Draft Law Amendments Highlighted

Marked up copy of Companies Law

Showing change in draft Companies (Amendment No 10) Law 200- and draft Companies (Amendment No 3) Regulations 200-

KEY

Deletions made by the Regulations are shown in green Additions made by the Regulations are shown in red Deletions made by the Law are shown in purple Additions made by the Law are shown in orange

COMPANIES (JERSEY)

LAW 1991

Revised Edition

7

COMPANIES (JERSEY) LAW 1991

Arrangement

Article PART 1

PRELIMINARY

1. Interpretation
2. Meanings of subsidiary , wholly-owned subsidiary and holding body

2A Further provisions relating to subsidiaries and holding bodies PART 2

COMPANY FORMATION AND REGISTRATION

3. Method of formation of a company

3A Public companies

3B Private companies

3C Limited companies

3D Unlimited companies

3E Par value companies

3F No par value companies

3G Guarantee companies

3H Limited life companies

3I Cell companies

4. Memorandum of association

4A Memorandum of company with shares

4B Memorandum of company with guarantor members

4C Memorandum or articles of company of limited duration

5. Articles of association
6. Standard Table
7. Documents to be delivered to registrar
8. Registration

9. Effect of registration
10. Effect of memorandum and articles
11. Alteration of memorandum and articles
12. Copies of memorandum and articles for members PART 3

NAMES

13. Requirements as to names
14. Change of name
15. Power to require change of name PART 4
16. Change of status of public company
17. Change of status of private company 17A Calculation of number of members 17B Notice of change of status

17C Alteration of numbers

PART 5

CORPORATE CAPACITY AND TRANSACTIONS

18. Capacity of company
19. No implied notice of public records
20. Form of contracts
21. Transactions entered into prior to corporate existence
22. Company seals
23. Official seal for use abroad
24. Official seal for securities

PART 6

MEMBERSHIP AND SHARES

25. Definition of member
26. Membership of holding company
27. Minimum membership for carrying on business
28. Prohibition of minors and interdicts

PART 7

PROSPECTUSES

29. Prospectuses
30. Compensation for misleading statements in prospectus
31. Exemption from liability to pay compensation
32. Recovery of compensation
33. Criminal liability in relation to prospectuses

PART 8

SHARE CAPITAL

34. Nature and numbering of shares
35. Commissions and discounts barred
36. Commissions
37. Provision for different amounts to be paid on shares
38. Alteration of capital of par value companies

38A Alteration of capital of no par value companies

38B Rate of exchange for currency conversions

39. Share premium accounts for par value companies

39A Stated capital accounts for no par value companies

39B Relief from requirements to make transfers to share premium

accounts and stated capital accounts

40. Power to issue fractions of shares

40A Conversion of shares in par value companies

40B Conversion of shares in no par value companies

PART 9

REGISTER OF MEMBERS AND CERTIFICATES

41. Register of members
42. Transfer and registration
43. Certification of transfers
44. Location of register of members
45. Inspection of register
46. Declaration
47. Rectification of share register
48. Trusts not to be entered on register
49. Overseas branch registers
50. Share certificates
51. Certificate to be evidence of title

51A Uncertificated securities

PART 10

CLASS RIGHTS

52. Variation of class rights
53. Members right to object to variation
54. Registration of particulars of special rights PART 11

REDEMPTION AND PURCHASE OF SHARES

55. Power to issue redeemable shares

57. Power of company to purchase its own limited shares

58. Financial assistance by company for purchase of its shares
59. Power of States to amend Part 11

PART 12

REDUCTION OF CAPITAL

60. Forfeiture of shares
61. Reduction of capital accounts
62. Application to Court for order of confirmation
63. Court order confirming reduction
64. Registration of Act and minute of reduction
65. Liability of members on reduced shares
66. Penalty for concealing name of creditor, etc. PART 13

ADMINISTRATION

67. Registered office

68

69. Company s name to appear in its correspondence, etc.
70. Particulars in correspondence, etc.
71. Annual return
72. Service of documents

PART 14

DIRECTORS AND SECRETARY

73. Directors
74. Duties of directors

74A Contracts with sole members who are also directors

75. Duty of directors to disclose interests
76. Consequences of failure to comply with Article 75
77. Indemnity of officers and former officers
78. Disqualification orders
79. Personal responsibility for liabilities where person acts while disqualified
80. Validity of acts of director
81. Secretary
82. Qualifications of secretary
83. Register of directors and secretaries
84. Particulars of directors
85. Particulars of secretaries

PART 15

MEETINGS

86. Participation in meetings

87. Annual general meeting
88. Commission s power to call meeting in default
89. Requisition of meetings
90. Definition of special resolution
91. Notice of meetings
92. General provisions as to meetings and votes
93. Representation of body corporate at meetings
94. Power of court to order meetings
95. Resolutions in writing

95A Recording of decisions by sole member

96. Proxies
97. Demand for poll
98. Minutes
99. Inspection of minute books
100. Filing of resolutions
101. Resolution passed at adjourned meeting PART 16

ACCOUNTS AND AUDIT

102. Accounting records
103. Retention of records
104. Accounts
105. Copies of accounts
106. Delivery of accounts to registrar
107. Failure to comply with Articles 102 to 104 or 106
108. Power to make Regulations as to accounts
109. Appointment and removal of auditors
110. Auditors report
111. Auditors duties and powers
112. False statements to auditors
113. Qualifications of individual for appointment as auditor 113A Qualifications of partnership for appointment as auditor 113B Qualifications of body corporate for appointment as auditor 113C Disqualification for appointment as auditor

