Every company is under a statutory duty under the Companies Act 2006 (the Act) to keep statutory registers, however, in reality many don’t as they either don’t understand the requirement or don’t see the importance of keeping them.
What are statutory registers or books?
A company should maintain certain records on their shareholders and directors. These records form the company’s statutory registers and should be kept at the company’s registered office or such other place as it notified to Companies House. Statutory registers should be maintained to provide a historical and an up to date record of matters affecting the company, for example if there is a change of directors this should be written up immediately.
What registers are a company required to keep?
The Act requires companies to keep the following registers:
Register of Members: s.113;
Register of Directors: s.162;
Register of Director’s residential addresses: s165;
Register of Secretaries: s275; and
Register of Charges: s.876.
Under the Small Business Enterprise and Employment Act, companies are also required to keep a register of persons with significant control from June 2016.
There is also the option to keep registers of transfers and allotments of shares.
What happens if a company fails to keep statutory registers?
If a company fails to adhere to the requirement to keep statutory registers outlined in the Act, an offence is committed by the company and every officer in default.
It is a fineable offence to be in contravention of the statutory requirements outlined in the Act. Depending on what information is missing from the statutory registers a fine up to £5,000 may be imposed on the company and its officers.
It can be particularly important for directors to ensure that the statutory registers are maintained or they may be found to be acting in breach of their statutory duties, potentially resulting in harsher punishments.
What can I do if I don’t have any statutory registers?
Having up to date statutory books can become increasingly important when selling a business as it provides the buyer with evidence of the company’s history.
If a company’s statutory registers are believed to be lost or have been destroyed it is possible to reconstitute the registers. This should be done as soon as possible after the realisation that the company does not have statutory books.
The Business law team at EHL Commercial Law can provide company secretarial services. As part of this service we can ensure that the statutory registers are maintained along with ensuring that the company meet any filing requirements on time.
For more information on the content of this guidance or on secretarial services, please call 0330 024 9643 and ask to speak to a member of the team.
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