Question 1

What is incorporation from scratch?

Accepted Answer

By submitting relevant information to Companies House

Question 2

What is a shelf company conversion?

Accepted Answer

Purchase a shelf company followed by formalities to enable necessary changes.

Question 3

What is the process for incorporating a company from scratch?

Accepted Answer

Send Companies House: Memo Articles IN01 Fee

Question 4

What information does the IN01 include?

Accepted Answer

The company’s proposed name and registered office which is an “appropriate address” Whether the company is to be private or public The company’s registered appropriate email address for Companies House use – added by ECCTA Whether the company is limited by shares or guarantee A statement of capital and initial shareholdings (unless limited by guarantee, details of guarantee must be given) A statement of the proposed officer’s and PSC’s A statement of compliance A statement of lawful purpose i.e. a statement that the subscribers are forming the company for lawful purposes – added by ECCTA

Question 5

What is an "appropriate address" for incorporation purposes?

Accepted Answer

An address where a document addressed to the company and delivered by either hand or post would be expected to come to the attention of a person acting on behalf of the company and where the delivery of documents is capable of being recorded. Therefore, not possible to use a PO Box.

Question 6

Once the Registrar of Companies has approved the application for incorporation what happens?

Accepted Answer

They send a certificate of incorporation which sets out: The name of the company CRN Date of incorporation

Question 7

When does a company incorporated from scratch become a legal entity?

Accepted Answer

From the date on which the certificate of incorporation is issued by Companies House.

Question 8

What is the process for incorporating a shelf company?

Accepted Answer

Solicitor purchases shelf company and makes the necessary changes to it on behalf of the client. It is likely the client will want to make the following changes: Name – can be changed by SR of the shareholders or by any other means provided in the Articles. SR, Form NM01 and fee to be sent to CoHo Registered office – will need to satisfy the requirement of an “appropriate address”. Form AD01 to be filed at CoHo Articles – may be amended by SR and amended Articles being sent to CoHo Members, directors and company secretary – representatives of the law firm will be the first members etc so this needs amending

Question 9

When a shelf-company is incorporated what changes will need to be made to the members, directors and company secretary?

Accepted Answer

The shares held by the subscribers transferred using STF. The client becomes shareholder once entered on register of members The clients representatives appointed as company secretary and directors using AP01 and AP03 and filed at CoHo The first directors and secretary resign using TM01 and TM02

Question 10

What are the requirements in relation to a company name?

Accepted Answer

Must not be offensive Must end in limited/ltd Must not be the `same as’ another on the index of company names Must obtain approval if contains “sensitive words” or suggests a “connection with government or public authority”

Question 11

When does a new company name become effective?

Accepted Answer

A new company name becomes effective from the date on which the new certificate of incorporation on change of name is issued by the Registrar of Companies

Question 12

What additional restrictions did ECCTA add in relation to company names?

Accepted Answer

In the opinion of the secretary of state, is intended to facilitate what would, in the UK constitute an offence of honesty or deception; Suggest a connection with a foreign government or its off-shoots; Consists of or includes what, in the opinion of the secretary of state, is a computer code; Is one that has already been subject to a direction by the Registrar to change and the company is seeking to re-register using that name; Gives a misleading indication of its activities; or In the opinion of the secretary of state, has been used or is intended to be used for criminal activities.

Question 13

What post-incorporation steps need to be taken?

Accepted Answer

Chairperson – The Board needs to decide whether to elect a chair and whether the Chairperson should have a casting vote in the event of a tied board resolution. MA provides for this, but they may wish to amend the MA. Accounting reference date – CA 2006 provides that the default accounting reference date will be the last day of the month in which the company was incorporated. Often companies will change this to align with their financial year. Form AA01 is required to be filed at Companies House. Auditor – all companies must prepare annual accounts and will usually therefore need to appoint an auditor usually by Board resolution if company has MA. Tax registrations – the company will need to register for corporation tax, VAT and PAYE and National Insurance (if it has employees). Shareholder agreement – this is a private contract between the shareholders. It is not required and not all companies have a shareholder agreement, but it may be useful.

Question 14

Can a company enter into a contract before incorporation?

Accepted Answer

A company comes into existence at the time of issue of the certificate of incorporation. Until this time, it is not a legal person and therefore has no capacity to enter into contracts. CA 2006 seeks to protect third parties who believe they are entering into a contract with a company which is incorporated and registered by making pre-incorporation contracts enforceable as personal contracts against the persons purporting to act on the company’s behalf.

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Formation of a Company Flashcards

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