113D Power of Minister to amend qualifications

113E Criminal liability of unqualified auditor

PART 17

DISTRIBUTIONS

114. Construction of terms used in Part 17
115. Restrictions on distributions

115A Consequences of unlawful distribution

PART 18

TAKEOVERS

116. Takeover offers
117. Right of offeror to buy out minority shareholders
118. Effect of notice under Article 117
119. Right of minority shareholder to be bought out by offeror
120. Effect of requirement under Article 119
121. Applications to the court
122. Joint offers
123. Associates
124. Convertible securities

124A Power of States to amend Part 18

PART 18A

125. Power of company to compromise with creditors and members
126. Information as to compromise to be circulated
127. Provisions for facilitating company reconstruction or amalgamation

PART 18B

127A Mergers

127B Approval of merger agreement

127C Merger of subsidiaries

127D Notice to creditors

127E Objections by members

127F Documents to be delivered to registrar 127G Completion of merger

PART 18C

127H Bodies corporate which are eligible for continuance

127I Restrictions on continuance

127J Security for Commission s expenses under this Part

127K Application to Commission for continuance within Jersey

127L Articles of continuance

127M Proposed name

127N Determination of application to Commission for continuance

within Jersey

127O Issue of certificate of continuance within Jersey

127P Effect of issue of certificate of continuance within Jersey

127Q Approval by company and members of proposal for continuance

overseas

INVESTIGATIONS

128. Appointment of inspectors
129. Powers of inspectors
130. Production of records and evidence to inspectors
131. Power of inspectors to call for directors bank accounts
132. Authority for search
133. Obstruction
134. Failure to co-operate with inspectors
135. Inspectors reports
136. Power to bring civil proceedings on behalf of body corporate
137. Expenses of investigating a company s affairs
138. Inspectors report to be evidence
139. Privileged information
140. Investigation of external companies

PART 20

UNFAIR PREJUDICE

141. Power for member to apply to court
142. Power for Minister or the Commission to apply to court
143. Powers of court

PART 21

WINDING UP OF COMPANIES

Chapter 1 Winding up of companies of limited

duration

144. Procedure winding up of limited life companies

144A Procedure winding up of other companies of limited duration Chapter 2 Summary winding up

145. Application of this Chapter
146. Procedure
147. Commencement of summary winding up
148. Effect on status of company
149. Appointment of liquidator
150. Application of assets and dissolution
151. Effect of insolvency
152. Remuneration of liquidator
153. Cesser of office by liquidator
154. Termination of summary winding up

154A Declaration under Désastre Law

Chapter 3 Winding up on just and equitable

grounds

155. Power for court to wind up

Chapter 4 Creditors winding up

156. Application of this Chapter
157. Procedure
158. Notice of winding up
159. Commencement and effects of creditors winding up
160. Meeting of creditors in creditors winding up
161. Appointment of liquidator
162. Appointment of liquidation committee
163. Remuneration of liquidator, cesser of directors powers, and vacancy in office of liquidator
164. No liquidator appointed
165. Costs of creditors winding up
166. Application of the law relating to désastre
167. Arrangement when binding on creditors
168. Meetings of company and creditors
169. Final meeting and dissolution

169A Procedure at creditors meeting

170. Powers and duties of liquidator
171. Power to disclaim onerous property
172. Disclaimer of contract leases
173. Powers of court in respect of disclaimed property
174. Unenforceability of liens on records
175. Appointment or removal of liquidator by the court
176. Transactions at an undervalue

176A Giving of preferences

176B Definitions relating to transactions at an undervalue

and preferences

177. Responsibility of persons for wrongful trading
178. Responsibility for fraudulent trading
179. Extortionate credit transactions
180. Delivery and seizure of property
181. Liability in respect of purchase or redemption of shares
182. Resolutions passed at adjourned meetings
183. Duty to co-operate with liquidator
184. Liquidator to report possible misconduct
185. Obligations arising under Article 184

185A Termination of creditors winding up

185B Declaration under Désastre Law

186. Distribution of company s property

Chapter 5 Provisions of general application

186A References to the Court

187. Enforcement of liquidator s duty to make returns, etc.
188. Qualifications of liquidator
189. Corrupt inducement affecting appointment as liquidator
190. Notification by liquidator of resignation, etc.
191. Notification that company is in liquidation
192. Liability as contributories of present and past members
193. Bar against other proceedings in bankruptcy
194. Disposal of records

PART 22

EXTERNAL COMPANIES

195. Power to make Regulations as to registration and regulation of external companies

PART 23

REGISTRAR

196. Registrar and other officers
197. Registrar s seal
198. Registered numbers
199. Size, durability, etc. of documents delivered to registrar
200. Form of documents to be delivered to the registrar
201. Fees and charges

201A Keeping of records by registrar

202. Inspection and production of records kept by registrar
203. Enforcement of company s duty to make returns
204. Destruction of records
205. Registrar s powers to strike companies off register

205A Registrar may strike company off register at end of duration PART 24

MISCELLANEOUS AND FINAL PROVISIONS

206. Form of company s records
207. Examination of records and admissibility of evidence
208. Production and inspection of records where offence suspected
209. Legal professional privilege
210. Right to refuse to answer questions
211. Relief for private companies
212. Power of court to grant relief in certain cases
213. Power of court to declare dissolution of company void

213A Recognition of status of foreign corporations

214. Registration in the Public Registry
215. Punishment of offences

COMPANIES (JERSEY) LAW 1991[1]

A  LAW  to  provide  for  the  incorporation,  regulation  and  winding  up  of companies, and for connected purposes[2]

Commencement [see endnotes]

