide a guide to company law as it affects companies limited by guarantee, not only for use by lawyers advising them, but by those involved in the formation and running of them.
This edition has been updated in the light of the changes in the law since 2011. The appendices contain the model articles of a company limited by guarantee and include additional clauses for use by a property management company, a procedure for the expulsion of a member and other precedents which may be useful in running a company limited by guarantee.
We have attempted to state the law as at 9 December 2013.
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