WA83

Small business welcomes Companies Act plans

The Federation of Small Businesses (FSB) has welcomed the announcement of a timetable for implementing the Companies Act.

The Companies Act 2006 introduces sweeping changes to company law, with the aim of making it simpler, easier to understand, and more flexible for smaller businesses.

MP Margaret Hodge said that the implementation timetable will be linked to the existing 'common commencement' dates for new legislation, in order to reduce the burden on small firms.

All of the measures will be in place by October 2008, although many measures will come into effect in October 2007, including the provisions relating to the rights of indirect investors, and most of the provisions relating to directors' general duties.

However, the FSB has highlighted the importance of providing good and timely advice, so that small businesses know what it required of them, and how they could benefit from the changes.

Mike Cherry of the FSB said, 'The Companies Act is a welcome piece of legislation, which should make formal procedures simpler and less burdensome for small businesses. The smallest businesses in particular have been crying out for reform of unnecessary and out-dated company laws. It is important for the Government to get the implementation and timing of this right, but the signs so far are encouraging'.

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