• This Is Why a Written Resolution Is Important Jun 30, 2020
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    If you thought organising meetings is a common necessity for forming a company, wait until your company is in full swing; meetings and minutes await! For all those company-affecting critical decisions, you’ll be holding a number of general meetings and board meetings involving company members and directors; these meetings must be compliant with company law and follow the correct procedures.

    Any decisions (resolutions) made in these meetings must be accurately recorded and, in some situations, directors must also report certain meeting-matters to Companies House. However, some resolutions can be passed in writing rather than at a general meeting.


    What Are the Different Types of Resolutions?


    In order to pass company resolutions (they may be “ordinary” or “special”), shareholders have to vote for or against a proposed course of action. This process can take place either at a general meeting or by a written resolution.

    Before we get to a written resolution, here’s an overview of both an ordinary and special resolution:


    What Is an Ordinary Resolution?

    Ordinary resolutions are passed if a simple majority (above 50%) of the votes are cast in favour of the resolution. Provided that the Companies Act or the articles of association does not state the need for a special resolution, an ordinary resolution will be used for any decisions made by directors and shareholders.

    An ordinary resolution requires...

    Read the full article for FREE at https://www.yourcompanyformations.co.uk/blog/this-is-why-a-written-resolution-is-important/


    What Is a Special Resolution?

    Special resolutions are used for unique or sensitive issues. The Companies Act 2006 and the articles of association will both explain which decisions require a special resolution. A special resolution may only be passed when at least 75% of shareholders vote in favour of the resolution.

    A special resolution may be used for the following:

    Read the full article for FREE at https://www.yourcompanyformations.co.uk/blog/this-is-why-a-written-resolution-is-important/


    What Is a Written Resolution?

    A written resolution can be either ordinary or special and is passed in writing rather than being passed at a general meeting whereby members cast votes in person or by proxy. A written company resolution may be proposed by a director or any shareholder who owns at least 5% of the voting rights in the company.

    Invariably, written resolutions can be used for all decisions in a private limited company apart from the decisions to remove a director or an auditor.

    Note: Public limited companies (PLCs) cannot use the written resolution procedure.


    Read the full article for FREE at https://www.yourcompanyformations.co.uk/blog/this-is-why-a-written-resolution-is-important/
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