Limited Liability Companies Act 1996

Link to law: https://legislation.gov.im/cms/images/LEGISLATION/PRINCIPAL/1996/1996-0019/LimitedLiabilityCompaniesAct1996_5.pdf
Published: 2015-11-01

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Limited Liability Companies Act 1996

c i e
AT 19 of 1996

LIMITED LIABILITY COMPANIES ACT 1996

Limited Liability Companies Act 1996 Index


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c i e
LIMITED LIABILITY COMPANIES ACT 1996

Index Section Page

PART 1 – LIMITED LIABILITY COMPANIES 7

CHAPTER I - INTRODUCTION 7
1 Description of the features of limited liability companies ........................................ 7
1A Limited liability company may have one or more members ................................... 8
2 Status, purposes and powers of limited liability companies .................................... 8
3 Name of limited liability company .............................................................................. 9
4 Registered office .............................................................................................................. 9
5 Registered agent .............................................................................................................. 9
CHAPTER II - REGISTRATION 10
6 Formation ....................................................................................................................... 10
7 Articles of organisation ................................................................................................ 10
8 Registration of limited liability company .................................................................. 11
9 Change etc of registered office or registered agent .................................................. 12
10 Annual returns .............................................................................................................. 12
11 Department of Economic Development may strike defunct limited liability
company off register ..................................................................................................... 13
11A Alternative procedure for dissolving solvent limited liability companies ........... 14
11B Restoration of dissolved limited liability companies to the register ..................... 17
11C Power of Department to refuse to register or receive documents ......................... 19
11D Appeals from decisions of Department ..................................................................... 19
CHAPTER III - CAPITAL: CONTRIBUTIONS, WITHDRAWAL, REDUCTION,
ETC 20
12 Contributions to capital ............................................................................................... 20
13 Liability of members of limited liability companies ................................................ 20
14 Withdrawal or reduction of members’ contributions to capital ............................ 21
15 Division of profits; impairment of capital ................................................................. 22
16 Members’ interest and transferability ........................................................................ 23
CHAPTER IV - MANAGEMENT 23
17 Management .................................................................................................................. 23
Index Limited Liability Companies Act 1996


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18 Contracting debts ......................................................................................................... 23
19 Accounting records ...................................................................................................... 24
20 Registration of charges ................................................................................................ 25
21 Execution of instruments ............................................................................................ 25
22 Unauthorised assumption of powers ........................................................................ 25
23 Waiver of notice ............................................................................................................ 25
CHAPTER V - PROCEEDINGS AND INSPECTION 26
24 Parties to actions ........................................................................................................... 26
25 Service of process ......................................................................................................... 26
26 Inspection of affairs of companies ............................................................................. 26
PART 2 – DISSOLUTION OF LIMITED LIABILITY COMPANIES 27

27 Circumstances in which limited liability companies are to be wound up ........... 27
28 Winding up procedure ................................................................................................ 28
29 Distribution of assets in winding up ......................................................................... 30
30 Dissolution .................................................................................................................... 30
31 Application of bankruptcy rules in winding up of insolvent limited
liability companies ....................................................................................................... 30
32 Jurisdiction of the High Court .................................................................................... 31
33 Application of Part X of the Companies Act 1931 ................................................... 31
34 Property discovered after dissolution ....................................................................... 31
35 Power of court to declare dissolution of limited liability company void ............. 32
36 Offences ......................................................................................................................... 32
PART 3 – TAXATION 32

CHAPTER I — 32
37 to 45 [Repealed] .............................................................................................................. 32
CHAPTER II - TAXATION OF OTHER LIMITED LIABILITY COMPANIES 32
46 [Inserts section 2M in the Income Tax Act 1970.] ....................................................... 32
47 [Inserts section 63A in the Income Tax Act 1970.] ..................................................... 32
PART 4 – GENERAL 32

48 Inspection of documents by the public ..................................................................... 32
49 Offences: members and officers ................................................................................. 33
50 Fees ................................................................................................................................. 33
51 Public documents ......................................................................................................... 33
51A Interpretation ................................................................................................................ 33
52 [Amendments to Companies Act 1931 and Partnership Act 1909] ........................... 33
52A Power to make orders as to disposal of valueless documents ............................... 34
53 Financial provision ....................................................................................................... 34
54 Short title and commencement ................................................................................... 35
SCHEDULE 1 37

STATUS AND POWERS OF LIMITED LIABILITY COMPANIES 37
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SCHEDULE 2 38

MATTERS TO BE SPECIFIED IN THE ARTICLES OF ORGANISATION 38
SCHEDULE 3 39

REGISTRATION OF CHARGES 39
Provisions as to Limited Liability Company’s Register of Charges and as

to Copies of Instruments creating Charges 43

SCHEDULE 4 44

OFFENCES ETC ANTECEDENT TO OR IN THE COURSE OF WINDING UP 44
ENDNOTES 49

TABLE OF LEGISLATION HISTORY 49
TABLE OF RENUMBERED PROVISIONS 49
TABLE OF ENDNOTE REFERENCES 49

Limited Liability Companies Act 1996 Section 1


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c i e
LIMITED LIABILITY COMPANIES ACT 1996

Received Royal Assent: 9 July 1996
Passed: 9 July 1996
Commenced: 1 August 1996
AN ACT
to provide for the establishment of limited liability companies; for the
taxation of such companies; and for other purposes.
PART 1 – LIMITED LIABILITY COMPANIES

CHAPTER I - INTRODUCTION
1 Description of the features of limited liability companies

(1) A limited liability company formed under this Act is a body of one or
more persons the principal features of which are that —
(a) the company has legal personality and capacity for the exercise of
its purposes and powers (section 2); and
(b) [Repealed]1

(c) the liability of its members is limited to the extent of their
contribution to its capital (section 13); and
(d) restrictions are imposed on the transfer of members interests in
the company (section 16); and
(e) the management of the company is vested in the members in
proportion to their contribution to the capital of the company or
as otherwise permitted by this Act (section 17); and
(f) the company must be wound up and dissolved on the happening
of certain events such as the death or resignation of a member
(section 27); and
(g) the profits of the company will be treated as the income of the
members for the purposes of income tax (section 46).2

(2) This section is for the purposes of explanation only and does not affect
the operation of the following provisions of this Act.
Section 2 Limited Liability Companies Act 1996


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1A Limited liability company may have one or more members

(1) A limited liability company may be formed under section 6 by one or
more persons and may have one or more members.
(2) Subsection (1) has effect despite contrary provision in any enactment or
rule of law.
(3) Subsection (4) has effect in relation to an enactment or rule of law which
applies in relation to a limited liability company.
(4) The enactment or rule of law applies to a limited liability company which
is formed by one person or which has one member as it applies in
relation to such a company which is formed by 2 or more persons or
which has 2 or more members, with any necessary modifications.
(5) Subsection (4) is subject to express provision to the contrary.
(6) Without limiting subsection (4), if a limited liability company has only
one member, references in this Act to “members”, “all members”, “other
members” and “remaining members” are to be treated as references to
the sole member.3

2 Status, purposes and powers of limited liability companies

(1) A limited liability company is a legal entity which is distinct from its
members, manager and registered agent.
(2) A limited liability company which is organised under this Act may
undertake any lawful activity, trade or business except —
(a) to (c) [Repealed]4

