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Section 1183: Meaning of “the court” and “UK company”

1509. Section 1183 sets out the meaning of “the court” and “UK company” for the purposes of this Part.

Section 1184: Disqualification of persons subject to foreign restrictions

1510. Section 1184 provides a power for the Secretary of State to make regulations disqualifying a person subject to foreign restrictions from being the director of a UK company, acting as a receiver of a UK company’s property, or, in any way, taking part in the promotion, formation or management of a UK company.

1511. The power is subject to affirmative resolution procedure.

Section 1185: Disqualification regulations: supplementary

1512. Section 1185 states that the regulations under section 1184 may make different provision for different types of case, and sets out some examples. If the regulations provide for application to the court (either by the Secretary of State for a disqualification order under section 1184(2)(b), or by a disqualified person seeking relief under section 1184(5)), the section requires the regulations to specify the grounds on which an application to the court may be made. It also allows the regulations to set out matters to which the court should have regard when considering an application.

Section 1186: Offence of breach of disqualification

1513. Section 1186 provides that regulations made under section 1184 may provide that a person disqualified under this Part who acts in breach of the disqualification commits an offence.

Section 1187: Personal liability for debts of company

1514. Section 1187 provides for the Secretary of State to make regulations to the effect that a person disqualified under this part who acts as a director of a UK company, or is involved in the management of a UK company is personally responsible for all debts and liabilities of the company incurred during the time that he or she is subject to foreign restrictions.

Section 1188: Statements from persons subject to foreign restrictions

1515. Section 1188 provides a power for the Secretary of State to make regulations providing that a person not disqualified under this Part but subject to foreign restrictions must send a statement to the registrar if he or she does anything that, if done by a person disqualified under this Part, would be a breach of the disqualification.

1516. The power is subject to affirmative resolution procedure.

Section 1189: Statements from persons disqualified

1517. Section 1189 provides a power for the Secretary of State to make provisions by regulation that would require a disqualified director to provide an additional statement where he or she has received approval from the court to act in a capacity that would otherwise be in breach of the disqualification.

1518. The power is subject to affirmative resolution procedure.

Section 1190: Statements: whether to be made public

1519. Section 1190 provides for regulations under sections 1188 and 1189 to state whether statements made under those regulations shall be on the public register, and the circumstances in which they may withheld from public inspection or removed from the register.

Section 1191: Offences

1520. Section 1191 provides for regulations to apply criminal sanctions for a failure to comply with any requirements on statements under sections 1188 and 1189.

PART 41: BUSINESS NAMES

1521. The provisions of this Part replace the Business Names Act 1985.

CHAPTER 1: RESTRICTED OR PROHIBITED NAMES

Section 1192: Application of this Chapter

1522. This section partly replaces section 1 of the Business Names Act 1985. It ensures that the restrictions on the use of names in the course of business apply to all persons carrying on business in the UK, other than certain individuals or partnerships (see below). In particular, the restrictions:

• apply to all companies (and not as in the Business Names Act, just to any company capable of being wound up under the Insolvency Act 1986 which trades under a name other than that under which it is registered); and

• apply to any partnership whose members include a company (and not, as in the Business Names Act, only if the name under which such a partnership does business includes names for the corporate partners other than those under which they are registered).

1523. As in the Business Names Act, the restrictions do not apply to individuals if they trade either alone or in partnership under their surnames augmented only by their forenames and/or initials. Sole traders and individuals carrying on business in partnership are also excluded from the scope of the Chapter if the only addition to their name shows the business’s previous ownership

1524. The main effect of the wider coverage is that controls apply to all overseas companies carrying on business in the UK. It also removes any uncertainty as to whether the controls apply to business entities other than companies incorporated under the Companies Acts.

Section 1193 to 1196: Sensitive words or expressions

1525. Sections 1193 to 1195 replace sections 2, 3, 6 and 7 of the Business Names Act 1985. Section 1199 (see below) contains savings equivalent to those currently in section 2(2) of the Business Names Act.

1526. These sections require prior approval for the use of any name for carrying on business for which a company would require approval before it could be registered under it. (Sections 54 to 56, replacing sections 26(2) and 29 of the 1985 Act, apply corresponding restrictions to company names.) The differences between the requirements under these sections and the requirements under the Business Names Act are:

• Section 1193(1)(a) requires prior approval for names likely to give the impression that the business is connected with Her Majesty’s Government in Northern Ireland;

• Section 1193(1)(c) provides a power for the Secretary of State to specify in regulations the public authorities such that prior approval will be required for names likely to give the impression that the business is connected with it;

• The definition of local authority in section 1193(2) is brought up to date for Scotland and includes a district council in Northern Ireland;

• Section 1195(4) provides that the Secretary of State may refuse to consider an application for approval that is not compliant with the statutory requirements.

1527. Section 1196 provides that approval for the use of a name may be withdrawn in appropriate circumstances.

Section 1197: Name containing inappropriate indication of company type or legal form

1528. This section replaces sections 33, 34 and 34A of the 1985 Act. Rather than making it an offence on the face of the Act to use prohibited words, this section provides that the Secretary of State may by regulations make it an offence to carry on business under names using indicators of particular legal status, or similar words, unless entitled to do so. It complements sections 58 and 59, which control the use of statutory indicators of legal status (eg “ltd.” and “p.l.c.”) in companies’ registered names.