PART 1 PRELIMINARY

1 Interpretation[3]

1. In this Law, unless the context otherwise requires

 annual return means the return to be made by a company under Article 71;

 allotment , in relation to shares, means a transaction by which a person  acquires  the  unconditional  right  to  be  included  in  a company s register of members in respect of the shares;

 arrangement , in Articles 125 and 126, includes a reorganisation of a company s share capital by the consolidation of shares of different classes or by the division of shares into shares of different classes, or by both of those methods;[4]

 articles , in relation to a company, means its articles of association as originally framed or as altered;

 capital accounts means

1. in relation to a par value company, its share capital accounts and  any  share  premium  accounts  and  capital  redemption reserves; and
2. in  relation  to  a  no  par  value  company,  its  stated  capital accounts and any capital redemption reserves;[5]

 cause has the meaning assigned to it by the customary law of Jersey;[6]

 cell means a cell of a cell company;

 cell  company means  a  company  that  is  an  incorporated  cell company or a protected cell company;

 certificate of continuance means a certificate of continuance issued by the registrar under Article 127O;[7]

 class of members , in respect of a protected cell company, includes

1. the members of a cell of the company; and
2. any class of members of a cell of the company;

 Commission means the Jersey Financial Services Commission established by the Financial Services Commission (Jersey) Law 1998[8];[9]

 company means a company registered under this Law, or an existing company;

 contributory means a person liable to contribute to the assets of a company pursuant to Article 192;

 court means the Royal Court;[10]

 currency includes foreign currency and any other means of exchange that may be prescribed;

 delivered , in Articles 200 and 201, includes (in the case of a document which is a notice) given;[11]

 Désastre Law means the Bankruptcy (Désastre) (Jersey) Law 1990[12];

 director means a person occupying the position of director, by whatever name called;

 dissolved , in relation to a company, means dissolved under this Law or any other law of Jersey;

 document includes summons, notice, statement, return, account, order, and other legal process, and registers;

 existing company means a company registered under the Laws repealed by Article 223;

 external company means a body corporate which is incorporated outside Jersey and which carries on business in Jersey or which has an address in Jersey which is used regularly for the purposes of its

business;

 financial period means a period for which a profit and loss account of a company is made up in accordance with this Law;

 fixed period of time , in Articles 3H, 144 and 144A, means a period of time which is ascertainable without reference to any event which is

1. contingent; or
2. otherwise uncertain;[13]

 former forenames or surname does not include

1. in the case of a peer or a person usually known by a British title which differs from his or her surname, the name by which he or she was known before the adoption of the title or his or her succession to it; or
2. in the case of any person, a former forename or surname which was changed or disused before the person attained the age of 20, or which has been changed or disused for a period of not less than 20 years;[14]

 guarantee company means a guarantee company as defined in Article 3G;[15]

 guarantor member means a member of a company (whether or not it is a guarantee company) whose liability in his or her capacity as such a member is limited by guarantee, that is to say limited by the memorandum to the amount which the member thereby undertakes (by way of guarantee and not by reason of holding any share) to contribute to the assets of the company in the event of its being wound up;[16]

 incorporated cell company means a company to which Article 3I(1) applies;

 insolvent means unable to pay debts as they fall due;

 interdict means a person in respect of whom a curator has been appointed in pursuance of Article 43 of the Mental Health (Jersey) Law 1969[17], or a corresponding provision of the law of a place

outside Jersey;

 liabilities includes any amount reasonably necessary to be retained for the purpose of providing for any liability or loss which is either likely to be incurred or certain to be incurred but uncertain as to amount or as to the date on which it will arise;

 limited company means a limited company as defined in Article 3C;[18]

 limited life company means a limited life company as defined in Article 3H;[19]

 limited share means a share in respect of which liability is limited to the amount unpaid on it;[20]

 memorandum , in relation to a company, means its memorandum of association as originally framed or as altered;

 merged company means a company in respect of which a certificate of incorporation is issued under Article 9, pursuant to Article 127G(1);[21]

 Minister means the Minister for Economic Development;

 net  asset  value ,  in  relation  to  the  shares  of  an  open-ended investment  company,  means  net  asset  value  as  defined  in  the

company s articles;[22]

 no par value company means a no par value company as defined in Article 3F;[23]

 no par value share means a share which is not expressed as having nominal value;[24]

 number , in relation to shares, includes amount, where the context admits of the reference to shares being construed to include stock;

 officer ,  in  relation  to  a  body  corporate,  means  a  director  or liquidator;

 open-ended investment company means a company  

1. the sole business of which is to invest in securities or other property  of  any  description,  with  the  aim  of  spreadinginvestment risk;
2. the articles of which provide that its shares, or substantially allits shares, are to be redeemed or purchased at the request of the holders at a price or prices not exceeding the net asset value ofthose shares; and
3. which holds a permit as a functionary of Group 1 of Part 2 of the  Schedule  to  the  Collective  Investment  Funds  (Jersey)Law 1988[25];[26]

open-ended investment company means a company

1. the sole business of which is to invest in securities or other property of any description; and
2. the articles of which provide that its shares, or substantially all its shares, are to be redeemed or purchased at the request of the holders at a price or prices not exceeding the net asset value of those shares;

 paid up includes credited as paid up;

 partnership , in Articles 113A, 113B, 113C and 113D, includes

1. a Scott ish firm; and
2. a  limited  liability partnership  which  is  registered  under  the Limited Liability Partnerships (Jersey) Law 1997[27];[28]

 par  value  company means  a  par  value  company  as  defined  in Article 3E;[29]

 par  value  share means  a  share  which  is  expressed  as  having nominal value;[30]

 personal representative means the executor or administrator for the time being of a deceased person;

 prescribed means prescribed by Order made by the Minister;

 printed includes typewritten and a photocopy of a printed or typewritten document;

 private company means a private company as defined in Article 3B;[31]

 prospectus means an invitation to the public to become a member of a company or to acquire or apply for any securities, for which purposes

