Company Law for Accountants - Essay Example

a foreigner with only a student visa can not form a company until and unless you are given the proper visa by the Home Office of UK, you may not be able to form a company. For the purpose of forming a company, foreigners therefore have to following different regulations including the regulations put forward by the Home Office because it issues particular visas and the applicants have to fulfill certain pre-conditions i.e. minimum amount of capital etc before a person given be given the right of forming a company in UK.

Similarly, the different disclosures made by the company are also in direct contravention of some of the clauses of the act and as such may attract certain penalties for the company. Further, it is also critical to understand that the formation of certain charges over the assets of the company for the personal liabilities of the directors is also a void act under law because as per law, the ownership and the company are two different entities hence, a company may not take up the personal liabilities of its directors under ordinary course of business.

According to Companies Act 2006, directors in a private limited company have the unlimited powers to allocate shares to the different shareholders until such powers are not limited by the memorandum and articles of association of the company. Based on such regulations, a shareholder may get the shares in a UK private limited company however since 1 shareholder is not the legal resident of the UK and her status is that of “International Student” therefore under the laws framed for the entry into UK, a person with an student visa may not be able to own shares in a private of public limited company neither he or she can be the directors of the firm.

The fact that new shares at discount have not been allocated to Shaniga is against the section 11 of the companies’ act which clearly indicates that the founding members of the firm must contribute towards assets of the company in case it is wound up.