Companies (Audit, Investigations and Community Enterprise) Act 2004

Becoming a community interest company E+W+S

36 New companies E+W+S

(1) If a company is to be formed as a community interest company, the documents delivered to the registrar of companies under [F1 section 10 of the 1985 Act or Article 21 of the 1986 Order] (memorandum, articles and statement of names and particulars of directors and secretary) must be accompanied by the prescribed formation documents.

(2) “The prescribed formation documents” means such statutory declarations or other declarations or statements as are required by regulations to accompany the documents delivered under that section, in such form as may be approved in accordance with the regulations.

(3) On receiving the documents delivered under that section and the prescribed formation documents the registrar of companies must (instead of registering the memorandum and articles)—

(a) forward a copy of each of the documents to the Regulator, and

(b) retain the documents pending the Regulator’s decision.

(4) The Regulator must decide whether the company is eligible to be formed as a community interest company.

(5) A company is eligible to be formed as a community interest company if—

(a) the memorandum and articles comply with the requirements imposed by and by virtue of section 32 and the company’s name complies with section 33, and

(b) the Regulator, having regard to the documents delivered under [F2 section 10 of the 1985 Act or Article 21 of the 1986 Order], the prescribed formation documents and any other relevant considerations, considers that the company will satisfy the community interest test and is not an excluded company.

(6) The Regulator must give notice of the decision to the registrar of companies (but the registrar is not required to record it).

(7) If the Regulator gives notice of a decision that the company is eligible to be formed as a community interest company, [F3 section 12 of the 1985 Act or Article 23 of the 1986 Order] (registration of memorandum and articles) applies; and if the registrar registers the memorandum and articles he must also retain and record the prescribed formation documents.

(8) The certificate of incorporation under [F4 section 13 of the 1985 Act or Article 24 of the 1986 Order] (effect of registration) is to contain a statement that the company is a community interest company.

(9) The fact that the certificate of incorporation contains such a statement is conclusive evidence that the company is a community interest company.

(10) If the Regulator decides that the company is not eligible to be formed as a community interest company, any subscriber to the memorandum may appeal to the Appeal Officer against the decision.

Textual Amendments

F1 Words in s. 36(1) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 6(a) (with art. 11(1))

F2 Words in s. 36(5)(b) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 6(a) (with art. 11(1))

F3 Words in s. 36(7) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 6(b) (with art. 11(1))

F4 Words in s. 36(8) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 6(c) (with art. 11(1))

Commencement Information

I1 S. 36 in force at 1.7.2005 by S.I. 2004/3322, art. 2(3), Sch. 3

37 Existing companies: requirements E+W+S

(1) If a company is to become a community interest company, the company must—

(a) by special resolution alter its memorandum to state that it is to be a community interest company,

(b) by special resolutions under [F5 the 1985 Act or the 1986 Order] make such alterations of its memorandum and articles as it considers necessary to comply with requirements imposed by and by virtue of section 32 or otherwise appropriate in connection with becoming a community interest company, and

(c) by special resolution change its name to comply with section 33.

(2) [F6 Section 380(1) of the 1985 Act or Article 388(1) of the 1986 Order] (forwarding of copies of special resolutions to registrar of companies) must be complied with in relation to each of the special resolutions at the same time.

(3) If the special resolutions include one under [F7 section 4 or 17 of the 1985 Act or Article 15 or 28 of the 1986 Order] (alterations of memorandum)—

(a) copies of the special resolutions must not be forwarded to the registrar of companies before the relevant date, and

(b) [F8 section 380(1) of the 1985 Act or Article 388(1) of the 1986 Order] has effect in relation to them as if it referred to 15 days after the relevant date.

(4) If an application is made under [F9 section 5 of the 1985 Act or Article 16 of the 1986 Order] (objection to alteration of memorandum F10 ...), the relevant date is—

(a) the date on which the court determines the application (or, if there is more than one application, the date on which the last to be determined by the court is determined), or

(b) such later date as the court may order.

(5) If there is no application under [F11 section 5 of the 1985 Act or Article 16 of the 1986 Order], the relevant date is the end of the period for making such an application.