1. an invitation is made to the public where it is not addressed exclusively to a restricted circle of persons; and
2. an invitation shall not be considered to be addressed to a restricted circle of persons unless

1. the invitation is addressed to an identifiable category of persons to whom it is directly communicated by the inviter or the inviter s agent,
2. the members of that category are the only persons who may accept the offer and they are in possession of sufficient information to be able to make a reasonable evaluation of the invitation, and
3. the number of persons in Jersey or elsewhere to whom the invitation is so communicated does not exceed 50;[32]

 protected cell company means a company to which Article 3I(2) applies;

 public company means a public company as defined in Article 3A;[33]

 published means

1. in respect of a fee payable by virtue of this Law, published by the Commission in accordance with Article 15(5)[34] of the Financial Services Commission (Jersey) Law 1998; and
2. in any other case, published by the Commission in a manner likely to bring it to the attention of those affected,

and publish shall be interpreted accordingly;[35]

 recognized professional body ,  in  Articles 113, 113A,  113B and 113D, means

1. the Institute of Chartered Accountants in England and Wales;
2. the Institute of Chartered Accountants of Scotland;
3. the Association of Chartered Certified Accountants; or
4. the Institute of Chartered Accountants in Ireland;[36]

 records means documents and other records however stored;

 registrar means the registrar of companies appointed pursuant to Article 196 and registrar s seal , in relation to the registrar, means a seal prepared under Article 197;

 securities

1. in Article 51A, has the meaningassigned to it by paragraph (4) of that Article; and
2. except as provided in sub-paragraph (a) of this definition, means

1. shares in or debentures of a body corporate,
2. interests in any such shares or debentures, or
3. rights to acquire any of the foregoing;[37]

 share

1. means a share in a body corporate or a cell and, unless a distinction between shares and stock is expressed or implied, also means stock; and
2. in Article 36, also has the meaning assigned to it by paragraph (2A) of that Article,

except that in Article 116(1), it means a share, as defined in sub- paragraph (a) of this definition, to which Article 116(2) refers;

 special resolution has the meaning  given to that  expression by Article 90;

 surname , in the case of a peer or a person usually known by a title which differs from his or her surname, means that title;[38]

 unlimited share means a share in respect of which liability is not limited to the amount unpaid on it;[39]

 variation , in Articles 52 and 53, includes abrogation;[40]

 year means a calendar year.[41]

2. References in this Law to a bodycorporate

1. include a body corporate incorporated outside Jersey but do not include a corporation sole;
2. except in Articles 2 and 2A, do not include an association incorporated under the Loi (1862) sur les teneures en fidéicommis et l incorporation d associations[42];
3. do not include a Scott ish firm;
4. do not include a limited liability partnership registered under the Limited Liability Partnerships (Jersey) Law 1997[43].[44]

2 Meanings of subsidiary , wholly-owned subsidiary

and holding body [45]

1. A body corporate is a subsidiary of another body corporate if the second body

1. holds a majority of the voting rights in the first body;
2. is a member of the first body and has the right to appoint or remove a majority of the board of directors of the first body; or
3. is a member of the first body and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in the first body,

or if the first body is a subsidiary of a body corporate which is itself a subsidiary of the second body.

2. A body corporate is a wholly-owned subsidiary of another body corporate if the first body has no members except

1. the second body; and
2. wholly-owned subsidiaries of or persons acting on behalf of the second body or the second body s wholly-owned subsidiaries.

3. A body corporate is the holding body of another body corporate if the second body is a subsidiary of the first body.
4. A holding company is a body corporate that is a holding body.
5. The Minister mayby Order modify the provisions of this Article and Article 2A and, without prejudice to the generality of the foregoing, any such Order mayamend the meanings of subsidiary , wholly- owned subsidiary , holding body and holding company for the purposes of all or anyprovisions of this Law.

2A Further provisions relating to subsidiaries and

holding bodies[46]

1. The provisions of this Article explain expressions used in Article 2 and otherwise supplement that Article.
2. In Article 2(1)(a) and (c), the references to the voting rights in a body corporate are to the rights conferred on shareholders in respect of their shares, or (in the case of a body not having a share capital) on members, to vote at general meetings of the body on all or substantially all matters.

3. In Article 2(1)(b), the reference to the right to appoint or remove a majority of a board of directors is to the right to appoint or remove directors holding a majority of the voting rights at meetings of the board on all or substantially all matters; and for the purposes of that provision

1. a body corporate shallbe treated as having the right to appoint to a directorship if

1. a person s appointment to it follows necessarily from the person s appointment as director of the body, or
2. the directorship is heldby the body itself; and

2. a right to appoint or remove which is exercisable only with the consent or concurrence of another person shall be left out of account unless no other person has a right to appoint or, as the case may be, remove in relation to that directorship.

4. Rights which are exercisable only in certain circumstances shall be taken into account only

1. when the circumstances have arisen, and for so long as they continue to obtain; or
2. when the circumstances are within the control of the person having the rights,

and rights which are normally exercisable but are temporarily incapable of exercise shall continue to be taken into account.

5. Rights held by a person in a fiduciary capacity shall be treated as not held by the person.
6. Rights held by a person as nominee for another shall be treated as held by the other; and rights shall be regarded as held as nominee for another if they are exercisable only on his or her instructions or with his or her consent or concurrence.
7. Rights attached to shares held by way of security shall be treated as held by the person providing the security

1. where, apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights are exercisable only in accordance with the person s instructions; and
2. where the shares are held in connection with the granting of loans as part of normal business activities and apart from the right to exercise them for the purpose of preserving the value of

the security, or of realising it, the rights are exercisable only in the person s interests.

