Coronavirus disease (COVID-19): situation report, 152
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Part 2 of Schedule 11 to the Companies Act 1989 (c. 40) (requirements for recognition of supervisory bodies for purposes of provisions relating to company auditors) is amended as follows.
The body must participate in arrangements within paragraph 17, and the rules and practices mentioned in sub-paragraph (1) above must include provision requiring compliance with any standards for the time being determined under such arrangements.
The body must participate in arrangements within paragraph 18, and the rules and practices mentioned in sub-paragraph (1) above must include provision requiring compliance with any standards for the time being determined under such arrangements.
After paragraph 10 insert—
After paragraph 12 insert—
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Section 46 of the Companies Act 1989 (c. 40) (delegation by Secretary of State of functions relating to auditors) is amended as follows.
For subsection (1) substitute—
In subsection (2) (effect of delegation order on body established by it), for “established” substitute “designated”.
For subsection (6) substitute—
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Schedule 13 to the Companies Act 1989 (c. 40) (supplementary provisions about delegation orders) is amended as follows.
For paragraph 1 substitute—
In paragraph 10 (report and accounts)—
The following provisions of this paragraph apply as follows—
Unless the body is a company to which section 226 of the Companies Act 1985 (duty to prepare individual company accounts) applies— Whether or not the body is a company to which section 226 of the Companies Act 1985 applies—
In paragraph 11 (other supplementary provisions), for “established” (in both places) substitute “designated”.
After paragraph 12 insert—
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Section 33 of the Companies Act 1989 (c. 40) (approval of overseas qualifications for auditors) is amended as follows.
For subsections (1) and (2) substitute—
For subsection (6) substitute—
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For section 390B of the Companies Act 1985 (c. 6) substitute—
In section 390A of the Companies Act 1985 (c. 6) (remuneration of auditors)—
subsection (3) (auditors' remuneration to be disclosed in note to accounts) accordingly ceases to have effect, and
in subsection (5) (application to benefits in kind), for the words from “payments in cash” onwards substitute “payments of money.”
In paragraph 1(1) of Schedule 4A to that Act (form and contents of group accounts), omit “section 390A(3) (amount of auditors' remuneration) and”.
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Part 7 of the Companies Act 1985 (c. 6) (accounts and audit) is amended as follows.
In section 234 (duty to prepare directors' report), after subsection (2) insert—
After section 234 insert—
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Section 245C of the Companies Act 1985 (c. 6) (other persons authorised to apply to court) is amended as follows.
After subsection (1) insert—
After subsection (4) insert—
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After section 245C of the Companies Act 1985 (c. 6) insert—
After Article 253C of the Companies (Northern Ireland) Order 1986 (S.I. 1986/1032 (N.I. 6)) insert—
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After section 245E of the Companies Act 1985 (c. 6) (as inserted by clause 11) insert—
Schedule 1 (which inserts Schedule 7B in the Companies Act 1985 (c. 6)) has effect.
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The Secretary of State may make an order appointing a body (“the prescribed body”) to exercise the functions mentioned in subsection (2).
The functions are—
keeping under review periodic accounts and reports that are produced by issuers of transferable securities and are required to comply with any accounting requirements imposed by Part 6 rules; and
if the prescribed body thinks fit, informing the Financial Conduct Authority of any conclusions reached by the body in relation to any such accounts or report.
A body may be appointed under this section if it is a body corporate or an unincorporated association which appears to the Secretary of State—
to have an interest in, and to have satisfactory procedures directed to, monitoring compliance by issuers of transferable securities with accounting requirements imposed by Part 6 rules in relation to periodic accounts and reports produced by such issuers; and
otherwise to be a fit and proper body to be appointed.
But where the order is to contain any requirements or other provisions specified under subsection (8), the Secretary of State may not appoint a body unless, in addition, it appears to him that the body would, if appointed, exercise its functions as a prescribed body in accordance with any such requirements or provisions.
A body may be appointed either generally or in respect of any of the following, namely— and different bodies may be appointed in respect of different classes within either or both of paragraphs (a) and (b).
any particular class or classes of issuers,
any particular class or classes of periodic accounts or reports,
In relation to the appointment of a body in respect of any such class or classes, subsections (2) and (3) are to be read as referring to issuers, or (as the case may be) to periodic accounts or reports, of the class or classes concerned.
Where— the body is to exercise those functions in relation to that issuer as well.
a body is so appointed, but
the Financial Conduct Authority requests the body to exercise its functions under subsection (2) in relation to any particular issuer of transferable securities in relation to whom those functions would not otherwise be exercisable,
An order under this section may contain such requirements or other provisions relating to the exercise of functions by the prescribed body as appear to the Secretary of State to be appropriate.
If the prescribed body is an unincorporated association, any relevant proceedings may be brought by or against that body in the name of any body corporate whose constitution provides for the establishment of the body. For this purpose “relevant proceedings” means proceedings brought in or in connection with the exercise of any function by the body as a prescribed body.
Where an appointment is revoked, the revoking order may make such provision as the Secretary of State thinks fit with respect to pending proceedings.
The power to make an order under this section is exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.
In this section and sections 15A to 15E below —
“issuer”, “listing rules” and “security” have the meaning given by section 103(1) of the Financial Services and Markets Act 2000 (c. 8) (interpretation of Part 6);
“specified” means specified in an order or regulations under this section.
“excluded company” is to be construed in accordance with section 35(6),
The provisions of sections 15A to 15E have effect in relation to bodies appointed under section 14 (supervision of accounts and reports of issuers of transferable securities).
sections 245D and 245E of the Companies Act 1985 (c. 6) (as inserted by section 11(1) of this Act),
Articles 253D and 253E of the Companies (Northern Ireland) Order 1986 (S.I. 1986/1032 (N.I. 6)) (as inserted by section 11(2) of this Act), and
sections 245F and 245G of and Schedule 7B to the Companies Act 1985 (as inserted by section 12(1) of this Act).
In those sections—
“prescribed body” means a body appointed under that section; and
references to the functions of a prescribed body are to its functions under that section.
Articles 253D and 253E apply in relation to prescribed bodies and their functions as they apply in relation to persons authorised under Article 253C of that Order and persons authorised under section 245C of the Companies Act 1985 and the functions of such persons mentioned in Articles 253D(3) and 253E(1). But Article 253E so applies as if paragraph (2)(b) of that Article were omitted.
Sections 245F and 245G and Schedule 7B apply in relation to prescribed bodies and their functions as they apply in relation to persons authorised under section 245C of that Act and the functions of such persons mentioned in section 245F(2), section 245G(3)(a) and paragraph 16 of Schedule 7B.
But section 245F so applies as if—
subsection (1) of that section provided that the section applies where it appears to a prescribed body that there is, or may be, a question whether any relevant accounts or reports produced by an issuer of listed securities comply with any accounting requirements imposed by listing rules;
the references in section 245F(3)(a) and (b) to “the company” were references to that issuer; and
the references in section 245F(4) and (5) to “the court” were to the High Court or, in Scotland, the Court of Session.
In subsection (5)—
“relevant accounts or reports” means accounts or reports in relation to which the prescribed body has functions under section 14; and
“issuer”, “listing rules” and “security” have the same meanings as in section 14.
In this section “prescribed body” has the same meaning as in section 14.
The Commissioners for Her Majesty’s Revenue and Customs may disclose information to a prescribed body for the purposes of its functions.
This section applies despite any statutory or other restriction on the disclosure of information. Provided that, in the case of personal data ... , information is not to be disclosed in contravention of the data protection legislation.
Information disclosed to a prescribed body under this section—
may only be used for the purposes of its functions, and
must not be further disclosed except to the person to whom the information relates.
A person who contravenes subsection (3) commits an offence unless—
the person did not know, and had no reason to suspect, that the information had been disclosed under this section, or
the person took all reasonable steps and exercised all due diligence to avoid the commission of the offence.
A person guilty of an offence under subsection (4) is liable—
on conviction on indictment, to imprisonment for a term not exceeding two years or a fine (or both);
on summary conviction—
in England and Wales or Scotland, to imprisonment for a term not exceeding twelve months or to a fine not exceeding the statutory maximum (or both);
in Northern Ireland, to imprisonment for a term not exceeding three months, or to a fine not exceeding the statutory maximum (or both).
In subsection (5)(b)(i) as it applies in relation to England and Wales the reference to twelve months is to be read as a reference to the general limit in a magistrates’ court (or to six months in the case of an offence committed before 2 May 2022).
Sections 400, 401 and 403 of the Financial Services and Markets Act 2000 (supplementary provisions relating to offences) apply in relation to an offence under this section.
In this section—
...
This section applies where it appears to a prescribed body that there is, or may be, a question whether the periodic accounts and reports produced by an issuer of transferable securities comply with any accounting requirements imposed by Part 6 rules.
The prescribed body may require any of the persons mentioned in subsection (3) to produce any document, or to provide any information or explanations, that the body may reasonably require for the purpose of its functions.
Those persons are—
the issuer;
any officer, employee, or auditor of the issuer;
any persons who fell within paragraph (b) at a time to which the document or information required by the prescribed body relates.
If a person fails to comply with such a requirement, the prescribed body may apply to the court.
If it appears to the court that the person has failed to comply with a requirement under subsection (2), it may order the person to take such steps as it directs for securing that the documents are produced or the information or explanations are provided.
A statement made by a person in response to a requirement under subsection (2) or an order under subsection (5) may not be used in evidence against him in any criminal proceedings.
Nothing in this section compels any person to disclose documents or information in respect of which a claim to legal professional privilege (in Scotland, to confidentiality of communications) could be maintained in legal proceedings.
In this section—
“the court” means the High Court or the Court of Session; and
This section applies to information (in whatever form) obtained in pursuance of a requirement or order under section 15B (power of prescribed body to require documents etc) that relates to the private affairs of an individual or to any particular business.
No such information may, during the lifetime of that individual or so long as that business continues to be carried on, be disclosed without the consent of that individual or the person for the time being carrying on that business.
This does not apply—
to disclosure permitted by section 15D (permitted disclosure of information obtained under compulsory powers), or
to the disclosure of information that is or has been available to the public from another source.
A person who discloses information in contravention of this section commits an offence, unless—
the person did not know, and had no reason to suspect, that the information had been disclosed under section 15B, or
the person took all reasonable steps and exercised all due diligence to avoid the commission of the offence.