(6) The copies of the special resolutions forwarded to the registrar of companies must be accompanied by—

(a) a copy of the memorandum and articles of the company as altered by the special resolutions, and

(b) the prescribed conversion documents.

(7) “The prescribed conversion documents” means such statutory declarations or other declarations or statements as are required by regulations to accompany the copies of the special resolutions, in such form as may be approved in accordance with the regulations.

Textual Amendments

F5 Words in s. 37(1)(b) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 7(a) (with art. 11(1))

F6 Words in s. 37(2) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 7(b) (with art. 11(1))

F7 Words in s. 37(3) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 7(c) (with art. 11(1))

F8 Words in s. 37(3)(b) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 7(d) (with art. 11(1))

F9 Words in s. 37(4) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 7(e)(i) (with art. 11(1))

F10 Words in s. 37(4) omitted (6.4.2007) by virtue of The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 7(e)(ii) (with art. 11(1))

F11 Words in s. 37(5) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 7(f) (with art. 11(1))

Commencement Information

I2 S. 37 in force at 1.7.2005 by S.I. 2004/3322, art. 2(3), Sch. 3

38 Existing companies: decisions etc. E+W+S

(1) On receiving under section 37 the copies of the special resolutions, the memorandum and articles as altered by the special resolutions and the prescribed conversion documents, the registrar of companies must (instead of recording the special resolutions and entering a new name on the register)—

(a) forward a copy of each of the documents to the Regulator, and

(b) retain the documents pending the Regulator’s decision.

(2) The alterations of the memorandum and articles made by the special resolutions are to take effect only as provided by this section.

(3) The Regulator must decide whether the company is eligible to become a community interest company.

(4) A company is eligible to become a community interest company if—

(a) the memorandum and articles as altered by the special resolutions comply with the requirements imposed by and by virtue of section 32 and the company’s name as so altered complies with section 33, and

(b) the Regulator, having regard to the special resolutions, the memorandum and articles as altered, the prescribed conversion documents and any other relevant considerations, considers that the company will satisfy the community interest test and is not an excluded company.

(5) The Regulator must give notice of the decision to the registrar of companies (but the registrar is not required to record it).

(6) If the Regulator gives notice of a decision that the company is eligible to become a community interest company, [F12 section 28(6) of the 1985 Act or Article 38(6) of the 1986 Order] (registration of new name) applies; and if the registrar of companies enters the new name of the company on the register the registrar must also retain and record the special resolutions and the prescribed conversion documents.

(7) On the special resolutions being recorded, the alterations to the company’s articles and memorandum made by the special resolutions take effect.

(8) The certificate of incorporation under [F13 section 28(6) of the 1985 Act or Article 38(6) of the 1986 Order] is to contain a statement that the company is a community interest company.

(9) The fact that the certificate of incorporation contains such a statement is conclusive evidence that the company is a community interest company.

(10) If the Regulator decides that the company is not eligible to become a community interest company, the company may appeal to the Appeal Officer against the decision.

Textual Amendments

F12 Words in s. 38(6) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 8 (with art. 11(1))

F13 Words in s. 38(8) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 8 (with art. 11(1))

Commencement Information

I3 S. 38 in force at 1.7.2005 by S.I. 2004/3322, art. 2(3), Sch. 3

39 Existing companies: [F14 English] charities E+W+S

(1) A [F15 company that is an English charity] may not by special resolution change its name to comply with section 33 without the prior written consent of the [F16 Charity Commission].

(2) If a [F15 company that is an English charity] contravenes subsection (1), the [F16 Charity Commission] may apply to the High Court for an order quashing any altered certificate of incorporation issued under section 28(6) of [F17 the 1985 Act].

(3) If a [F15 company that is an English charity] becomes a community interest company, that does not affect the application of—

(a) any property acquired under any disposition or agreement previously made otherwise than for full consideration in money or money’s worth, or any property representing property so acquired,

(b) any property representing income which has previously accrued, or

(c) the income from any such property.

F18 (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F14 Words in s. 39 heading inserted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 9(a) (with art. 11(1))

F15 Words in s. 39 substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 9(b) (with art. 11(1))

F16 Words in s. 39(1)(2) substituted (27.2.2007) by Charities Act 2006 (c. 50), s. 79(2), Sch. 8 para. 201; S.I. 2007/309, art. 2, Sch.; S.I. 2007/309, art. 2, Sch.