(d) such business as may be prescribed.5

(3) Nothing in this Act shall be interpreted as —
(a) precluding a person who carries on a business which requires
licensing or authorisation under any statutory provision from
forming a limited liability company; or
(b) precluding a limited liability company from holding any shares
in, or debentures of a body corporate which carries on such a
business,
if the applicable statutory provision does not prohibit it and the body
licensing or authorising the occupation does not prohibit it in exercise of
any power conferred under such provision.
(4) A limited liability company has the status and powers specified in
Schedule 1.
Limited Liability Companies Act 1996 Section 3


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3 Name of limited liability company

(1) The words “limited liability company”, or its abbreviations “LLC” or
“L.L.C.” shall be included at the end of the name of every limited
liability company.
(2) The omission of the words “limited liability company,” or the
abbreviations “LLC” or “L.L.C.” in the use of the name of the limited
liability company shall render any person who participates in the
omission, or knowingly acquiesces in it, liable for any indebtedness,
damage or liability occasioned by the omission.
(3) The Company and Business Names etc Act 2012 has effect in respect of the
names of limited liability companies which are formed under this Act.6

(4) The requirements of that Act are additional to the requirements of this
Act.7

(5) to (7) [Repealed]8

(8) to (10) [Repealed]9

4 Registered office

(1) A limited liability company shall at all times maintain a registered office
in the Island.
(2) If a limited liability company fails for 1 month to maintain a registered
office in contravention of subsection (1) —
(a) it shall be guilty of an offence and shall be liable on summary
conviction to a fine not exceeding £5,000; and
(b) it shall be deemed to be defunct until a registered office is
established and a statement in the prescribed form is delivered to
the Department.10

5 Registered agent

(1) A limited liability company shall at all times maintain a registered agent
in the Island who shall hold the prescribed qualifications.
(2) If a limited liability company fails for 1 month to maintain a registered
agent in contravention of subsection (1) —
(a) it shall be guilty of an offence and shall be liable on summary
conviction to a fine not exceeding £5,000; and
(b) it shall be deemed to be defunct until a registered agent is
appointed and a statement in the prescribed form is delivered to
the Department.11

Section 6 Limited Liability Companies Act 1996


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CHAPTER II - REGISTRATION
6 Formation

(1) Any person who is resident in the Island may apply to form a limited
liability company by delivering to the Department —
(a) articles of organisation which comply with the requirements of
this Act and which are signed by —
(i) the person forming the company; and
(ii) the first members named in the articles of organisation;
and
(b) a consent in the prescribed form signed by the person named in
the articles as the registered agent; and
(c) a statement in the prescribed form of the intended registered
office in the Island.12

(2) The person forming the company need not be a member of the limited
liability company.
7 Articles of organisation

(1) The articles of organisation shall specify —
(a) the name of the limited liability company;
(b) [Repealed]13

(c) the names and addresses of its members;
(d) the name and address of its registered agent in the Island;
(e) the matters referred to in Schedule 2.
(1A) Except where the articles of organisation fix a time for the dissolution of
the limited liability company, the duration of the company shall not be
limited to any fixed period of time.14

(2) It is not necessary to set out in the articles of organisation any of the
powers specified in this Act.
(3) Subject to subsection (5), the articles of organisation shall be amended
when —
(a) there is a change in the name of the limited liability company; or
(b) there is a change in the amount or the character of the
contributions to capital;
(c) there is any change in the membership of the limited liability
company;
(d) there is a false or erroneous statement in the articles of
organisation;
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(e) there is a change in the time as stated in the articles of
organisation for the dissolution of the limited liability company;
(f) a time is fixed for the dissolution of the limited liability company
if no time is specified in the articles of organisation; or
(g) the members desire to make a change in any other statement in
the articles of organisation in order that it shall accurately
represent the agreement between them.
(4) Any amendment to the articles of organisation shall be adopted in
accordance with the operating agreement or with the consent of all
members.
(5) Where a limited liability company amends its articles of organisation its
registered agent shall within 1 month of the making of the amendment
deliver to the Department notice, in the prescribed form, of the
amendment and the Department shall retain it with the registered copy
of the articles of organisation of the company.15

(6) Where a limited liability company changes its name, the Department
shall on delivery of the documents referred to in subsection (5), and
subject to compliance with the requirements of the Company and Business
Names etc Act 2012, issue a replacement certificate of organisation to meet
the circumstances of the case.16

(7) A change of name shall have effect from the date on which a replacement
certificate is issued.
(8) A change of name of a limited liability company shall not affect any
rights or obligations of the company, or render defective any legal
proceedings by or against the company, and any legal proceedings that
might have been continued or commenced against it by its former name
may be continued or commenced against it by its new name.
8 Registration of limited liability company

(1) If the Department is satisfied that the requirements of this Act in respect
of the registration and of matters precedent and incidental to registration
have been complied with, it shall retain and register the documents
delivered under section 6.17

(2) On the registration of documents under subsection (1), the Department
shall certify that the limited liability company is organised and registered
under this Act.18

(3) A certificate of organisation shall be conclusive evidence that all the
requirements of this Act in respect of registration and of matters
precedent and incidental to registration have been complied with and
that a limited liability company has been organised and registered under
this Act.
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(4) A limited liability company shall not transact business nor incur
indebtedness, except that which is incidental —
(a) to its organisation and registration; or
(b) to obtaining subscriptions for or payment of contributions,
until the certificate of organisation is issued.
9 Change etc of registered office or registered agent

(1) If for any reason there is a change in the registered office or the
registered agent of a limited liability company, the company shall deliver
to the Department within 1 month of the change a statement in the
prescribed form.19

(2) If a limited liability company fails to comply with subsection (1) —
(a) it shall be guilty of an offence and shall be liable on summary
conviction to a fine not exceeding £5,000;
(b) it shall be deemed to be defunct until the statement is delivered to
the Department .20

10 Annual returns

(1) Every limited liability company shall in each year deliver an annual
return in the prescribed form to the Department within one month of the
anniversary of the company’s registration under this Act.21

(2) The annual return shall state —
(a) the address of the registered office of the company;
(b) the name and address of the registered agent of the company;
(c) the name and address of the manager (if any) of the company, the
date of his election and the period of his appointment;22

(d) the names and addresses of the members of the company,
or, where any of those particulars remain unchanged, it shall state
that fact.
(3) If a limited liability company fails to comply with subsection (1) —
(a) it shall be guilty of an offence and shall be liable on summary
conviction to a fine not exceeding £5,000;
(b) it shall be deemed to be defunct until the annual return is
delivered to the Department.23

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11 Department of Economic Development may strike defunct limited

liability company off register

(1) Where the Department has reasonable cause to believe that a limited
liability company is not carrying on business or in operation, it may send
a letter —
(a) inquiring whether the company is carrying on business or in
operation; and
(b) stating that if no answer is received within 2 months from the date
of the letter, a notice will be published with a view to striking the
name of the company off the register.24

(2) A letter sent under subsection (1) of this section shall be sent by recorded
delivery.
(3) If the Department either receives an answer to the effect that the limited
liability company is not carrying on business or in operation, or does not
within 2 months after sending the letter under subsection (1) of this
section receive any answer, it will publish and send to the company by
post, a notice that at the expiration of 2 months from the date of that
notice the name of the company mentioned therein will, unless cause is
shown to the contrary, be struck off the register and the company will be
dissolved.25

(4) If, in any case where a limited liability company is being wound up, the
Department has reasonable cause to believe either that no liquidator is
acting, or that the affairs of the company are fully wound up, and the
returns required to be made by the liquidator have not been made for a
period of 6 consecutive months, the Department shall publish and send
to the company or the liquidator, if any, a like notice as is provided in the
last preceding subsection.26

