New law: Government defers abolition of corporate directors

Companies with corporate directors, which were planning to terminate their appointment during October 2016, do not need to do so for the time being, as the Government has deferred introduction of new law abolishing such directors.

The law allowing one limited company to be a director of another was due to be abolished in October 2016 (subject to certain exceptions) but this has now been deferred to a date yet to be determined.

This will give the Government more time to reconsider the exceptions – the circumstances in which corporate directors will still be allowed.

Companies likely to be affected when corporate directors are eventually abolished include companies within groups, companies acting as trustees and companies set up for overseas individuals/companies for tax reasons.

Operative date

  • Now

Recommendation

  • Companies with corporate directors, which were planning to terminate their appointment during October, do not need to do so for the time being, as the Government has deferred introduction of the new law abolishing corporate directors to a date to be determined

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