8. Rights shall be treated as heldby a body corporate ifthey are heldby any of its subsidiaries; and nothing in paragraph (6) or (7) shall be construed as requiring rights held by a body corporate to be treated as held byany of its subsidiaries.
9. For the purposes of paragraph (7), rights shall be treated as being exercisable in accordance with the instructions or in the interests of a body corporate if they are exercisable in accordance with the instructions of or, as the case may be, in the interests of

1. any subsidiary or holdingbody of the first body; or
2. any subsidiary of a holding body of the first body.

10. The voting rights in a body corporate shall be reduced byany rights held by the body itself.
11. References in any of paragraphs (5) to (10) to rights held by a person include rights falling to be treated as held by the person by virtue of any other provision of those paragraphs, but do not include rights which by virtue of any such provision are to be treated as not held by the person.

2B Power of States to amend Part 1

The States may amend this Part by Regulations.

PART 2

COMPANY FORMATION AND REGISTRATION 3 Method of formation of a company[47]

1. Any 2 or more persons associated for a lawful purpose mayapply for the formation of an incorporated public company, with or without limited liability, by signing and delivering to the registrar a memorandum of association that states that the company is to be a public company.
2. Any person or 2 or more persons associated for a lawful purpose mayapply for the formation of an incorporated private company, with or without limited liability, bysigninganddelivering to the

registrar a memorandum of association that states that the company is to be a private company.

3. The registrar shall not grant an application made under paragraph (2) by more than 30 persons unless the Commission notifies the registrar that, on application made to it and on payment of any published fee, it has satisfied itself that byreason of the nature of the company s intended activities its affairs may properly be regarded as the domestic concern of its members.[48]
4. The Commission may give its notification under paragraph (3) subject to such conditions as shall be specified in the approval.
5. Where it does so, paragraphs (3), (4), (5) and (6) of Article 16 shall apply to the notification, with the necessary amendments, as if the approval were a written notice given under Article 16(2).
6. A person mentioned in paragraph (1) or paragraph (2) must not be a minor or an interdict.
7. A public or privatecompanymay be formed

1. having the liability of all or any of its members limited by shares, that is to say limited by its memorandum to the amounts (if any) unpaidon the shares respectively held by them;
2. having the liability of all or any of its members limited by guarantee, that is to say limited by its memorandum to such amounts as those members by the memorandum respectively undertake, by way of guarantee and not by reason of holding any share, to contribute to the assets of the company if it is wound up; or
3. having, in respect of the liability of all or any of its members, no limit.

8. A public or privatecompanymay be formed as
   1. a par value company;
   2. a no par value company; or
   3. a guarantee company.
9. A companyshall not have a share capital the shares of which include par value shares and no par value shares.
10. Paragraph (9) is without prejudice to Article 127YA(4) (which relates to the types of cells a cellcompany may create).

3A Public companies[49]

A company is a public company if

1. its memorandum states that it is a public company; or
2. it is anexistingcompany which became a public company on 30th March 1992 by the operation of Article 16(2) (as then in force), and it has not subsequently become a private company.

3B Private companies[50]

A company is a private company if

1. its memorandum states that it is a private company; or
2. it is a company which immediately before the commencement of this Article was a private company, and it has not subsequently become a public company.

3C Limited companies[51]

1. A par value company or a no par value company is a limited company if

1. any person is a member of the companyby reason of holding a limited share; or
2. any person is a guarantor member of the company, whether or not it also has members whose liability is unlimited.

2. A guarantee company is a limited company.

3D Unlimited companies[52]

1. A company is an unlimited company if

1. it is a par value company or a no par value company;
2. no person is a member of the companyby reason of holding a limited share; and
3. no person is a guarantor member of the company.

2. Nothing in this Lawshall be taken as prohibiting a company

1. from changing any unlimited shares in the company to limited shares in the company; or
2. from changing any limited shares in the company to unlimited shares in the company.

3E Par value companies[53]

A company is a par value company if

1. it is registered with share capital;
2. its shares are expressed as having nominal value; and

1. its memorandum states that it is a par value company, or
2. it is a company which was registered under this Law before the commencement of this Article,

whether or not it also has guarantor members. 3F No par value companies[54]

A company is a no par value company if

1. it is registered with shares which are not expressed as having nominal value; and
2. its memorandum states that it is a no par value company,

whether or not it also has guarantor members. 3G Guarantee companies[55]

A company is a guarantee company if

1. it consists only of guarantor members; and
2. its memorandum states that it is a guarantee company.

3H Limited life companies[56]

1. A company (whether it is a par value company, a no par value company or a guarantee company) is a limited life company if its memorandum includes or its articles include a provision that the company shall be wound up and dissolvedupon

1. the bankruptcy, death, expulsion, insanity, resignation or retirement of any member of the company; or
2. the happening of some other event which is not the expiration of a fixed period of time.

2. A limited life companymay include in its memorandum or articles a provision for its winding up and dissolution on the expiration of a fixed period of time.

3I Cell companies[57]

1. A company is an incorporated cell company if its memorandum provides that it is an incorporated cell company.
2. A company is a protected cell company if its memorandum provides that it is a protected cell company.
3. A cellcompanymay be

1. a public or a private company;
2. a par value company, a no par value company or a guarantee company; and

3. a limited company or an unlimited company.

4 Memorandum of association[58]

1. The memorandum of a company shall be in the English or French language, and shall be printed.
2. The memorandum shall state

1. the name of the company;
2. whether it is a publiccompany or a private company;
3. whether it is a par value company, a no par value company or a guarantee company;
4. the full name and the address of each subscriber who is a natural person; and
5. the corporate name and the address of the registered or principal office of each subscriber which is a body corporate.

