Statutory Requirements
The statutory requirements for all companies include:
- Maintaining registers of members, directors, secretaries and charges;
- Maintaining accounting records and minutes of meetings;
- Maintaining a registered office or place of business in the Island;
- Filing an annual return and paying the statutory fee;
- Filing notices of changes in various matters, including directors, secretary, registered office.
The annual return includes details of shareholders and directors. Confidentiality as to membership
can be secured by the use of nominee shareholders. All companies are required to prepare annual
accounts. There is no provision for the accounts of a private company to be filed; however, the annual
return of a company must be accompanied by a declaration as to whether or not the company has complied
with various legislative provisions relating to accounts. The accounts of a public company must be filed
at the Companies Registry.
All companies limited by share or guarantee are required to make a return of the appointment of
directors and company secretary, and any changes, within a month. The initial subscribing shareholders are
shown on the memorandum and articles of association. Changes of members (other than for limited liability
companies) are not filed except as disclosed in the annual return. There are certain residency
qualifications for officers if particular tax treatments are required. A company must hold an annual meeting
of members.
The register of members, which must be kept in the Isle of Man, is open to inspection by the members of
the company and the general public (on payment of a reasonable fee) but the register of charges is open to
inspection, free of charge, by all creditors and members of the Company. All records held by the Registrar
of Companies are open to inspection by members of the public on payment of the appropriate fee.
Formation Procedures
One or more persons subscribe their names to the Memorandum and Articles of Association as the first
members. The Memorandum sets out the name of the company, the jurisdiction of situation of the registered
office, the authorised share capital (in the case of a company limited by shares) or the liability of the
guarantee members (in the case of a company limited by guarantee) or both (in the case of a hybrid company)
and the fact that the liability of the members is limited. The Articles of Association set out the procedure
for the day to day running of the company. The proposed name is usually first cleared as available and
acceptable with the Registrar of Companies and usually reserved. The Memorandum and Articles and the
statement of first directors, secretary and registered office, together with the appropriate fees are then
submitted to the Registrar, who registers the Company. A certificate of incorporation is issued after which
the company is legally in existence. The required documents and procedures are slightly different for a
limited liability company.
Audits
Certain companies, other than a public company, a corporate service provider, a banking or insurance
company and a company authorised to carry on Investment Business, may, if permitted by its articles,
resolve not to appoint an auditor if the company comply with the requirements of regulations.
Minority Protection
In spite of the fact that the activities of a company are governed by the majority principle (unless
the constitutional documents provide otherwise) the Companies Acts contain compulsory provisions to protect
minority shareholders.
Winding Up
Winding up may be either:
- by the court, in a variety of circumstances, including company insolvency; or
- voluntarily, principally by a resolution of the members.
There is a statutory framework of responsibilities and a timetable in relation to both methods
of winding up.