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UK Corporate Vehicles (In the UK, CA2006 sets out the requirements of…
UK Corporate Vehicles
Companies have their own legal personality which is separate from the legal personalities of the individuals who own and manage the company. Limited companies therefore offer protection to the owners of the business and this is why sole traders often form companies to limit their liability for debt
It is possible to form an unlimited company but these are less common as the benefits, which include not having to file financial statements with Companies House rarely outweigh the downside of unlimited liability
In the UK, CA2006 sets out the requirements of limited companies. Limited companies are either public or private and may be limited by shares or by guarantee for example,
Public limited companies (or plc) may issue share to the general public and each shareholder's liability is limited to the amount unpaid on the shares
Private companies limited by shares may only issue shares to a restricted circle of person which does not include the general public. Each member's liability is limited to the amount unpaid on their shares
Private companies limited by guarantee, unlike private companies limited by shares do not have share capital. The members are guarantors whose liability is limited to the amount they undertake to contribute to the company's assets if it is wound up
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A private company may re-register as a public company limited by shares (with the Registrar of Companies at Companies House) provided certain conditions are met including requirements in respect of the company's share capital. The capital would also need to make the necessary changes to its name and Articles of Association to reflect the fact that it will be a public company
A public company may re-register as a private limited company upon special resolution and filing of the necessary documents to the Registrar of Companies. The company must make the necessary changes to its name and Articles of Association to reflect the fact that it will be a private company limited by shares or by guarantee