Small Business, Enterprise and Employment Act 2015
The primary reason for the Small Business, Enterprise and Employment Act 2015 is to simplify the filing regime for all businesses. It stems from a major business initiative of the prevous Government, the ‘Red Tape Challenge’ where a whole host of regulations were considered in orde to determine whether they could be repealed or improved in some way. As a result, a number of changes to the filing regime were included in the Act, aiming to not only reduce the administrative compliance burden, (particularly for smaller companies), but improve the integrity of the information on the public register.
When it came into effect in April 2016 it abolished corporate directors and 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).
The also introduced a move away from filing annual returns on a set date every year, to making a Confirmation Statement at least once every 12 months under s92 of the Act (duty to deliver confirmation statement instead of annual return) which is a substitution for Part 24 of the Companies Act 2006 (annual confirmation of accuracy of information on register). Statutory registers can also be maintained at Companies House rather than at the registered office of the company in order to remove the element of duplicate filing for companies that take advantage of this new option.
The improvement of dispute processes will mean it is easier for individuals whose names or addresses are used to establish companies without their authority to have these details removed from the register.