A person guilty of an offence under this section is liable—
on conviction on indictment, to imprisonment for a term not exceeding two years or a fine (or both);
on summary conviction—
in England and Wales or Scotland, to imprisonment for a term not exceeding twelve months or to a fine not exceeding the statutory maximum (or both);
in Northern Ireland, to imprisonment for a term not exceeding six months, or to a fine not exceeding the statutory maximum (or both).
In subsection (5)(b)(i) as it applies in relation to England and Wales the reference to twelve months is to be read as a reference to the general limit in a magistrates’ court (or to six months in the case of an offence committed before 2 May 2022).
The prohibition in section 15C of the disclosure of information obtained in pursuance of a requirement or order under section 15B (power of prescribed body to require documents etc) that relates to the private affairs of an individual or to any particular business has effect subject to the following exceptions.
It does not apply to the disclosure of information for the purpose of facilitating the carrying out by the prescribed body of its functions.
It does not apply to disclosure to—
the Secretary of State,
the Department of Enterprise, Trade and Investment for Northern Ireland,
the Treasury,
the Bank of England (including the Bank in its capacity as the Prudential Regulation Authority),
the Financial Conduct Authority, or
the Commissioners for Her Majesty’s Revenue and Customs.
It does not apply to disclosure—
for the purpose of assisting a body designated by an order under section 1252 of the Companies Act 2006 (delegation of functions of the Secretary of State) to exercise its functions under Part 42 of that Act (statutory auditors);
for the purposes of facilitating—
the carrying out of inspections under paragraph 1 of Schedule 12 to the Companies Act 2006 (arrangements for independent monitoring of audits of UK-traded third country companies); or
the carrying out of investigations under paragraph 2 of that Schedule (arrangements for independent investigations for disciplinary purposes).
for the purposes of enabling the competent authority to exercise its functions under the Statutory Auditors and Third Country Auditors Regulations 2016 or under Regulation (EU) 537/2014 on specific requirements regarding statutory audit of public interest entities;
with a view to the institution of, or otherwise for the purposes of, disciplinary proceedings relating to the performance by an accountant or auditor of his professional duties;
for the purpose of enabling or assisting the Secretary of State or the Treasury to exercise any of their functions under any of the following—
the Companies Acts (as defined in section 2 of the Companies Act 2006),
Part 5 of the Criminal Justice Act 1993 (insider dealing),
the Insolvency Act 1986 or the Insolvency (Northern Ireland) Order 1989,
the Company Directors Disqualification Act 1986 or the Company Directors Disqualification (Northern Ireland) Order 2002,
the Financial Services and Markets Act 2000;
for the purpose of enabling or assisting the Department of Enterprise, Trade and Investment for Northern Ireland to exercise any powers conferred on it by the enactments relating to companies, directors’ disqualification or insolvency;
for the purpose of enabling or assisting the Bank of England (acting otherwise than in its capacity as the Prudential Regulation Authority) to exercise its functions;
for the purpose of enabling or assisting the Commissioners for Her Majesty’s Revenue and Customs to exercise their functions;
for the purpose of enabling or assisting the Financial Conduct Authority or the Prudential Regulation Authority to exercise its functions under any of the following—
the legislation relating to friendly societies ...,
the Credit Unions Act 1979,
the Building Societies Act 1986,
Part 7 of the Companies Act 1989,
the Financial Services and Markets Act 2000;
the Co-operative and Community Benefit Societies Act 2014; or
in pursuance of any assimilated obligation.
It does not apply to disclosure to a body exercising functions of a public nature under legislation in any country or territory outside the United Kingdom that appear to the prescribed body to be similar to its functions for the purpose of enabling or assisting that body to exercise those functions.
In determining whether to disclose information to a body in accordance with subsection (5), the prescribed body must have regard to the following considerations—
whether the use which the other body is likely to make of the information is sufficiently important to justify making the disclosure;
whether the other body has adequate arrangements to prevent the information from being used or further disclosed other than—
for the purposes of carrying out the functions mentioned in that subsection, or
for other purposes substantially similar to those for which information disclosed to the prescribed body could be used or further disclosed.
Nothing in this section authorises the making of a disclosure in contravention of the data protection legislation.
In this section, “the data protection legislation” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act).
The Secretary of State may by order amend section 15D(3), (4) and (5).
An order under this section must not—
amend subsection (3) of that section (UK public authorities) by specifying a person unless the person exercises functions of a public nature (whether or not he exercises any other function);
amend subsection (4) of that section (purposes for which disclosure permitted) by adding or modifying a description of disclosure unless the purpose for which the disclosure is permitted is likely to facilitate the exercise of a function of a public nature;
amend subsection (5) of that section (overseas regulatory authorities) so as to have the effect of permitting disclosures to be made to a body other than one that exercises functions of a public nature in a country or territory outside the United Kingdom.
The power to make an order under this section is exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.
The Secretary of State may make grants to any body carrying on activities concerned with any of the matters set out in subsection (2).
The matters are—
issuing accounting standards;
issuing standards in respect of matters to be contained in reports required to be produced by auditors or company directors;
investigating departures from standards within paragraph (a) or (b) or from the accounting requirements of the Companies Act 2006 or any requirements of directly applicable EU legislation relating to company accounts;
taking steps to secure compliance with such standards or requirements;
keeping under review periodic accounts and reports that are produced by issuers of listed securities and are required to comply with any accounting requirements imposed by listing rules;
establishing, maintaining or carrying out arrangements within paragraph 21, 22, 23(1) , 23A(1) or 24(1) of Schedule 10 to the Companies Act 2006;
exercising the functions of the competent authority under the Statutory Auditors and Third Country Auditors Regulations 2016 and under Regulation (EU) 537/2014 on specific requirements regarding statutory audit of public interest entities;
exercising functions of the Secretary of State under Part 42 of that Act ;
assessing, and reporting to the Secretary of State on, the comparability of the audit regulatory regimes of third countries to the audit regulatory regime of the United Kingdom;
carrying out investigations into public interest cases arising in connection with the performance of accountancy functions by members of professional accountancy bodies;
assessing, and reporting to the Secretary of State on, the adequacy of third country competent authorities, in relation to their ability to co-operate with the competent authority on the exchange of audit working papers and investigation reports;
holding disciplinary hearings relating to members of such bodies following the conclusion of such investigations;
deciding whether (and, if so, what) disciplinary action should be taken against members of such bodies to whom such hearings related;
supervising the exercise by such bodies of regulatory functions in relation to their members;
issuing standards to be applied in actuarial work;
exercising functions of the Independent Supervisor appointed under Chapter 3 of Part 42 of the Companies Act 2006;
establishing, maintaining or carrying out arrangements within paragraph 1 or 2 of Schedule 12 to the Companies Act 2006;
issuing standards in respect of matters to be contained in reports or other communications required to be produced or made by actuaries or in accordance with standards within paragraph (l);
investigating departures from standards within paragraph (l) or (m);
taking steps to secure compliance with standards within paragraph (l) or (m);
exercising functions under regulations made under section 113(3A) of the Pension Schemes Act 1993 or section 109(3A) of the Pension Schemes (Northern Ireland) Act 1993 (preparing guidance for pensions illustrations);
carrying out investigations into public interest cases arising in connection with the performance of actuarial functions by members of professional actuarial bodies;
holding disciplinary hearings relating to members of professional actuarial bodies following the conclusion of investigations within paragraph (p);
deciding whether (and, if so, what) disciplinary action should be taken against members of professional actuarial bodies to whom hearings within paragraph (q) related;
supervising the exercise by professional actuarial bodies of regulatory functions in relation to their members;
overseeing or directing any of the matters mentioned above.
A grant may be made to a body within subsection (1) in respect of any of its activities.
For the purposes of this section—
a body is to be regarded as carrying on any subsidiary activities of the body; and
a body’s “subsidiary activities” are activities carried on by any of its subsidiaries or by any body established under its constitution or under the constitution of such a subsidiary.
In this section—
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The Secretary of State may make payments to the Appeal Officer.
the setting by such bodies of standards in relation to the performance by their members of accountancy functions, and
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for “section 389A(1) and (2)” substitute “sections 389A(1) and 389B(1) and (5)”; and
for “the auditors” substitute “an auditor”.
the determining by such bodies of requirements in relation to the education and training of their members;
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after “under” insert “section 245E(3), section 245G(7),”; and
omit “section 389A(3) or”.
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“regulatory functions”, in relation to professional accountancy bodies, means any of the following functions—
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“the competent authority” means the Financial Reporting Council Limited;
the setting by such bodies of standards in relation to the performance by their members of actuarial functions, and
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In paragraph 24 of Schedule 4 to the Anti-terrorism, Crime and Security Act 2001 (enactments to which section 17 of that Act applies), for “449(1)” substitute “ 449 ”.
The Regulator may, after consulting the Minister for the Civil Service as to numbers and terms and conditions of service, appoint such staff as the Regulator may determine. The members of staff must include a deputy to the Regulator who is to act as Regulator— Where a participant in a scheme under section 1 of the Superannuation Act 1972 (c. 11) is appointed as the Regulator, the Minister for the Civil Service may determine that the person’s term of office as the Regulator is to be treated for the purposes of the scheme as service in the employment by reference to which he was a participant (whether or not any benefits are payable by virtue of paragraph 2(2)).
The Regulator must, in respect of each financial year, prepare a report on the exercise of the Regulator’s functions during the financial year. The Regulator must prepare accounts in respect of a financial year if the Secretary of State so directs. The Regulator must send a copy of the accounts to the Comptroller and Auditor General. The Comptroller and Auditor General must examine, certify and report on the accounts and send a copy of the report to the Regulator. The Regulator must include the accounts and the Comptroller and Auditor General’s report on them in the report prepared by the Regulator in respect of the financial year to which the accounts relate. The Regulator must prepare that report as soon as possible after the end of the financial year to which it relates. The Regulator must send to the Secretary of State a copy of— The Secretary of State must lay before each House of Parliament a copy of each of those reports. The Regulator must supply the Secretary of State with such other reports and information relating to the exercise of the Regulator’s functions as the Secretary of State may require. “Financial year” means—
Regulations may make provision about the practice and procedure to be followed by the Appeal Officer. Regulations under this paragraph may in particular impose time limits for bringing appeals.