(5) At the expiration of the time mentioned in the notice the Department
may, unless cause to the contrary is previously shown by the company,
strike its name off the register, and shall publish notice and on the
publication the company shall be dissolved:
Provided that —
(a) the liability of every manager, if any, and member shall continue
and may be enforced as if the company had not been dissolved;
and
(b) nothing in this subsection shall affect the power of the court to
wind up a limited liability company the name of which has been
struck off the register.27

(6) If a limited liability company or any member or creditor feels aggrieved
by the company having been struck off the register, the court on an
application made by the company or member or creditor before the
expiration of 12 years from the publication of the notice aforesaid may, if
Section 11 Limited Liability Companies Act 1996


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satisfied that the company was at the time of the striking off carrying on
business or in operation or otherwise that it is just that the company be
restored to the register, order the name of the company to be restored to
the register, and upon an office copy of the order being delivered to the
Department for registration together with such fee as may be prescribed
under section 50 for the restoration of the company to the register, the
company shall be deemed to have continued in existence as if its name
had not been struck off, and the court may by order give such directions
and make such provisions as seem just for placing the company and all
other persons in the same position as nearly as may be as if the name of
the company had not been struck off.28

(7) A notice to be sent under this section to a liquidator may be addressed to
the liquidator at his last known place of business, and a letter or notice to
be sent under this section to a limited liability company may be
addressed to the company at its registered office, or, if no office has been
registered or the Department has reasonable cause to believe that the
registered office has been abandoned, to the care of the manager, the
registered agent or any member whose name and address are known to
the Department, or may be sent to each of the persons who subscribed to
the articles of organisation, addressed to him at the address mentioned in
the articles of organisation.29

(8) For the purposes of this section, a limited liability company which has
failed to forward an annual return to the Department within 6 months
after the company’s return date under section 10, shall be deemed not to
be in operation until such return is forwarded to the Department.30

(9) Subsection (8) is without prejudice to section 10(3) of this Act.
(10) For the purposes of this section and section 11A, a notice shall be
considered published —
(a) by publishing a notice in one edition of a newspaper published
and circulating in the Isle of Man; and
(b) by publishing a notice on the Department of Economic
Development website for a minimum period of one month; and31

(c) by the Department maintaining a current list in the prescribed
form and with the prescribed particulars of limited liability
companies in respect of which notice has been published and by
making such list available for inspection by any person.32

11A Alternative procedure for dissolving solvent limited liability

companies

(1) Where a limited liability company has ceased to operate and has
discharged all its debts and liabilities (other than contributions to capital
owed to its members) the registered agent or any member of the
Limited Liability Companies Act 1996 Section 11


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company may apply to the Department for a declaration of dissolution of
the company.33

(2) An application by a limited liability company under this section in the
prescribed form for a declaration of dissolution shall be in writing and
shall be accompanied by a statutory declaration made by a manager or a
member of the limited liability company stating that the company has
ceased to operate, that it has complied with its obligations under section
10 and that to the best of his knowledge and belief and having made full
enquiry into the affairs of the limited liability company the manager or
member is satisfied that —
(a) the limited liability company has discharged all its debts and
liabilities (other than contributions to capital owed to its
members); and
(b) the particulars contained within the last annual return of the
limited liability company (or, in the case of a company for which
an annual return has not fallen due, the particulars filed on first
registration) remain accurate at the date of making the statutory
declaration or that they are accurate as amended by the applicant
at the date of making the statutory declaration.
(3) Upon receipt of an application under subsection (1) the Department
shall —
(a) publish a notice in the manner prescribed by section 11(10) to the
effect that the applicant has applied to the Department for a
declaration of dissolution of the limited liability company and
that, unless written objection is made to the Department within
one month of the date of publication of the notice, the Department
may dissolve the company; and
(b) within one month of the date of publication of the notice obtain
written notice from the Authority, the Assessor of Income Tax, the
Collector of Customs and Excise and the Attorney General that
they have no objection to the making of a declaration of
dissolution in respect of the limited liability company.34
35

(4) The court, on being satisfied that the period made available to the
Assessor of Income Tax or the Collector of Customs and Excise or the
Attorney General by the Department for the making of objections under
subsection (3)(b) requires to be extended, may upon application order
that the period for objections shall be extended on such terms and
conditions as it deems appropriate.36

(5) Before making an application to the Department under this section, the
applicant shall ensure that there has been sent by pre-paid post to the
registered agent and to the manager (if any) and each member of the
limited liability company at the last address of which the limited liability
company has notice, a notice to the effect that the applicant proposes to
Section 11 Limited Liability Companies Act 1996


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apply to the Department for a declaration of dissolution of the limited
liability company and that, unless written objection is made to the
Department within one month of the date the notice was posted, the
Department may dissolve the limited liability company.37

(6) The Department shall not make a declaration of dissolution of a limited
liability company earlier than one month after the date of the publication
of the notice required by subsection (3) of this section.38

(7) On receipt of any written objection to the dissolution of the limited
liability company, the Department shall forthwith notify the applicant for
the declaration of dissolution of the receipt of the objection and of the
identity of the objector.39

(8) Where any manager, member or creditor of a limited liability company
has objected to the dissolution of the limited liability company the
Department shall not declare the dissolution thereof unless —
(a) the manager, member or creditor, as the case may be, withdraws
the objection; or
(b) the Department decides that the objection is completely without
justification, and40

the objector has not appealed against the Department’s decision within
the time specified in section 11D(1), or the court has upheld the
Department’s decision.41

(9) If the Department is not prevented from declaring the dissolution of a
limited liability company pursuant to this section and agrees to the
dissolution, it shall notify the limited liability company that, subject to
the company’s articles of organisation, operating agreement or other
document evidencing agreement between the members, it is entitled to
distribute its surplus assets among its members according to their
respective rights and, notwithstanding any other provision of this Act or
any rule of law, the limited liability company may distribute its surplus
assets accordingly.42

(10) Subject to subsection (11) of this section, on receipt of notification from a
limited liability company that its surplus assets have been distributed in
accordance with subsection (9) of this section, the Department may, by
notice in one newspaper published and circulating in the Isle of Man,
declare that the limited liability company is dissolved and, on the
publication of the notice, the limited liability company shall be
dissolved.43

(11) Notwithstanding the dissolution of the limited liability company —
(a) the liability, if any, of every manager and member of the company
shall continue and may be enforced as if the limited liability
company had not been dissolved; and
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(b) notwithstanding that a limited liability company has been
dissolved, or that its surplus assets have been distributed in
accordance with this section, the court may wind up the limited
liability company as if it had not been dissolved, or its surplus
assets had not been distributed, as the case may be.
(12) Where a limited liability company has been dissolved pursuant to this
section, the court, on an application made by the Department or the
manager (if any), a member or creditor of the limited liability company
before the expiration of 12 years from the publication of the notice of
dissolution, may, if satisfied that at the time of dissolution of the limited
liability company it was in operation or had not discharged all its debts
and liabilities or otherwise that it is just that the dissolution of the limited
liability company be revoked, order that the dissolution of the limited
liability company be revoked, and upon a sealed copy of the order being
delivered to the Department for registration, the limited liability
company shall be deemed to have continued in existence as if it had not
been dissolved; and the court may by the order give such directions and
make such provisions as seem just for placing the limited liability
company and all other persons in the same position as nearly as may be
as if the limited liability company had not been dissolved.44

(13) An order under subsection (12) may be made on such terms and
conditions as the court thinks fit.45

