Who Can Be A Company Director?
Anyone can be a Director unless they have been disqualified under the Company Directors Disqualification Act 1986, or by being an undischarged bankrupt. There is no maximum age limit but s157 of the Companies Act 2006 (minimum age for appointment of director) imposes a 16 year minimum and s159 of the same Act (existing under age-directors) states that directorship ceases where a company has an under-age director on the implementation date (1st October 2008). Also there are no statutory limitations as to nationality or residence so it is possible to merge these into the company Articles but this rarely happens. It is unusual for modern company articles to impose a share qualification but if they do then the shares must be acquired within two months of the Directorship appointment.
The Small Business, Enterprise and Employment Act 2015 however abolished corporate directors when it came into effect in April 2016. It also made a number of changes to the Directors Disqualification Register:
- The grounds for making a directors’ disqualification order or accepting a disqualification undertaking under the Company Directors Disqualification Act 1986 are extended to include convictions abroad;
- Someone who has had influence over a disqualified person can also be disqualified;
- The matters to be taken into account when a court is determining unfitness to be a director to include conduct in relation to one or more overseas companies;
- A new Schedule of matters for determining unfitness;
- The period in which an application for a disqualification may be made is extended from 2 years to 3 years;
- The court may make a compensation order against a person who is subject to a disqualification order or disqualification undertaking and which has caused loss to one or more creditors.
Additionally, a director or shadow director of a company which has gone into insolvent liquidation is prohibited for 5 years from being a director or shadow director, or being involved in the formation or running of a company which has the same, (or a very similar), name to the liquidated company under s216 of the Insolvency Act 1986 (restriction on re-use of company names).