The person appointed to chair the Charity Commission may make available to the Regulator, to assist in the exercise of the Regulator's functions—
any other member of the Commission appointed under paragraph 1(1) of Schedule 1 to the Charities Act 2011, or
any member of staff of the Commission appointed under paragraph 5(1) of that Schedule.
In section 124A(1)(a) of the Insolvency Act 1986 (petition for winding up on grounds of public interest), after “Part XIV” insert “ (except section 448A) ”.
In paragraph 17 of Schedule 2 to the Criminal Justice and Police Act 2001 (amendments of sections 434 and 447 of the Companies Act 1985), for “sections 434(6) and 447(9)” substitute “ section 434(6) ”.
a qualifying body, as defined by section 32 of that Act, which enforces rules as to the performance of accountancy functions by its members,
In their application to Scotland, subsection (2)(a) to (t) are to be read as referring only to matters provision relating to which would be outside the legislative competence of the Scottish Parliament.
subsection (2)(a) is to be read as referring only to accounting standards applying in relation to the accounts of companies or bodies (other than companies) established for the purpose of carrying on any kind of business, whether or not for profit;
subsection (2)(h) to (j) are to be read as referring only to accountancy functions performed in relation to companies or such bodies, and
subsection (2)(k) is to be read as referring only to regulatory functions exercised in relation to the performance of such accountancy functions;
Omit section 256(3) of the Companies Act 1985 (c. 6) (grants to bodies concerned with issuing accounting standards etc.), which is superseded by this section.
“company” means a company as defined in section 1(1) of the Companies Act 2006;
“ professional actuarial body” means— and the “members” of a professional actuarial body include persons who, although not members of the body, are subject to its rules in performing actuarial functions;
References in this section to Part 42 of the Companies Act 2006 or to paragraph 21, 22, 23(1) or 24(1) of Schedule 10 to that Act include that Part or paragraph as it has effect by virtue of Schedule 5 to the Local Audit and Accountability Act 2014 (which applies Part 42 with modifications in relation to audits of local authorities etc).
The reference in the definition of “professional accountancy body” in subsection (5) to section 1220 of the Companies Act 2006 includes a reference to section 1219 of that Act as it has effect by virtue of Schedule 5 to the Local Audit and Accountability Act 2014.
For the purpose of meeting any part of the expenses of a grant-aided body, the Secretary of State may by regulations provide for a levy to be payable to that body (“the specified recipient”) by bodies or persons which are specified, or are of a description specified, in the regulations.
For the purposes of this section—
“grant-aided body” means a body to whom the Secretary of State has paid, or is proposing to pay, grant under section 16; and
any expenses of any body carrying on subsidiary activities of the grant-aided body (within the meaning of that section) are to be regarded as expenses of the grant-aided body.
The power to specify (or to specify descriptions of) bodies or persons must be exercised in such a way that the levy is only payable by—
bodies corporate to which , or persons within subsection (3A) to whom, the Secretary of State considers that any of the activities of the specified recipient, or any of its subsidiary activities, are relevant to a significant extent, or
bodies or persons who the Secretary of State considers have a major interest in any of those activities being carried on.
Regulations under this section may in particular—
specify the rate of the levy and the period in respect of which it is payable at that rate;
make provision as to the times when, and the manner in which, payments are to be made in respect of the levy.
make different provision for different cases.
The following persons are within this subsection—
the administrators of a public service pension scheme (within the meaning of section 1 of the Pension Schemes Act 1993);
the trustees or managers of an occupational or personal pension scheme (within the meaning of that section).
In determining the rate of the levy payable in respect of a particular period, the Secretary of State—
must take into account the amount of any grant which is to be or has been made to the specified recipient in respect of that period under section 16;
may take into account estimated as well as actual expenses of that body in respect of that period.
Any amount of levy payable by any body or person is a debt due from the body or person to the specified recipient, and is recoverable accordingly.
The specified recipient must—
keep proper accounts in respect of amounts of levy received, and
prepare in relation to each levy period a statement of account relating to such amounts in such form and manner as is specified in the regulations.
Those accounts must be audited, and the statement certified, by persons appointed by the Secretary of State.
The power to make regulations under this section is exercisable by statutory instrument.
Regulations to which this subsection applies may not be made unless a draft of the regulations has been laid before, and approved by a resolution of, each House of Parliament.
Subsection (10) applies to—
the first regulations under this section, and
any other regulations under this section that would result in any change in the bodies or persons by whom the levy is payable.
Otherwise, any statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of either House of Parliament.
If a draft of any regulations to which subsection (10) applies would, apart from this subsection, be treated for the purposes of the standing orders of either House of Parliament as a hybrid instrument, it is to proceed in that House as if it were not such an instrument.
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Where a grant has been paid by the Secretary of State to a body under section 16, this section prevents any liability in damages arising in respect of certain acts or omissions occurring during the period of 12 months beginning with the date on which the grant was paid.
In this section—
The Official Property Holder is a corporation sole. A document purporting to be— shall be received in evidence and shall, unless the contrary is proved, be taken to be so executed or signed.
The Official Property Holder holds property vested in or transferred to him as a trustee. The Official Property Holder may release or deal with the property— Subject to sub-paragraph (2), the Official Property Holder may not release or deal with the property except in accordance with directions given by the Regulator.
A statement made by a person in compliance with a requirement imposed under paragraph 1 may be used in evidence against the person. But in criminal proceedings— unless evidence relating to it is adduced or a question relating to it is asked in the proceedings by or on behalf of that person. However, sub-paragraph (2) does not apply to proceedings in which a person is charged with—
“a relevant body” means the body mentioned in that subsection or a body carrying on any subsidiary activities of that body (within the meaning of section 16);
The Appeal Officer holds office for the period determined by the Secretary of State on appointment (or re-appointment). But— Subject to that, the Appeal Officer holds and vacates office on the terms determined by the Secretary of State.
“enactment” includes an Act of the Scottish Parliament,
Neither a relevant body, nor any person who is (or is acting as) a member, officer or member of staff of a relevant body, is to be liable in damages for anything done, or omitted to be done, during the exemption period for the purposes of or in connection with—
the carrying on of any section 16(2) activities of the body, or
the purported carrying on of any such activities.
Subsection (3) does not apply—
if the act or omission is shown to have been in bad faith; or
so as to prevent an award of damages in respect of the act or omission on the grounds that it was unlawful as a result of section 6(1) of the Human Rights Act 1998 (c. 42) (acts of public authorities incompatible with Convention rights).
The Secretary of State may by order or regulations provide for the exemption from liability in subsections (3) and (4) to apply to specified bodies or persons (referred to in this section as “exempt persons”).
The order or regulations may provide for the exemption to apply subject to specified conditions or for a specified period.
Neither the exempt person, nor any person who is (or is acting as) a member, officer or member of staff of the exempt person, is to be liable in damages for anything done, or omitted to be done, for the purposes of or in connection with—
the carrying on of those section 16(2) activities of the exempt person that are specified in relation to that person, or
the purported carrying on of any such activities.
Subsection (3) does not apply—
if the act or omission is shown to have been in bad faith, or
so as to prevent an award of damages in respect of the act or omission on the grounds that it was unlawful as a result of section 6(1) of the Human Rights Act 1998 (acts of public authorities incompatible with Convention rights).
In this section—
Orders and regulations under this section—
are to be made by statutory instrument;
may make different provision for different cases;
may make transitional provision and savings.
A statutory instrument containing an order or regulations under this section is subject to annulment in pursuance of a resolution of either House of Parliament, subject to subsection (8).
An order or regulations under this section may be included in a statutory instrument which may not be made unless a draft of the instrument is laid before, and approved by a resolution of, each House of Parliament.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
After section 309 of the Companies Act 1985 (c. 6) insert—
In section 310 of that Act (provisions exempting officers and auditors from liability), the following provisions cease to have effect— and in the sidenote, for “exempting officers and” substitute “protecting”.
in subsection (1), the words “any officer of the company or”, and
in subsection (3)—
the words “officer or” (in both places), and
the words from “section 144(3)” to “nominee) or”;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
For section 447 of the Companies Act 1985 (c. 6) substitute—
After section 448 of the Companies Act 1985 (c. 6) insert—
After section 453 of the Companies Act 1985 (c. 6) insert—
After section 453B of the Companies Act 1985 (c. 6) (inserted by section 23) insert—
Schedule 2 (minor and consequential amendments relating to Part 1) has effect.
That Schedule has effect subject to the modifications set out in subsection (3)—
in relation to England and Wales, in the case of an offence committed before 2 May 2022, and
in relation to Scotland.
The modifications are—
the amendment in paragraph 10(2) has effect as if for “12 months” there were substituted “ 6 months ”;
the amendment in paragraph 10(3) has effect as if for “12 months”, in both places where it occurs, there were substituted “ 3 months ”;
the amendment in paragraph 10(4) has effect as if for “12 months” there were substituted “ 6 months ”;
the amendment in paragraph 26(2) has effect as if for “the general limit in a magistrates’ court” there were substituted “ 6 months ”; and
the amendment in paragraph 26(3) has effect as if for “the general limit in a magistrates’ court” there were substituted “ 6 months ”.
There is to be a new type of company to be known as the community interest company.
In accordance with this Part—
a company limited by shares or a company limited by guarantee and not having a share capital may be formed as or become a community interest company, and
a company limited by guarantee and having a share capital may become a community interest company.
A community interest company established for charitable purposes is to be treated as not being so established and accordingly—
is not an English charity or a Northern Ireland charity, and
must not be entered in the Scottish Charity Register.
There is to be an officer known as the Regulator of Community Interest Companies (referred to in this Part as “the Regulator”).
The Secretary of State must appoint a person to be the Regulator.
The Regulator has such functions relating to community interest companies as are conferred or imposed by or by virtue of this Act or any other enactment.
The Regulator must adopt an approach to the discharge of those functions which is based on good regulatory practice, that is an approach adopted having regard to—
the likely impact on those who may be affected by the discharge of those functions,
the outcome of consultations with, and with organisations representing, community interest companies and others with relevant experience, and
the desirability of using the Regulator’s resources in the most efficient and economic way.
The Regulator may issue guidance, or otherwise provide assistance, about any matter relating to community interest companies.
The Secretary of State may require the Regulator to issue guidance or otherwise provide assistance about any matter relating to community interest companies which is specified by the Secretary of State.