11B Restoration of dissolved limited liability companies to the register

(1) A limited liability company or any manager, member or creditor thereof
who feels aggrieved by a company having been either —
(a) struck off the register under section 11 of this Act; or
(b) dissolved under section 11A of this Act,
may, before the expiration of 12 years from the publication of a notice
under section 11(5) or section 11A(10), make application to the
Department for a direction under this section.46

(2) Upon receipt of an application under subsection (1) the Department
shall, within a reasonable time, publish notice of the application on the
Department of Economic Development website and shall maintain a
current list of applications.47

(3) An application under subsection (1) shall be in the prescribed form and
shall be accompanied by —
(a) a copy of the notice given under subsection (4) of this section; and
(b) written notice from the Authority, the Attorney General, the
Assessor of Income Tax and the Collector of Customs and Excise
stating that they have no objection to the restoration of the limited
liability company to the register.48

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(4) Before making an application to the Department under subsection (1) of
this section, the applicant shall ensure that there has been —
(a) published in one newspaper published and circulating in the Isle
of Man; and
(b) sent by post to each member of the limited liability company at
the last address of which the limited liability company has notice,
a notice to the effect that the applicant proposes to apply to the
Department for a direction restoring the limited liability company to the
register and that unless written objection is made to the Department
within one month of the date of publishing or posting, as the case may
be, the Department may make such direction.49

(5) The Department shall not make a direction under this section earlier than
one month after the date of publication or posting, as the case may be, of
the last notice published or posted for the purposes of subsection (4) of
this section.50

(6) On receipt of any written objection to the restoration of the limited
liability company, the Department shall forthwith notify the applicant of
the receipt of the objection and of the identity of the objector.51

(7) The Department shall not make a direction under this section unless —
(a) there are no objections to the restoration of the limited liability
company under this section; or
(b) all objections are withdrawn; or
(c) the Department decides that the objections are without
justification and the objector has not appealed against the
Department’s decision within the time specified in section 11D of
this Act or the court has upheld the Department’s decision.52

(8) On receipt of an application under this section the Department, if
satisfied that there are good grounds for restoration of the limited
liability company to the register, may direct the name of the company to
be restored to the register.53

(9) A direction given under this section may be made subject to conditions
and the Department may include such further directions and such
provisions as seem just for placing the limited liability company and all
other persons in the same position as nearly as maybe as if the company
had not been dissolved and without prejudice to the generality of the
foregoing any fees and duties due to the Department shall be due and
payable at the rates prevailing at the date of such restoration.54

(10) When the applicant delivers a certified copy of the direction for
registration the limited liability company shall be deemed to have
continued in existence as if it had not been dissolved.
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(11) This section is without prejudice to the powers of the court under section
11(6) or section 11A(12).55

11C Power of Department to refuse to register or receive documents

(1) Subject to section 11D, a document shall be deemed not to have been
submitted under this Act to the Department (whether by delivery, filing,
production, forwarding, lodging, electronic filing or otherwise) until the
time when it is accepted for registration or otherwise received by the
Department.56

(2) The Department may prescribe regulations for the electronic filing of any
document required to be filed under this Act.57

(3) If in the opinion of the Department any document submitted to it under
this Act —
(a) contains any matter contrary to law; or
(b) does not comply with this Act; or
(c) has not been duly completed; or
(d) contains any misdescription or error, or any matter that is not
clearly legible; or
(e) is not furnished in such manner and conforming to such
requirements as the Department may reasonably require for the
purpose of enabling the processing and copying of the document;
or
(f) is not accompanied by the correct fee or duty; or
(g) is not in the prescribed format;
it may refuse to accept for registration or otherwise receive the
document, and may request either that the document be appropriately
amended or completed and submitted to it again or that a fresh
document be submitted in its place or that the document be submitted
again with the correct fee or duty.58

(4) The Department may require any person who submits a document to it
under this Act to produce to it such other document or to give to it such
information as it considers necessary in order to form an opinion
whether it may refuse under subsection (3) of this section to accept for
registration or to otherwise receive the document.59

11D Appeals from decisions of Department

(1) Any person who is aggrieved by the refusal of the Department to register
a limited liability company, or to register or receive any document
submitted to it under this Act, or who is aggrieved by any other act or
decision of the Department under this Act, may appeal to a court of
Section 12 Limited Liability Companies Act 1996


Page 20 AT 19 of 1996 c

summary jurisdiction within 21 days after the date of the refusal or other
act or decision, or within such further time as the court may allow.60

(2) On hearing the appeal, the court may confirm the refusal or other act or
decision of the Department, or give such directions or make such
determination in the matter as the court thinks fit.61

(3) No right of appeal shall lie under this section against any act or decision
of the Department —
(a) in respect of which there is any express provision in this Act in the
nature of an appeal or review; or
(b) that is declared by this Act to be conclusive or final, or that is
embodied in any document declared by this Act to be conclusive
evidence of any act, decision, matter, or thing.62

(4) Subject to subsection (5), notwithstanding any other provision of any
enactment or any rule of law, where a person appeals or applies to the
court in respect of an act or decision of the Department under section
11C until a decision on the appeal or application is given, the
Department, and any person authorised by it under that section for the
purpose, may continue to exercise its powers under that section as if no
such appeal or application had been made, and no person shall be
excused from fulfilling his obligations under that section by reason of
that appeal or application.63

(5) To the extent that an appeal or application in respect of any such act or
decision is allowed or granted, as the case may be —
(a) the Department shall ensure that, forthwith after the decision on
the appeal or application is given, all records made by it, or by a
person authorised by it for that purpose, under section 11C in
respect of that act or decision are destroyed or expunged; and64

(b) no information acquired under section 11C of this Act in respect
of that act or decision shall be admissible in any proceedings.65

CHAPTER III - CAPITAL: CONTRIBUTIONS, WITHDRAWAL, REDUCTION,
ETC
12 Contributions to capital

The contributions to capital of a member to a limited liability company may be
in cash, property or services rendered, or by means of a promissory note or any
form of binding obligation to contribute cash or property or to perform services.
13 Liability of members of limited liability companies

(1) The liability of a member is limited to —
Limited Liability Companies Act 1996 Section 14


c AT 19 of 1996 Page 21

(a) the difference between his contributions to capital as actually
made and that stated in the articles of organisation, operating
agreement, subscription for contribution or other document
executed by the member as having been made by the member;
and
(b) any unpaid contribution to capital which he agreed in the articles
of organisation, operating agreement or other document executed
by the member to make in the future at the time and on the
conditions stated in the articles of organisation, operating
agreement or other document evidencing such agreement.
(2) Subject to subsection (3), the liabilities of a member specified in
subsection (1) can be waived or compromised with the consent of all
members.
(3) A waiver or compromise under subsection (2) shall not affect the rights
of any creditor of, or any other person having a claim against, the limited
liability company.
(4) When the whole or part of the capital of a contributor has been returned
to him, he shall for a period of 6 years after the return continue to be
liable to the limited liability company for any sum (not exceeding the
amount returned) necessary to discharge its relevant liabilities.
(5) For the purposes of subsection (4), the relevant liabilities are the
liabilities to all creditors of, and other persons having claims against, the
limited liability company, in respect of —
(a) any credit extended during the period that the returned capital
contribution was held by the limited liability company; or
(b) any claims which arose before the return.
14 Withdrawal or reduction of members’ contributions to capital

(1) A member shall not receive out of the property of a limited liability
company any part of his contribution to capital unless —
(a) all liabilities of the limited liability company, except liabilities to
members on account of their contributions to capital, have been
paid or there remains property of the limited liability company
sufficient to pay them;
(b) the consent of all members is had, unless the return of the
contribution to capital may be rightfully demanded as provided
in this Act; and66

