Shelf companies (Operating Decisions)- FS Flashcards
(9 cards)
What is a shelf company in the context of UK company law?
A shelf company is a company that has already been incorporated, often by a solicitor’s firm, and is held “on the shelf” ready to be used immediately for a transaction or other legal purpose.
Why might a solicitor’s firm use a shelf company for a client?
To provide a fast and efficient solution for clients who need a company urgently, especially where there is an imminent transaction and no time to incorporate a new company via Form IN01.
What are the minimum officer requirements for a private limited company in the UK?
A private limited company must have at least one director and one subscribing shareholder.
Who typically acts as the initial directors and shareholders in a shelf company?
These roles are usually fulfilled by members of the solicitor’s firm that set up the shelf company.
What process is required to tailor a shelf company to the client’s needs?
The client must pass resolutions to amend the company’s structure—such as replacing directors or shareholders—so that the company can be used for its intended transaction.
How quickly can resolutions to modify a shelf company’s directors and shareholders take effect?
These resolutions can be passed and effected immediately, allowing the company to be adapted swiftly to the client’s specifications.
What is a key advantage of using a shelf company in urgent transactions?
It bypasses the administrative time involved in completing and submitting Form IN01 and waiting for Companies House to confirm incorporation.
How long does it typically take to incorporate a company using Form IN01?
The form can usually be completed in about an hour, and confirmation from Companies House is generally received within two days.
Why is a shelf company considered suitable for high-pressure or time-sensitive transactions?
Because it allows for instant use—directors and shareholders are already in place, and structural changes can be made quickly via resolutions without delay from Companies House.
