Stanley Carter - company secetarial services

March 20, 2020

Company Directors’ Responsibilities

Directors in today’s global market are increasingly being held personally liable for their actions that harm their companies, as well as facing civil and criminal liabilities for failing to comply with the procedures and requirements of various laws. Further, there are several Acts, for which the violation thereof can result in criminal sanctions, including fines and even imprisonment. Directors can find themselves subject to criminal sanctions for such minor infractions as late filing or inadvertently filling out a form incorrectly.

By accepting the assignment as a director, the director establishes a contractual relationship with the company based on two distinguishable obligations:

obligations relating to the functioning of the company; and
management obligations.

Both categories are in the exclusive competence of the director. The obligations relating the functioning of the company pertain to all acts aimed at ensuring the operations of all corporate bodies, to which the director is responsible by law or by the Articles of Association of the company. In this context, the following can be included: the obligation to call the shareholder meeting; the responsibility to prepare and approve the draft budget and to convene the meeting for approval. Furthermore, the obligation to keep accounting records; to announce, register and fulfil the duties of the Business Register. The director is prohibited from acting in conflict of interest with the company or in competition with the latter.

The management obligations indicate all acts aimed to achieve the corporate purpose. For example, the obligation to provide the company with an adequate organisational and accounting structure, to guarantee safety in the workplace and to ensure that the company is acting in accordance with the law. From this point of view, the most important obligation is to act with diligence, i.e. to identify and implement all the necessary measures to take care of the interests of the company.

The scope of this obligation is measured on the basis of two criteria:

nature of the assignment, where all characteristics of the company administered – such as size, activity performed, organisational structure and the position held by the director within the administrative body must be considered;
specific skills, according to the particular knowledge of the director, his technical and managerial skills and his actual experiences need to be kept in mind.

In the event of a court judgment, the Judge will evaluate the director’s behaviour based on the aforementioned criteria. The level of diligence required from a long-experienced managing director of a multinational company may be different from that of a director of a private company with small turnover volumes.

If the following conditions are fulfilled, a Director is liable of non-fulfilment or incorrect fulfilment of his obligations:

the director has, in the performance of his duties, adopted a behaviour in violation of the duties and obligations provided law or by the Articles of Association;
this behaviour caused damage;
a causal link between the behaviour of the director and the damage exists (i.e. the damage is an “immediate and direct consequence” of the behaviour).

Actions to enforce the liability of a director of a limited liability company can be raised:

by the company itself,
by company’s creditors,
by individual shareholders and third parties, if the behaviour of the directors caused damage to them;

Directors can minimise their risks by being aware of their duties and responsibilities and ensuring that they are performed prudently and diligently. Among the steps that a director can take to minimise his liability are the following:

attend directors’ meetings regularly;
ensure that delegated authority is exercised properly;
ensure that directors’ decisions are implemented properly;
document measures taken to prevent mismanagement

It is notable that the director holds the position of the company’s legal representative according to the Companies House, based on which a lawsuit is in practice often filed together with a lawsuit against the company. For example, in an employee dismissal case, the director may be sued as the second defendant and claiming for compensation due to his authority to make a decision for the aforementioned act on behalf of the company. However, the law sees the director as a legal representative which is granted protection in terms of personal liability to third parties for any act that has been done prudently and diligently within the scope of his authority. By virtue of his legal representation, such action shall be attributed to the company.

If you need any assistance or require further information regarding company directors responsible please contact us on 0870 228 1999 or email us on info@stanleycarter.co.uk

February 24, 2020February 24, 2020

Positioning Compliance as the Distinction

As the threat landscape has become more perilous and complex, regulators have imposed a wide array of mandates designed to protect sensitive personal information. For most organisations, compliance is seen as the cost of doing business. However, if executed strategically it can not only improve a company’s overall security posture but shortens sales cycles and open the business to new markets.

In order to turn compliance from a check-the-box line item into a valued business initiative, businesses need to identify all global, local and industry regulations that apply to their business and, also, strategically implement the processes and technologies that keep them compliant. Whether you’re targeting specific industry or going after international customers, entering new markets requires continuous education about the latest in compliance and regulatory standards as they relate to data privacy and security.

A good way to get started is to put together a roadmap for how you will get, and stay, compliant with the regulations relevant to your business. What follows is an outline of such roadmap.

Start with the Basics

When you are building a house, a foundation is the key to a safe structure. This holds true for building a compliance roadmap.

