Companies required to have directors
154
(1) A private company must have at least one director. (2) A public company must have at least two directors.
Companies Act 2006 Chapter 1 — Appointment and removal of directors
Requirement to have directors
Companies required to have at least one director who is a natural person
155
(1) A company must have at least one director who is a natural person. (2) This requirement is met if the office of director is held by a natural person as a corporation sole or otherwise by virtue of an office.
Direction requiring company to make appointment
156
(1) If it appears to the Secretary of State that a company is in breach of— section 154 (requirements as to number of directors), or section 155 (requirement to have at least one director who is a natural person), the Secretary of State may give the company a direction under this section. (2) The direction must specify— (a) the statutory requirement the company appears to be in breach of, (b) what the company must do in order to comply with the direction, and (c) the period within which it must do so. That period must be not less than one month or more than three months after the date on which the direction is given. (3) The direction must also inform the company of the consequences of failing to comply. (4) Where the company is in breach of section 154 or 155 it must comply with the direction by— (a) making the necessary appointment or appointments, and (b) giving notice of them under section 167G , before the end of the period specified in the direction. (5) If the company has already made the necessary appointment or appointments (or so far as it has done so), it must comply with the direction by giving notice of them under section 167G before the end of the period specified in the direction. (5A) Nothing in subsection (4) or (5) affects the duty imposed by section 167G to give notice within the period mentioned in subsection (6) of that section. (6) If a company fails to comply with a direction under this section, an offence is committed by— (a) the company, and (b) every officer of the company who is in default. For this purpose a shadow director is treated as an officer of the company. (7) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 5 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 5 on the standard scale one-tenth of the greater of £5,000 or level 4 on the standard scale .
Appointment
Each director to be a natural person
156A
(1) A person may not be appointed a director of a company unless the person is a natural person. (2) Subsection (1) does not prohibit the holding of the office of director by a natural person as a corporation sole or otherwise by virtue of an office. (3) An appointment made in contravention of this section is void. (4) Nothing in this section affects any liability of a person under any provision of the Companies Acts or any other enactment if the person— (a) purports to act as director, or (b) acts as shadow director, although the person could not, by virtue of this section, be validly appointed as a director. (5) This section has effect subject to section 156B (power to provide for exceptions from requirement that each director be a natural person). (6) If a purported appointment is made in contravention of this section, an offence is committed by— (a) the company purporting to make the appointment, (b) where the purported appointment is of a body corporate or a firm that is a legal person under the law by which it is governed, that body corporate or firm, and (c) every officer of a person falling within paragraph (a) or (b) who is in default. For this purpose a shadow director is treated as an officer of a company. (7) A person guilty of an offence under this section is liable on summary conviction— (a) in England and Wales, to a fine; (b) in Scotland or Northern Ireland, to a fine not exceeding level 5 on the standard scale.
Power to provide for exceptions from requirement that each director be a natural person
156B
(1) The Secretary of State may make provision by regulations for cases in which a person who is not a natural person may be appointed a director of a company. (2) The regulations must specify the circumstances in which, and any conditions subject to which, the appointment may be made. (3) Provision made by virtue of subsection (2) may in particular include provision that an appointment may be made only with the approval of a regulatory body specified in the regulations. (4) The regulations must include provision that a company must have at least one director who is a natural person (and for this purpose the requirement is met if the office of director is held by a natural person as a corporation sole or otherwise by virtue of an office). (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6) The regulations may make different provision for different parts of the United Kingdom. This is without prejudice to the general power to make different provision for different cases. (7) Regulations under this section are subject to affirmative resolution procedure.
Existing director who is not a natural person
156C
(1) In this section “the relevant day” is the day after the end of the period of 12 months beginning with the day on which section 156A comes into force. (2) Where— (a) a person appointed a director of a company before section 156A comes into force is not a natural person, and (b) the case is not one excepted from that section by regulations under section 156B, that person ceases to hold office by virtue of that appointment on the relevant day. (2A) Nothing in this section affects any liability of a person under any provision of the Companies Acts or any other enactment, if, having ceased to hold office by virtue of subsection (2), the person— (a) purports to act as director, or (b) acts as shadow director. (3) If it appears to the registrar that, as a result of subsection (2), a company should have given notice under section 167G of a person having ceased to be a director but has failed to do so, the registrar must include a note in the register recording that fact.
