In a well-publicised change to the existing rules, provisions of the Companies Act 2006 (the 2006 Act) coming into force on 1 October will provide greater protection for directors and company secretaries by limiting the circumstances in which their residential addresses may be disclosed.
At present, a director’s residential address is a matter of public record. It is available to the public both from the company’s register of directors and from the records held at Companies House. The same principle applies to company secretaries.
There is, however, an exception to this rule provided by the confidentiality order regime. Where a director or company secretary is subject to a serious threat of violence or intimidation, he may seek a confidentiality order under the Companies Act 1985 (the 1985 Act). If such an order is granted, that person’s service address becomes the address of public record, both in the company’s register and at Companies House, while his residential address is, subject to certain limited exceptions, treated as confidential.
What are the new rules for directors?
The new rules extend the protection offered by the use of a service address more generally to all directors. A director who is an individual will have to disclose two addresses to the company and to Companies House: a service address and his usual residential address. However, it is only the director’s service address that will appear in the company’s register of directors and on the public record at Companies House.
Can a director give the company’s registered office as his service address?
Yes: in fact, the director’s service address may simply be stated to be ‘the company’s registered office’. If the director so wishes, his service address may be the same as his residential address but this will not be apparent from the public record.
How is a director’s residential address protected under the new rules?
The 2006 Act designates a director’s usual residential address as ‘protected information’ and limits how such information may be used, or disclosed, both by the company and by Companies House. These restrictions will continue to apply even after the director has ceased to be a director of the company.
The company must record the director’s residential address in a new, separate, register of directors’ usual residential addresses. This register is not open to public inspection. Companies House is required to omit the director’s residential address from the public register.
When may the company reveal a director’s residential address?
Unless the director has agreed otherwise, the company may not use, or disclose, this address except:
- when communicating with the director;
- when complying with an obligation to send information to Companies House; or
- when required by the court (for example, when the director’s residential address is needed to enforce a court order).
What are the rules relating to disclosure by Companies House?
Companies House may, likewise, use the director’s residential address to communicate with the director and must disclose this address when required by the court. Companies House may also disclose the address:
- to certain specified public authorities (for example, the Takeover Panel and the Financial Services Authority), subject to certain conditions; and
- to credit reference agencies. However, a director who is at risk of violence or intimidation because of the activities of the company (perhaps a life sciences company, for example) or who has an association with certain categories of organisation (including the security services or a police force) may apply for higher protection to prevent disclosure of his residential address to credit reference agencies.
What are the new rules for company secretaries?
A company secretary who is an individual need only notify the company and Companies House of a service address. This will be the address of public record contained in the company’s register of company secretaries and in the register at Companies House. Again, the secretary’s service address may be stated to be ‘the company’s registered office’.
How will the new rules treat the residential address registered before 1 October in respect of an existing director or secretary? This address will automatically be deemed to be that person’s service address for the purposes of the 2006 Act. As such, it will continue to be a matter of public record and will not be treated as “protected information”.
However, a service address already registered in respect of a director or secretary who holds a confidentiality order granted under the 1985 Act which is valid on 30 September will continue to be the address of public record for that person after 1 October. The residential address of any director with the benefit of such an order will be ‘protected information’ under the new regime.
Accordingly, directors and secretaries who are not already protected by a confidentiality order may wish to change their deemed service address as from 1 October in order to take advantage of the general protection offered by the new rules.
Does a confidentiality order which is in force on 30 September offer any other protection?
Yes: a director who has been granted such an order will automatically be treated as having made a successful application under the new regime preventing Companies House from disclosing his residential address to credit reference agencies.
What steps should companies take in light of the changes to the rules?
- Companies may wish to start taking administrative steps in readiness for their new obligation to keep a separate register of directors’ residential addresses, which takes effect on 1 October. If a director’s residential address is the same as his service address, the register need only contain an entry to that effect (although this will not apply if a director’s service address is stated to be ‘the company’s registered office’).
- Companies will need to take account of the new restrictions, effective on 1 October, on the disclosure of directors’ residential addresses both when complying with their various legal and regulatory obligations (for example, when allowing members to inspect directors’ service contracts in accordance with the 2006 Act) and also when conducting their day- to-day activities. Companies may wish to put new procedures in place, and to brief relevant personnel, accordingly.