Any guidance issued under this section must be such that it is readily accessible to, and capable of being easily understood by, those at whom it is aimed; and any other assistance provided under this section must be provided in the manner which the Regulator considers is most likely to be helpful to those to whom it is provided.
Schedule 3 (further provisions about the Regulator) has effect.
There is to be an officer known as the Appeal Officer for Community Interest Companies (referred to in this Part as “the Appeal Officer”).
The Secretary of State must appoint a person to be the Appeal Officer.
The Appeal Officer has the function of determining appeals against decisions and orders of the Regulator which under or by virtue of this Act or any other enactment lie to the Appeal Officer.
An appeal to the Appeal Officer against a decision or order of the Regulator may be brought on the ground that the Regulator made a material error of law or fact.
On such an appeal the Appeal Officer must—
dismiss the appeal,
allow the appeal, or
remit the case to the Regulator.
Where a case is remitted the Regulator must reconsider it in accordance with any rulings of law and findings of fact made by the Appeal Officer.
Schedule 4 (further provisions about the Appeal Officer) has effect.
There is to be an officer known as the Official Property Holder for Community Interest Companies (referred to in this Part as “the Official Property Holder”).
The Regulator must appoint a member of the Regulator’s staff to be the Official Property Holder.
The Official Property Holder has such functions relating to property of community interest companies as are conferred or imposed by or by virtue of this Act or any other enactment.
Schedule 5 (further provisions about the Official Property Holder) has effect.
Community interest companies must not distribute assets to their members unless regulations make provision authorising them to do so.
If regulations authorise community interest companies to distribute assets to their members, the regulations may impose limits on the extent to which they may do so.
Regulations may impose limits on the payment of interest on debentures issued by, or debts of, community interest companies.
Regulations under this section may make provision for limits to be set by the Regulator.
The Regulator—
may set a limit by reference to a rate determined by any other person (as it has effect from time to time), and
may set different limits for different descriptions of community interest companies.
The Regulator must (in accordance with section 27)—
undertake appropriate consultation before setting a limit, and
in setting a limit, have regard to its likely impact on community interest companies.
Regulations under this section may include power for the Secretary of State to require the Regulator to review a limit or limits.
Where the Regulator sets a limit he must publish notice of it in the Gazette.
Regulations may make provision for and in connection with the distribution, on the winding up of a community interest company, of any assets of the company which remain after satisfaction of the company’s liabilities.
The regulations may, in particular, amend or modify the operation of any enactment or instrument.
The articles of a community interest company must state that the company is to be a community interest company.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The articles of a community interest company of any description—
must at all times include such provisions as regulations require to be included in the articles of every community interest company or a community interest company of that description, and
must not include such provisions as regulations require not to be so included.
The provisions required by regulations under subsection (3)(a) to be included in the articles of a community interest company may (in particular) include—
provisions about the transfer and distribution of the company’s assets (including their distribution on a winding up),
provisions about the payment of interest on debentures issued by the company or debts of the company,
provisions about membership of the company,
provisions about the voting rights of members of the company,
provisions about the appointment and removal of directors of the company, and
provisions about voting at meetings of directors of the company.
The articles of a community interest company are of no effect to the extent that they—
are inconsistent with provisions required to be included in the articles of the company by regulations under subsection (3)(a), or
include provisions required not to be included by regulations under subsection (3)(b).
Regulations may make provision for and in connection with restricting the ability of a community interest company to amend its articles so as to add, remove or alter a statement of the company’s objects.
The name of a community interest company which is not a public company must end with—
“community interest company”, or
“c.i.c.”.
In the case of a Welsh company, its name may instead end with— ...
“cwmni buddiant cymunedol”, or
“c.b.c.”,
The name of a community interest company which is a public company must end with—
“community interest public limited company”, or
“community interest p.l.c.”.
In the case of a Welsh company, its name may instead end with— ...
“cwmni buddiant cymunedol cyhoeddus cyfyngedig”, or
“cwmni buddiant cymunedol c.c.c.”,
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The directors of a community interest company must prepare in respect of each financial year a report about the company’s activities during the financial year (a “community interest company report”).
Regulations must make provision requiring the directors of a community interest company to deliver to the registrar of companies a copy of the community interest company report.
Regulations—
must make provision requiring community interest company reports to include information about the remuneration of directors,
may make provision as to the form of, and other information to be included in, community interest company reports, and
may apply provisions of ... the Companies Act 2006 relating to directors' reports to community interest company reports (with any appropriate modifications).
The registrar of companies must forward to the Regulator a copy of each community interest company report delivered to the registrar by virtue of this section.
This section has effect for the purposes of this Part.
A company satisfies the community interest test if a reasonable person might consider that its activities are being carried on for the benefit of the community.
An object stated in the articles of a company is a community interest object of the company if a reasonable person might consider that the carrying on of activities by the company in furtherance of the object is for the benefit of the community.
Regulations may provide that activities of a description prescribed by the regulations are to be treated as being, or as not being, activities which a reasonable person might consider are activities carried on for the benefit of the community.
“Community” includes a section of the community (whether in the United Kingdom or anywhere else); and regulations may make provision about what does, does not or may constitute a section of the community.
A company is an excluded company if it is a company of a description prescribed by regulations.
If a company is to be formed as a community interest company, the documents delivered to the registrar of companies under section 9 of the Companies Act 2006 (registration documents) must be accompanied by the prescribed formation documents.
The “prescribed formation documents” means such declarations or statements as are required by regulations to accompany the application, in such form as may be approved in accordance with the regulations.
On receiving the documents delivered under that section and the prescribed formation documents, the registrar must (instead of registering the documents)—
forward a copy of each of the documents to the Regulator, and
retain the documents pending the Regulator’s decision.
The Regulator must decide whether the company is eligible to be formed as a community interest company.
A company is eligible to be formed as a community interest company if—
the memorandum and articles comply with the requirements imposed by and by virtue of section 32 and the company’s name complies with section 33, and
the Regulator, having regard to the documents delivered under section 10 of the Companies Act 1985 (c. 6), the prescribed formation documents and any other relevant considerations, considers that the company will satisfy the community interest test and is not an excluded company.
The Regulator must give notice of the decision to the registrar of companies (but the registrar is not required to record it).
If the Regulator gives notice of a decision that the company is eligible to be formed as a community interest company, section 12 of the Companies Act 1985 (registration of memorandum and articles) applies; and if the registrar registers the memorandum and articles he must also retain and record the prescribed formation documents.
The certificate of incorporation under section 13 of the Companies Act 1985 (effect of registration) is to contain a statement that the company is a community interest company.
The fact that the certificate of incorporation contains such a statement is conclusive evidence that the company is a community interest company.
If the Regulator decides that the company is not eligible to be formed as a community interest company, any subscriber to the memorandum may appeal to the Appeal Officer against the decision.
If a company is to become a community interest company—
the company must by special resolution—
state that it is to be a community interest company,
make such alterations of its articles as it considers necessary to comply with requirements imposed by and by virtue of section 32 or otherwise appropriate in connection with becoming a community interest company, and
change its name to comply with section 33;
the conditions specified below must be met; and
an application must be delivered to the registrar of companies in accordance with section 37C together with the other documents required by that section.
The conditions referred to in subsection (1)(b) are that—
where no application under section 37A for cancellation of the special resolutions has been made—
having regard to the number of members who consented to or voted in favour of the resolutions, no such application may be made, or
the period within which such an application could be made has expired, or
where such an application has been made—
the application has been withdrawn, or
an order has been made confirming the resolutions and a copy of that order has been delivered to the registrar.
Section 30 of the Companies Act 2006 (copies of resolutions to be forwarded to the registrar) applies to the special resolutions as follows—
that section is complied with by forwarding copies of the resolutions together with the application in accordance with section 37C,
copies of the resolutions must not be so forwarded before the relevant date, and
subsection (1) of that section has effect in relation to the resolutions as if it referred to 15 days after the relevant date.
The relevant date is—
if an application is made under section 37A for cancellation of the special resolutions—
the date on which the court determines the application (or if there is more than one application, the date on which the last to be determined by the court is determined), or
such later date as the court may order;
if there is no such application—
if having regard to the number of members who consented to or voted in favour of the resolutions, no such application may be made, the date on which the resolutions were passed or made (or, if the resolutions were passed or made on different days, the date on which the last of them was passed or made);
in any other case, the end of the period for making such an application.
If there is no application under section 5 of that Act, the relevant date is the end of the period for making such an application.
The copies of the special resolutions forwarded to the registrar of companies must be accompanied by—
a copy of the memorandum and articles of the company as altered by the special resolutions, and
the prescribed conversion documents.
“The prescribed conversion documents” means such statutory declarations or other declarations or statements as are required by regulations to accompany the copies of the special resolutions, in such form as may be approved in accordance with the regulations.
The Regulator must decide whether the company is eligible to be formed as a community interest company.
A company is eligible to be formed as a community interest company if—
its articles comply with the requirements imposed by and by virtue of section 32,
its proposed name complies with section 33, and
the Regulator, having regard to the application and accompanying documents and any other relevant considerations, considers that the company—
will satisfy the community interest test, and
is not an excluded company.
The Regulator must give notice of the decision to the registrar of companies (but the registrar is not required to record it).
The Regulator must decide whether the company is eligible to become a community interest company.
forward a copy of each of the documents to the Regulator, and
retain the documents pending the Regulator’s decision.
A company is eligible to become a community interest company if—
its articles as proposed to be amended comply with the requirements imposed by and by virtue of section 32,
its proposed name complies with section 33, and
the Regulator, having regard to the application and accompanying documents and any other relevant considerations, considers that the company—
will satisfy the community interest test, and
is not an excluded company.
The Regulator must give notice of the decision to the registrar of companies (but the registrar is not required to record it).
A company is eligible to become a community interest company if—
the memorandum and articles as altered by the special resolutions comply with the requirements imposed by and by virtue of section 32 and the company’s name as so altered complies with section 33, and
the Regulator, having regard to the special resolutions, the memorandum and articles as altered, the prescribed conversion documents and any other relevant considerations, considers that the company will satisfy the community interest test and is not an excluded company.
The Regulator must give notice of the decision to the registrar of companies (but the registrar is not required to record it).
If the Regulator gives notice of a decision that the company is eligible to become a community interest company, section 28(6) of the Companies Act 1985 (registration of new name) applies; and if the registrar of companies enters the new name of the company on the register the registrar must also retain and record the special resolutions and the prescribed conversion documents.
