Certificate of good standing

The certificate of good standing certifies that your UK company has been in continuous, unbroken existence since its incorporation. Concurrently, there is no action is currently being taken to strike it off Companies House register.

Generally, it is very easy for your company to achieve good standing status. All you need to do is to make sure you submit your company accounts and confirmation statements with Companies House on time.

In addition, your company must meet minimum company officer appointments requirements. For example, a Public Limited Company (PLC) must have at least two directors and a company secretary with one person director. Whereas for a private limited company, you must have at least one person director.

Companies House will not issue your certificate of good standing if your company’s filings are not up to date. For example, your company account is overdue at the time you request your certificate, Companies House would not issue it until your company account is filed.

When do you require a certificate of good standing?

Normally, if your company are banking overseas, your foreign bank would require you to provide a certified and apostilled certificate of good standing issued by Companies House every year.

In this circumstance, you must obtain your certificate from Companies House first. Thereafter, you arrange your certificate to be stamped by the Foreign and Commonwealth Office (FCO). You must send in the original certificate not the photocopy of it.

Additional facts on your certificate

You can request to include additional certified facts on your certificate. These include:

  • directors’ names, and details such as date of birth or nationality
  • secretaries’ names
  • registered office address
  • the company’s objects
  • good standing statement

If you have any questions on how to obtain your certificate of good standing, feel free to contact our London accountants.

Admission to Stock Exchange

Public limited company must comply with the Admission to Stock Exchange listing rules before they are allowed to trade their shares publicly.

Your public limited company must provide information which satisfies the listing requirements. In this case, the Financial Services Authority set the rules and also governs public companies in the United Kingdom.

The Financial Services Authority is acting as the United Kingdom Listing Authority or UKLA.

Overall, there are two types Stock Exchange markets in the United Kingdom. The Senior Equity Market and the Alternative Investment Market (AIM).

Senior Equity Market

The Senior Equity Market is for larger public companies. It is also known as the Official List.

Alternative Investment Market

The Alternative Investment Market is the secondary stock market. It is opened to smaller companies in the United Kingdom.

Ordinarily, your public limited company must meet the following criteria in order to be eligible for admission to stock exchange in London.

Firstly, your company must be registered as a public limited company. Secondly, it must intend to place on the market shares which are expected to have a market value of £700,000 or more.

3 years preceding company accounts

Your company must have filed 3 years company accounts previously with Companies House. In addition, your company accounts must be audited. Preferably with unqualified audit report attached.

To put it simply, your company will not be admitted to stock exchange if it has not filed accounts covering three years preceding to your application for listing in the Stock Exchange.

Approved Sponsors

Most importantly, your directors must consider that your company is financially viable. Furthermore, your company must have sufficient working capital.

This admission requirement is satisfied by your Approved Sponsor to the issue. Usually, a merchant bank or stockbroker with overall responsibility for arranging the issue. This includes sending a letter to the United Kingdom Listing Authority stating that your directors have made careful enquiries to satisfy themselves and the Approved Sponsor that the working capital is indeed adequate.

The final principal admission requirement is that your company intend that at least 25% of any class of shares will be in the hands of the public. This is a must and it is spelled out in The Listing Rules.


Thereafter, your company must also satisfy the listing particulars requirements. Subsequently, your company must prepare and publish a prospectus which complies with Chapter 5 and 6 of The Listing Rules.

Correspondingly, you company must publish the following information.

  • Information on the shares which are to be listed.
  • Your share or loan capital.
  • Principal activities.
  • Place of business and employees.
  • Company’s finances. In the form of balance sheet and profit and loss accounts for the last three years. Also, management and on trends in the company’s business.

On the other hand, your company need to include a statement in your prospectus that your company accounts have been audited for the last three financial years. Furthermore, the people responsible for the prospectus need to make a declaration. To the effect that to the best of their knowledge, the information given in that part of the prospectus for which they are responsible is in accordance with the facts and contains no admissions likely to affect the import of the prospect us.

