Corporations are formed in the UK by preparing Form 10, Form 12, the memorandum of association and articles of association and sending them to Corporations House, with the prescribed fee, which is presently set at £20.00, nonetheless an express registration service costs £50.00.
Form 10 is made available by Corporations House – within the UK, that is the trading name of the Register of Corporations (“the Registrar”) – to nominate the primary directors of the corporate, along with the primary registered address of the corporate in England, Scotland or Wales. The administrators must provide their home address, occupation,, date of birth and the opposite corporations during which they’ve been a director during the last five years.
Form 12 is solely a statutory declaration that the legal requirements to form an organization have been complied with, and should be signed by a solicitor or the person or considered one of the primary directors of the corporate, and witnessed by a commissioner of oaths or solicitor.
There are 4 basic varieties of corporations which may be formed in under UK law:
- Private corporations, limited by shares
The primary features of corporations limited by shares are that shareholders’ liability is restricted to the quantity that they have to pay for his or her shares. These are the favored type of company because of this. Shares could also be issued with no requirement for immediate payment for the shares, nonetheless like other corporations, the corporate may issue ‘calls’, that are demands issued by the corporate to the shareholders for payment. Within the event that the shareholder doesn’t pay the decision, the shares could also be forfeited to the corporate.
Private corporations limited by shares can have 1 subscriber.
- Private corporations, limited by guarantee
Shareholders’ liability is capped not limited in the identical way for corporations limited by guarantee. When a shareholder purchases shares in an organization limited by guarantee, the shareholder must conform to contribute to the corporate’s assets within the event of a winding up. This limit, or guarantee could also be as little as £1..00.
Private corporations limited by shares can have 1 subscriber.
- Private unlimited
Unlike the opposite types of corporations, shareholders’ liability within the event of a winding up is unlimited, which makes a shareholding in unlimited company the rough such as trading as a partnership or sole trader, where personal liability can be unlimited.
Private corporations limited by shares should have 2 subscribers.
- Public limited
Public corporations differ from the varieties of private corporations listed above in that the shares of the corporate could also be offered to the general public at large. Nevertheless, shareholders’ liability is restricted in the identical way as that which applies to non-public corporations – the shareholders’ liability is restricted to the sum they’re obliged to pay for his or her shares.
Private corporations limited by shares should have 2 subscribers.
Registered Office
The aim of the registered address is for statutory notices to be sent by the Registrar and correspondence by the general public. Within the event that an organization doesn’t reply to correspondence from the Registrar, it is going to eventually be struck off the Register of Corporations, because the address is just not effective.
Directors
For personal entities, a director may additionally be the secretary provided there may be one other director. Undischarged bankrupts and people disqualified by the court from holding office are prohibited from accepting appointments as directors unless special permission has been granted. Minors could also be appointed in special circumstances. The Act provides that the age of statutory senility for directors of public corporations reaching the age of 70. A general meeting could also be convened nonetheless to reappoint the director.
Memorandum of Association
The memorandum of association defines the company powers of the corporate. They govern the powers of the corporate, and is considered one of the 2 documents comprising the structure. That’s, what’s has the ability to do, and what it doesn’t. These provisions of the memorandum are the ‘objects’ of the corporate. When an organization purports to exercise an influence that it doesn’t have, it is alleged to be acting ultra vires. The memorandum must specify the authorised capital of the corporate, that’s the number and sophistication of shares that it could issue; the registered office.
Articles of Association
The articles of an organization govern the connection between the corporate, the administrators, and the shareholders. These are the important thing relationships inside the company and the articles serve to control the inner affairs of the corporate between these capacities. It’s the articles of association which are referred to when in search of to find out the powers of the corporate, shareholders or directors.
The articles for example may dictate that the corporate should have a minimum variety of directors.
Shareholders’ Agreements are contracts between the shareholders of an organization to control the conduct of the shareholders as between each other, and should impose obligations and duties over and above that existing within the articles of association.
The Role of the Company Secretary
The corporate secretary is the chief administrative officer, and has the ability to bind the corporate in respect to its administrative affairs. The secretary’s responsibilities are defined by their contract of service to the corporate and the articles of association, and includes the keeping of minutes, maintaining the statutory registers and preparing notifications to shareholders, amongst many other responsibilities.
The Register of Corporations
Corporations House maintains a register of all the businesses existing in the UK. The Register is public and available to be searched by members of the general public. The activities of the corporate should be reported to the Registrar in order that the Register is kept current. the Registrar provides forms to do that, similar to appointments of directors and the corporate secretary (Form 288a), resignations of directors and the corporate secretary (Form 288b), changes to the corporate name, changes to the registered address (Form 287), returns of allotments of shares (ie, when shares are issued to shareholders) (Form 88(2)), and increases in share capital (Form 123).