(c) the articles of organisation permit the withdrawal or reduction.
(2) Subject to the provisions of subsection (1), a member may demand the
return of his contribution —
(a) on the dissolution of the limited liability company; or
Section 15 Limited Liability Companies Act 1996


Page 22 AT 19 of 1996 c

(b) unless otherwise prohibited or restricted in the operating
agreement, after the member has given all other members of the
limited liability company prior notice in writing in conformity
with the operating agreement.
(3) If the operating agreement does not prohibit or restrict the right to
demand the return of capital and no notice period is specified, a member
making the demand must give 6 months prior notice in writing.
(4) In the absence of a statement in the articles of organisation to the
contrary or the consent of all members of the limited liability company, a
member, irrespective of the nature of his contribution, has only the right
to demand and receive cash in return for his contribution to capital.
(5) A member of a limited liability company may have the limited liability
company dissolved and its affairs wound up when —
(a) the member rightfully but unsuccessfully has demanded the
return of his contribution; or
(b) the other liabilities of the limited liability company have not been
paid, or the property of the limited liability company is
insufficient for their payment and the member would otherwise
be entitled to the return of his contribution.
15 Division of profits; impairment of capital

(1) Subject to subsection (2), a limited liability company may, from time to
time, divide and allocate the profits and losses of its business among the
members and among classes of the members of the company in
accordance with the operating agreement.
(2) No distribution shall be made if, after such distribution, the assets of the
limited liability company would not be in excess of all liabilities of the
limited liability company except liabilities to members on account of
their contributions.
(3) If the operating agreement does not so provide, profits and losses shall
be allocated on the basis of the value of the contributions made by each
member to the extent they have been received by the limited liability
company and have not been returned.
(4) Subject to subsection (5), distributions of cash or other assets of a limited
liability company shall be allocated among the members and among
classes of members in the manner provided in the operating agreement.
(5) If the operating agreement does not so provide, distributions shall be
made on the basis of the value of the contributions made by each
member to the extent they have been received by the limited liability
company and have not been returned.
(6) The provisions of this section relating to the allocation of losses shall not
affect the limitation on liability of members under section 13.
Limited Liability Companies Act 1996 Section 16


c AT 19 of 1996 Page 23

16 Members’ interest and transferability

(1) The interest of all members in a limited liability company constitutes the
personal estate of the member, and may be transferred or assigned as
provided in the operating agreement.
(2) If all the members of a limited liability company other than the member
proposing to dispose of his interest do not approve of the proposed
transfer or assignment by unanimous written consent, the transferee of
the member’s interest shall have no right —
(a) to become a member of the limited liability company; or
(b) to participate in the management of the business and affairs of the
limited liability company.
(3) Such a transferee shall only be entitled to receive the share of profits or
other compensation by way of income and the return of contributions, to
which the original member would otherwise have been entitled.
CHAPTER IV - MANAGEMENT
17 Management

(1) Subject to the following provisions of this section, a limited liability
company shall be managed by its members.
(2) The rights of the members to manage a limited liability company shall be
in proportion to their contribution to the capital of the company, as
adjusted from time to time to reflect any additional contributions or
withdrawals by the members.
(3) If provision is made for it in the articles of organisation, management of
the limited liability company may be vested in a manager who shall —
(a) be elected by the members in a manner provided for in the
operating agreement; and
(b) hold office for such period as the members shall determine,
unless the operating agreement expressly provides otherwise.
(4) The manager and any person appointed by him, shall have any such
right or duty as is —
(a) specified in the operating agreement; and
(b) expressly confirmed by the members.
18 Contracting debts

Except as otherwise provided in this Act, no debt shall be contracted or liability
incurred by or on behalf of a limited liability company, except by —
(a) any member if management of the limited liability company is
retained by the members; or
Section 19 Limited Liability Companies Act 1996


Page 24 AT 19 of 1996 c

(b) its manager if management of the limited liability company has
been conferred on a manager.
19 Accounting records

(1) Every limited liability company shall cause accounting records to be kept
in accordance with the provisions of this section.
(2) The accounting records shall be sufficient to show and explain the
company’s transactions.
(3) The accounting records shall be such as to disclose, within a reasonable
time and with reasonable accuracy, the financial position of the company
at any time.
(4) The accounting records shall in particular contain —
(a) entries from day to day of all sums of money received and
expended by the company and the matters in respect of which the
receipt and expenditure takes place;
(b) a record of the assets and liabilities of the company; and
(c) where the company’s business involves dealing in goods —
(i) statements of stock held by the company at the end of each
financial year of the company;
(ii) all statements of stocktakings from which any such
statement as is mentioned in sub-paragraph (i) has been or
is to be prepared; and
(iii) except in the case of goods sold by way of ordinary retail
trade, statements of all goods sold and purchased showing
the goods and the buyers and sellers in sufficient detail to
enable the goods and the buyers and sellers to be
identified.
(5) Subject to subsection (6), the accounting records shall be kept at the
registered office of the company or at such other place as the members of
the company think fit and shall at all times be open to inspection by the
members of the company.
(6) If accounting records are kept at a place outside the Island by a company,
accounts and returns with respect to the business dealt with in the
accounting records so kept shall be sent to, and kept at a place in the
Island and shall at all times be open to inspection by the members of the
company.
(7) The accounts and returns to be sent to the Island in accordance with
subsection (6) shall be such as to disclose with reasonable accuracy the
financial position of the business in question at intervals not exceeding 6
months.
Limited Liability Companies Act 1996 Section 20


c AT 19 of 1996 Page 25

(8) Subject to any direction with respect to the disposal of any records kept
by a company given under any regulations under section 28, any
accounting records which a company is required by this section to keep
shall be preserved by it for 6 years from the date on which they are
made.
(9) If a company fails to comply with any provision of subsections (1) to (6),
every member and manager (if any) of the company shall be guilty of an
offence.
(10) A person shall not be guilty of an offence under subsection (9) if he
shows that he acted honestly and that in the circumstances in which the
business of the company was carried on the default was excusable.
(11) If any member or manager of a company fails to take all reasonable steps
for securing compliance by the company with subsection (8) or has
intentionally caused any default by the company thereunder he shall be
guilty of an offence.
(12) Any person guilty of an offence under this section shall be liable —
(a) on conviction on information to custody for a term not exceeding
2 years, or to a fine, or to both;
(b) on summary conviction, to custody for a term not exceeding 6
months, or to a fine not exceeding £5,000, or to both.
20 Registration of charges

Schedule 3, which provides for the registration of charges, shall have effect.
21 Execution of instruments

Instruments and documents providing for the acquisition, mortgage or
disposition of property of a limited liability company shall be valid and binding
upon the limited liability company if executed by —
(a) any member if management of the limited liability company is
retained by the members; or
(b) its manager if management of the limited liability company has
been conferred on a manager.
22 Unauthorised assumption of powers

All persons who assume to act as a limited liability company without authority
to do so shall be jointly and severally liable for all debts and liabilities.
23 Waiver of notice

When, under this Act or under the articles of organisation or operating
agreement of a limited liability company, notice is required to be given to a
member or to a manager of a limited liability company having a manager or
Section 24 Limited Liability Companies Act 1996


Page 26 AT 19 of 1996 c

managers, a waiver in writing signed by the person or persons entitled to the
notice, whether before or after the time stated in it, is equivalent to the giving of
notice.
CHAPTER V - PROCEEDINGS AND INSPECTION
24 Parties to actions