Minimum age for appointment as director
157
(1) A person may not be appointed a director of a company unless he has attained the age of 16 years. (2) This does not affect the validity of an appointment that is not to take effect until the person appointed attains that age. (3) Where the office of director of a company is held by a corporation sole, or otherwise by virtue of another office, the appointment to that other office of a person who has not attained the age of 16 years is not effective also to make him a director of the company until he attains the age of 16 years. (4) An appointment made in contravention of this section is void. (5) Nothing in this section affects any liability of a person under any provision of the Companies Acts if he— (a) purports to act as director, or (b) acts as a shadow director, although he could not, by virtue of this section, be validly appointed as a director. (6) This section has effect subject to section 158 (power to provide for exceptions from minimum age requirement).
Power to provide for exceptions from minimum age requirement
158
(1) The Secretary of State may make provision by regulations for cases in which a person who has not attained the age of 16 years may be appointed a director of a company. (2) The regulations must specify the circumstances in which, and any conditions subject to which, the appointment may be made. (3) If the specified circumstances cease to obtain, or any specified conditions cease to be met, a person who was appointed by virtue of the regulations and who has not since attained the age of 16 years ceases to hold office by virtue of that appointment . (3A) Nothing in subsection (3) affects any liability of a person under any provision of the Companies Acts or any other enactment, if, having ceased to hold office by virtue of that subsection, the person— (a) purports to act as director, or (b) acts as shadow director. (4) The regulations may make different provision for different parts of the United Kingdom. This is without prejudice to the general power to make different provision for different cases. (5) Regulations under this section are subject to negative resolution procedure.
Existing under-age directors
159.
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Disqualified person not to be appointed as director
159A
(1) A person may not be appointed a director of a company if the person is disqualified under the directors disqualification legislation (see subsection (2)). (2) In the table— (a) Part 1 defines “ disqualified under the directors disqualification legislation ” for the purposes of provisions of this Act so far as relating to— (i) a company registered in England and Wales or Scotland, or (ii) the delivery of a document to the registrar of companies for England and Wales or Scotland or a statement contained in such a document; (b) Part 2 defines “ disqualified under the directors disqualification legislation ” for the purposes of provisions of this Act so far as relating to— (i) a company registered in Northern Ireland, or (ii) the delivery of a document to the registrar of companies for Northern Ireland or a statement contained in such a document. (3) An appointment made in contravention of this section is void. (4) Nothing in this section affects any liability of a person under any provision of the Companies Acts or any other enactment if the person— (a) purports to act as director, or (b) acts as shadow director, although the person could not, by virtue of this section, be validly appointed as a director.
Appointment of directors of public company to be voted on individually
160
(1) At a general meeting of a public company a motion for the appointment of two or more persons as directors of the company by a single resolution must not be made unless a resolution that it should be so made has first been agreed to by the meeting without any vote being given against it. (2) A resolution moved in contravention of this section is void, whether or not its being so moved was objected to at the time. But where a resolution so moved is passed, no provision for the automatic reappointment of retiring directors in default of another appointment applies. (3) For the purposes of this section a motion for approving a person's appointment, or for nominating a person for appointment, is treated as a motion for his appointment. (4) Nothing in this section applies to a resolution amending the company's articles.
Validity of acts of directors
161
(1) The acts of a person acting as a director are valid notwithstanding that it is afterwards discovered— (a) that there was a defect in his appointment; (b) that he was disqualified from holding office; (c) that he had ceased to hold office; (d) that he was not entitled to vote on the matter in question. (2) This applies even if the resolution for his appointment is void under section 160 (appointment of directors of public company to be voted on individually).
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Alternative method of record-keeping
161A
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Register of directors
162
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Particulars of directors to be registered: individuals
163
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Particulars of directors to be registered: corporate directors and firms
164
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Register of directors' residential addresses
165
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Particulars of directors to be registered: power to make regulations
166
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Duty to notify registrar of changes
167
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Option to keep information on the central register
Right to make an election
167A
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Effective date of election
167B
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Effect of election on obligations under sections 162 to 167
167C
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Duty to notify registrar of changes
167D
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Withdrawing the election
167E
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Power to extend option to public companies
167F
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Notification of information about directors
Duty to notify registrar of change in directors
167G
(1) A company must give notice to the registrar if a person— (a) becomes a director of the company, or (b) ceases to be a director of the company. (2) The notice must specify the date on which the person became or ceased to be a director of the company. (3) A notice under subsection (1)(a) of a person having become a director must contain— (a) a statement of the required information about the new director (see sections 167J and 167K); (b) a statement by the company that the person has consented to act in that capacity; (c) if the person is an individual, a statement that their identity is verified (see section 1110A); (d) a statement that the person is not— (i) disqualified under the directors disqualification legislation (see section 159A(2)), or (ii) otherwise ineligible by virtue of any enactment for appointment as a director; (e) if the person would be disqualified under the directors disqualification legislation but for the permission of a court to act, a statement to that effect specifying— (i) the court by which permission was given, and (ii) the date on which permission was given. (f) if the person would be disqualified under the directors disqualification legislation by virtue of section 11A of the Company Directors Disqualification Act 1986 or Article 15A of the Company Directors Disqualification (Northern Ireland) Order 2002 (designated persons under sanctions legislation) but for the authority of a licence of the kind mentioned in that section or Article, a statement to that effect specifying— (i) the date on which the licence was issued, and (ii) by whom it was issued. (4) In subsection (3)(e) “ permission of a court to act ” means permission of a court under a provision mentioned in column 2 of the table in section 159A(2). (5) Subsection (1)(a) does not require a company, on its incorporation, to give notice in relation to a person named as a proposed director in the statement under section 12. (6) A notice under this section must be given within the period of 14 days beginning with the day on which the person becomes or ceases to be a director.
