The existence of a company ends with dissolution – when the company name is removed from the Company Register (‘the Register’). This could happen for a number of reasons, including:
- Non-compliance with the requirement to file proper company accounts and annual returns
- The company is no longer operating
- There are insufficient directors
- Wrongful or fraudulent trading
The members of a company may also wind it up voluntarily.
What happens if you want to restore the company to the Register?
Can I Restore My Company To The Register?
Dissolution can create multiple unforeseen issues for company members. At Nath Solicitors in London, we are regularly instructed by business owners and others to restore a company to the Register. Reasons for restoration include:
- The failure to file accounts or the annual return may have been inadvertent and the directors wish to continue to operate the company
- Someone may have a legal claim against the company and can only pursue it if the company is re-established.
- There may be property or some other asset of value owned by the company that can only be realised through the company’s restoration.
It’s important to get legal advice from a company lawyer before restoration. Firstly to satisfy yourself that restoration is legally possible and secondly to ensure the correct procedures are followed and your paperwork is in order.
Under Part 31 of the Companies Act, 2006 there are two ways to restore a company to the Register: Administrative restoration and restoration by court order. We’ll look at these in turn.
What Is Administrative Restoration?
This method of restoration is intended for companies that were not voluntarily struck off and wish to continue trading. The application can only be made by a director or shareholder of the former company and the application must be made within six years of the dissolution. In addition, for an application to succeed the following conditions must be met:
- The company must have been carrying on a business when it was struck off (so an application to restore a dormant company is unlikely to succeed)
- Where any property has come under ownership of the Crown as a result of a dissolution (property without an owner vests in the crown under the principle of bona vacantia) the persons seeking to restore the company must get the consent of the Crown’s representative (usually the Treasury Solicitor)
- All the documents necessary to keep company records up to date must be delivered to the Registrar. This includes accounts and returns for the years during which the company was dissolved
- All outstanding filing fees or penalties must be paid
If the application to restore is unsuccessful it’s open to the applicants to apply for restoration using the second method of restoration – by applying to the court.
What Is Restoration By Court Order?
An application to the court must be submitted within six years of the company’s dissolution. However, an application to the court following a rejected application by the Companies House (see above) must be submitted within 28 days of the Registrar’s decision.
Unlike the administrative procedure, it’s not just directors and shareholders who can apply to the court to restore a company. Other parties that can use this mechanism to get a company back on the Register include:
- Creditors of the dissolved company
- Persons with a legal claim against the company
- Trustees of employee pension schemes
- Former liquidators of the company
The application is made against the Registrar of Companies and the court will normally allow a three-month period before hearing the case to enable all procedures to be followed. So long as all requirements are met this type of application usually results in a consent order, restoring the company to the Register.
What Is The Effect Of A Company Restoration?
The effect of restoring the company is that the company will be deemed as having continued in existence as if it had never been struck off. Restoration can have wide ramifications, affecting director duties, the rights of creditors and previous contractual obligations. It’s crucial to consider the potential impact of restoration at the time of the application so that the court can be asked to give directions on how such matters should be approached.
Contact Us
For more information on restoring a company to the register or any other aspect of company law please contact our director Shubha Nath at Nath Solicitors on 0203 983 8278 or contact the firm online.