A member of a limited liability company is not a proper party to proceedings by
or against a limited liability company, except where the object is to enforce a
member’s right against or liability to the limited liability company.
25 Service of process

(1) Any process, notice or demand required or permitted to be served upon
a limited liability company may be served on the company at its
registered office.
(2) Where this subsection applies to a limited liability company, any
document may be served on it by sending a copy of the document by
post to each person who, on the date on which the document is sent, is
shown as a member of the company in the documents kept by the
Department.67

(3) Subsection (2) applies to a limited liability company where the person
having control of the premises at which the company purports to have its
registered office has delivered to the Department a notice in the
prescribed form stating that the company does not have authority to
maintain its registered office at the premises.68

(4) This section shall not limit or affect the right to serve any process, notice
or demand required or permitted by law to be served upon a limited
liability company in any other manner now or hereafter permitted by
law.
26 Inspection of affairs of companies

(1) The High Court may on the application of the Department of Economic
Development, the Authority or a member of a limited liability company
appoint one or more competent inspectors to investigate the affairs of the
company and to report as the court directs.69

(2) It shall be the duty of all members, managers and registered agents of the
limited liability company, and of other persons who, in the opinion of the
inspectors, have or may be in possession of, any book, document or other
records of or relating to the company —
(a) to produce to the inspector all such books and documents which
are in their custody or power;
(b) to attend before the inspectors when required to do so; and
Limited Liability Companies Act 1996 Section 27


c AT 19 of 1996 Page 27

(c) otherwise to give the inspectors all assistance in connection with
the investigation which they are reasonably able to give.
(3) The inspectors may examine on oath the persons mentioned in
subsection (2) in relation to the affairs of the company and may
administer an oath accordingly.
(4) If any person mentioned in subsection (2) refuses —
(a) to produce to the inspectors any book or document which it is his
duty under this section so to produce; or
(b) to answer any question which is put to him by the inspectors with
respect to the affairs of the company,
the inspectors may certify the refusal under their hand to the High Court,
and the court may thereupon enquire into the case, and after hearing the
evidence of the inspectors and any evidence which may be offered in
defence, may punish the offender in the like manner as if he had been in
contempt of the court.
(5) On the conclusion of the investigation the inspectors shall report their
opinion to the court, and a copy of the report shall be forwarded by the
court to the Department or the Authority (whichever made the
application under subsection (1), the registered office of the company, its
registered agent and manager (if any).70

(6) If at any stage during the course of an inspection under this section it
appears to the High Court that any person may have been guilty of an
offence in relation to the company, it may refer the matter to the
Attorney General.
(7) The expenses of and incidental to an inspection under this section shall
be paid by the applicant or by the company or in part by the applicant
and in part by the company according to the direction of the court.
(8) Any balance of the expenses not defrayed either by the company or the
applicant shall be defrayed by the Treasury.71

(9) The power of the High Court under this section shall be exercisable in
respect of a limited liability company notwithstanding that it is in the
course of winding up.
PART 2 – DISSOLUTION OF LIMITED LIABILITY COMPANIES

27 Circumstances in which limited liability companies are to be

wound up

(1) The affairs of a limited liability company organised under this Act shall
be wound up on the occurrence of any of the following events —
Section 28 Limited Liability Companies Act 1996


Page 28 AT 19 of 1996 c

(a) when the period (if any) fixed by the articles of organisation for
the duration of the limited liability company expires; or72

(b) by the unanimous written agreement of all members; or
(c) subject to subsection (2) and to section 28(2), on the death,
retirement, resignation, expulsion, dissolution of a member or
occurrence of any other event which terminates the continued
membership of a member in the limited liability company; or73

(d) where the High Court makes an order under section 32; or
(e) in any other case for which this Act provides,
but its separate existence shall Continue until a certificate of dissolution
has been issued by the Department or until an order dissolving the
limited liability company has been made by the High Court.74

(2) The affairs of a limited liability company are only to be wound up on the
occurrence of an event specified in subsection (1)(c) if the operating
agreement of the company so provides.75

28 Winding up procedure

(1) On the occurrence of any of the events specified in section 27(1)(a) to (c)
and (e) the remaining members of a limited liability company —
(a) shall be deemed to be joint provisional liquidators of the company
for the purpose of winding up the affairs of the company; and
(b) shall forthwith deliver to the Department a notice in the
prescribed form of provisional intent to wind up the company,
and76

the company shall cease to carry on its business, except insofar as may be
necessary for the intended winding up of its business.77

(2) If, within 60 days of the occurrence of any of the events specified in
section 27(1)(c), there is delivered to the Department a notice in the
prescribed form that all the remaining members —
(a) have agreed to continue the business of the company; and78

(b) have entered into a legally binding agreement with the former
member, his agent or personal representatives for the purchase of
his interest in the company,
the obligation to wind up the company shall cease to have effect and the
company may continue to carry on its business.79

(3) Except where a notice has been delivered under subsection (2), on the
expiry of 60 days following the occurrence of any of the events specified
in section 27(1)(a) to (c) and (e) the provisional liquidators —
(a) shall be obliged to proceed to wind up the affairs of the company;
and
Limited Liability Companies Act 1996 Section 28


c AT 19 of 1996 Page 29

(b) shall publish a notice in the prescribed form in 2 newspapers
published and circulating in the Island.80

(4) The provisional liquidators may at any time by unanimous written
agreement appoint a person to act as liquidator in their place and shall,
upon making such an appointment, forthwith deliver a notice of
appointment in the prescribed form to the Department.81

(5) Where a liquidator appointed under subsection (4) ceases to act as such,
the persons who were the provisional liquidators who appointed the
liquidator shall resume office as provisional liquidators and —
(a) shall be obliged to continue the winding up of the affairs of the
company;
(b) shall forthwith deliver a notice of cessation in the prescribed form
to the Department; and82

(c) may exercise the power conferred by subsection (4) to replace the
former liquidator.
(6) The Treasury may by regulations provide for the practice and procedure
to be adopted by provisional liquidators and liquidators in the winding
up of limited liability companies.
(7) A provisional liquidator or liquidator who fails to comply with
regulations under subsection (6) shall be guilty of an offence and shall be
liable on summary conviction to a fine not exceeding £2,500.
(8) If on the expiry of the period of 12 months immediately following the
delivery of a notice under subsection (1)(b) —
(a) no notice has been delivered under subsection (2); and
(b) no notice has been delivered under subsection (4); and
(c) no liquidator has been appointed by the High Court under section
32; and
(d) no notice of dissolution has been delivered under section 30; and
(e) the Department is satisfied that the provisional liquidators are not
fulfilling their obligations under subsection (3),83

the company shall be deemed to be defunct until a liquidator is
appointed under subsection (4) or by the High Court under section 32.
(9) If on the expiry of the period of 12 months immediately following the
delivery of a notice under subsection (4) —
(a) the Department is satisfied that the liquidator has ceased to act as
such; and84

(b) no replacement has been appointed; and
(c) no liquidator has been appointed by the High Court under section
32; and
(d) no notice of dissolution has been delivered under section 30;
Section 29 Limited Liability Companies Act 1996


Page 30 AT 19 of 1996 c

the company shall be deemed to be defunct until a new liquidator is
appointed under subsection (4) or by the High Court under section 32.
(10) This section is subject to section 27(2).85