On the special resolutions being recorded, the alterations to the company’s articles and memorandum made by the special resolutions take effect.
The certificate of incorporation under section 28(6) of the Companies Act 1985 (c. 6) is to contain a statement that the company is a community interest company.
The fact that the certificate of incorporation contains such a statement is conclusive evidence that the company is a community interest company.
If the Regulator decides that the company is not eligible to become a community interest company, the company may appeal to the Appeal Officer against the decision.
If the Regulator decides that the company is eligible to be formed as a community interest company, the registrar of companies must—
proceed in accordance with sections 14 and 15 of the Companies Act 2006 (registration and issue of certificate of incorporation), and
if the company is entered on the register, retain and record the prescribed formation documents.
The certificate of incorporation must state that the company is a community interest company and is conclusive evidence that the company is a community interest company.
If the Regulator decides that the company is not eligible to be formed as a community interest company, any subscriber to the memorandum of association may appeal to the Appeal Officer against the decision.
A company that is an English charity may not become a community interest company without the prior written consent of the Charity Commission.
If a company that is an English charity contravenes subsection (1), the Charity Commission may apply to the High Court for an order quashing any altered certificate of incorporation issued under section 38A .
If a company that is an English charity becomes a community interest company, that does not affect the application of—
any property acquired under any disposition or agreement previously made otherwise than for full consideration in money or money’s worth, or any property representing property so acquired,
any property representing income which has previously accrued, or
the income from any such property.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
A company that is a Scottish charity may not become a community interest company.
If a company that is a Scottish charity purports by special resolution to change its name to comply with section 33, the Commissioners of Inland Revenue may apply to the Court of Session for an order quashing any altered certificate of incorporation issued under section 28(6) of the 1985 Act.
Regulations may repeal subsections (1) and (2); and subsections (4) to (7) have effect on and after the day on which regulations under this subsection come into force.
A Scottish charitable company may not become a community interest company without the prior written consent—
if the company’s registered office is situated in Scotland, of the Scottish Charity Regulator, or
if the company’s registered office is situated in England and Wales (or Wales), of both the Scottish Charity Regulator and the Charity Commission.
If a company that is a Scottish charity contravenes subsection (4)(a), the Scottish Charity Regulator may apply to the Court of Session for an order quashing any altered certificate of incorporation issued under section 38A.
If a company that is a Scottish charity contravenes subsection (4)(b), the Scottish Charity Regulator or the Charity Commission may apply to the High Court for such an order.
If a company that is a Scottish charity becomes a community interest company, it shall continue to be under a duty to apply– in accordance with its purposes as set out in its entry in the Scottish Charity Register immediately before it became a community interest company.
any property previously acquired, or any property representing property previously acquired,
any property representing income which has previously accrued, or
the income from any such property.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
is a Scottish charity, or
not being a Scottish charity, is registered in Scotland and established for charitable purposes only.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Where special resolutions have been passed with a view to the company becoming a community interest company, an application to the court for the cancellation of the resolutions may be made— but not by a person who has consented to or voted in favour of the resolutions.
by the holders of not less in the aggregate than 15% in nominal value of the company’s issued share capital or any class of the company’s issued share capital (disregarding any shares held by the company as treasury shares);
if the company is not limited by shares, by not less than 15% of its members; or
by the holders of not less than 15% of the company’s debentures entitling the holders to object to an alteration of its objects;
The application—
must be made within 28 days after the date on which the resolutions are passed or made (or, if the resolutions are passed or made on different days, the date on which the last of them is passed or made), and
may be made on behalf of the persons entitled to make it by such one or more of their number as they may appoint for the purpose.
On the hearing of the application the court shall make an order either cancelling or confirming the resolutions.
The court may—
make that order on such terms and conditions as it thinks fit,
if it thinks fit adjourn the proceedings in order that an arrangement may be made to the satisfaction of the court for the purchase of the interests of dissentient members, and
give such directions, and make such orders, as it thinks expedient for facilitating or carrying into effect any such arrangement.
The court’s order may, if the court thinks fit—
provide for the purchase by the company of the shares of any of its members and for the reduction accordingly of the company’s capital; and
make such alteration in the company’s articles as may be required in consequence of that provision.
The court’s order may, if the court thinks fit, require the company not to make any, or any specified, amendments to its articles without the leave of the court.
On making an application under section 37A (application to court to cancel resolutions) the applicants, or the person making the application on their behalf, must immediately give notice to the registrar of companies. This is without prejudice to any provision of rules of court as to service of notice of the application.
On being served with notice of any such application, the company must immediately give notice to the registrar.
Within 15 days of the making of the court’s order on the application, or such longer period as the court may at any time direct, the company must deliver to the registrar a copy of the order.
If a company fails to comply with subsection (2) or (3) an offence is committed by—
the company, and
every officer of the company who is in default.
A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 3 on the standard scale.
An application to become a community interest company must be accompanied by—
a copy of the special resolutions,
a copy of the company’s articles as proposed to be amended, and
the prescribed conversion documents.
The “prescribed conversion documents” means such declarations or statements as are required by regulations to accompany the application, in such form as may be approved in accordance with the regulations.
On receiving an application to become a community interest company together with the other documents required to accompany it, the registrar of companies must (instead of recording the documents and entering a new name on the register)—
forward a copy of each of the documents to the Regulator, and
retain the documents pending the Regulator’s decision.
If the Regulator gives notice of a decision that the company is eligible to become a community interest company, the registrar of companies must—
proceed in accordance with section 80 of the Companies Act 2006 (change of name: registration and issue of new certificate of incorporation), and
if the registrar enters the new name of the company on the register, retain and record the documents mentioned in section 37C(3).
The new certificate of incorporation must state—
that it is issued on the company’s conversion to a community interest company,
the date on which it is issued, and
that the company is a community interest company.
On the issue of the certificate—
the company by virtue of the issue of the certificate becomes a community interest company, and
the changes in the company’s name and articles take effect.
The certificate is conclusive evidence that the company is a community interest company.
If the Regulator decides that the company is not eligible to become a community interest company, the company may appeal to the Appeal Officer against the decision.
A company that is a Northern Ireland charity may not become a community interest company.
If a company that is a Northern Ireland charity purports to become a community interest company , the Commissioners of Her Majesty’s Revenue and Customs may apply to the High Court for an order quashing any altered certificate of incorporation under section 38A.
In deciding whether and how to exercise the powers conferred by sections 42 to 51 the Regulator must adopt an approach which is based on the principle that those powers should be exercised only to the extent necessary to maintain confidence in community interest companies.
No power conferred on the Regulator by— is exercisable in relation to a community interest company unless the company default condition is satisfied in relation to the power and the company.
section 45 (appointment of director),
section 46 (removal of director),
section 47 (appointment of manager), or
section 48 (property),
The company default condition is satisfied in relation to a power and a company if it appears to the Regulator necessary to exercise the power in relation to the company because—
there has been misconduct or mismanagement in the administration of the company,
there is a need to protect the company’s property or to secure the proper application of that property,
the company is not satisfying the community interest test, or
if the company has community interest objects, the company is not carrying on any activities in pursuit of those objects.
The power conferred on the Regulator by section 49 (transfer of shares etc.) is not exercisable in relation to a community interest company unless it appears to the Regulator that the company is an excluded company.
The Regulator may—
investigate the affairs of a community interest company, or
appoint any person (other than a member of the Regulator’s staff) to investigate the affairs of a community interest company on behalf of the Regulator.
Subsection (1)(b) is in addition to paragraph 5 of Schedule 3 (powers of Regulator exercisable by authorised members of staff) and does not affect the application of that paragraph to the Regulator’s power under subsection (1)(a).
Schedule 7 (further provision about investigations under this section) has effect.
The Regulator may by order require a community interest company to allow the annual accounts of the company to be audited by a qualified auditor appointed by the Regulator.
A person is a qualified auditor if he is eligible for appointment as a statutory auditor under Part 42 of the Companies Act 2006 .
Sections 499 to 501 of the Companies Act 2006 (auditor’s rights to information) apply in relation to an auditor appointed under this section ...
On completion of the audit the auditor must make a report to the Regulator on such matters and in such form as the Regulator specifies.
The expenses of the audit, including the remuneration of the auditor, are to be paid by the Regulator.
An audit under this section is in addition to, and does not affect, any audit required by or by virtue of any other enactment.
The Regulator may bring civil proceedings in the name and on behalf of a community interest company.
Before instituting proceedings under this section the Regulator must give written notice to the company stating—
the cause of action,
the remedy sought, and
a summary of the facts on which the proceedings are to be based.
Any director of the company may apply to the court for an order—
that proposed proceedings are not to be instituted under this section, or
that proceedings instituted under this section are to be discontinued.
On an application under subsection (3) the court may make such order as it thinks fit.
In particular the court may (as an alternative to ordering that proposed proceedings are not to be instituted under this section or that proceedings instituted under this section are to be discontinued) order—
that the proposed proceedings may be instituted under this section, or the proceedings instituted under this section may be continued, on such terms and conditions as the court thinks fit,
that any proceedings instituted by the company are to be discontinued, or
that any proceedings instituted by the company may be continued on such terms and conditions as the court thinks fit.
The Regulator must indemnify the company against any costs (or expenses) incurred by it in connection with proceedings brought under this section.
Any costs (or expenses)— are to be paid to the Regulator.
awarded to the company in connection with proceedings brought under this section, or
incurred by the company in connection with the proceedings and which it is agreed should be paid by a defendant (or defender),
The Regulator may by order appoint a director of a community interest company.
The person appointed may be anyone whom the Regulator thinks appropriate, other than a member of the Regulator’s staff.
A person may be appointed as a director of a company under this section—
whether or not the person is a member of the company, and
irrespective of any provision made by the articles of the company or a resolution of the company ....
An order appointing a person to be a director of a company under this section must specify the terms on which the director is to hold office; and those terms have effect as if contained in a contract between the director and the company.
The terms specified must include the period for which the director is to hold office, and may include terms as to the remuneration of the director by the company.
A director appointed under this section has all the powers of the directors appointed by the company (including powers exercisable only by a particular director or class of directors).
A director appointed under this section may not be removed by the company, but may be removed by the Regulator at any time.
