PTV LTD.

The Companies Act 2006

The Companies Act 2006

Introduction

The Company Act (2006) is one of the foundations of UK company law. The act was being presented in the British Parliament during 2005, with the title of Company Law Reform Bill. However, the act was approved in and was effective from November 2006. The act was covering 1300sections in it, accounted for 700 pages and also includes 16 schedules. The act is also considered as the largest statute to be passed in the history of British Parliament. The act is also considered to be a complete one, which covers more areas and aspects in comparison to the earlier acts. One of the sections in this act also includes statutory duties of the directors of the company, which is being discussed in the chapter 2 and part 10 of the act (Companies Act, 2006).

Commencement Information

S. 156 wholly in force at 1.10.2008; s. 156 not in force at Royal Assent see s. 1300; s. 156 in force at 1.10.2008 by S.I. 2007/3495, art. 5(1)(c) (subject to transitional adaptations in Sch. 1 para. 24)

This section states that there must include at least one director of the company, who must be a natural person. The director should be above 16 years of age. Directors are not supposed to be the shareholders of the company, but there is no restriction for them to own or purchase any amount of share of their company. In fact, there exist many examples in which companies do possess such directors who are also the shareholders of the company. The directors have been assigned with certain roles and responsibilities, which they have to adhere with. In addition to that, the act also states that the directors have certain powers that they need to exercise in various conditions. These powers are needed to be utilized carefully and to the best interest of the company, so that their actions must not provide harm to the company (Aguilera & Williams, 2008, pp. 147-158).

This paper will be focusing on a case scenario, which represents the partnership among three individuals in running a company, and that they are also appointed as the directors of the company. It will draw attention towards the actions of those individuals and whether the action of any partner breached the statutory duties that has been stated in The Company Act 2006. In addition to that, the paper will also draw recommendations regarding the necessary actions to be taken against the conducts of one of those members.

Discussion

Case Scenario

The case is based on the three individuals, namely Peter, Meg and Stewie. Peter had been established a television manufacturing company to be named as PTV Ltd. The decision of Peter soon turned out to be positive one, as he enjoyed success from the company. However, with the passage of time, he required external investment in order to expand his business. His plan was to manufacture DVD players, as well. He seeks assistance financial from his friends; Meg and ...