Companies Act 2006 (c. 46)

(The document as of February, 2008)

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(a) is disqualified automatically by virtue of the regulations, or

(b) may be disqualified by order of the court on the application of the Secretary of State.

(3) The regulations may provide that the Secretary of State may accept an undertaking (a "disqualification undertaking") from a person subject to foreign restrictions that he will not do anything which would be in breach of a disqualification under subsection (1).

(4) In this Part--

(a) a "person disqualified under this Part" is a person--

(i) disqualified as mentioned in subsection (2)(a) or (b), or

(ii) who has given and is subject to a disqualification undertaking;

(b) references to a breach of a disqualification include a breach of a disqualification undertaking.

(5) The regulations may provide for applications to the court by persons disqualified under this Part for permission to act in a way which would otherwise be in breach of the disqualification.

(6) The regulations must provide that a person ceases to be disqualified under this Part on his ceasing to be subject to foreign restrictions.

(7) Regulations under this section are subject to affirmative resolution procedure.

1185 Disqualification regulations: supplementary

(1) Regulations under section 1184 may make different provision for different cases and may in particular distinguish between cases by reference to--

(a) the conduct on the basis of which the person became subject to foreign restrictions;

(b) the nature of the foreign restrictions;

(2) Regulations under section 1184(2)(b) or (5) (provision for applications to the court)--

(a) must specify the grounds on which an application may be made;

(b) may specify factors to which the court shall have regard in determining an application.

(3) The regulations may, in particular, require the court to have regard to the following factors--

(a) whether the conduct on the basis of which the person became subject to foreign restrictions would, if done in relation to a UK company, have led a court to make a disqualification order on an application under the Company Directors Disqualification Act 1986 (c. 46) or the Company Directors Disqualification (Northern Ireland) Order 2002 (S.I. 2002/3150 (N.I. 4));

(b) in a case in which the conduct on the basis of which the person became subject to foreign restrictions would not be unlawful if done in relation to a UK company, the fact that the person acted unlawfully under foreign law;

(d) whether the person's activities (or proposed activities) in relation to UK companies are undertaken (or are proposed to be undertaken) outside the United Kingdom.

(4) Regulations under section 1184(3) (provision as to undertakings given to the Secretary of State) may include provision allowing the Secretary of State, in determining whether to accept an undertaking, to take into account matters other than criminal convictions notwithstanding that the person may be criminally liable in respect of those matters.

(5) Regulations under section 1184(5) (provision for application to court for permission to act) may include provision--

(a) entitling the Secretary of State to be represented at the hearing of the application, and

(b) as to the giving of evidence or the calling of witnesses by the Secretary of State at the hearing of the application.

1186 Offence of breach of disqualification

(1) Regulations under section 1184 may provide that a person disqualified under this Part who acts in breach of the disqualification commits an offence.

(2) The regulations may provide that a person guilty of such an offence is liable--

(a) on conviction on indictment, to imprisonment for a term not exceeding two years or a fine (or both);

(b) on summary conviction--

(i) in England and Wales, to imprisonment for a term not exceeding twelve months or to a fine not exceeding the statutory maximum (or both);

(ii) in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months, or to a fine not exceeding the statutory maximum (or both).

(3) In relation to an offence committed before the commencement of section 154(1) of the Criminal Justice Act 2003 (c. 44), for "twelve months" in subsection (2)(b)(i) substitute "six months".

Power to make persons liable for company's debts

1187 Personal liability for debts of company

(1) The Secretary of State may provide by regulations that a person who, at a time when he is subject to foreign restrictions--

(a) is a director of a UK company, or

(b) is involved in the management of a UK company,

is personally responsible for all debts and other liabilities of the company incurred during that time.

(2) A person who is personally responsible by virtue of this section for debts and other liabilities of a company is jointly and severally liable in respect of those debts and liabilities with--

(a) the company, and

(b) any other person who (whether by virtue of this section or otherwise) is so liable.

(3) For the purposes of this section a person is involved in the management of a company if he is concerned, whether directly or indirectly, or takes part, in the management of the company.

(4) The regulations may make different provision for different cases and may in particular distinguish between cases by reference to--

(a) the conduct on the basis of which the person became subject to foreign restrictions;

(b) the nature of the foreign restrictions;

(5) Regulations under this section are subject to affirmative resolution procedure.

