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Single Director Companies and Natural Persons

 

Companies Acting as Director - CA 2006 Provisions

The Companies Act 2006 states that in situations where there is a single corporate director, that officer must be a "natural person".

A natural person is defined as an individual human being, i.e. not a company. Where a corporation is presently the sole director of a business, a natural person would be required to be appointed.

Effects on Nominee Directors

This provision, which comes in to effect in October 2008, will essentially change the nature of nominee director services offered by UK company formation agents. Instead of using companies as nominees, they will be required to specify an individual as the director.

This could essentially end the nominee director service as UK company agents would no longer have the limited liability shield for their nominees. The costs of insurance against potential liabilities are likely to prohibitive.

 
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