1. Companies Act 2006Practically speaking Dealing with directors’ conflicts Codification of directors’ duties – the effects Bribery Act 2010 Companies House Annual Return, Statement of Capital & other possible changes Proposals regarding registration of charges Old articles v new law Model articles for a private company & possible modifications

2. Dealing with directors’ conflicts Codification of directors’ duties There are seven codified duties: 1. Duty to act within constitution and powers (s 171) 2. Duty to promote the success of the company and in doing so to have regard to a list of matters (s 172) 3. Duty to exercise independent judgement (s 173) 4. Duty to exercise reasonable care, skill and diligence (s 174) 5. Duty to avoid conflicts of interest (s 175) 6. Duty not to accept benefits from third parties (s 176) 7. Duty to declare an interest in a proposed transaction or arrangement (s 177)

3. Dealing with directors’ conflicts Directors’ conflicts provisions • Section 175 • A director must avoid a situation that conflicts with the interests of the company • Duty imposed by s177 to declare any interest in a proposed transaction • Requirement under s182 to declare any interest in an existing transaction

4. Dealing with directors’ conflicts Use of Articles to deal with directors’ conflicts • Private company Articles • Provided the nature and extent of any interest is disclosed • Disinterested directors approve a conflict • Alternate director • Majority of the shareholders may authorise or ratify certain conflicts

5. Codification of directors’ duties – the effects • Courts are reluctant to allow such actions except cases where a prima facie case made out • And notional director believes in accordance with duty to promote the success of the company • Sections 261 and 262 CA2006 - two-stage process for granting of permission

6. Codification of directors’ duties – the effects Recent cases: • West Coast Capital (Lios) Ltd [2008] CSOH 72 • Re Southern Counties Fresh Foods Ltd [2008] EWHC 2810 (Ch) • Mission Capital plc v Sinclair [2008] EWHC 1339 (Ch) • Stimpson v Southern Private Landlords Association [2009] EWHC 2072 (Ch) • Kiani v Cooper [2010] BCC 463

7. Bribery Act 2010 The Bribery Act 2010 (“BA2010”) came into force on 1 July 2011. There are four main offences: • Offence of bribing another person • Offence of being bribed • Offence of bribing a foreign public official • Offence of failure of a commercial organisation to prevent

8. Bribery Act 2010 Elements of the offences: • Bribing another person • Being bribed • Failure of a commercial organisation to prevent bribery

9. Bribery Act 2010 Guidance The guidance sets out six principles relating to bribery prevention: • Proportionate procedures • Top level commitment • Risk assessment • Due diligence • Communication (including training) • Monitoring and review

10. Companies House • Rejections of accounts • Administrative Restorations • Changes of fees from 6 April 2011

11. Annual Return, Statement of Capital & other possible changes Annual Return • Changes proposed to take effect from October 2011 • Changes to the Annual Return proposed to take effect at some future unspecified date • Statement of capital • Notices of Auditors leaving office

12. Proposals regarding registration of charges • General requirement to maintain own register of charges will no longer apply • Requirement to keep instrument of charge available for inspection will remain • Possible to register charges electronically • Some changes to the details that are required to be registered

13. Old articles v new law • Choice whether to update their old “memorandum and articles” • No requirement to update • Cost/benefit decision

14. Old articles v new law • The difference between “old” and “new” • Notice of meetings and rights of proxies • Notice period for a members’ meeting • Written resolutions • Share capital

15. Model articles for a private company & possible modifications • Directors’ decisions • Sole director • Conflicts • Other possible additions/modifications