Power to require statements to be sent to the registrar of companies

1188 Statements from persons subject to foreign restrictions

(1) The Secretary of State may make provision by regulations requiring a person who--

(a) is subject to foreign restrictions, and

(b) is not disqualified under this Part,

to send a statement to the registrar if he does anything that, if done by a person disqualified under this Part, would be in breach of the disqualification.

(2) The statement must include such information as may be specified in the regulations relating to--

(a) the person's activities in relation to UK companies, and

(b) the foreign restrictions to which the person is subject.

(3) The statement must be sent to the registrar within such period as may be specified in the regulations.

(4) The regulations may make different provision for different cases and may in particular distinguish between cases by reference to--

(a) the conduct on the basis of which the person became subject to foreign restrictions;

(b) the nature of the foreign restrictions;

(5) Regulations under this section are subject to affirmative resolution procedure.

1189 Statements from persons disqualified

(1) The Secretary of State may make provision by regulations requiring a statement or notice sent to the registrar of companies under any of the provisions listed below that relates (wholly or partly) to a person who--

(a) is a person disqualified under this Part, or

(b) is subject to a disqualification order or disqualification undertaking under the Company Directors Disqualification Act 1986 (c. 46) or the Company Directors Disqualification (Northern Ireland) Order 2002 (S.I. 2002/3150 (N.I. 4)),

to be accompanied by an additional statement.

(2) The provisions referred to above are--

(a) section 12 (statement of a company's proposed officers),

(b) section 167(2) (notice of person having become director), and

(3) The additional statement is a statement that the person has obtained permission from a court, on an application under section 1184(5) or (as the case may be) for the purposes of section 1(1)(a) of the Company Directors Disqualification Act 1986 (c. 46) or Article 3(1) of the Company Directors Disqualification (Northern Ireland) Order 2002 (S.I. 2002/3150 (N.I. 4)), to act in the capacity in question.

(4) Regulations under this section are subject to affirmative resolution procedure.

1190 Statements: whether to be made public

(1) Regulations under section 1188 or 1189 (statements required to be sent to registrar) may provide that a statement sent to the registrar of companies under the regulations is to be treated as a record relating to a company for the purposes of section 1080 (the companies register).

(2) The regulations may make provision as to the circumstances in which such a statement is to be, or may be--

(a) withheld from public inspection, or

(b) removed from the register.

(3) The regulations may, in particular, provide that a statement is not to be withheld from public inspection or removed from the register unless the person to whom it relates provides such information, and satisfies such other conditions, as may be specified.

(4) The regulations may provide that section 1081 (note of removal of material from the register) does not apply, or applies with such modifications as may be specified, in the case of material removed from the register under the regulations.

(5) In this section "specified" means specified in the regulations.

1191 Offences

(1) Regulations under section 1188 or 1189 may provide that it is an offence for a person--

(a) to fail to comply with a requirement under the regulations to send a statement to the registrar;

(b) knowingly or recklessly to send a statement under the regulations to the registrar that is misleading, false or deceptive in a material particular.

(2) The regulations may provide that a person guilty of such an offence is liable--

(a) on conviction on indictment, to imprisonment for a term not exceeding two years or a fine (or both);

(b) on summary conviction--

(i) in England and Wales, to imprisonment for a term not exceeding twelve months or to a fine not exceeding the statutory maximum (or both);

(ii) in Scotland or Northern Ireland, to imprisonment for a term not exceeding six months, or to a fine not exceeding the statutory maximum (or both).

(3) In relation to an offence committed before the commencement of section 154(1) of the Criminal Justice Act 2003 (c. 44), for "twelve months" in subsection (2)(b)(i) substitute "six months".

Part 41 Business names

Chapter 1 Restricted or prohibited names

Introductory

1192 Application of this Chapter

(1) This Chapter applies to any person carrying on business in the United Kingdom.

(2) The provisions of this Chapter do not prevent--

(a) an individual carrying on business under a name consisting of his surname without any addition other than a permitted addition, or

(b) individuals carrying on business in partnership under a name consisting of the surnames of all the partners without any addition other than a permitted addition.

(3) The following are the permitted additions--

(a) in the case of an individual, his forename or initial;

(b) in the case of a partnership--

(i) the forenames of individual partners or the initials of those forenames, or

(ii) where two or more individual partners have the same surname, the addition of "s" at the end of that surname;

(c) in either case, an addition merely indicating that the business is carried on in succession to a former owner of the business.