Once the foundation has been set, it’s then time for the compliance, IT and security teams to determine which regulations apply to their business. This is the backbone of the compliance roadmap. The good news is that many of these regulations overlap so businesses can complete requirements for multiple regulations at the same time

The Roadmap Focal Point: GDPR

The General Data Protection Regulation (GDPR) brought compliance into the mainstream. When GDPR passed, it established strict regulations for how organisations must handle customer data. The regulation is so broad, stringent and complicated that it has motivated many companies to create new job titles to ensure compliance.

However, while there have been strict compliance regulations before, it’s the high financial stakes attached to GDPR that set it apart. A business can be fined up to 4% of its global revenue if it’s found to be non-compliant. Very few organisations can afford to take that kind of hit which is why so many make it the centre piece to their compliance strategy.

The privacy implications of GDPR are extensive but one of the most important and challenging requirements is the data breach notification. Organisations must notify authorities or specific data subjects within 72 hours of a breach. Most organisations are unable to locate sensitive consumer information within their environment, making this requirement near impossible. However, if the organisation puts data controls into its systems and enacts continuous monitoring and real time intrusion detection, it not only becomes achievable but improves internal processes.

Compliance can be a powerful differentiator and business driver that inspire trust and confidence amongst prospects, customers and external partners. Although the above standards and regulations require extensive resources, non-compliance can result in fines and other punishment that can cripple a company. It’s important to remember that these compliance standards and regulations may have to be revisited, but once put into place and assigned to a dedicated compliance team; the once daunting task pays for itself.

For more information on how to meet your business compliance obligation get in touch with us on 08702281999 or contact us via info@stanleycarter.co.uk or further details on our website www.stanleycarter.co.uk.

January 30, 2020

It’s the New Year and we would like to list some legal considerations your business might be forgetting

New business regulations come into play all the time, and after a while, keeping up with the changes in legal requirements can start to feel like a job in itself. However, failing to adhere to these ever evolving rules can quickly land you and your business in hot water. To help you stay on the right side of the law, we have pulled together five of the most important things to consider.

Filing your company’s confirmation statement

A confirmation statement is a document providing the government with your company’s details, including your office’s address, your principal business activities and the names of any shareholders. Known previously as an annual return, every registered UK Company is legally required to submit a confirmation statement at least once a year to ensure the Companies House has your up-to-date company information.

You must file your statement no later than twelve months after your new company’s date of incorporation. For established companies, the review period is up to twelve months after your last confirmation filing. Even if you don’t have any updates on your company’s details, you will still have to confirm an annual statement. While there isn’t a fine for late submission of your form, it is a criminal offence not to submit one at all, and this could lead the registrar to believe your company is no longer operating and strike you off the register. This means that your company will no longer legally exist, and its assets will become Crown property.

This process is fairly simple and can be completed online. The likes of Online Filings require you to simply find your company in the Companies House register and choose a package that is right for you, and then fill out a short application form with your company number and authentication code. This process takes less than five minutes to complete, and can be approved within three hours. Submitting a confirmation statement online also saves you money, compared to submitting a paper form, which costs £40.

Employers liability insurance

It’s a simple fact that, if your business hires any staff, you will need to take out an employer’s liability insurance policy. If a worker makes a claim against you, this covers any compensation or legal fees. Whether your employees work on a full-time basis or on freelancing terms, this cover is a legal requirement for all businesses with at least one employee.

Staff can have multiple grounds to make a claim against their employers, such as if they injure themselves, or become seriously ill as a result of their work, or if a client or member of the public is injured or has their property damaged by your professional actions. Failing to have employer’s liability in place may result in your business facing hefty fines of £2500 per employee working for you, which could leave you with some considerable financial ramifications.

Ensuring your software is licensed

Your business likely uses a huge variety of software programmes on a daily basis, whether for word processing, accounts, billing, and databases. Regardless of which ones you use, they must be licensed for use. If you use unlicensed software, it most likely won’t do everything you need it to for long, as software providers can check their registrations and only allow their use for a certain amount of time before suggesting a paid software upgrade. You will also receive no additional support and face security risks, with viruses and malware issues rife amongst unlicensed programs. Illegal use can also land you with both civil and criminal penalties.

