Friday 28 November 2014

UK: BIS consultation - exceptions to the prohibition on corporate directors

Clause 84 of the Small Business, Enterprise and Employment Bill (currently before Parliament and scheduled for second reading in the House of Lords on 2 December) will insert a new provision into the Companies Act 2006 in order to provide that company directors must be natural persons, thereby prohibiting so-called corporate directors (i.e., directors that are companies). Exceptions to this general prohibition are possible and the power to set out such exceptions through secondary legislation is given to the Secretary of State in Clause 84. In this regard, the Department for Business, Innovation and Skills has published a consultation paper setting out its position on the circumstances in which the use of corporate directors should be permitted, including (for example) UK companies with shares admitted to trading on regulated markets: see here (pdf).

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