Mergers and acquisitions regulations
The Companies (Reporting Requirements in Mergers and Divisions) Regulations 2011 (2011/1606) come into force today.
The regulations aim to reduce the administrative burden on companies through amendments to parts 17 and 27 of the Companies Act 2006 (the Act). They detail proposals to simplify processes for mergers and divisions by taking advantage of new technology and removing over-regulation, including:
The option to publish merger terms on a website as an alternative to the current obligation under section 906 of the Act to file a copy of the terms with Companies House.
The option to make documents available for inspection on a website instead of at the company's registered office. An exception is made where members can only take copies of those documents from such a website and in these cases the company must also make hard copies available at the registered office.
Amendments to the circumstances that require a company to obtain expert reports, produce supplementary accounting statements, develop or obtain a directors' explanatory report, and an amendment to section 918A on members' agreement to dispense with an expert's report. These will allow members to reach unanimous agreement on not only disapplying the need to produce an expert's report, but also a directors' explanatory statement, supplementary accounting statement and report on material changes of assets of a merging company.