3. The memorandum shall be signed by or on behalf of each subscriber, in the presence of at least one witness who shall attest the signature and insert his or her own name and address.
4. If a memorandum is permitted under the Electronic Communications (Jersey) Law 2000[59] to be delivered under paragraph (1) by way of

electronic communication, any memorandum so delivered is not required to be printed nor to be signed in the presence of a witness.[60]

4A Memorandum of company with shares[61]

1. Where a company is to be registered with shares

1. if it is a par value company, the memorandum shall state the amount of share capital with which it is to be registered, and the amounts (being fixed amounts) into which the shares of each class are divided;
2. if it is a no par value company, the memorandum shall state the limit (if any) on the number of shares of each class which the company is to be authorized to issue;
3. if the company is to be registered with any limited share, the memorandum shall state that the liability of a member arising from the member s holding of such a share is limited to the amount (if any) unpaid on it;
4. if the company is to be registered with any unlimited share, the memorandum shall state that the liability of a member arising from the member s holding of such a share is unlimited; and

5. in every case, against the name of each person who subscribes for shares, the memorandum shall state separately

1. the number of limited shares (if any) of each class which the person takes, and
2. the number of unlimited shares (if any) of each class which the person takes.

2. The amount of a par value share maybe stated in any unit or part of a unit of any currency.[62]
3. If a company is to be registered with shares, no person may subscribe for less than one share.

4B Memorandum of company with guarantor members[63]

1. Where a company is to be registered with a memorandum which provides for guarantor members, the memorandum shall state that each guarantor member undertakes to contribute to the assets of the company, if it should be wound up while he or she is a member or within 12 months after he or she ceases to be a member, such amount as may be required for the purposes specified in paragraph (2) but does not exceed a maximum amount to be specified in the memorandum in relation to that member.
2. The purposes to which paragraph (1) refers are

1. payment of the debts and liabilities of the company contracted before he or she ceases to be a member;
2. payment of the costs, charges and expenses of winding up; and
3. adjustment of the rights of the contributories among themselves.

3. Where a company is to be registered with a memorandum which provides for guarantor members the memorandum shallalso state, against the name of each person who subscribes as a guarantor member

1. that he or she does so as such a member; and
2. the maximum amount so specified in relation to him or her.

4C Memorandum or articles of company of limited

duration[64]

Where a company is to be wound up and dissolved upon

1. the expiration of a period of time; or
2. the happening of some other event,

that period or event shall be specified in the memorandum or articles of the company.

5 Articles of association[65]

1. There shall be delivered to the registrar, with the memorandum for a company which is to be formed, articles specifying regulations for the company.
2. The articles shall be in the English or French language, and shall
   1. be printed;
   2. be divided into paragraphs numbered consecutively.
3. The articles shall be signed by or on behalf of each subscriber of the memorandum, in the presence of at least one witness who shall attest the signature and insert his or her own name and address.
4. This Article is subject to Article 6.
5. If articles are permitted under the Electronic Communications (Jersey) Law 2000[66] to be delivered under paragraph (1) by way of

electronic communication, any articles so delivered are not required to be printed nor to be signed in the presence of a witness.[67]

6 Standard Table[68]

1. The Minister may prescribe a set of model articles, to be known as the Standard Table, which is appropriate for a par value company which

1. does not have unlimited shares; and
2. has a memorandum which does not provide for guarantor members.

(1A) Any company (whether or not it is one to which paragraph (1)

refers) may adopt the whole or any part of the Standard Table for its articles to the extent that it is appropriate to do so.

2. Where a company to which paragraph (1) refers is registered after the Standard Table has been prescribed, the Table (so far as it is applicable, and in force at the date of the company s registration) shall

1. if articles have not been registered; or
2. if articles have been registered, to the extent that they do not modify or exclude the Table,

constitute the company s articles as if articles in the form of the Table had been duly registered.

3. If the Standard Table is altered in consequence of an Order under this Article, the alteration shall not

1. affect a company registered before the alteration takes effect; or
2. have the effect of altering, as respects that company, any portion of the Table.

7 Documents to be delivered to registrar

1. With the memorandum there shall be delivered to the registrar a statement containing the intended address of the company s registered office on incorporation and any other published particulars; and the statement shall be signed by or on behalf of the subscribers of the memorandum.[69]
2. Where a memorandum is delivered by a person as agent for the subscribers, the statement shall specify that fact and the person s name and address.
3. Where the company is a public company, the statement shall specify the following particulars with respect to each director

1. the director s present forenames and surname;
2. any former forenames or surname;
3. the director s business or usual residential address;
4. the director s nationality;
5. the director s business occupation (if any); and
6. the director s date of birth.[70]

4. If the Standard Table has been prescribed under Article 6, the statement shall specify the extent (if any) to which the company

adopts the Table.[71]

8 Registration[72]

1. If, on an application for the formation of a company, the registrar is of the opinion thatthe formation of the company would not be inthepublic interest, the registrar must refer the application to thecourt.
   2. If an application is referred to the court in accordance with paragraph (1) or if the court calls for an application to be referred to it, the court may

1. authorize the registration of the memorandum and any articles of the company; or

2. if it considers that the formation of the company would not be in the public interest, refuse to authorize the registration of its memorandum andany articles.

3. Where

1. the registrar is satisfied that all the requirements of this Law in respect of the registration of a company have been complied with; and
2. if the application for the formation of the company has been considered by the court, the registrar has received an Act of the court authorizing the registration,

the registrar shall register the memorandum and any articles of the company delivered to the registrar under Article 5.

