182 12: Corporations and legal personality Part D The formation and constitution of business organisations
An unlimited company can only be a private company, by definition a public company is always limited.
An unlimited company need not file a copy of its annual accounts and reports with the Registrar, unless
during the relevant accounting reference period:
(a) It is (to its knowledge) a subsidiary of a limited company.
(b) Two or more limited companies have exercised rights over the company, which (had they been
exercised by only one of them) would have made the company a subsidiary of that one company.
(c) It is the parent company of a limited liability company.
The unlimited company certainly has its uses. It provides a corporate body (a separate legal entity) which
can conveniently hold assets to which liabilities do not attach.3.3 Public and private companies
A company may be private or public. Only the latter may offer its share to the public.A public company is a company whose constitution states that it is public and that it has complied with
the registration procedures for such a company.
A private company is a company which has not been registered as a public company under the
Companies Act. The major practical distinction between a private and public company is that the former
may not offer its securities to the public.A public company is a company registered as such under the Companies Act with the Registrar. Any
company not registered as public is a private company. A public company may be one which was
originally incorporated as a public company or one which re-registered as a public company having been
previously a private company.3.4 Conditions for being a public company
To trade, a public company must hold a Registrar's trading certificate having met the requirements,
including minimum capital of £50,000.3.4.1 Registrar's trading certificate
Before it can trade a company originally incorporated as a public company must have a trading certificate
issued by the Registrar. The conditions for this are:
The name of the company identifies it as a public company by ending with the words 'public
limited company' or 'plc' or their Welsh equivalents, 'ccc', for a Welsh company.
The constitution of the company states 'the company is a public company' or words to that effect.
The allotted share capital of the company is at least the authorised minimum which is £50,000. It is a company limited by shares.
With regard to the minimum share capital of £50,000.
A company originally incorporated as a public company will not be permitted to trade until its
allotted share capital is at least £50,000.
A private company which re-registers as a public company will not be permitted to trade until it has
allotted share capital of at least £50,000; this needs only be paid up to one quarter of its nominal
value (plus the whole of any premium).
A private company which has share capital of £50,000 or more may of course continue as a private
company; it is always optional to become a public company.Key termsFAST FORWARDFAST FORWARD