A Public Limited Company (PLC) must apply for a Trading certificate before starting business.
Apply a trading certificate for your PLC
Universally, your PLC must satisfy the authorized minimum share capital requirement. Which is the nominal value of your PLC’s allotted share capital must be at least £50,000 or €65,600. However, your PLC cannot satisfy the share capital requirement by a combination of euro and sterling shares or by shares in any other currency.
Consequently, your PLC must deliver the form SH50 to Companies House and includes the following information.
- State whether your authorised minimum share capital requirement will be satisfied in sterling or in euros.
- You specify the amount, or estimated amount, of your company’s preliminary expenses.
- Specify any amount or benefit paid or given, or intended to be paid or given, to any promoter of your company. This includes the consideration for the payment or benefit.
- Provide a statement of the aggregate amount paid up on your company shares on account of their nominal value.
- Be accompanied by a statement of compliance. The statement of compliance is a statement that your company meets the requirements for the issue of a certificate under section 761 of the Companies Act 2006. The registrar may accept the statement of compliance as sufficient evidence of the matters stated in it.
Exemption from a trading certificate
On the other hand, your PLC is not required to apply for a trading certificate, if your company is upgrading its status from a private to public limited company status.
However, when re-registering your private limited company to a public limited company. The nominal value of your PLC’s allotted share capital must be at least meet the authorised minimum share capital requirement. Additionally, the authorised minimum share capital requirement must be satisfied either entirely in sterling shares or entirely in euro shares.
Seal a deal or borrow money
In the event your PLC do business or exercises any borrowing powers in contravention of section 761 of the Companies Act 2006. In this instance, you have committed an offence. Your company and every officer of your company is in default.
Conviction and fine
A person guilty of an offence under section 767 subsection (1) of the Companies Act 2006 is liable:
(a) on conviction on indictment, to a fine;
(b) on summary conviction, to a fine not exceeding the statutory maximum.
The transaction still valid
A contravention of section 761 does not affect the validity of a transaction entered into by your company, but if your company
(a) enters into a transaction in contravention of that section, and
(b) fails to comply with its obligations in connection with the transaction within 21 days from being called on to do so, the directors of your company are jointly and severally liable to indemnify any other party to the transaction in respect of any loss or damage suffered by him by reason of your company’s failure to comply with its obligations.
Who is liable?
The directors who are so liable are those who were directors at the time your company entered into the transaction.