Additionally, you must also disclose if there is changes in your auditors in the previous three years. In this case, the details of audit options, tax clearances, and the terms of the directors’ service contracts.

Above all, your information in the prospectus should not be misleading, false or deceptive. Otherwise, your public limited company will incur both civil and criminal liability under the Financial Services and Markets Act 2000 if evidence supporting materials errors on the prospectus is established. In other words, do not even try to mislead your potential investors and manipulate the information on your prospectus.

Special rules for public limited company

It is very common for companies to upgrade trading status from a private limited company to a public limited company. For this reason, there are special rules for a public limited company (PLC) to comply.

Payment for share capital

  1. The original subscribers to a public limited company’s memorandum are required to pay cash for their shares.
  2. At least 25% of the nominal value and the whole of any premium on shares in a public limited company must be paid on allotment.
  3. A public limited company cannot accept an undertaking to do work or perform services as consideration for the allotment of shares.
  4. A public limited company can accept the transfer of assets to the company as full or part (subject to the 25% limit) payment for the allotment of shares. However, any undertaking to transfer those assets to the company must be performed within five years of the allotment. Furthermore, the company must take steps to satisfy itself that the value of the assets transferred to the company is accurate by obtaining an expert’s valuation and report.

Pre-emption rights on the allotment of shares

Generally, a public limited company must include the statutory pre-emption rights by a provision in its memorandum or articles. However, a public limited company (like a private company) can prevent the pre-emption rights applying by giving the directors the authority to allot shares in accordance with the Companies Act 2006.

Maintenance of capital

Ordinarily, the directors of a public limited company are obliged to convene an extraordinary general meeting if the company ‘s net assets are 50% or less of its called up share capital. Correspondingly, the meeting must be convened within 28 days of one of the directors becoming aware of this fact. And it must be held within 56 days. Obviously, the purpose of the meeting is for the problem to be considered. However, the Companies Act does not require the directors to take any definite steps to remedy the position.

Purchase own shares

Public limited company, like private limited company, can buy back their own shares and issue redeemable shares. However, public limited company cannot (unlike private companies) use it’s capital to purchase or redeem shares. However, a public company can use its profits for these purposes. In addition, the tax rules which, if the various conditions are complied with, allow the shareholder whose shares have been bought by the company to treat the purchase as a disposal for capital gains tax purposes. Rather than the receipt of a distribution attracting income tax liability, only apply to the shares in unquoted companies. However, It should be remembered that a public limited company will not necessarily have a listing on the Stock Exchange.

Financial assistance for the acquisition of shares and loans to directors

The rules prohibiting companies from providing financial assistance for the purchase of their own shares are more stringent. Comparatively, in the case of public limited company than in the case of private limited company. Similarly, the rules dealing with loans to directors are more stringent in the case of loans to directors of public limited company as laid down by the Companies Act.

Distribution of profits

In addition to the general rules restricting the funds from which companies can make distributions, public limited company is only permitted to make a distribution if their net assets are not, as a result of the distribution, reduced below the combined total of their called up share capital and ‘undistributed reserves.

Accounting requirements

The provisions which permit ‘small’ and ‘medium sized’ companies to file less detailed accounts with the Registrar of Companies do not apply to public limited company. They also cannot qualify as dormant company. Which would lead them to be able to dispense with auditors. A public limited company must deliver audited company accounts to Companies House.

Age of directors

A public limited company may not appoint a person aged 70 and above to be a director unless the appointment is approved by the company in general meeting, following special notice (giving the age of the director) of such resolution. When a director of a public limited company reaches the age of 70, he must retire unless the company in general meeting votes to retain him. Again, special notice must be given of any such resolution.

Written resolutions

The Companies Act which read the members of private limited company can take decisions by written resolutions rather than passing resolutions at general meetings. This does not apply to public limited company.