29 Distribution of assets in winding up

(1) In winding up a limited liability company, debts and liabilities shall be
settled in the following order —
(a) creditors and others having any claim against the company in
respect of any liability or obligation, except those to members of
the limited liability company on account of their contributions;
(b) members of the limited liability company in respect of their share
of the profits and other compensation by way of income on their
contributions; and
(c) members of the limited liability company in respect of their
contributions to capital.
(2) In winding up a limited liability company there shall be paid in priority
to all other debts the debts specified in the Preferential Payments Act 1908.
(3) Subject to the operating agreement, members share in the assets of a
limited liability company in respect to their claims for capital and in
respect to their claims for profits or for compensation by way of income
on their contributions, respectively, in proportion to the respective
amounts of the claims.
30 Dissolution

(1) When all debts, liabilities and obligations have been paid and discharged
or adequate provision has been made therefor and all of the remaining
property and assets have been distributed to the members, notice of
dissolution in the prescribed form shall be delivered to the Department.86

(2) On receipt of the notice of dissolution under subsection (1) the
Department shall issue a certificate of dissolution in the prescribed
form.87

(3) On the issue of the certificate of dissolution the company is dissolved.
31 Application of bankruptcy rules in winding up of insolvent limited

liability companies

In the winding up of an insolvent limited liability company the same rules shall
apply with respect to the rights of secured and unsecured creditors and to debts
provable and the valuation of annuities and future and contingent liabilities as
are in force for the time being under the law of bankruptcy with respect to the
estates of persons adjudged bankrupt.
Limited Liability Companies Act 1996 Section 32


c AT 19 of 1996 Page 31

32 Jurisdiction of the High Court

(1) The High Court shall have the power to order the winding up and
dissolution of a limited liability company on such terms as it may think
fit and may do or secure the doing of all such things as appear necessary
or expedient for such winding up and dissolution.
(2) Sections 28 and 30 shall not apply in respect of the winding up and
dissolution of a limited liability company by order of the High Court.
33 Application of Part X of the Companies Act 1931

(1) Part X of the Companies Act 1931 shall apply as if a limited liability
company were an unregistered company within the meaning of section
306 of that Act.
(2) This section is without prejudice to the jurisdiction and powers of the
High Court under section 32.
34 Property discovered after dissolution

(1) Where, after the dissolution of a limited liability company, there is
discovered any property of the company —
(a) the registered agent in office at the time of dissolution; or
(b) if there is no such agent, the members of the company at that time,
shall, subject to subsection (2), thereafter be trustee for the members and
creditors of the dissolved limited liability company and as such shall
have authority to distribute any such company property, convey land
and take such other action as may be necessary on behalf of and in the
name of such dissolved limited liability company.
(2) Where the members of a limited liability company are trustees by virtue
of subsection (1), they may at any time by unanimous written agreement
appoint a person to act as trustee in their place and shall, upon making
such an appointment, forthwith deliver a notice of appointment in the
prescribed form to the Department.88

(3) On the delivery of the notice of appointment to the Department under
subsection (2), the appointed person shall be the trustee for the members
and creditors of the dissolved limited liability company in place of the
members and as such shall have authority to distribute the company
property discovered after dissolution, convey land and take such other
action as may be necessary on behalf of and in the name of such
dissolved limited liability company.89

Section 35 Limited Liability Companies Act 1996


Page 32 AT 19 of 1996 c

35 Power of court to declare dissolution of limited liability company void

(1) The High Court may at any time within 2 years of the date of dissolution
of a limited liability company, make an order declaring the dissolution to
have been void.
(2) On the making of an order under subsection (1), the company shall be
deemed to have continued in existence as if it had not been dissolved but
only for the purpose of winding up its affairs or distributing its property.
(3) An order under subsection (1) may be made upon such terms as the
court thinks fit.
(4) An application for an order under subsection (1) may be made by any
member or creditor of the company or any person who appears to the
court to be interested in the company.
(5) It shall be the duty of the person on whose application the order was
made, within 7 days after the making of the order, or such further time as
the court may allow, to deliver to the Department for registration a copy
of the order, and if that person fails so to do that person shall be guilty of
an offence and on summary conviction shall be liable to a fine not
exceeding £5,000.90

36 Offences

Schedule 4 (offences antecedent etc to winding up) shall have effect.
PART 3 – TAXATION

CHAPTER I —
37 to 45 [Repealed]
91

CHAPTER II - TAXATION OF OTHER LIMITED LIABILITY COMPANIES
46 [Inserts section 2M in the Income Tax Act 1970.]
92

47 [Inserts section 63A in the Income Tax Act 1970.]

PART 4 – GENERAL

48 Inspection of documents by the public

(1) Any person may inspect —
(a) a copy of any document kept by the Department under this Act;93

(b) if the copy is illegible or unavailable, the document itself.
Limited Liability Companies Act 1996 Section 49


c AT 19 of 1996 Page 33

(2) In subsection (1), a copy is to be treated as the copy of a document if it is
taken from a copy or other reproduction of the original.
49 Offences: members and officers

Where an offence by a limited liability company was committed with the
consent or connivance of, or was attributable to any neglect on the part of, any
member, registered agent, manager or similar officer of the company, or any
person who was purporting to act as any such officer, that person shall also be
guilty of the like offence as the body corporate and shall be punishable
accordingly.
50 Fees

The Department may, with the concurrence of the Treasury, by order prescribe
the fees and duties to be paid in respect of limited liability companies, the filing
of documents, the issue of certificates, the inspection of documents and the
exercise of functions by the Department under this Act.94

51 Public documents

(1) The Treasury may make such regulations as are necessary to give effect
to Part 3.95

(1A) The Department of Economic Development may make such regulations
as are necessary to give effect to Parts 1 and 2, and Schedules 1 to 4.96

(2) Regulations under this Act shall be laid before Tynwald as soon as
practicable after they are made, and if Tynwald at the sitting at which the
regulations are laid or at the next following sitting resolves that they
shall be annulled, they shall cease to have effect.
51A Interpretation

In this Act “Authority
” means the Isle of Man Financial Services Authority (as
established by article 4 of the Transfer of Functions (Isle of Man Financial
Services Authority) Order 2015), and “Department
” means the Department of
Economic Development.97

52 [Amendments to Companies Act 1931 and Partnership Act 1909]

(1) [Amends section 79 of the Companies Act 1931 by inserting subsection
(3A).]
(2) [Amends the proviso to section 290(1) of the Companies Act 1931 by
inserting paragraph (ia).]
(3) (a) [Repealed]98

(b) [Repealed]99

Section 53 Limited Liability Companies Act 1996


Page 34 AT 19 of 1996 c

(c) [Repealed]100

(d) [Repealed]101

(4) (a) [Amends section 49 of the Partnership Act 1909 by inserting
subsections (1C) and (1D).]
(b) [Amends section 49A of the Partnership Act 1909 as follows:
subparagraph (i) inserts “Subject to subsection (2A),” in
subsection (2) at the beginning; and subparagraph (ii) inserts
subsection (2A).]
(c) [Amends section 50 of the Partnership Act 1909 by repealing
paragraph (g).]
(d) [Amends section 51(1B) of the Partnership Act 1909 as follows:
subparagraph (i) repeals in paragraph (d) the words “, and the
sum contributed by,”; and subparagraph (ii) repeals in paragraph
(e) the words “, and the sum which was contributed by,”.]
52A Power to make orders as to disposal of valueless documents

(1) Where a limited liability company has been dissolved under this Act or
otherwise, the Department after consultation with the Authority and the
Chief Registrar may at any time after the expiration of 12 years (or 2
years where subsection (2) applies) from the date of dissolution, order
the disposal, by destruction or otherwise, of documents relating to that
company which are in the register of companies, the Public Record Office
or any repository referred to in section 1(5) of the Public Records Act 1999
and which are not of sufficient public value to justify their
preservation.102

