Part XXIV of the Companies Act 1997 carried companies formed under the repealed Act into the new regime. It still matters for any company incorporated before the Act commenced.
Section 441 — the old law kept running
The provisions of the repealed Act, and of any Rules and Regulations made under it that this Act repealed, shall continue to apply to an existing company as if that Act had not been repealed, until either —
(a) the existing company registers under this Act in accordance with section 442; or
(b) the existing company is deemed to be registered under this Act in accordance with section 443.
So there was a transitional period in which two company law regimes ran in parallel. The bridge closed by section 443.
Section 442 — the registration proposal
(1) The board may at any time resolve to submit to members a registration proposal.
(2) The proposal shall have attached to it the application for registration the directors propose to submit.
(3) Before submitting it, the board shall resolve that the proposal is not unfairly prejudicial to and does not unfairly discriminate against any member.
(4) The directors who vote in favour shall forthwith sign a certificate to that effect.
(5) The directors may then call meetings of the holders of each class of shares to consider the proposal.
(6) Within one month after all those meetings have approved the proposal by special resolution, the directors may submit the application to the Registrar — with a certified copy of the constitution if the company is to have one.
Every director who (a) fails to comply with subsection (4), or (b) signs a certificate while believing the proposal is unfairly prejudicial to or unfairly discriminates against any member, commits an offence and is liable on conviction to the penalty in section 414(1).
The certificate mechanism — a board resolution, followed by a personally signed certificate, backed by an offence for signing it dishonestly — is the same technique the Act uses for the solvency test in distributions, buy-backs and amalgamations.
Note the class meetings: approval was required by each class of shares separately, by special resolution. That protects a class whose rights the new regime would affect differently — the same idea as the interest group machinery in sections 97 to 99.
Section 443 — deemed registration
An existing company that has not registered under section 442 is deemed, on and from the day that is six months after the commencement of this Act, to be registered under Part II on the terms and conditions set out in Schedule 14, as supplemented or modified by any Regulations under section 439 — and the Registrar shall issue a certificate of incorporation accordingly.
Where deemed registration is prejudicial to a member, that member may apply to the Court within one year of the deemed registration for an order requiring the directors at the time of deemed registration to pay such compensation as is fair and reasonable, having regard to —
(a) the extent of the loss or damage suffered by the member as a result of the deemed registration; and
(b) the extent to which the directors are responsible for the failure of the company to submit an application.
Deemed registration happened automatically, so the company lost nothing by inaction. The exposure fell on the directors personally: a member prejudiced by the automatic route could recover compensation from them, measured partly by how responsible they were for failing to run the section 442 process. That is why most substantial companies elected rather than drifted.
Section 444 — continuity
(a) create a new legal entity; or
(b) prejudice or affect the identity of the body corporate or its continuity as a legal entity; or
(c) affect the property, rights, or obligations of the company; or
(d) affect proceedings by or against the company.
And under subsection (2), proceedings that could have been commenced or continued before registration may be commenced or continued after it.
This is the same principle the Act applies to a change of name under section 24(4) and to amalgamation under section 238: the corporate person survives the paperwork.
The rest of Part XXIV
| Section | Effect |
|---|---|
| 445 | A foreign company registered under Part XII of the repealed Act is deemed registered as an overseas company under Part XX; a Minister’s declaration under the old s 360(5) is deemed made under s 390(8) |
| 446 | Documents lodged or registered, registers kept, appointments made, and declarations, consents, exemptions and directions of the Minister under the repealed Act are deemed made under this Act, to the extent they could have been — subject to any express provision of this Act |
| 447 | A name reservation under the old section 22 that had not expired or been revoked is deemed reserved under section 21 and continues available for the period it would have had |
| 448 | Part XVII applies to a receiver holding office at commencement, with stated modifications — ss 256 (mostly), 273, 278, 279 and parts of 281 do not apply |
| 449–451 | Transitional provisions for liquidations, for voidable transactions, and for proceedings under the repealed Act |
| 452–457 | Existing causes of action, company charges, companies in official management, the Registrar, inspections, and further transitional provisions |
Why this still matters
- Old companies are governed by the new Act. Whether by election or by deeming, every surviving company is now a Companies Act 1997 company — there is no residue of the old law for a company that continued in existence.
- Deemed-registration terms. A company deemed registered took the terms in Schedule 14; those terms, and any Regulations under section 439, may still explain features of an old company’s constitution.
- Continuity of title. Section 444 is the answer whenever anyone asks whether a company that predates 1997 is the same legal person that signed a lease, a charge or a contract decades ago. It is.
- Old charges and old securities are carried forward by sections 446 and 453 — relevant when searching the register of charges for a long-established company.
- The compensation window has closed. Section 443(2) required an application within one year of the deemed registration.
Sources
- Companies Act 1997 — ss 14, 21, 24, 97–99, 238, 414, 439, 440–457; Schedule 14
Before relying on anything here, read the current text of the Companies Act 1997 and check for later amendments. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.