Sensitive words or expressions

1193 Name suggesting connection with government or public authority

(1) A person must not, without the approval of the Secretary of State, carry on business in the United Kingdom under a name that would be likely to give the impression that the business is connected with--

(a) Her Majesty's Government, any part of the Scottish administration or Her Majesty's Government in Northern Ireland,

(b) any local authority, or

(2) For the purposes of this section--

"local authority" means--
(a)
a local authority within the meaning of the Local Government Act 1972 (c. 70), the Common Council of the City of London or the Council of the Isles of Scilly,
(b)
a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994 (c. 39), or
(c)
a district council in Northern Ireland;
"public authority" includes any person or body having functions of a public nature.

(3) Regulations under this section are subject to affirmative resolution procedure.

(4) A person who contravenes this section commits an offence.

(5) Where an offence under this section is committed by a body corporate, an offence is also committed by every officer of the body who is in default.

(6) 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.

1194 Other sensitive words or expressions

(1) A person must not, without the approval of the Secretary of State, carry on business in the United Kingdom under a name that includes a word or expression for the time being specified in regulations made by the Secretary of State under this section.

(2) Regulations under this section are subject to approval after being made.

(3) A person who contravenes this section commits an offence.

(4) Where an offence under this section is committed by a body corporate, an offence is also committed by every officer of the body who is in default.

(5) 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.

1195 Requirement to seek comments of government department or other relevant body

(1) The Secretary of State may by regulations under--

(a) section 1193 (name suggesting connection with government or public authority), or

(b) section 1194 (other sensitive words or expressions),

require that, in connection with an application for the approval of the Secretary of State under that section, the applicant must seek the view of a specified Government department or other body.

(2) Where such a requirement applies, the applicant must request the specified department or other body (in writing) to indicate whether (and if so why) it has any objections to the proposed name.

(3) He must submit to the Secretary of State a statement that such a request has been made and a copy of any response received from the specified body.

(4) If these requirements are not complied with, the Secretary of State may refuse to consider the application for approval.

(5) In this section "specified" means specified in the regulations.

1196 Withdrawal of Secretary of State's approval

(1) This section applies to approval given for the purposes of--

section 1193 (name suggesting connection with government or public authority), or
section 1194 (other sensitive words or expressions).

(2) If it appears to the Secretary of State that there are overriding considerations of public policy that require such approval to be withdrawn, the approval may be withdrawn by notice in writing given to the person concerned.

(3) The notice must state the date as from which approval is withdrawn.

Misleading names

1197 Name containing inappropriate indication of company type or legal form

(1) The Secretary of State may make provision by regulations prohibiting a person from carrying on business in the United Kingdom under a name consisting of or containing specified words, expressions or other indications--

(a) that are associated with a particular type of company or form of organisation, or

(b) that are similar to words, expressions or other indications associated with a particular type of company or form of organisation.

(2) The regulations may prohibit the use of words, expressions or other indications--

(a) in a specified part, or otherwise than in a specified part, of a name;

(b) in conjunction with, or otherwise than in conjunction with, such other words, expressions or indications as may be specified.

(3) In this section "specified" means specified in the regulations.

(4) Regulations under this section are subject to negative resolution procedure.

(5) A person who uses a name in contravention of regulations under this section commits an offence.

(6) Where an offence under this section is committed by a body corporate, an offence is also committed by every officer of the body who is in default.

(7) 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.

1198 Name giving misleading indication of activities

(1) A person must not carry on business in the United Kingdom under a name that gives so misleading an indication of the nature of the activities of the business as to be likely to cause harm to the public.

(2) A person who uses a name in contravention of this section commits an offence.

(3) Where an offence under this section is committed by a body corporate, an offence is also committed by every officer of the body who is in default.

(4) 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.

Supplementary

1199 Savings for existing lawful business names

(1) This section has effect in relation to--

sections 1192 to 1196 (sensitive words or expressions), and
section 1197 (inappropriate indication of company type or legal form).

(2) Those sections do not apply to the carrying on of a business by a person who--

(a) carried on the business immediately before the date on which this Chapter came into force, and

(b) continues to carry it on under the name that immediately before that date was its lawful business name.

(3) Where--

(a) a business is transferred to a person on or after the date on which this Chapter came into force, and

(b) that person carries on the business under the name that was its lawful business name immediately before the transfer,

those sections do not apply in relation to the carrying on of the business under that name during the period of twelve months beginning with the date of the transfer.

(4) In this section "lawful business name", in relation to a business, means a name under which the business was carried on without contravening--

(a) section 2(1) of the Business Names Act 1985 (c. 7) or Article 4(1) of the Business Names (Northern Ireland) Order 1986 (S.I. 1986/1033 N.I. 7)), or

(b) after this Chapter has come into force, the provisions of this Chapter.