Where— the obligation which would otherwise be imposed on the company under section 167G(1) of the Companies Act 2006 (duty to notify registrar of change in directors) is instead an obligation of the Regulator.
a person is appointed to be a director of the company under this section, or
a person so appointed ceases to be a director of the company,
But if subsection (10) applies, section 167G(6) applies as if the period within which the Regulator must send a notification to the registrar of companies is 14 days from the date on which the Regulator receives notification under that subsection.
Where a person appointed to be a director of the company under this section ceases to be a director of the company (otherwise than by removal under subsection (7)), the company must give notification of that fact to the Regulator in a form approved by the Regulator before the end of the period of 14 days beginning with the date on which the person ceases to be a director.
If default is made in complying with subsection (10) an offence is committed by— For this purpose a shadow director is treated as an officer of the company.
the company, and
every officer of the company who is in default.
A person guilty of an offence under subsection (11) 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 .
The company may appeal to the Appeal Officer against an order under this section.
The Regulator may by order remove a director of a community interest company.
If a person has been removed under subsection (1)—
the company may not subsequently appoint him a director of the company, and
any assignment to the person of the office of director of the company is of no effect (even if approved by special resolution of the company).
The Regulator may by order suspend a director of the company pending a decision whether to remove him.
The maximum period for which a director may be suspended under subsection (3) is one year.
If the Regulator suspends a director under subsection (3) the Regulator may give directions in relation to the performance of the director’s functions.
The Regulator may discharge an order made under subsection (1).
The discharge of an order made under subsection (1) does not reinstate the person removed by the order as a director of the company, but on the discharge of the order subsection (2) ceases to apply to the person.
The Regulator must from time to time review any order made under subsection (3) and, if it is appropriate to do so, discharge the order.
Before making an order under subsection (1) or (3) in relation to a director, the Regulator must give at least 14 days' notice to—
the director, and
the company.
Where an order is made in relation to a director under subsection (1) or (3) the director may appeal against the order—
in England and Wales or Northern Ireland, to the High Court, or
in Scotland, to the Court of Session.
The Regulator must, before the end of the period of 14 days beginning with the date on which— give notification of that event to the registrar of companies in a form approved by the registrar of companies.
an order under subsection (1) is made or discharged,
an order under subsection (3) is made or discharged or expires, or
an order under subsection (1) or (3) is quashed on appeal,
Where subsection (11) imposes an obligation to notify the registrar of companies of an event, section 167G(1) of the Companies Act 2006 (duty to notify registrar of change in directors) does not apply in respect of the event.
The Regulator may by order appoint a manager in respect of the property and affairs of a community interest company.
The person appointed may be anyone whom the Regulator thinks appropriate, other than a member of the Regulator’s staff.
An order under subsection (1) may make provision as to the functions to be exercised by, and the powers of, the manager.
The order may in particular provide—
for the manager to have such of the functions of the company’s directors as are specified in the order, and
for the company’s directors to be prevented from exercising any of those functions.
In carrying out his functions the manager acts as the company’s agent; and a person dealing with the manager in good faith and for value need not inquire whether the manager is acting within his powers.
The appointment of the manager does not affect—
any right of any person to appoint a receiver or manager of the company’s property (including any right under section 51 of the Insolvency Act 1986 (c. 45) (power to appoint receiver under law of Scotland)), or
the rights of a receiver or manager appointed by a person other than the Regulator.
The manager’s functions are to be discharged by him under the supervision of the Regulator; and the Regulator must from time to time review the order by which the manager is appointed and, if it is appropriate to do so, discharge it in whole or in part.
In particular, the Regulator must discharge the order on the appointment of a person to act as administrative receiver, administrator, provisional liquidator or liquidator of the company.
The Regulator may apply to the court for directions in relation to any matter arising in connection with the manager’s functions or powers.
On an application under subsection (9) the court may give such directions or make such orders as it thinks fit.
The costs of any application under subsection (9) are to be paid by the company.
Regulations may authorise the Regulator—
to require a manager to make reports,
to require a manager to give security (or, in Scotland, to find caution) for the due exercise of the manager’s functions, and
to remove a manager in circumstances prescribed by the regulations.
Regulations may—
provide for a manager’s remuneration to be payable from the property of the company, and
authorise the Regulator to determine the amount of a manager’s remuneration and to disallow any amount of remuneration in circumstances prescribed by the regulations.
The company may appeal to the Appeal Officer against an order under this section.
The Regulator may by order—
vest in the Official Property Holder any property held by or in trust for a community interest company, or
require persons in whom such property is vested to transfer it to the Official Property Holder.
The Regulator—
may order a person who holds property on behalf of a community interest company, or on behalf of a trustee of a community interest company, not to part with the property without the Regulator’s consent, and
may order any debtor of a community interest company not to make any payment in respect of the debtor’s liability to the company without the Regulator’s consent.
The Regulator may by order restrict— and the order may in particular provide that transactions may not be entered into or payments made without the Regulator’s consent.
the transactions which may be entered into by a community interest company, or
the nature or amount of the payments that a community interest company may make,
The vesting or transfer of property under subsection (1) does not constitute a breach of a covenant or condition against alienation, and no right listed in subsection (5) operates or becomes exercisable as a result of the vesting or transfer.
The rights are—
a right of reverter (or, in Scotland, the right of the fiar on the termination of a liferent),
a right of pre-emption,
a right of forfeiture,
a right of re-entry,
a right of irritancy,
an option, and
any right similar to those listed in paragraphs (a) to (f).
The Regulator must from time to time review any order under this section and, if it is appropriate to do so, discharge the order in whole or in part.
On discharging an order under subsection (1) the Regulator may make any order as to the vesting or transfer of the property, and give any directions, which he considers appropriate.
If a person fails to comply with an order under subsection (1)(b), the Regulator may certify that fact in writing to the court.
If, after hearing— the court is satisfied that the offender failed without reasonable excuse to comply with the order, it may deal with him as if he had been guilty of contempt of the court.
any witnesses who may be produced against or on behalf of the alleged offender, and
any statement which may be offered in defence,
A person who contravenes an order under subsection (2) or (3) commits an offence, but a prosecution may be instituted—
A person guilty of an offence under subsection (10) is liable on summary conviction to a fine not exceeding level 5 on the standard scale.
in England and Wales, only with the consent of the Regulator or the Director of Public Prosecutions;
Subsections (8) to (10) do not prevent the bringing of civil proceedings in respect of a contravention of an order under subsection (1)(b), (2) or (3).
in Northern Ireland, only with the consent of the Regulator or the Director of Public Prosecutions for Northern Ireland.
The company and any person to whom the order is directed may appeal to the Appeal Officer against an order under subsection (1) or (2).
The company may appeal to the Appeal Officer against an order under subsection (3).
If a community interest company has a share capital, the Regulator may by order transfer specified shares in the company to specified persons.
If a community interest company is a company limited by guarantee, the Regulator may by order—
extinguish the interests in the company of specified members of the company (otherwise than as shareholders), and
appoint a new member in place of each member whose interest has been extinguished.
An order under subsection (1) may not transfer any shares in respect of which—
a dividend may be paid, or
a distribution of the company’s assets may be made if the company is wound up.
An order under this section in relation to a company—
may only transfer shares to, and appoint as new members, persons who have consented to the transfer or appointment, and
may be made irrespective of any provision made by the articles of the company or a resolution of the company in general meeting.
The company and any person from whom shares are transferred by the order may appeal to the Appeal Officer against an order under subsection (1).
The company and any person whose interest is extinguished by the order may appeal to the Appeal Officer against an order under subsection (2).
“Specified”, in relation to an order, means specified in the order.
The Regulator may present a petition for a community interest company to be wound up if the court is of the opinion that it is just and equitable that the company should be wound up.
Subsection (1) does not apply if the company is already being wound up by the court.
In section 124 of the Insolvency Act 1986 (c. 45) (application for winding up), after subsection (4) insert—
If a community interest company has been— the Regulator may apply to the court under section 1029 of that Act for an order restoring the company’s name to the register.
dissolved, or
struck off the register under section 1000 or 1001 of the Companies Act 2006,
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If an application under section 1003 of the Companies Act 2006 (striking off on application by company) is made on behalf of a community interest company, section 1006 of the Companies Act 2006 (persons to be notified of application) is to be treated as also requiring a copy of the application to be given to the Regulator.
A community interest company is excluded from re-registering under section 102 of the Companies Act 2006 (re-registration of limited company as unlimited).
If a community interest company which is not a public company re-registers as a public company under section 90 of the Companies Act 2006 , or a community interest company which is a public company re-registers as a private company under section 97 of the Companies Act 2006 , the certificate of incorporation issued under section 96(2) or 101(2) of the Companies Act 2006 is to contain a statement that the company is a community interest company.
The fact that the certificate of incorporation contains such a statement is conclusive evidence that the company is a community interest company.
A community interest company may not cease to be a community interest company except by dissolution or as provided—
by sections 54 to 55A (becoming a charity ...), or
if regulations are made under section 56 (becoming a registered society ), by the regulations.
If a company is to cease to be a community interest company and become a charity—
the company must by special resolution—
state that it is to cease to be a community interest company,
make such alterations of its articles as it considers appropriate, and
change its name so that it does not comply with section 33;
the conditions specified below must be met; and
an application must be delivered to the registrar of companies in accordance with section 54C together with the other documents required by that section.
The conditions referred to in subsection (1)(b) are that—
where no application under section 54A for cancellation of the special resolutions has been made—
having regard to the number of members who consented to or voted in favour of the resolutions, no such application may be made, or
the period within which such an application could be made has expired, or
where such an application has been made—
the application has been withdrawn, or
an order has been made confirming the resolutions and a copy of that order has been delivered to the registrar.
Section 30 of the Companies Act 2006 (copies of resolutions to be forwarded to the registrar) applies to the special resolutions as follows—
that section is complied with by forwarding copies of the resolutions together with the application in accordance with section 54C,
copies of the resolutions must not be so forwarded before the relevant date, and
subsection (1) of that section has effect in relation to the resolutions as if it referred to 15 days after the relevant date.
The relevant date is—
if an application is made under section 54A for cancellation of the resolutions—
the date on which the court determines the application (or if there is more than one application, the date on which the last to be determined by the court is determined), or
such later date as the court may order;
if there is no such application—
if having regard to the number of members who consented to or voted in favour of the resolutions, no such application may be made, the date on which the resolutions were passed or made (or, if the resolutions were passed or made on different days, the date on which the last of them was passed or made);
in any other case, the end of the period for making such an application.