When initially accessing any software, you will have already agreed to its licensing terms and conditions, and complying with these terms is vital. It’s against the law to use unlicensed software, which includes any unauthorised use or distribution from downloading, sharing, selling or installing multiple copies. Although it may cost more to have licensed software, it’s worth it in the long run, as it prevents you from facing any potential legal problems.

To avoid legal issues, keep track of which programmes you use, and make sure to keep any relevant documentation which contains details of the software license. Write down the name of the software, its associated ID, the license number for that particular installation, when it was installed, and verification of compliance. Having this documentation protects you should a software vendor accuse your company of noncompliance to their terms.

Intellectual property protection

Protecting your intellectual property (IP) can safeguard a range of your creative business ideas, including your business name and logo, any products you have designed and created, and trademarks. It doesn’t just cover your ideas and concepts, but also business assets like any equipment that is essential for running your business.

With more businesses relying on the internet to promote and sell their products and services, there is a heightened risk of individuals having their unique ideas infringed upon. This includes violating the terms of any agreement made with third parties; for example, if you were to use someone else’s design without the owner’s permission you would be subject to an infringement claim. It’s worth protecting your IP in case people try to steal your ideas and sell them off as their own. For instance, if you own a trademark and someone uses a similar one to sell similar products or services, this could count as a case of trademark infringement.

By having IP protection, your business will be covered if anyone tries to copy your creative property. It also stops you from unintentionally stealing or copying other creative work from others.

For more information on how to meet your business compliance obligations get in touch with us on 08702281999 contact us via info@stanleycarter.co.uk or further details on our website www.stanleycarter.co.uk

December 20, 2019December 23, 2019

Starting a business can be a risk

There are so many things that could go wrong and what business owners need to know is that compliance is one of the best ways to manage most risks that are inherent to Startups. Non-compliance to regulatory requirements results in fines, restrictions on operations, and license revocations. Therefore, Startups must observe compliance guidelines to ensure smooth operations. Compliance can be a complicated affair, especially when you realize just how much needs to be done.

Here are some aspects of compliance that are relevant to every Startup.

Choosing the Right Business Structure

Deciding whether your business will be a sole trader, partnership, limited company, or any other type is extremely important. There are regulations and tax requirements that are unique to each business structure. Understanding how your business structure relates to compliance is the first step for every entrepreneur.

You might have enough capital to register as a sole trader or require funding hence opt for a limited liability company. Business capital is governed by a unique set of laws that you have to consider. Whichever the case, keep tax and other regulatory obligations in mind as you make this choice.

Most SMEs either comply with basic registration or overlook it completely. This is a grave mistake that could have serious legal implications. Take the time to understand the categories your business falls under and what is expected from you as far as registration goes.

Adhering To Audit and Tax Regulations

All businesses are required to carry out yearly audits and prepare annual audit reports. These reports must contain all financial transactions of the year. Startups and SMEs are not exempted from this regulatory requirement.

Auditing may not be a familiar concept for most people running startups simply because not everyone knows the ins and outs of recording transactions. To simplify auditing and ensure you comply with regulatory requirements, maintain a book of accounts. Hire an auditor to crunch the numbers and prepare a report.

Startups are required to declare their tax liabilities at the time of incorporation. Failure to do so creates inconveniences down the road.

If you need any assistance or require further information please contact us on 0870 228 1999 or email us on info@stanleycarter.co.uk

October 28, 2019

Authorities ramp up enforcement of foreign companies’ non-compliance with national anti-bribery laws

In recent years, multinationals have increased their efforts to mitigate the risk of commercial bribery in particularly given the wide-reaching applicability of the UK Bribery Act.

The prosecution of commercial bribery has once again become a key issue following the amendment of the Anti unfair Competition Act (AUCA). With the restructuring of the act’s anti-bribery provision, which dovetailed with the national anti corruption movement, the government appears to be cracking down on unlawful commercial activities by both domestic and foreign companies.

Foreign companies’ compliance with anti-bribery laws is set to become as big a focus area as domestic companies compliance with foreign laws.

What constitutes commercial bribery under AUCA?

The AUCA defines ‘commercial bribery’ as “using money, things of value, or other means to bribe with the purpose of obtaining transactional opportunity or competitive advantage”. Possible recipients of unlawful commercial bribery under the AUCA are limited to:

the employees of a counterparty to a transaction;
organisations or individuals entrusted by a counterparty to a transaction to handle relevant matters; and
organisations or individuals that use their power to influence a transaction.

