The Companies Act 2006 currently allows companies to appoint a corporate director as long as at least one of the directors is an individual. However, the Small Business, Enterprise and Employment Act 2015 will change that, such that only a natural person may be appointed as a director of a company unless the appointment falls within one of the exceptions provided for by regulations.

The rationale for the ban on the use of corporate directors is found in the Government’s campaign to increase corporate transparency. The new regime was expected to come into force in October.

However, and without publicising the fact, the Companies House website now says: “You won’t be able to appoint corporate directors, although there are some limited exceptions. The detail of these exceptions are still under development. Any further information including a date for implementation will be provided on GOV.UK as soon as it’s available.”

It is hoped that this delay will afford an opportunity for the Department for Business, Energy and Industrial Strategy to review the scope of the ban and the proposals for possible exceptions to it.