If there is no application under section 5 of that Act, the relevant date is the end of the period for making such an application.
The copies of the special resolutions forwarded to the registrar of companies must be accompanied by—
a copy of the memorandum and articles of the company as altered by the special resolutions, and
a statement under subsection (7) or, if the company’s registered office is situated in Scotland and the company is to become a Scottish charity, a statement under subsection (8).
A statement under this subsection is a statement by the Charity Commissioners that in their opinion, if the special resolutions take effect and the company ceases to be a community interest company the company will be a charity and will not be an exempt charity.
A statement under this subsection is a statement by the Commissioners of Inland Revenue that—
the company has claimed exemption under section 505(1) of the Income and Corporation Taxes Act 1988 (c. 1), and
if the special resolutions take effect and the company ceases to be a community interest company the company will be given such intimation as is mentioned in section 1(7) of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 (c. 40).
“Exempt charity” has the same meaning as in the Charities Act 1993 (c. 10) (see section 96 of that Act).
The Regulator must decide whether the company is eligible to cease being a community interest company.
forward a copy of each of the documents to the Regulator, and
retain them pending the Regulator’s decision.
A company is eligible to cease being a community interest company if it has complied with sections 54 and 54C and none of the following applies—
the Regulator has under section 43 appointed an auditor to audit the company’s annual accounts and the audit has not been completed,
civil proceedings instituted by the Regulator in the name of the company under section 44 have not been determined or discontinued,
a director of the company holds office by virtue of an order under section 45,
a director of the company is suspended under section 46(3),
there is a manager in respect of the property and affairs of the company appointed under section 47,
the Official Property Holder holds property as trustee for the company,
an order under section 48(2) or (3) is in force in relation to the company,
a petition has been presented for the company to be wound up.
The Regulator must give notice of the decision to the registrar of companies (but the registrar is not required to record it).
The company is eligible to cease being a community interest company if it has complied with section 54 and none of the following applies—
the Regulator has under section 43 appointed an auditor to audit the company’s annual accounts and the audit has not been completed,
civil proceedings instituted by the Regulator in the name of the company under section 44 have not been determined or discontinued,
a director of the company holds office by virtue of an order under section 45,
a director of the company is suspended under section 46(3),
there is a manager in respect of the property and affairs of the company appointed under section 47,
the Official Property Holder holds property as trustee for the company,
an order under section 48(2) or (3) is in force in relation to the company,
a petition has been presented for the company to be wound up.
The Regulator must give notice of the decision to the registrar of companies (but the registrar is not required to record it).
If the Regulator gives notice of a decision that the company is eligible to cease being a community interest company, section 28(6) of the Companies Act 1985 (c. 6) (registration of new name) applies; and if the registrar of companies enters the new name of the company on the register he must also retain and record the special resolutions and the statement.
On the date on which the certificate of incorporation is issued the alterations to the company’s articles and memorandum made by the special resolutions take effect and the company ceases to be a community interest company.
If the Regulator decides that the company is not eligible to cease being a community interest company, the company may appeal to the Appeal Officer against the decision.
Where special resolutions have been passed with a view to a company ceasing to be a community interest company and becoming a charity, an application to the court for the cancellation of the resolutions may be made— but not by a person who has consented to or voted in favour of the resolutions.
by the holders of not less in the aggregate than 15% in nominal value of the company’s issued share capital or any class of the company’s issued share capital (disregarding any shares held by the company as treasury shares);
if the company is not limited by shares, by not less than 15% of its members; or
by the holders of not less than 15% of the company’s debentures entitling the holders to object to an alteration of its objects;
The application—
must be made within 28 days after the date on which the resolutions were passed or made (or, if the resolutions were passed or made on different days, the date on which the last of them was passed or made), and
may be made on behalf of the persons entitled to make it by such one or more of their number as they may appoint for the purpose.
On the hearing of the application the court shall make an order either cancelling or confirming the resolutions.
The court may—
make that order on such terms and conditions as it thinks fit,
if it thinks fit adjourn the proceedings in order that an arrangement may be made to the satisfaction of the court for the purchase of the interests of dissentient members, and
give such directions, and make such orders, as it thinks expedient for facilitating or carrying into effect any such arrangement.
The court’s order may, if the court thinks fit—
provide for the purchase by the company of the shares of any of its members and for the reduction accordingly of the company’s capital; and
make such alteration in the company’s articles as may be required in consequence of that provision.
The court’s order may, if the court thinks fit, require the company not to make any, or any specified, amendments to its articles without the leave of the court.
Unless regulations make provision to the contrary, a community interest company may not convert itself into a registered society under section 115 of the Co-operative and Community Benefit Societies Act 2014 or section 62 of the Industrial and Provident Societies Act (Northern Ireland) 1969.
If regulations make provision allowing the conversion of community interest companies under that section they may include provision modifying that section in its application by virtue of the regulations.
On making an application under section 54A (application to court to cancel resolutions) the applicants, or the person making the application on their behalf, must immediately give notice to the registrar of companies. This is without prejudice to any provision of rules of court as to service of notice of the application.
On being served with notice of any such application, the company must immediately give notice to the registrar.
Within 15 days of the making of the court’s order on the application, or such longer period as the court may at any time direct, the company must deliver to the registrar a copy of the order.
If a company fails to comply with subsection (2) or (3) an offence is committed by—
the company, and
every officer of the company who is in default.
A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 3 on the standard scale and, for continued contravention, a daily default fine not exceeding one-tenth of level 3 on the standard scale.
An application to cease to be a community interest company and become a charity must be accompanied by—
a copy of the special resolutions,
a copy of the company’s articles as proposed to be amended, and
the statement required by subsection (2).
The statement required is—
where the company is to become an English charity, a statement by the Charity Commission that, in its opinion, if the proposed changes take effect the company will be an English charity and will not be an exempt charity;
where the company is to become a Scottish charity, a statement by the Scottish Charity Regulator that if the proposed changes take effect the company will be entered in the Scottish Charity Register;
where the company is to become a Northern Ireland charity, a statement by the Commissioners of Her Majesty’s Revenue and Customs that the company has claimed exemption under a relevant provision of Part 11 of the Corporation Tax Act 2010.
In subsection (2)(a) exempt charity” has the same meaning as in the Charities Act 2011 (see section 22 of that Act).
For the purposes of subsection (2)(c) all the provisions of Part 11 of the Corporation Tax Act 2010 under which exemption may be claimed are relevant provisions except—
section 480 (exemption for profits of small-scale trades), and
section 481 (exemption from charges under provisions to which section 1173 applies).
On receiving an application to cease to be a community interest company and become a charity, together with the other documents required to accompany it, the registrar of companies must (instead of recording the documents and entering a new name on the register)—
forward a copy of each of the documents to the Regulator, and
retain the documents pending the Regulator’s decision.
If the Regulator gives notice of a decision that the company is eligible to cease being a community interest company, the registrar of companies must—
proceed in accordance with section 80 of the Companies Act 2006 (change of name: registration and issue of new certificate of incorporation), and
if the registrar enters the new name of the company on the register, retain and record the documents mentioned in section 54C(4).
The new certificate of incorporation must state—
that it is issued on the company’s ceasing to be a community interest company, and
the date on which it is issued.
On the issue of the certificate—
the changes in the company’s name and articles take effect, and
the company ceases to be a community interest company.
If the Regulator decides that the company is not eligible to cease being a community interest company, the company may appeal to the Appeal Officer against the decision.
Regulations may require the payment of such fees in connection with the Regulator’s functions as may be specified in the regulations.
The regulations may provide for fees to be paid to the registrar of companies (rather than to the Regulator).
The Regulator may charge a fee for any service which is provided otherwise than in pursuance of an obligation imposed by law, other than the provision of guidance which the Regulator considers to be of general interest.
Fees paid by virtue of this section are to be paid into the Consolidated Fund.
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Part 24 of the Companies Act 1985 (registrar), or
Part 25 of that Act (miscellaneous and supplementary),
Regulations may require the registrar of companies—
to notify the Regulator of matters specified in the regulations, and
to provide the Regulator with copies of documents specified in the regulations.
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In section 31(2) of the Data Protection Act 1998 (c. 29) (restricted access to data processed for specified purposes)—
in paragraphs (b), (c) and (d), after “charities” insert “ or community interest companies ”, and
in paragraph (b), after “trustees” insert “ , directors ”.
A public authority may disclose to the Regulator, for any purpose connected with the exercise of the Regulator’s functions, information received by the authority in connection with its functions.
The Regulator may disclose to a public authority any information received by the Regulator in connection with the functions of the Regulator—
for a purpose connected with the exercise of those functions, or
for a purpose connected with the exercise by the authority of its functions.
In deciding whether to disclose information to a public authority in a country or territory outside the United Kingdom the Regulator must have regard to the considerations listed in section 243F(2) and (3) of the Enterprise Act 2002 (c. 40) (relevant considerations relating to overseas disclosures), but as if the reference to information of a kind to which section 237 of that Act applies were to information of the kind the Regulator is considering disclosing.
The powers to disclose information in subsections (4) and (5) are subject to—
any restriction on disclosure imposed by or by virtue of an enactment, and
any express restriction on disclosure subject to which information was supplied.
Information may be disclosed under subsection (4) or (5) subject to a restriction on its further disclosure.
A person who discloses information in contravention of a restriction imposed under subsection (8) is guilty of an offence, but a prosecution may be instituted—
A person guilty of an offence under subsection (9) is liable on summary conviction to a fine not exceeding level 3 on the standard scale.
in England and Wales, only with the consent of the Regulator or the Director of Public Prosecutions;
“Public authority” means a person or body having functions of a public nature.
in Northern Ireland, only with the consent of the Regulator or the Director of Public Prosecutions for Northern Ireland.
If an offence under section 48 or 59 or paragraph 5 of Schedule 7 committed by a body corporate is proved— the officer as well as the body corporate is guilty of the offence and liable to be proceeded against and punished accordingly.
to have been committed with the consent or connivance of an officer, or
to be attributable to any neglect on the part of an officer,
“Officer” means a director, manager, secretary or other similar officer of the body corporate, or a person purporting to act in any such capacity.
“Director”—
includes a shadow director, and
if the affairs of a body corporate are managed by its members, means a member of the body.
