Small Business, Employment and Enterprise Act 2015
A revised provisional implementation timetable has been published by Companies House for the Small Business, Employment and Enterprise Act 2015 (SBEEA) (which BIS has confirmed as being correct). Headline changes to the timetable are as follows:
- companies must keep a register of persons with significant control (PSC Register) from April 2016 (previously January 2016);
- companies to file PSC Register information at Companies House from 30 June 2016 onwards (previously April 2016);
- "check and confirm" statements, replacing Annual Returns, and the new regime relating to Statements of Capital in force in June 2016 (previously April 2016);
companies able to opt to keep registers solely at Companies House in force from June 2016 (previously April 2016); and
- director disqualification regime amendments are expected to come into force in June 2016 (previously April 2016).
You will remember that the implementation of the bar on corporate directors taking effect was also recently moved back by 12 months to October 2016. To review the revised implementation timetable in full, please read our SBEEA Implementation Timetable Alert which has been amended to reflect the changes.
BIS has confirmed that the government intends to end the ability to ban invoice assignment clauses in business to business contracts through powers granted under the Small Business, Enterprise and Employment Act 2015.
BIS has published an update on the implementation of the EU Audit Directive.
In doing so it has confirmed that:
- BIS will publish a formal consultation in the next few weeks focussing on the definition of a "public interest entity" (PIE), FRC powers and mandatory retendering and rotation of PIE auditor appointments. The outcome of the consultation will be significant as, depending on its conclusion, it may bring AIM and other non-listed companies within the scope of the rules;
- in September, the Financial Reporting Council (FRC) will report on the decisions it has reached on the Directive driven changes to auditing and ethical standards and consult further on the detail of implementation, including issues such as types of entity in scope and prohibited non-audit services. The consultation will also propose changes to the UK Corporate Governance Code and its associated Guidance on Audit Committees;
- in early September, the Financial Conduct Authority (FCA) will consult on Directive driven changes to the Disclosure and Transparency Rules relating to Audit Committees which will be of relevance to companies with securities admitted to trading on regulated markets. The Prudential Regulation Authority (PRA) will undertake a similar consultation later in the same month, dealing with requirements for banks, building societies and insurers.
The Directive must be implemented by 17 June 2016. By way of reminder, the FRC has been confirmed as the UK competent authority for the regulation of auditors.
Equity Capital Markets
HM Treasury has launched a consultation on the draft Transparency Regulations 2015 which set out proposed amendments to the Financial Services and Markets Act 2000 (FSMA) to effect the implementation of this EU amending directive. From previous editions of Corporate News, you'll remember that the primary thrust of the changes is to extend the scope of Chapter 5 of the DTRs which will ultimately require the notification of dealings by substantial shareholders in an increased number of financial instruments issued by (or referable to instruments issued by) listed and certain AIM quoted issuers.
Comments on the draft regulations are required by 4 September 2015. The Directive must be implemented during November 2015.
The FCA has launched new and separate FCA Handbook and PRA Rulebook websites. Anyone attempting to visit the old online rulebook from 1 September 2015 will be redirected to the new websites.
Partnerships / Funds
High Court decision on multi-party LLP agreements illustrates they cannot be terminated for repudiatory breach
In the case of Flanagan v Liontrust Investment Partners LLP  EWHC 2171 (Ch), the High Court has held that repudiatory breaches of contract are implicitly excluded in LLP agreements, at least where the agreement has more than two parties.
Thus an LLP member who claimed that there had been a repudiatory breach could not use the default statutory rules applicable to LLPs to obtain a pro rata share of the LLP’s assets.
This Addleshaw Goddard Briefing provides an overview of The Modern Slavery Act 2015 which is expected to be brought into force no earlier than October 2015. To read the Government's response and next steps paper (published on 29th July) where the annual turnover threshold was confirmed as £36m thereby determining whether a company is 'large' and so subject to the requirements of the Act, click here: Modern Slavery and Supply Chains.
The Act provides for all businesses which have a turnover of over £36m to publish an annual statement stating the steps that they have taken to ensure that slavery and human trafficking are not taking place in their business or their supply chains.