FID Trust International

A Public Limited Company (PLC) is a type of Limited Company in the United Kingdom which is permitted to offer its shares to the public and has limited liability.

Before it is allowed to trade, a PLC must satisfy the Company Registrar that at least £50,000 of shares have been issued and that each share has been paid up to at least a quarter of its face value.

A PLC Company is a company which allows shares to be sold to the public and:

  1. You are able to buy and sell the shares to anyone.
  2. A Public Limited Company’s stock can be acquired by anyone and holders are only limited to potentially lose the amount paid for the share.
  3. There are no maximum shares, you can have as many as you like.
  4. Permission to advertise sale of shares publicly.

The Companies Act generally allows three or more persons to form a public limited company (PLC) for any lawful purpose by subscribing to its memorandum of association.

To start the process you are required to:

  1. Have a registered office address of your company in England or Wales. If you do not have one - you can choose our prestigious London address (1st Floor, 26 Fouberts Place, London W1F 7PP).
  2. Name your company. You will find the relevant law in the Companies Act 1985 and in the Company and Business Names Regulations or in the UK Company Registration Procedure.
  3. Appoint a minimum of TWO company directors. In general terms anyone can be a company director, but there are some rules. You can't be a company director if:
    1. you are undercharged, bankrupt or disqualified by a court from holding a directorship, unless given a leave to act in respect of a particular company or companies;
    2. in the case of PLCs or their subsidiaries, you are over 70 years of age or reach 70 years of age while in office, unless you are appointed or re-appointed by resolution of the company in general meeting of which special notice has been given.

There is no minimum age limit in the Companies Act for a director to be appointed in England and Wales. Every director of the company must be aware of the appointment and the taken responsibilities. You should seek legal advice if you intend to have a very young person as a director of your company.

In Scotland the Registrar will not register for any company the appointment of a director under the age of 16 years old. A child below that age does not have the legal capacity to accept a directorship - Age of Legal Capacity (Scotland) Act 1991. If you need more information, contact Companies House, Edinburgh.

Some people who are not of British nationality are restricted as to what work they may do while in this country. If you need more information about whether such a person can become a director of a UK-registered company, contact:

Home Office Immigration and Nationality Department,

Lunar House,

Companies Housellesley Road,

Croydon CR9 2BY.

Tel: 0870 606 7766.

Appoint a company secretary

The secretary (or each joint secretary) of a public limited company must also be a person who appears to the directors to have the necessary knowledge and ability to fulfil the functions and who:

  1. held the office of secretary or assistant or deputy secretary on 22 December 1980;
  2. for at least three of the five years before their appointment, held the office of secretary of a non-private company;
  3. is a barrister, advocate or solicitor called or admitted in any part of the United Kingdom;
  4. is a person who, by virtue of his or her previous experience or membership of another body, appears to the directors to be capable of discharging the functions of secretary;
  5. or is a member of any of the following bodies:
    1. the Institute of Chartered Accountants in England and Wales;
    2. the Institute of Chartered Accountants of Scotland;
    3. the Institute of Chartered Accountants in Ireland;
    4. the Institute of Chartered Secretaries and Administrators;
    5. the Chartered Association of Certified Accountants;
    6. the Chartered Institute of Management Accountants (formally known as the Institute of Cost and Management Accountants);
    7. or the Chartered Institute of Public Finance and Accountancy.

Decide on the amount of authorised share capital

When a company is formed, the person or people forming it decide whether its members' liability will be limited by shares. The memorandum of association (one of the documents by which the company is formed) will state:

  1. the amount of share capital the company will have; and
  2. the division of the share capital into shares of a fixed amount.

The members must agree to take some, or all, of the shares when the company is registered. The memorandum of association must show the names of the people who have agreed to take shares and the number of shares each will take. These people are called the subscribers.

There is a minimum share capital for public limited companies: Before it can start business, it must have allotted shares to the value of at least £50,000. A quarter of them, £12,500, must be paid up. Each allotted share must be paid up to at least one quarter of its nominal value together with the whole of any premium.

A company can increase its authorised share capital by passing an ordinary resolution (unless its articles of association require a special or extraordinary resolution). A copy of the resolution - and notice of the increase on Form 123 - must reach Companies House within 15 days of being passed. No fee is payable to Companies House.

A company can decrease its authorised share capital by passing an ordinary resolution to cancel shares which have not been taken or agreed to be taken by any person. Notice of the cancellation, on Form 122, must reach Companies House within one month. No fee is payable to Companies House.

A company may have as many different types of shares as it wishes, all with different conditions attached to them. Generally share types are divided into the following categories:

  1. Ordinary: As the name suggests these are the ordinary shares of the company with no special rights or restrictions. They may be divided into classes of different value.
  2. Preference: These shares normally carry a right that any annual dividends available for distribution will be paid preferentially on these shares before other classes.
  3. Cumulative preference: These shares carry a right that, if the dividend cannot be paid in one year, it will be carried forward to successive years.
  4. Redeemable: These shares are issued with an agreement that the company will buy them back at the option of the company or the shareholder after a certain period, or on a fixed date. A company cannot have redeemable shares only.

A PLC has access to capital markets and can offer its shares for sale to the public through a recognised stock exchange. It can also issue advertisements offering any of its securities for sale to the public. In contrast, a private company may not offer to the public any shares in itself.

Complete all applications for incorporation

If you incorporate a company yourself, you will need to send the following documents, together with the registration fee to the Registrar of Companies:

  1. A memorandum of association.
  2. Articles of association.
  3. Form10.
  4. Form12.

Each of these documents is explained below.

MEMORANDUM OF ASSOCIATION

This document sets out:

  1. the company's name,
  2. where the registered office of the company is situated (in England, Wales or Scotland); and
  3. what it will do (its objects).

The object of a company may simply be to carry on business as a general commercial company. Other clauses to be included in the memorandum depend on the type of company being incorporated. The form of memorandum for each type of company is set out in a set of tables called The Companies (Tables A to F) Regulations, 1985.

The company's memorandum delivered to the Registrar must be signed by each subscriber in front of a witness who must attest the signature.

ARTICLES OF ASSOCIATION

This document sets out the rules for the running of the company's internal affairs. Model articles are provided in the Tables mentioned above.

A company may adopt the whole of Table A as its articles or any part of it.

A company limited by shares which has adopted the whole of Table A without modification does not need to deliver a copy for registration. If you incorporate PLC by yourself you must attach a letter to your application saying this.

FORM 10

Form 10 gives details of the first directors, secretary and the intended address of the registered office. The company's directors must give their date of birth, occupation and details of other directorships they have held within the last five years. Each officer appointed and each subscriber (or their agent) must sign and date the form.

The Company can have a postal and registered address at once. The importance of the registered address is that all official letters and documentation from the government departments (including Inland Revenue and Companies House) will be sent to the registered office address and this address has to be shown on all your official company documentation. The registered office can be anywhere in England and Wales (or Scotland if your company is registered there).

The registered office must always be an effective address for delivering documents to the company, and to avoid delays it is important that all correspondence sent to this address is dealt with promptly. If a company changes its registered office address after incorporation, the new address must be notified to Companies House on Form 287.

FORM 12

Form 12 is a statutory declaration of compliance with all the legal requirements relating to the incorporation of a company. It must be signed by a solicitor who is forming the company, or by one of the people named as a director or company secretary on Form 10. It must be signed in the presence of a commissioner for oaths, a notary public, a justice of the peace or a solicitor.

Please contact us by telephone 0207 439 3400 (0044 207 439 3400 – International) or E-mail if you wish to incorporate Public Limited Company (PLC) by Shares in the United Kingdom.