A guide to the Act

Key points * The new Companies Act reduces the administrative burden for private companies. * Public companies may find the new regime more onerous. * Directors have to work towards the good of the company as a whole and not just chase profit for its own sake. * Emergence of electronic communication.

THE LONG AWAITED new Companies Act 2006 has now become law. In summary it is a consolidation of laws applicable to companies and codifies common law to an extent particularly in relation to directors' duties. In respect of private companies the Act overall introduces an easier less regulated regime.
For public companies the changes are intended to ensure greater transparency and accountability and will therefore increase the compliance and administrative burden for most. Although the changes are in many respects tax neutral advisers should ensure that they are aware of the changes...