The statutory registers of a private limited company, often referred to as the legal statutory books, are extremely important.
Anisha Malik from JTC’s Transactional Corporate Services team in London looks at why they are so vital and can affect everyone, including those looking for investment or considering selling a company.
What are statutory registers?
Statutory registers provide the historic and current record of a company’s ownership and all persons responsible for controlling the company and its associated business.
These registers are required to be accurate, kept up-to-date and amended to show any relevant changes that occur within the company throughout its history. Statutory Registers may be kept in paper form or electronically.
Statutory registers (Registers) comprise of the following:
- members
- directors
- director’s residential addresses
- secretaries
- persons with significant control
- charges (for charges registered before 6 April 2013).
Why are they required?
It is very important to maintain accurate and up-to-date Registers and company books as failing to keep and update the statutory records constitutes an offence.
Officers are also required to comply with a separate statutory duty to take adequate precautions to prevent any potential falsification of the company books. If a company does not keep accurate Registers by default, an offence is committed by the company and each of its officers.
The company’s directors will be acting in breach of their directors’ duties and any officers in breach would be liable to receiving a fine.
While companies may regularly update their records at Companies House as part of the legal requirement, updating the company books is often omitted.
Filing information on a company’s public register at Companies House does not normally give legal effect to a transaction. For example, as well as notifying Companies House of the appointment of a company secretary, the register of secretaries should be updated in the company books to record the appointment.
When will I need them?
Although it is important to maintain all Registers, the register of members is particularly significant as this is the definitive record of a company’s shareholders.
To become a legal registered shareholder of a UK company, details of the shareholder and the number of shares owned must be entered into the company’s register of members. Until this process has taken place, the legal title to the shares has not yet technically been acquired by the shareholder.
The Registers should be kept either at the company’s registered office or another single alternative inspection location (SAIL) which must be notified to Companies House.
In either case the Registers must be made available for inspection at that address by the company’s shareholders who are entitled to inspect the registers upon request and without charge.
Registers within company books are required to be inspected as part of any diligence in relation to the sale of or investment in a company.
A failure to make the statutory registers available for inspection is an offence under the Companies Act 2006 as is a failure to comply with a valid request to inspect the statutory registers.
How can JTC help?
If you are considering selling your company, or looking for investment in future, it is crucial to ensure that your company books are accurate and current as this will likely avoid potentially costly delays.
If you realise that you have not been keeping company registers, or you discover that they are not up to date, you must the oversight is rectified as soon as possible.
Outsourcing the maintenance of the Registers to a professional services firm may be the option to ensure that your company’s Registers are always in order.
JTC provides a comprehensive suite of services from incorporation, including maintenance of legal statutory books, while supporting the full lifecycle through to dissolutions.
To find out more, contact Michelle O’Flaherty.
