The Government’s drive to improve transparency of UK company ownership by putting a ban on corporate directors (subject to certain exceptions), has once again been put on hold. The provision introduced by the Small Business, Enterprise and Employment Act 2015, was originally due to come into force in October 2015, then October 2016, but has now seen a further delay, with no new firm implementation date being released.
At present, The Companies Act 2006 allows companies to have corporate directors (that is, one or more legal persons such as a company or limited liability partnership who are directors) as long as one director is a natural person (i.e. an individual).
Once the ban comes into effect, there will be a 12-month grace period for existing corporate directors. Any corporate director still in place after 12 months (not covered by an exemption) will automatically cease to be a director.
Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.