F17 Words in s. 39(2) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 9(c) (with art. 11(1))

F18 S. 39(4) omitted (6.4.2007) by virtue of The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 9(d) (with art. 11(1))

Commencement Information

I4 S. 39 in force at 1.7.2005 by S.I. 2004/3322, art. 2(3), Sch. 3

40 Existing companies: Scottish charities E+W+S

(1) A [F19 company that is a Scottish charity] may not become a community interest company.

(2) If a [F19 company that is a Scottish charity] purports by special resolution to change its name to comply with section 33, the Commissioners of Inland Revenue may apply to the Court of Session for an order quashing any altered certificate of incorporation issued under section 28(6) of [F20 the 1985 Act].

(3) Regulations may repeal subsections (1) and (2); and subsections (4) to (7) have effect on and after the day on which regulations under this subsection come into force.

(4) A [F19 Scottish charitable company] may not by special resolution change its name to comply with section 33 without the prior written consent—

(a) if the company’s registered office is situated in Scotland, of the Scottish Charity Regulator, or

(b) if the company’s registered office is situated in England and Wales (or Wales), of both the Scottish Charity Regulator and the [F21 Charity Commission].

(5) If a [F19 company that is a Scottish charity] contravenes subsection (4)(a), the Scottish Charity Regulator may apply to the Court of Session for an order quashing any altered certificate of incorporation issued under section 28(6) of [F22 the 1985 Act] (c. 6).

(6) If a [F19 company that is a Scottish charity] contravenes subsection (4)(b), the Scottish Charity Regulator or the [F23 Charity Commission] may apply to the High Court for such an order.

(7) If a [F19 company that is a Scottish charity] becomes a community interest company, [F24 it shall continue to be under a duty to apply–

(a) any property previously acquired, or any property representing property previously acquired,

(b) any property representing income which has previously accrued, or

(c) the income from any such property.

in accordance with its purposes as set out in its entry in the Scottish Charity Register immediately before it became a community interest company.]

F25 (8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F26 (9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F19 Words in s. 40 substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 10(a) (with art. 11(1))

F20 Words in s. 40(2) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 10(b) (with art. 11(1))

F21 Words in s. 40(4)(b) substituted (27.2.2007) by Charities Act 2006 (c. 50), s. 79(2), Sch. 8 para. 202; S.I. 2007/309, art. 2, Sch.

F22 Words in s. 40(5) substituted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 10(b) (with art. 11(1))

F23 Words in s. 40(6) substituted (27.2.2007) by Charities Act 2006 (c. 50), s. 79(2), Sch. 8 para. 202; S.I. 2007/309, art. 2, Sch.

F24 Words in s. 40(7) substituted (1.4.2006) by Charities and Trustee Investment (Scotland) Act 2005 (Consequential Provisions and Modifications) Order 2006 (S.I. 2006/242), art. 1(3), Sch. para. 8(3)(a)

F25 S. 40(8) omitted (6.4.2007) by virtue of The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 10(c) (with art. 11(1))

F26 S. 40(9) repealed (1.4.2006) by Charities and Trustee Investment (Scotland) Act 2005 (Consequential Provisions and Modifications) Order 2006 (S.I. 2006/242), art. 1(3), Sch. para. 8(3)(c)

Commencement Information

I5 S. 40 in force at 1.7.2005 by S.I. 2004/3322, art. 2(3), Sch. 3

[F27 40A. Existing companies: Northern Ireland charities E+W+S

(1) A company that is a Northern Ireland charity may not become a community interest company.

(2) If a company that is a Northern Ireland charity purports by special resolution to change its name to comply with section 33, the Commissioners of Her Majesty’s Revenue and Customs may apply to the High Court for an order quashing any altered certificate of incorporation under Article 38(6) of the 1986 Order . ]

Textual Amendments

F27 S. 40A inserted (6.4.2007) by The Companies Act 2006 (Commencement No. 2, Consequential Amendments, Transitional Provisions and Savings) Order 2007 (S.I. 2007/1093), art. 1(3), Sch. 4 para. 11 (with art. 11(1))