Duty to notify registrar of changes of information
167H
(1) A company must give notice to the registrar of any change in the required information about a director (see sections 167J and 167K). (2) The notice must specify the date on which the change occurred. (3) A notice under this section must be given within the period of 14 days beginning with the day on which the change occurs. (4) Where a company gives notice of a change of a director’s service address but not their residential address, the notice must contain a statement that the residential address is unchanged.
Notification of changes occurring before company’s incorporation
167I
(1) A company must give notice to the registrar if a person named in the statement under section 12 as a proposed director of the company did not become a director on its incorporation. (2) A company must give notice to the registrar of any change in the required information about a proposed director that occurred— (a) after the application for the company’s registration under section 9 was delivered to the registrar, but (b) before the company was incorporated. (3) But a company is not required to give notice under subsection (2) in respect of a person if it gives notice under subsection (1) in respect of the person. (4) A notice under subsection (2) must specify the date on which the change occurred. (5) A notice under this section must be given within the period of 14 days beginning with the day on which the company was incorporated.
Required information about a director: individuals
167J
(1) The required information about a director (or proposed director) who is an individual is— (a) name, date of birth and nationality; (b) any relevant former names; (c) a service address (which may be stated as “The company’s registered office”); (d) usual residential address; (e) the part of the United Kingdom in which the individual is usually resident or, if the individual is usually resident in a country or state outside the United Kingdom, that country or state. (2) In subsection (1)(b) “ relevant former name ” means any former name other than— (a) in the case of a peer, or an individual normally known by a British title, the name by which the individual was known previous to the adoption of or succession to the title, or (b) in the case of any person— (i) a former name which was changed or disused before the person attained the age of 16 years, (ii) a former name which has been changed or disused for 20 years or more, or (iii) a former name which the registrar is required to refrain from making available for public inspection or from disclosing (or both) by virtue of regulations under section 1088(1)(a) or (b). (3) In this section— “ former name ” means a name by which the individual was formerly known for business purposes; “ name ” means the individual’s forename and surname. (4) Where a director (or proposed director) is a peer or an individual usually known by a title, any requirement imposed by this Act to provide the individual’s name because it forms part of the required information may be satisfied by providing that title instead of the individual’s forename and surname. (5) The Secretary of State may by regulations— (a) amend this section so as to change the required information about a director (or proposed director) who is an individual; (b) repeal subsection (4). (6) Regulations under this section are subject to affirmative resolution procedure.
Required information about a director: corporate directors and firms
167K
(1) The required information about a director (or proposed director) that is a body corporate, or a firm that is a legal person under the law by which it is governed, is— (a) corporate or firm name; (b) principal office; (c) a service address (which may be stated as “The company’s registered office”); (d) in the case of a limited company that is a UK-registered company, the registered number; (e) in any other case, particulars of— (i) the legal form of the body corporate or firm and the law by which it is governed, and (ii) if applicable, the register in which it is entered (including details of the state) and its registration number in that register. (2) The Secretary of State may by regulations amend this section so as to change the required information about a director (or proposed director) of a description mentioned in subsection (1). (3) Regulations under this section are subject to affirmative resolution procedure.
Directors: offence of failure to notify of changes
167L
(1) If a company fails, without reasonable excuse, to comply with section 167G, 167H or 167I, an offence is committed by— (a) the company, and (b) every officer of the company who is in default. (2) For this purpose a shadow director is treated as an officer of the company. (3) A person guilty of an offence under this section is liable on summary conviction— (a) in England and Wales, to a fine; (b) in Scotland or Northern Ireland, to a fine not exceeding level 5 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 5 on the standard scale.
