The States of Guernsey will meet on 30 October to discuss and approve the Companies (Guernsey) Law, 2008 (Amendment) Ordinance, 2013. If approved, changes to the Companies (Guernsey) Law, 2008 will take effect on 1 November 2013.
Proposed within the ordinance are two long-awaited amendments to the existing legislation, both with practical and very useful consequences. Firstly, the requirement for Guernsey companies to publish information regarding issued shares (number, aggregate value, amounts paid up and forms of consideration, etc.) in annual validations will be removed, thus further simplifying the return and considerably improving the position for corporate service providers.
Secondly, and perhaps more significantly, are the changes to the "audit exemption" provisions within the law. At present, in order to exempt a qualifying company from the requirement for its accounts to be audited, members of a company must pass a waiver resolution (being not less than 90% of the holders of shares) each year. The added complication under the existing regime is that this waiver resolution must be passed for each financial year before it begins. The ordinance will allow members to pass a single waiver resolution exempting their company from audit indefinitely (much like they can now for annual general meetings). Additionally, members will have the power to rescind an audit exemption by ordinary resolution, provided such resolution is passed not later than 11 months after the beginning of the financial year to which such resolution relates.
The Guernsey Registry and Guernsey service providers have been anticipating the incoming audit waiver amendments for some time. The Registry has already published on its website a form of "indefinite waiver" resolution that many corporate service providers have chosen to have companies pass in anticipation of the ordinance coming into force. Provided the ordinance takes effect on 1 November, companies having passed such a resolution will be treated by the Registry as already having indefinitely waived their audit obligations.
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