'Think small first' Company Law Reform long overdue

The Forum of Private Business (FPB) says small firms will breathe a heavy sigh of relief now the Government has finally published the draft Company Law Reform Bill, which commits to ‘think small first.’

The FPB’s Head of Policy, Alison Fletcher, said the proposals come at the end of a thorough consultation exercise that the FPB has been closely involved in.

“These proposals will be warmly welcomed by smaller firms as they will mean less red tape to deal with, lower costs and valuable time savings,’ she said. “The present system is fundamentally flawed and desperately requires change to take into account the practicalities of how smaller firms operate. Thankfully, the proposals are full of commonsense because the Department of Trade and Industry’s (DTI) consultation exercise was so comprehensive.”

Ms Fletcher stressed the FPB’s support for:

- The restructuring of elements of Company Law most relevant to smaller businesses to make it easier for them to understand their obligations

- Simpler rules for setting up a company

- Abolition of the need for a company secretary

- Making Annual General Meetings (AGM) ‘opt-in’ rather than ‘opt-out’

Ms Fletcher continued, “For more than 10 years, the FPB has been petitioning the Government to adopt a ‘think small first’ approach to regulation, so it is terrific news that, finally, the message seems to be getting through. The DTI’s commitment to offer clear and comprehensive guidance to simplify the basic day-to-day requirements that apply to them will be broadly welcomed by the small business community.”

A full copy of the Company Law Reform White Paper, Cm 6456 is available from the Stationery Office or from the DTI website at www.dti.gov.uk/cld/review.htm