Companies (Corporate Enforcement Authority) Act 2021: Amendments to the Companies Act 2014
The Companies (Corporate Enforcement Authority) Act 2021 (the “Act”) has been commenced.
In addition to establishing the Corporate Enforcement Authority (see our briefing here and listen to our podcast here), the Act makes a number of amendments to the Companies Act 2014, primarily to address anomalies which had been identified. These changes include:
- an unlimited company will not be required to have distributable reserves in order to acquire its own shares;
- shares acquired by a company pursuant to a merger or division are deemed to be treasury shares;
- restoring a provision from the prior Companies Acts in relation to the permitted uses by a company of its share premium account;
- confirming that a reduction in share capital (carried out in accordance with the Companies Act 2014) is not a distribution; and
- confirming that ‘share for undertaking transactions’ can proceed where the transferor company has distributable reserves equal to the value of the assets transferred.
A new provision requiring company directors to provide the Companies Registration Office with their PPS number (or such other information concerning their identity as determined by the Registrar) when filing certain documents, including Forms B10, has not yet been commenced.