Those wishing to run a business through the medium of a company may either create a company from scratch or purchase an existing “shelf” company i.e. a company which has already been set up.
Karen Edwards is a Commercial Solicitor at Frettens who assists clients who are forming a company. She says “A shelf company is often used for speed because it is already in existence and this avoids the time-consuming process of applying to register a new company. Once the company has been acquired, particularly in the case of a shelf company, it may then be necessary to adapt the directorship, shareholding and articles of association as appropriate.”
There are also a number of immediate obligations and practicalities that the directors of the company should consider upon incorporation or acquisition. For example:
- the statutory books which comprise, amongst other things, the register of members and register of directors, should be updated and held at the registered office of the company
- most businesses will also have to consider whether or not they will need to register for VAT
- the company should consider making sure that its stationery bares the company name, its place of registration, its register number, the address of the registered office and either the names of all the directors or the names of none of them
- appropriate insurances should be taken out in the company’s name
- the company should also consider its banking arrangements
- if there is more than one member of the company, they should consider entering into a shareholders’ agreement
- lastly, but by no means least, if the company is to have employees working for it, then the appropriate employment contracts should be put in place.
For assistance with forming a company and any related aspects, please get in touch with Karen or another member of our Commercial Team.