Jersey makes changes to Companies Law
Jersey is introducing changes to its Companies Law, which aim to make the jurisdiction more attractive for those who use Jersey companies for investment structuring, asset holding and a wide variety of other purposes.
The Draft Companies (Amendment No. 11) (Jersey) Law has been passed by the island’s parliament, the States of Jersey, and is expected to come onto the statute book in the Autumn once it obtains Privy Council approval.
The measures to be introduced include an ‘out of court’ procedure for reduction of capital, increased flexibility surrounding shareholder resolutions and the prospect of new regulations that will permit a company to ‘demerge’ into two or more surviving companies.
Geoff Cook CEO of Jersey Finance, says: “Jersey is already well established as a leading European centre for investment structures and the Jersey company is an attractive choice for institutional investors listing in London and on other international stock exchanges. These 20 or so amendments, which have been agreed following detailed consultation with industry and the regulator, serve to clarify important aspects of the existing law, expand the options and choices for investors and further enhance Jersey’s corporate offering, ensuring that it continues to provide the fullest range of modern and flexible vehicles, both incorporated and unincorporated.”
Highlights among the amendments include:
• Overseas branch registers – listings of Jersey companies on overseas exchanges will be made easier by an ability to permit companies to include the details of any shareholder on its branch register
• Shareholder resolutions – increased flexibility surrounding shareholder resolutions which will permit different thresholds to apply for different types of resolutions
• Reduction of capital – introduction of an alternative ‘out-of-court’ reduction of capital procedure for both private and public companies
• Statutory demerger regime – regulation-making powers will see the introduction of a demerger mechanism, allowing a company to split into two or more surviving companies
• New ratification regimes – provision of robust, alternative regimes for dealing with breaches of director’s duties and payment of unlawful dividends
• Annual general meeting requirements – in a reversal of the existing position, private companies formed after the amendments come into force will no longer need to hold AGMs unless their articles specify
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