First Council Directive of 9 March 1968 on co-ordination of safeguards which, for the protection of the interests of members and others, are required by Member States of companies within the meaning of the second paragraph of Article 58 of the Treaty, with a view to making such safeguards equivalent throughout the Community (68/151/EEC) (repealed)

SECTION III U.K. Nullity of the company

Article 10 U.K.

In all Member States whose laws do not provide for preventive control, administrative or judicial, at the time of formation of a company, the instrument of constitution, the company statutes and any amendments to those documents shall be drawn up and certified in due legal form.

Article 11 U.K.

The laws of the Member States may not provide for the nullity of companies otherwise than in accordance with the following provisions:

1.

Nullity must be ordered by decision of a court of law;

2.

Nullity may be ordered only on the following grounds:

(a)

that no instrument of constitution was executed or that the rules of preventive control or the requisite legal formalities were not complied with;

(b)

that the objects of the company are unlawful or contrary to public policy;

(c)

that the instrument of constitution or the statutes do not state the name of the company, the amount of the individual subscriptions of capital, the total amount of the capital subscribed or the objects of the company;

(d)

failure to comply with the provisions of the national law concerning the minimum amount of capital to be paid up;

(e)

the incapacity of all the founder members;

(f)

that, contrary to the national law governing the company, the number of founder members is less than two.

Apart from the foregoing grounds of nullity, a company shall not be subject to any cause of nonexistence, nullity absolute, nullity relative or declaration of nullity.

Article 12 U.K.

1. The question whether a decision of nullity pronounced by a court of law may be relied on as against third parties shall be governed by Article 3. Where the national law entitles a third party to challenge the decision, he may do so only within six months of public notice of the decision of the court being given.

2. Nullity shall entail the winding up of the company, as may dissolution.

3. Nullity shall not of itself affect the validity of any commitments entered into by or with the company, without prejudice to the consequences of the company's being wound up.

4. The laws of each Member State may make provision for the consequences of nullity as between members of the company.

5. Holders of shares in the capital shall remain obliged to pay up the capital agreed to be subscribed by them but which has not been paid up, to the extent that commitments entered into with creditors so require.