Chapter 2 Disclosure required in case of individual or partnership

Introductory

1200 Application of this Chapter

(1) This Chapter applies to an individual or partnership carrying on business in the United Kingdom under a business name.

References in this Chapter to "a person to whom this Chapter applies" are to such an individual or partnership.

(2) For the purposes of this Chapter a "business name" means a name other than--

(a) in the case of an individual, his surname without any addition other than a permitted addition;

(b) in the case of a partnership--

(i) the surnames of all partners who are individuals, and

(ii) the corporate names of all partners who are bodies corporate,

without any addition other than a permitted addition.

(3) The following are the permitted additions--

(a) in the case of an individual, his forename or initial;

(b) in the case of a partnership--

(i) the forenames of individual partners or the initials of those forenames, or

(ii) where two or more individual partners have the same surname, the addition of "s" at the end of that surname;

(c) in either case, an addition merely indicating that the business is carried on in succession to a former owner of the business.

1201 Information required to be disclosed

The "information required by this Chapter" is--

(a) in the case of an individual, his name;

(b) in the case of a partnership, the name of each member of the partnership;

and in relation to each person so named, an address in the United Kingdom at which service of any document relating in any way to the business will be effective.

Disclosure requirements

1202 Disclosure required: business documents etc

(1) A person to whom this Chapter applies must state the information required by this Chapter, in legible characters, on all--

(a) business letters,

(b) written orders for goods or services to be supplied to the business,

(d) written demands for payment of debts arising in the course of the business.

This subsection has effect subject to section 1203 (exemption for large partnerships if certain conditions met).

(2) A person to whom this Chapter applies must secure that the information required by this Chapter is immediately given, by written notice, to any person with whom anything is done or discussed in the course of the business and who asks for that information.

(3) The Secretary of State may by regulations require that such notices be given in a specified form.

(4) Regulations under this section are subject to negative resolution procedure.

1203 Exemption for large partnerships if certain conditions met

(1) Section 1202(1) (disclosure required in business documents) does not apply in relation to a document issued by a partnership of more than 20 persons if the following conditions are met.

(2) The conditions are that--

(a) the partnership maintains at its principal place of business a list of the names of all the partners,

(b) no partner's name appears in the document, except in the text or as a signatory, and

(c) the document states in legible characters the address of the partnership's principal place of business and that the list of the partners' names is open to inspection there.

(3) Where a partnership maintains a list of the partners' names for the purposes of this section, any person may inspect the list during office hours.

(4) Where an inspection required by a person in accordance with this section is refused, an offence is committed by any member of the partnership concerned who without reasonable excuse refused the inspection or permitted it to be refused.

(5) A person guilty of an offence under subsection (4) 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.

1204 Disclosure required: business premises

(1) A person to whom this Chapter applies must, in any premises--

(a) where the business is carried on, and

(b) to which customers of the business or suppliers of goods or services to the business have access,

display in a prominent position, so that it may easily be read by such customers or suppliers, a notice containing the information required by this Chapter.

(2) The Secretary of State may by regulations require that such notices be displayed in a specified form.

(3) Regulations under this section are subject to negative resolution procedure.

Consequences of failure to make required disclosure

1205 Criminal consequences of failure to make required disclosure

(1) A person who without reasonable excuse fails to comply with the requirements of--

section 1202 (disclosure required: business documents etc), or
section 1204 (disclosure required: business premises),

commits an offence.

(2) Where an offence under this section is committed by a body corporate, an offence is also committed by every officer of the body who is in default.

(3) 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.

(4) References in this section to the requirements of section 1202 or 1204 include the requirements of regulations under that section.

1206 Civil consequences of failure to make required disclosure

(1) This section applies to any legal proceedings brought by a person to whom this Chapter applies to enforce a right arising out of a contract made in the course of a business in respect of which he was, at the time the contract was made, in breach of section 1202(1) or (2) (disclosure in business documents etc) or section 1204(1) (disclosure at business premises).

(2) The proceedings shall be dismissed if the defendant (in Scotland, the defender) to the proceedings shows--

(a) that he has a claim against the claimant (pursuer) arising out of the contract that he has been unable to pursue by reason of the latter's breach of the requirements of this Chapter, or

(b) that he has suffered some financial loss in connection with the contract by reason of the claimant's (pursuer's) breach of those requirements,

unless the court before which the proceedings are brought is satisfied that it is just and equitable to permit the proceedings to continue.

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