On 29 July 2015, the States of Guernsey are expected to approve
long anticipated amendments to the Companies (Guernsey) Law, 2008
(the "Companies Law"). The changes are set out in the
Companies (Guernsey) Law, 2008 Amendment Ordinance, 2015 (the
"Ordinance") published on the 19 June 2015. Directors and
company administrators should be alert to the effect of these
changes on corporate transactions, memoranda and articles and board
and shareholder meetings. This note summarises the main impact of
the Ordinance on Guernsey companies. For a more detailed briefing
note on all of the changes please contact
If approved, the Ordinance will commence on a date to be set in
a separate regulation. Certain provisions of the Ordinance, such as
those affecting the memorandum and articles of companies formed
under the old Companies (Guernsey) 1994 Law, will not come into
effect until 31 December 2016 by which time the Companies
(Transitional Provisions) Regulations, 2008 as recently amended
will have expired. Other Ordinance provisions refer to further
implementing regulations the details of which have yet to be
Company administrators may now wish to update memoranda and
articles, board minutes and review their advice to directors as the
Ordinance has clarified and streamlined several key administrative
procedures. For example, the directors of a company with
multiple share classes will now have the power to issue shares
subject to any restrictions the company approves by ordinary
resolution or as set out in its memorandum or articles. A director
disclosing his interest in transactions with the company will no
longer have to determine the monetary value of that interest and
will still be required to disclose the nature of his interest. It
will become more straightforward to delineate clearer duties, and
corresponding liabilities for a company secretary in the articles.
Further, a company's articles will be able to set specific time
limits on the deemed receipt of notices sent to shareholders by
post or e-mails. This should make communications with shareholders
and timetables for corporate actions more efficient.
Administratively, certain non-regulated companies will be able to
take advantage of a new waiver resolution to exempt directors from
producing a directors' report. Companies will also be able to
adopt and reserve an 'alternative name' in non-Roman script
which may be of particular interest to those clients in the Middle
East and Asia.
Directors and shareholders will be interested by the amendments
accelerating the timetable for amalgamations, migrations, and
takeovers. Advisors and their clients used to takeovers on
the public equity markets of London and elsewhere will recognise
the new amended squeeze out provisions. These will be more closely
aligned with the provisions which apply in the other jurisdictions
which fall within the scope of The City Code on Takeovers and
Mergers (the "Takeover Code") and will be easier to apply
in practice. A detailed briefing note on these changes will be
issued in due course.
In relation to winding up a company, liquidators and directors
may wish to note the new duties to alert the Guernsey Financial
Services Commission and the new court procedures for obtaining a
liquidator's release upon completion of the winding up.
The amendments above are only a selection of the changes
introduced by the Ordinance.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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