9 Effect of registration

1. On the registration

1. of a company s memorandum; or
2. of a company under Article 127G(1),

the registrar shall issue a certificate that the company is incorporated.[73]

2. The certificate shall be signed by the registrar and sealed with the registrar s seal.
3. From the date of incorporation mentioned in the certificate the subscribers of the memorandum, together with such other persons who may from time to time become members of the company, shall be a body corporate having the name contained in the memorandum capable forthwith of exercising all the functions of an incorporated company, but with such liability on the part of its members to contribute to its assets as is provided by this Law or any other enactment in the event of itsbeing wound up.
4. If the memorandum states that the company is a public companyor a private company the certificate shall so state and if the memorandum also states that the company is an incorporated cell company or a protected cellcompany the certificate shall also so state.[74]
5. A certificate of incorporation issued under this Law is conclusive evidence of the following matters

1. that the company is incorporated under this Law;
2. that the requirements of this Law have been complied with in respect of

1. the registration of the company,
2. all matters precedent to its registration, and
3. all matters incidental to its registration; and

3. if the certificate states that it is a public company or a private company, or that it is an incorporated cell company or a protected cell company, that it is such a company.[75]

6. The Act of Incorporation of an existing company, issued by the Court and ordering the registration of its memorandum and articles of association in accordance with the Laws repealed by Article 223, is conclusive evidence of the following matters

1. that the company is incorporated; and
2. that the requirements of those Laws have been complied with in respect of

1. the registration of the company,
2. all matters precedent to its registration, and
3. all matters incidental to its registration.[76]

10 Effect of memorandum and articles

1. Subject to the provisions of this Law, the memorandum and articles, when registered, bind the company and its members to the same extent as if they respectively had been signed and sealed by the company andby each member, and contained covenants on the part of the company and each member to observe all the provisions of the memorandum and articles.
2. Money payable by a member to the company under the memorandum or articles is a debt due from the member to the company.

11 Alteration of memorandum and articles[77]

1. Subject to the provisions of this Law, a company maybyspecial resolution alter its memorandum or articles.
2. An alteration in the memorandum or articles of a company

1. may provide that upon

1. the expiration of a period of time, or
2. the happening of some other event,

the company is to be wound up and dissolved; or

2. may amend or delete any such provision.

3. Notwithstanding anything in the memorandum or articles, a member of a company is not bound by an alteration made in the memorandum or articles after the date on which the member became a member, if and so far as the alteration

1. requires the member to take or subscribe for more shares than the number held by the member at the date on which the alteration is made; or
2. in any way increases the member s liability as at that date to contribute to the company s share capital or otherwise to pay money to the company,

unless the member agrees in writing, either before or after the alteration is made, to be bound by it.

4. The power conferred by this Article to alter the memorandum or articles shall not be exercisable by an existingcompany

1. so as to shorten a period of time by which the company s existence is limited, or to provide for its winding up and dissolution on the happening of an event other than the expiration of a period of time; or
2. so as to alter rights attached to a class of shares which could not have been altered under the Laws repealed by Article 223, unless the alteration is agreed to by all of the members or approved by the court.[78]

12 Copies of memorandum and articles for members

1. A company shall, on being so requiredby a member, send to the member a copy of the memorandum andof the articles subject to payment of such sum (if any), not exceeding the published maximum, as the companymay require.[79]
2. If a company fails to comply with this Article, it is guilty of an offence.

PART 3 NAMES

13 Requirements as to names

1. The registrar may refuse to register

1. the memorandum; or
2. a special resolution changing the name of a company,

where the name to be registered is in the registrar s opinion in any way misleading or otherwise undesirable.

2. The name of a limitedcompany shall end

1. with the word Limited or the abbreviation Ltd ; or
2. with the words avec responsabilité limitée or the abbreviation a.r.l .[80]

3. A company which is registered with a nameending

1. with the word Limited or the abbreviation Ltd ; or
2. with the words avec responsabilité limitée or the abbreviation a.r.l ,

may, in setting out or using its name for any purpose under this Law, do so in full or in the abbreviated form, as it prefers.[81]

(3A) Despite paragraph (2), the name of a public company that is a

limited company may end with the words public limited company or the abbreviation PLC or plc .

(3B) A company which is registered with a name ending with the

words public limited company or the abbreviation PLC or plc may, in setting out or using its name for any purpose under this Law, do so

1. in full or in the abbreviated form; and
2. in any combination of capital or lower case characters, as it prefers.

4. Where the registrar considers that it would be convenientto do so and not misleading, the registrar may in any reference to a company in a document issued under this Law use an abbreviation permitted by this Article or Article 127YS.[82]

14 Change of name

1. Subject to Article 13, a company may, by special resolution, change its name.
2. Where a company changes its name under this Article, the registrar shall enter the new name on the register in place of the former name, and shall issue under Article 9 a certificate of incorporation altered to meet the circumstances of the case; and the change of namehas effect from the date on which the altered certificate is issued.[83]
3. Where, at the time of the passing of the special resolution enabling a company to change its name, the companyhas its name inscribed in the Public Registry as being the holder of, or having an interest in, immovable property in Jersey, the company shall deliver to the Judicial Greffier a copy of the altered certificate of incorporation within 14 days after it is issued and the Judicial Greffier shall cause the new name to be registered in the Public Registry.

4. A company which fails to comply with paragraph (3) is guilty of an offence.
5. A change of nameby a company under this Law does not affect any rights or obligations of the company or render defective any legal proceedings by or against it; and any legal proceedings that might have been continued or commenced against it by its former name may be continued or commenced against it by its newname.

15 Power to require change of name

1. If, in the opinion of the registrar, the name by which a company is registered is misleading or otherwise undesirable, the registrar may direct the company to change it.
2. The direction, if not made the subject of an application to the court under paragraph (3), shall be complied with within 3 months from the date of the direction or such longer period as the registrar may allow.
3. The company may within 21 days from the date of the direction apply to the court to set it aside; and the court may set the direction aside or confirm it.
4. If the court confirms the direction, it shall specify a period not being less than 28 days within which it shall be complied with and may order the registrar to pay the company such sum (if any) as it thinks fit in respect of the expense to be incurred by the company in complying with the direction.
5. A company which fails to comply with a direction under this Article is guilty of an offence.
6. Expenses to be defrayed by the registrar under this Article shall be paid out of money provided by the States.