In this sense, the AUCA not only includes counterparties as potential recipients for commercial bribery purposes, it also prohibits the provision of discounts to counterparties or the payment of commission to intermediates unless the discount or commission is offered and accepted in accordance with the agreement and in an honest manner. In addition, where commercial bribery by an employee is demonstrated, the AUCA requires the employer to prove its irrelevance; otherwise, the employer is liable.

If you have any concerns or require some assistant contact our expert team on 08702281999 or send us an email info@stanleycarter.co.uk

September 23, 2019September 23, 2019

Brexit challenges and competitive advantage

As organisations seek to harness information to maintain and grow competitive advantage, the importance of developing a clear data strategy is becoming increasingly evident among enterprises.

As the clock ticks on towards a no-deal Brexit on October 31st, the effects are already beginning on the UK economy.

The pound has hit a two-year low, and the economy contracted by 0.2% in the second quarter of this year. This is bad news for home based growth and a clear motivation for companies to look elsewhere for new opportunities, fuelling their move into new markets.

Not every business can follow Dyson’s business structure and set up a new HQ on another continent, but fast growth businesses looking to maintain their trajectory towards unicorn status are certainly eyeing the EU.

It’s clear that our nearest trading partners still exert a significant pull on UK enterprises consider Starling Bank’s recent £75m funding round to power their European expansion, or furniture retailer Made.com plans to move into four additional EU countries in 2019, bringing its total footprint to 13 across the continent.

Brexit will bring with it all kinds of challenges when looking to expand across the channel. One often overlooked challenge is around maintaining basic business communications.

Without a suitable communications plan in place for a post-Brexit transition, businesses may find it increasingly difficult to communicate with overseas offices, colleagues and contacts due to complex and varied regulatory requirements.

Businesses must consider that each new market must navigate the varying legal regimes and requirements, and make costly infrastructural investments with high potential costs (fines, operating restrictions, even criminal culpability for business owners) for getting it wrong. As a final anti inducement, many European regulators still accept only hard-copy paper-based applications in their native language to be filled out in triplicate.

If you need any assistance or require further information please contact us on 0870 228 1999

August 27, 2019August 27, 2019

Every CEO cares about compliance

But not every CEO makes compliance a top priority. That means compliance wouldn’t be just a company issue, but also a personal one.

Pressure to strictly follow the rules comes from other directions as well. Various regulatory bodies have long signalled their intentions to hold executives individually responsible. Unlike before, executives accept the responsibility for compliance. Even more significantly, they now will accept the risk of noncompliance. Meeting that standard will require a lot of adaptation, and it needs to begin now.

Building Beneficial Partnerships

It’s unrealistic to expect CEOs to bear the entire compliance burden. The CEO should get help from the Chief Compliance Officer (CCO) in achieving compliance.

No matter the company’s regulatory requirements, it’s vitally important that the CEO works to supply the necessary tools and resources to enable the CCO perform his core duties, as well as serve as a primary point of communication and guide for ensuring a culture of compliance within its business.

Again, comprehensive support is key; consider the breadth of responsibility a CCO assumes, including serving as in-house expert to stay up to date about the latest regulatory revisions; acting as program director to build the company’s specific compliance policies; communicating the importance of compliance across the entire organisation; and evaluating and continuously monitoring compliance performance.

Each of these roles is important, and together they lead to consistent compliance. Increasing the compliance department’s budget is one way the CEO can help to strengthen compliance efforts. Additional funds could be used to hire staff, bring in consultants and managed service providers, or pay for professional development. These investments are necessary to stay compliant, and therefore necessary to keep executives out of trouble.

When the company does well by its customers in areas of compliance, after all, it receives a committed customer base in exchange.

Staying Away From Trouble

To be sure, the reason regulators are getting tough is not to penalise executives; it’s to underline the importance of compliance even in the midst of today’s fast paced, ever disruptive economy. In that context, staying compliant is an urgent obligation, but it’s also an opportunity for executives and their companies who embrace it. Here are a few strategic steps to ensure compliance is a consistent priority:

Build a compliance dashboard: Compliance is a systematic process. A number of third-party organisations sell compliance checklists tailored to specific industries and even individual companies. Following one of these governance checklists (under the supervision of the CCO) is an effective way to check all the boxes of compliance. As the CEO, emphasise that your company’s compliance policy must align completely with the checklist guide. Finally, make time to review your checklist and dashboard with the CCO periodically to stay on the right side of ever-changing regulations.
Make compliance part of the culture: One reason companies have neglected compliance is that the penalties have been relatively small. Now, in addition to executive penalties, compliance breaches lead to bad publicity and lost consumer confidence. The simple fact is that compliance breaches hurt companies in deep and lasting ways, so they must be avoided at all costs. Talent, technology, and policies can serve that effort. In the end, however, compliance is consistent only when the company culture mandates it. As the steward of the organization, the CEO can do a lot to cultivate that culture: Regularly talk about the importance of compliance, participate in compliance planning and training, and provide a personal example for your company
Fully support the CCO: The CEO should be eager to support the CCO at every turn. That becomes especially important if and when a compliance investigation starts. The CEO should oversee the investigation process, ensuring that it’s conducted fairly and transparently. Satisfying the requirements of investigators is a lot easier if CEO is also willing to invest in effective technologies, such as information archiving. That way, any documents requested by regulators are easily retrievable from a searchable database. The right tools make compliance easier on everyone.

A new era of accountability is coming, and CEO must adapt. It’s time to stop thinking of compliance as an obscure subject or noncompliance as a minor setback. It affects the entire organisation, and it starts at the top. CEO who get in front of this issue place both themselves and their companies in greater positions to succeed. For those who don’t, compliance is about to get a lot more contentious.

For all your business and corporate needs give us a call on 0870 228 1999

or send us an email info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

July 23, 2019July 23, 2019

How to Empower Small Businesses with Compliance

Compliance can significantly save SMEs time and money and make achieving compliance more than a goal they never achieve.

Compliance is a top priority for organisations of all sizes and industries. However, ensuring compliance with industry regulations can prove particularly challenging for SMEs, which commonly lack the resources leveraged by larger enterprises.

To effectively help small and medium-sized businesses achieve compliance, you must first understand the difficulties they face in doing so. SMEs bound by regulations must devote time and effort to fulfilling their compliance related duties on a regular basis. Unlike larger companies, they often can’t afford to employ in-house compliance officers, so the responsibility of ensuring the business obeys regulations ends up on the plate of an already busy CEO, director, business manager, or office administrator.

Maintaining compliance is far from easy.

There’s auditing, daily enforcement of proper processes, and keeping up with current events to make sure the business continues to meet regulatory requirements. Due to the high importance of adhering to regulations and the amount of labour needed to properly do so, many small businesses turn to a third party to take over compliance, since outsourcing is more affordable than hiring an in-house staff member to oversee the process.

Subsequently, Stanley Carter presents a significant area of opportunity for SMEs seeking assistance.

For all your business and corporate needs give us a call on 0870 228 1999

or send us an email info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk

June 20, 2019June 20, 2019

Corporate Compliance

Don’t be complacent with your corporate compliance

As a normal citizen, we deal with compliance every day whether or not we are aware of it. Every time we obey traffic lights and stop our car when the light turns red, we are being compliant with local traffic laws. When we stand clear of the train doors after a train announcement, we are compliant with safety regulations.

Compliance is everywhere around us and the workplace is no different. But how does this everyday action translate to the business world? What does compliance mean for a company and how can businesses ensure they are maintaining their compliance?

What is the purpose of corporate compliance?

The purpose of corporate compliance goes beyond following the letter of the law. A recent study cited that almost two-thirds of organisations believe that their compliance efforts helped reduce the legal cost and resolution time of regulatory issues and fines.

Corporate compliance is about prevention as much as it is about obeying the law. The right compliance strategy can keep your company out of hot water, protect your employee data, and keep your company out of hot water.

To better understand where corporate compliance comes into play, we have outlined a common example of corporate compliance failure.

Does that sound like something straight out of a Mission Impossible film? It’s not; It’s actually happening to Goldman Sachs. The company is accused of promoting a company culture that enabled two of their bankers to steal billions from the Malaysian government. The Goldman Sachs x 1MDB scandal is just the latest example of a financial compliance failure.

Corporate compliance is about control and consideration. Is corporate compliance the most interesting part of your business model? Of course not; but it is a vital component to the health of your business. Before you decide to innovate to try and get ahead, make sure you are staying compliant in the process.

For all your business and corporate needs give us a call on 0870 228 1999

or send us an email info@stanleycarter.co.uk or check our website for further details www.stanleycarter.co.uk