UK Law and Practice Contributed by: Paolo Palmigiano, Rachael Roberts, Helen Farr, Debbie Heywood and Louise Popple, Taylor Wessing LLP
3.3 Ongoing Reporting and Disclosure Obligations Companies in England are subject to various ongoing reporting and disclosure obligations, which aim to ensure transparency and account - ability. Private limited companies, PLCs and LLPs are required to inform Companies House about any changes in directors or secretaries, amendments to articles, changes in beneficial ownership and certain resolutions of the shareholders. These fil - ings must be made with Companies House with - in certain deadlines, often 14–30 days from the relevant event or change. Private limited compa - nies and PLCs also need to file annual financial statements and annual confirmation statements. Financial statements should reflect an accurate financial position of the company and be filed within nine months of the end of their accounting reference period for small companies, or within 12 months for other private companies. Con - firmation statements must be filed on a yearly basis to confirm that all information about the business held by Companies House is current and correct, including details on management, share capital, shareholders and the people with significant control (PSC) register. For PLCs, there are a number of further reporting and disclosure requirements that are set out by the market regulators. If companies fail to comply with their ongoing reporting and disclosure obligations, various penalties and consequences may apply. 3.4 Management Structures In the UK, entities are typically organised under a one-tier system, meaning that there is a sin - gle board of directors responsible for both the strategic direction as well as the day-to-day
management of the company. The board of directors is usually made up of both executive and non-executive directors – executive direc - tors are responsible for the daily operations of the company, and the non-executive directors bring an independent perspective and oversee the performance of the executive directors. A one-tier system is designed to streamline deci - sion-making processes by combining oversight with active management within a single body. 3.5 Directors’, Officers’ and Shareholders’ Liability Directors and officers of both public and private companies have fiduciary duties towards the company, which include, among others, acting within their powers, promoting the success of the company for its members’ benefit, exercis - ing independent judgment and reasonable care, skill and diligence and avoiding conflicts of inter - est. The main rules that govern the liabilities of directors in the UK are set out in the Compa - nies Act 2006. If directors breach their fiduci - ary duties, they could face civil proceedings. In some cases, criminal liability may arise under the aforementioned Act, for example for fraud or wrongful trading. There are certain other rules and regulations that may govern a company, depending on whether it is public or listed on a stock exchange, for example, the Market Abuse Regulations or the Listing Rules, although the key rules are those set out under the Companies Act 2006. The principle known as “piercing (or lifting) the corporate veil” exists in English law, and refers to a situation where a court sets aside the separate legal personality of a company. Typically, a com - pany is seen as a distinct entity from its share - holders, although the court may decide to pierce this ”veil”. This principle is applied very narrowly by courts only in exceptional circumstances
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