PART 4

PUBLIC COMPANIES AND PRIVATE COMPANIES[84] 16 Change of status of public company[85]

1. A public company which has not more than 30 members may become a private company by altering its memorandum to state that it is a private company.
2. If, on the application of a public company which has more than 30 members, the Commission is satisfied that by reason of the nature

of the company s activities its affairs may properly be regarded as the domestic concern of its members, the Commission may in its discretion by written notice to the company direct that notwithstanding that it has more than 30 members it may, subject to such conditions as may be specified in the direction, become a private company by altering its memorandum to state that it is a private company.

3. The Commission may at any time by written notice withdraw or amend the terms of any such condition.
4. If

1. a company which is a private company in consequence of a direction under paragraph (2) fails to comply with a condition of the direction; or
2. at any time while such a company continues to have more than 30 members, the Commission ceases to be satisfied that its affairs may properly be regarded as the domestic concern of its members,

the Commission may in its discretion, by written notice to the company, direct that as from a date specified in the notice (being not sooner than 28 days after the company is served with the notice) the company shall as long as it has more than 30 members be subject to this Law as though it were a public company.

5. The company shall within 14 days after the receipt of a notice under any of paragraphs (2), (3) and (4) deliver a copy of the notice to the registrar.
6. If there is a failure to comply

1. with a condition of a direction under paragraph (2); or
2. paragraph (5),

the company is guilty of an offence.

7. Within 28 days after a companyreceives a notice of a direction made by the Commission under paragraph (2) in relation to the company

1. a member of the company may appeal to the court on the ground that the direction was unreasonable having regard to all the circumstances of the case; and
2. the company, or a member of the company, mayappeal to the court on the ground that a condition imposed by the direction was unreasonable having regard to all the circumstances of the case.

8. Within 28 days after a company receives a notice of a direction made by the Commission under paragraph (4) in relation to the company, the company, or a member of the company, mayappeal to the court on the ground that the direction was unreasonable having regard to all the circumstances of the case.
9. On hearing an appeal under this Article

1. if the appeal is against a direction imposed by the Commission, the court may confirm or reverse the direction made by the Commission; or
2. if the appeal is against a condition specified in a direction made by the Commission, the court may confirm, vary or revoke the condition and, in any case, add a new condition to the conditions specified in the direction.

10. On hearing an appeal under this Article the court may make such order as to the costs of the appeal as it thinks fit.

17 Change of status of private company[86]

1. A private company which has at least 2 members may become a public company by altering its memorandum to state  that  it is a public company.
2. If

1. a private company, otherwise than in accordance with a direction under Article 16(2), enters the name of any person in its register of members so as to increase the number of its members beyond 30, and their number for the time being remains above 30; or
2. a private company circulates a prospectus relating to its own securities,

the company shall be subject to this Law as though it were a public company.[87]

3. If a private company enters the name of any person in its register of members so as to increase the number of its members beyond 30, it shall within 14 days give written notice of that fact to the registrar.

5. If there is a contravention of paragraph (3) then, without derogation from the consequences under that paragraph, the company is guilty of an offence.
6. If the court, on the application of a company which has increased the number of its members in the manner described in paragraph (2)(a), or of any other person interested, is satisfied that it is just to relieve the company from all or any of the consequences of the action, it may grant relief on such terms as seem to it expedient.[88]
7. If, on the application of a private company, the Commission is satisfied that by reason of the nature of the company s activities its affairs may properly be regarded as the domestic concern of its members, the Commission may in its discretion by written notice to the company direct that paragraph (2) shall apply to the company with such modifications as are specified in the direction, and the Commission may at any time withdraw or amend the terms of any such direction.
8. The company shall within 14 days after the making of an order under paragraph (6) or the receipt of a direction under paragraph (7) deliver the relevant Act of the court or a copy of the direction, as the case may be, to the registrar, and if there is failure to comply with this paragraph the company is guilty of an offence.
9. Within 28 days after a company receives a notice of a direction, or an amendment of the terms of a direction, made by the Commission under paragraph (7) in relation to the company

1. a member of the company may appeal to the court on the ground that the direction was unreasonable having regard to all the circumstances of the case; and
2. the company, or a member of the company, mayappeal to the court on the ground that a term imposed by the direction, or an amendment to a term of the direction, was unreasonable having regard to all the circumstances of the case.

10. On hearing an appeal under this Article

1. if the appeal is against a direction imposed by the Commission, the court may confirm or reverse the direction made by the Commission; or
2. if the appeal is against a term imposed by a direction made by the Commission, the court may confirm, vary or revoke the term and, in any case, add a new term to the terms imposedby the direction.

11. On hearing an appeal under this Article the Court may make such order as to the costs of the appeal as it thinks fit.

17A Calculation of number of members[89]

1. In determining for the purposes of Article 16 and Article 17(2) the number of members of a company, no account shall be taken of a member

1. who is a director or is in the employment of the company; or
2. who, having been a director or in the employment of the company

1. was at the same time a member, and
2. has continued to be a member since ceasing to be a director or in its employment.

2. Where 2 or more persons hold oneor more shares in a company jointly, they shall be treated as a single member for the purposes of this Part.

17B Notice of change of status[90]

Where a company changes its status in accordance with Article 16 or Article 17(1) the registrar shall, upon delivery to him or her of a copy of the special resolution altering the memorandum, issue under Article 9 a certificate of incorporation which is appropriate to the altered status.