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The Importance of maintaining a Company's statutory registers

What are statutory registers?

Statutory registers (the Registers), otherwise known as 'stat books', compromise a collection of registers/documents that contain a record of past and present information about a company. In accordance with the Companies Act 2006 (the Act), it is a legal requirement to always maintain and keep up to date the following Registers:

• Register of Members (s113 of the Act) - past and present shareholders and details of their shareholding;
• Register of Directors (s162 of the Act) - details of past and present company directors;
• Register of People with significant control (s790M of the Act) - details of individuals or entities that hold more than 25% of a company's shares, voting rights or have the power to appoint/remove the majority of company directors;
• Register of Secretaries (s275 of the Act) - details of past and present company secretaries; and
• Register of Mortgages & Charges (for charges created pre 6th April 2013)

Whilst there is no legal requirement to maintain the following, keeping a register of allotments and transfers can be useful in providing a source of reference as to the company's share capital and vital in future when determining a company's history of share ownership.

There are also other registers, such as directors'/secretaries' residential addresses, or directors' interests, that are good practice to keep, however, these are confidential and not to be disclosed to third parties without the consent of the directors or on an official request from proper authorities.

Why should I maintain them?

Failure to maintain the Registers may result in an offence being committed by the company and each of its officers (i.e. directors & secretaries), which may result in imposition of a fine (unlimited).

These Registers must be maintained and kept up to date, and subject to the rules of the Companies Act, made available for public inspection at either the registered office or a single alternative inspection address (SAIL). Under s1135 of the Act, the Registers may be kept in hard or electronic form. In practice, we often see that registers aren't maintained properly, are lost, or have never existed to begin with.

Additionally, the Registers represent a definitive statement as to who the members of the company are and what respective shareholdings they each possess. Therefore, if a shareholder's exit, sale of the company or other share acquisitions are proposed - the Registers can be produced and relied upon prior to completion, and omitting to do so will call for the Registers to be updated or reconstituted. Depending on the age of the company, this can be a time-consuming process, which can cause significant delays to the transaction and incurring additional costs for this work.

How do I maintain the registers?

Firstly, ensure that your registers exist. In practice, there are countless instances where an individual will be required to present their Registers and will be unable to. Once you know these exist, remember to update these as shares are issues, transferred, disposed of and acquired along with members or officers of the company resigning or becoming appointed. These should be maintained and reflected to mirror the Companies House records - this may take some time now; however, it will save you time and costs in the future.

If there's ever an instance where you must produce your statutory registers and are unable to, our corporate team are able to assist in reconstituting your statutory books and drafting the relevant documentation required to do so.

For more information contact David Filmer in our Corporate department via email or phone on 0333 207 1132. Alternatively send any question through to Forbes Solicitors via our online Contact Form.

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