In our final bulletin before 1 October 2009, we look at the changes which the Companies Act 2006 will make to the rules on striking off and restoring companies to the register.
Striking off a company (sections 1000-1011)
The Companies Act 1985 provides two ways for a company to have its name struck off the register. The Registrar of Companies may strike off a company which he has reasonable cause to believe is not carrying on business or in operation. Alternatively, the directors of a private company only may apply to the Registrar to have the company's name struck off the register.
The principal change under the 2006 Act is that from 1 October 2009 the procedure for a voluntary striking off will be available to public companies as well as private companies
Restoring to the register (sections 1024-1034)
Under sections 651 and 653 of the 1985 Act, there are two alternative procedures for applying to court to have a company restored to the register. The 2006 Act introduces a single, unified court procedure, largely based on the procedure in section 653 of the 1985 Act. There is, however, a new time limit for making an application. This is six years, although there continues to be no time limit where the application is to enable a personal injury claim.
The 2006 Act also introduces a new procedure for administrative restoration to the register. It is a simplified procedure involving an application to the Registrar of Companies rather than the court. It is only available in limited circumstances.
- The company must have been struck off under the 2006 Act.
- The company must have been carrying on business or in operation at the time of its striking off.
- If any property of the company has vested as "bona vacantia" after it was struck off, the Crown representative must have given consent to the restoration.
- The paperwork necessary to bring the company's records up to date at Companies House must have been delivered to the Registrar and any penalties paid.
Only a former director or member can make the application. (In contrast, a much wider list, including creditors and "any other person appearing to the court to have an interest in the matter", can apply for a court restoration.) There is a six-year time limit for an application. This runs from the date of dissolution of the company.
Transitional rules on court restorations
Sections 651 and 653 of the 1985 Act impose time limits of two and 20 years respectively from dissolution for an application to court. Under transitional rules in the Eighth Commencement Order, the new time limit of six years applies to companies dissolved on or after 1 October 2007. Also the six year time limit does not prevent a court application being made before 1 October 2015 or 20 years after dissolution (whichever occurs first) where the company was struck off under the 1985 Act.