An order made by the Regulator under this Part must be given to the community interest company in relation to which it is made and—
if the order is under section 46(1) or (3), to the director removed or suspended,
if the order is under section 48(1)(b) or (2), to the person to whom the order is directed,
if the order is under section 49(1), to the persons from and to whom shares are transferred,
if the order is under section 49(2), to the person whose interest is extinguished and any person appointed in his place.
Orders made by the Regulator under or by virtue of this Part may contain any incidental or supplementary provisions the Regulator considers expedient.
When discharging an order made under or by virtue of this Part, the Regulator may make savings and transitional provisions.
A document certified by the Regulator to be a true copy of an order made by the Regulator is evidence of the order without further proof; and a document purporting to be so certified shall, unless the contrary is proved, be taken to be so certified.
Where the Regulator makes an order or decision against which an appeal lies under or by virtue of this Part, the Regulator must give reasons for the order or decision to the persons entitled to appeal against it.
Any power to make regulations under this Part is exercisable by the Secretary of State by statutory instrument.
Regulations under this Part may make different provision for different cases.
Regulations under this Part may confer or impose functions on the Regulator or any other person specified in the regulations (and, unless made under paragraph 4 of Schedule 4, may provide for appeals to the Appeal Officer from a person on whom functions are conferred by the regulations).
No regulations to which this subsection applies are to be made unless a draft of the statutory instrument containing the regulations (whether or not together with other provisions) has been laid before, and approved by a resolution of, each House of Parliament.
Subsection (4) applies to regulations under—
section 30,
section 31,
section 32,
section 34,
section 35,
section 36,
section 37C ,
section 47, and
section 56.
A statutory instrument containing regulations under this Part is (unless a draft of it has been approved by each House of Parliament under subsection (4)) subject to annulment in pursuance of a resolution of either House of Parliament.
In this Part—
investigatory or disciplinary functions exercised by such bodies in relation to the performance by their members of accountancy functions,
“Scottish charity” has the meaning given by section 1(7) of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 (c. 40).
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“the Official Property Holder” has the meaning given by section 29(1),
The Regulator must make available to the Official Property Holder such members of the Regulator’s staff as the Official Property Holder may require in order to exercise the functions of the office.
The Official Property Holder may recover his expenses in respect of property held by him from the property or from the community interest company by which, or in trust for which, the property was held before it was vested in or transferred to the Official Property Holder. Any expenses of the Official Property Holder not recovered under sub-paragraph (1) are to be met by the Regulator.
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Schedule 8 (repeals and revocations) has effect.
This Act (apart from this section and sections 66 and 67) does not come into force until such day as the Secretary of State may by order made by statutory instrument appoint; and different days may be appointed for different provisions or otherwise for different purposes.
The Secretary of State may by order made by statutory instrument make any transitional provisions or savings which appear appropriate in connection with the commencement of any provision of this Act.
Any amendment made by this Act has the same extent as the provision to which it relates.
Sections 14, 15(1)(b), (3) and (7) and 16 to 18A and Part 2 extend to Northern Ireland.
Subject to that, this Act (apart from section 65, this section and section 67) does not extend to Northern Ireland.
This Act may be cited as the Companies (Audit, Investigations and Community Enterprise) Act 2004.
Section 12
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Section 25
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The investigator of a community interest company may require the company or any other person— A person on whom a requirement is imposed under sub-paragraph (1) may require the investigator to produce evidence of his authority. A requirement under sub-paragraph (1) must be complied with at such time and place as may be specified by the investigator. The production of a document in pursuance of this paragraph does not affect any lien which a person has on the document. The investigator may take copies of or extracts from a document produced in pursuance of this paragraph. In relation to information recorded otherwise than in legible form, the power to require production of it includes power to require the production of a copy of it in legible form or in a form from which it can readily be produced in visible and legible form. In this Schedule—
This paragraph applies if a person fails to comply with a requirement imposed under paragraph 1. The investigator may certify that fact in writing to the court. If, after hearing— the court is satisfied that the offender failed without reasonable excuse to comply with the requirement, it may deal with him as if he had been guilty of contempt of the court.
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sections 40(1)(a) and 47(3)(c);
section 87(4) in the entry relating to bodies established by order under section 46 of the Act.
In the Companies (Northern Ireland) Order 1990, omit Article 49 and Schedule 14 (supervisory and qualifying bodies: restrictive practices).
The Companies Act 1985 has effect subject to the following amendments.
The Regulator of Community Interest Companies. Functions under the Companies (Audit, Investigations and Community Enterprise) Act 2004.
Anything which the Regulator is authorised or required to do may be done by a member of the Regulator’s staff if authorised by the Regulator (generally or specifically) for that purpose.
In Schedule 2 to the Parliamentary Commissioner Act 1967 (c. 13) (departments and authorities subject to investigation), insert at the appropriate place— “ Office of the Regulator of Community Interest Companies. ”
The Regulator must appoint a member of the Regulator’s staff who is to act as Official Property Holder—
during any vacancy in the office, or
if the Official Property Holder is absent, subject to suspension or unable to act.
As soon as possible after the end of each financial year, the Official Property Holder must prepare a report on the exercise of the Official Property Holder’s functions during the financial year. The Official Property Holder must send a copy of the report to the Regulator. “Financial year” means—
After section 447 insert—
In Part 3 of Schedule 1 to the House of Commons Disqualification Act 1975 (c. 24) (disqualifying offices), insert at the appropriate place— “ Regulator of Community Interest Companies. ”
For section 449 substitute—
For section 451 substitute—
Section 451A (disclosure of certain information) is amended as follows. For subsection (1) substitute— After subsection (5) insert—
In section 452—
for subsection (1) substitute—
for subsections (2) and (3) substitute—
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in subsection (1), for “447 to 451” substitute “448, 449 to 451, 453A”;
in subsection (2)(b), for “447 to 451” substitute “448, 449 to 451 and 453A”.
in subsection (3), after “privilege” insert “or, in Scotland, confidentiality of communications”.
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in subsection (1), for “and 447 to 451” substitute “, 448, 449 to 451 and 453A”;
in subsection (4), for “447 to 451” substitute “448, 449 to 451 and 453A”.
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After Schedule 15B insert—
Schedule 24 (punishment of offences) is amended as follows. 449(6) Wrongful disclosure of information to which section 449 applies. 1. On indictment. 2. Summary. 2 years, or a fine; or both. the general limit in a magistrates’ court, or the statutory maximum; or both. 451 Providing false information in purported compliance with section 447. 1. On indictment. 2. Summary. 2 years, or a fine; or both. the general limit in a magistrates’ court, or the statutory maximum; or both. 453A(5) Intentionally obstructing a person lawfully acting under section 453A(2) or (4). 1. On indictment. 2. Summary. A fine. The statutory maximum.
Section 27
the Institute of Actuaries, or
The period for which a person is appointed as Regulator must not exceed five years. A person who has held office as Regulator may be re-appointed, once only, for a further period not exceeding five years. The Regulator may at any time resign the office by giving notice in writing to the Secretary of State. The Secretary of State may at any time remove the Regulator on the ground of incapacity or misbehaviour. Subject to that, the Regulator holds and vacates office on the terms determined by the Secretary of State.
“periodic” accounts and reports means accounts and reports which are required by Part 6 rules to be produced periodically.
The Secretary of State may pay remuneration and travelling and other allowances to the Regulator. The Secretary of State may—
The Secretary of State may make payments to the Regulator.
Section 28
...
The Secretary of State may pay remuneration and travelling and other allowances to the Appeal Officer. The Secretary of State may—
In Schedule 2 to the Parliamentary Commissioner Act 1967 (c. 13) (departments and authorities subject to investigation), insert at the appropriate place— “ Appeal Officer for Community Interest Companies. ”
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Nothing in paragraph 1 requires a person to produce a document or provide information in respect of which a claim could be maintained— but a person who is a lawyer may be required to provide the name and address of his client. Nothing in paragraph 1 requires a person carrying on the business of banking to produce a document, or provide information, relating to the affairs of a customer unless a requirement to produce the document, or provide the information, has been imposed on the customer under that paragraph.
A person commits an offence if in purported compliance with a requirement under paragraph 1 to provide information, the person— .... A prosecution for an offence under sub-paragraph (1) may be instituted— A person guilty of an offence under sub-paragraph (1) is liable— In relation to an offence committed before 2 May 2022, sub-paragraph (2)(b) has effect as if for “the general limit in a magistrates’ court” there were substituted “six months”.
In Part 3 of Schedule 1 to the House of Commons Disqualification Act 1975 (c. 24) (disqualifying offices), insert at the appropriate place— “ Appeal Officer for Community Interest Companies. ”
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Section 29
Section 33
Section 42
Section 64 Title and reference Extent of repeal or revocation Companies Act 1985 (c. 6) In section 27(4), the word “and” at the end of paragraph (c). Section 245C(6). Section 256(3). In section 310, in subsection (1) the words “any officer of the company or”, and in subsection (3) the words “officer or” (in both places) and the words from “section 144(3)” to “nominee) or”. Section 390A(3). In section 734(1), the words “section 389A(3) or”. In Schedule 4A, in paragraph 1(1), the words “section 390A(3) (amount of auditors' remuneration) and”. In Schedule 24, the entry relating to section 447(6). Insolvency Act 1985 (c. 65) In Schedule 6, paragraph 4. Insolvency Act 1986 (c. 45) In Schedule 13, in Part 1, the entry relating to section 449(1) of the Companies Act 1985. Companies Act 1989 (c. 40) Section 48(3). Section 63. Section 65. Section 67. Section 69(2) and (4). Section 120(2) and (3). Companies (Northern Ireland) Order 1990 (S.I. 1990/593 (N.I. 5)) Article 48(2)(a). Article 49. In Article 56, the entry relating to “Director (in Schedule 14)”. Schedule 14. Friendly Societies Act 1992 (c. 40) In Schedule 21, paragraph 7. Pensions Act 1995 (c. 26) In Schedule 3, paragraph 12. Bank of England Act 1998 (c. 11) In Schedule 5, paragraph 62. Competition Act 1998 (c. 41) In Schedule 2, paragraph 3. Youth Justice and Criminal Evidence Act 1999 (c. 23) In Schedule 3, paragraph 6. Competition Act 1998 (Competition Commission) Transitional, Consequential and Supplemental Provisions Order 1999 (S.I. 1999/506) Article 41. Enterprise Act 2002 (c. 40) In Schedule 25, paragraph 22.