Directors: duties relating to ID verification and notification
Prohibition on director acting unless ID verified
167M
(1) An individual must not act as a director of a company unless the individual’s identity is verified (see section 1110A). (2) A company must ensure that an individual does not act as a director unless the individual’s identity is verified (see section 1110A). (3) A person who contravenes subsection (1) commits an offence. (4) If a company contravenes subsection (2) an offence is committed by— (a) the company, and (b) every officer of the company who is in default. For this purpose a shadow director is treated as an officer of the company. (5) A person guilty of an offence under this section is liable on summary conviction— (a) in England and Wales, to a fine; (b) in Scotland or Northern Ireland, to a fine not exceeding level 5 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 5 on the standard scale. (6) The only consequences of contravening subsections (1) and (2) are the offences provided for by this section (so that, for example, a contravention does not in any way affect the validity of an individual’s acts as a director).
Prohibition on acting unless directorship notified
167N
(1) This section applies where— (a) a person has become a director of a company otherwise than on its incorporation, and (b) notice under section 167G of the person having done so has not been given within the period mentioned in subsection (6) of that section. (2) The person may not act as a director of the company until notice is given under section 167G. (3) A person who contravenes subsection (2) commits an offence. (4) Where the offence is committed by a firm, every officer of the firm who is in default also commits the offence. (5) It is a defence for a person charged with an offence under this section to prove that they reasonably believed that notice had been given under section 167G. (6) A person guilty of an offence under this section is liable on summary conviction— (a) in England and Wales, to a fine; (b) in Scotland or Northern Ireland, to a fine not exceeding level 5 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 5 on the standard scale. (7) The only consequence of a contravention of subsection (2) is the offence provided for by this section (so that, for example, a contravention does not in any way affect the validity of a person’s acts as a director).
Removal
Resolution to remove director
168
(1) A company may by ordinary resolution at a meeting remove a director before the expiration of his period of office, notwithstanding anything in any agreement between it and him. (2) Special notice is required of a resolution to remove a director under this section or to appoint somebody instead of a director so removed at the meeting at which he is removed. (3) A vacancy created by the removal of a director under this section, if not filled at the meeting at which he is removed, may be filled as a casual vacancy. (4) A person appointed director in place of a person removed under this section is treated, for the purpose of determining the time at which he or any other director is to retire, as if he had become director on the day on which the person in whose place he is appointed was last appointed a director. (5) This section is not to be taken— (a) as depriving a person removed under it of compensation or damages payable to him in respect of the termination of his appointment as director or of any appointment terminating with that as director, or (b) as derogating from any power to remove a director that may exist apart from this section.
Director's right to protest against removal
169
(1) On receipt of notice of an intended resolution to remove a director under section 168, the company must forthwith send a copy of the notice to the director concerned. (2) The director (whether or not a member of the company) is entitled to be heard on the resolution at the meeting. (3) Where notice is given of an intended resolution to remove a director under that section, and the director concerned makes with respect to it representations in writing to the company (not exceeding a reasonable length) and requests their notification to members of the company, the company shall, unless the representations are received by it too late for it to do so— (a) in any notice of the resolution given to members of the company state the fact of the representations having been made; and (b) send a copy of the representations to every member of the company to whom notice of the meeting is sent (whether before or after receipt of the representations by the company). (4) If a copy of the representations is not sent as required by subsection (3) because received too late or because of the company's default, the director may (without prejudice to his right to be heard orally) require that the representations shall be read out at the meeting. (5) Copies of the representations need not be sent out and the representations need not be read out at the meeting if, on the application either of the company or of any other person who claims to be aggrieved, the court is satisfied that the rights conferred by this section are being abused. (6) The court may order the company's costs (in Scotland, expenses) on an application under subsection (5) to be paid in whole or in part by the director, notwithstanding that he is not a party to the application.
Removal from office of disqualified directors
169A
(1) A person who has been appointed as a director of a company ceases to hold office by virtue of that appointment if the person becomes disqualified under the directors disqualification legislation (see section 159A(2)). (2) Nothing in this section affects any liability of a person under any provision of the Companies Acts or any other enactment, if, having ceased to hold office by virtue of subsection (1), the person— (a) purports to act as director, or (b) acts as shadow director. (3) In relation to a person appointed as a director of a company before the time when this section comes into force, the reference in subsection (1) to a person who becomes disqualified includes a reference to a person who, at that time, is already disqualified.
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