(2) The Department may make an order under subsection (1) at any time
after the expiration of 2 years from such dissolution if it is satisfied that it
has in its custody a copy of any document disposed of under that
subsection.103

(3) A copy of any document to which subsection (2) applies shall for the
purposes of this Act, be treated as if it were the original document and if
the copy is not kept in a legible form, any duty of the Department to
allow inspection of, or to furnish a copy of, the document or any part of it
is to be treated as a duty to allow inspection of, or to furnish a
reproduction of the copy or of the relevant part of it in legible form.104

53 Financial provision

There shall be paid out of money provided by Tynwald any expenses of the
Treasury, the Department and the Authority under this Act.105

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54 Short title and commencement

(1) This Act shall be cited as the Limited Liability Companies Act 1996.
(2) This Act shall come into force on such day as the Treasury may by order
appoint and different days may be so appointed for different provisions
and for different purposes.106

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c AT 19 of 1996 Page 37

Schedule 1

STATUS AND POWERS OF LIMITED LIABILITY COMPANIES

Section 2(4)
1. To sue and be sued, complain and defend, in its name.
2. To purchase, take, receive, lease or otherwise acquire, own, hold, improve, use
and otherwise deal in and with real or personal property, or an interest in it, wherever
situated.
3. To sell, convey, mortgage, pledge, lease, exchange, transfer and otherwise
dispose of all or any part of its property and assets.
4. To lend money to and otherwise assist its members, managers and employees.
5. To purchase, take, receive, subscribe for or otherwise acquire, own, hold, vote,
use, employ, sell, mortgage, lend, pledge or otherwise dispose of, and otherwise use
and deal in and with shares or other interests in or obligations of other limited liability
companies, domestic or foreign corporations, associations, general or limited
partnerships or individuals, or direct or indirect obligations of the Island or of any
government, state, territory, governmental district or municipality or of any
instrumentality of it.
6. To make contracts and guarantees and incur liabilities, borrow money at such
rates of interest as the limited liability company may determine, issue its notes, bonds
and other obligations and secure any of its obligations by mortgage or pledge of all or
any part of its property, franchises and income.
7. To lend money for its proper purposes, invest and reinvest its funds and take
and hold real property and personal property for the payment of funds so loaned or
invested.
8. To conduct its business, carry on its operations and have and exercise the
powers granted by this Act anywhere in the world.
9. To elect or appoint managers, officers, employees and agents of the limited
liability company, and define their duties and authority, which may include authority
also delegated to the members or managers under sections 17 and 18, and fix their
compensation.
10. To make and alter operating agreements, not inconsistent with its articles of
organisation or with the laws of the Island, for the administration and regulation of the
affairs of the limited liability company.
11. To indemnify a member or manager or former member or manager of the
limited liability company against expenses actually and reasonably incurred by him or
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Page 38 AT 19 of 1996 c

it in connection with the defence of an action, suit or proceeding, civil or criminal, in
which he or it is made a party by reason of being or having been such member or
manager, except in relation to matters as to which he or it shall be adjudged in the
action, suit or proceeding to be liable to the company for negligence or misconduct in
the performance of duty or to have received improper personal benefit on account
thereof
12. To make any other indemnification that is authorised by the articles of
organisation or by an article of the operating agreement or resolution adopted by the
members after notice.
13. To cease its activities and surrender its certificate of organisation.
14. To have and exercise all powers necessary or convenient to effect any activity,
trade or business of the limited liability company.
15. To become a member of a general partnership, limited partnership, joint venture
or similar association, or any other limited liability company.
16. To pay pensions and establish pension plans, pension trusts, profit-sharing
plans, ownership interest bonus plans and option plans, and benefit or incentive plans
for any or all of its current or former managers, officers, employees and agents.
17. To make donations for the public welfare or for charitable, scientific or
educational purposes.
Schedule 2

MATTERS TO BE SPECIFIED IN THE ARTICLES OF ORGANISATION

Section 7(1)
1. The total amount of cash and a description and agreed value of property other
than cash contributed by the members.
2. The total additional contributions, if any, agreed to be made by all members and
the times at which or events upon the happening of which they shall be made.
3. The right, if given, of the members to admit additional members, and the terms
and conditions of the admission.
4. The right, if given, of the remaining members of the limited liability company to
continue the business on the death, retirement, resignation, expulsion, bankruptcy or
dissolution of a member or occurrence of any other event which terminates the
continued membership of a member in the limited liability company.
5. If the members of a limited liability company are to be permitted to elect a
manager to manage the limited liability company, the articles of organisation shall so
state.
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c AT 19 of 1996 Page 39

6. Any other provision which the members elect to set out in the articles of
organisation for the regulation of the internal affairs of the limited liability company,
including any provisions which under this Act are required or permitted to be set out
in the operating agreement of the limited liability company.
Schedule 3

REGISTRATION OF CHARGES

Section 20
Registration of Charges with the Department107

Registration of charges created by limited liability companies
1. (1) Subject to the provisions of this Schedule, every charge created by a
limited liability company and being a charge to which this paragraph applies shall, so
far as any security on the company’s property or undertaking is conferred thereby, be
void against the liquidator and any creditor of the company, unless the prescribed
particulars of the charge, together with the instrument, if any, by which the charge is
created or evidenced, are delivered to the Department for registration within 1 month
after the date of its creation.108

(2) Sub-paragraph (1) is without prejudice to any contract or obligation for
repayment of the money secured by a charge.
(3) When a charge becomes void under this paragraph the money secured
thereby shall immediately become payable.
(4) This paragraph applies to the following charges —
(a) a charge for the purpose of securing any issue of debentures;
(b) a charge created or evidenced by an instrument which, if executed
by an individual, would require registration;
(c) a charge on land, wherever situate, or any interest therein;
(d) a charge on book debts of the company;
(e) a floating charge on the undertaking or property of the company;
(f) a charge on a ship or an aircraft or any share in a ship;
(g) a charge on goodwill, on a patent or a licence under a patent, on a
trademark or on a copyright or a licence under a copyright.
2. (1) In the case of a charge created out of the Island comprising solely of
property situate outside the Island, the delivery to and the receipt by the Department
of a copy verified in the prescribed manner of the instrument by which the charge is
created or evidenced, shall have the same effect for the purposes of paragraph 1 as the
delivery and receipt of the instrument itself, and 1 month after the date on which the
instrument or copy could, in due course of post, and if dispatched with due diligence,
have been received in the Island, shall be substituted for one month after the date of
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the creation of the charge, as the time within which the particulars and instrument or
copy are to be delivered to the Department.109

(2) Where a charge is created in the Island but comprises property outside
the Island, the instrument creating or purporting to create the charge may be sent for
registration under paragraph 1 notwithstanding that further proceedings may be
necessary to make the charge valid or effectual according to the law of the country in
which the property is situate.
(3) Where a negotiable instrument has been given to secure the payment of
any book debts of a limited liability company, the deposit of the instrument for the
purpose of securing an advance to the company shall not for the purposes of
paragraph 1 be treated as a charge on those book debts.
(4) The holding of debentures entitling the holder to a charge on land shall
not for the purposes of paragraph 1 be deemed to be an interest in land.
(5) Where a series of debentures containing, or giving by reference to any
other instrument, any charge to the benefit of which the debenture holders of that
series are entitled pari passu is created by a limited liability company, it shall for the
purposes of paragraph 1 be sufficient if there are delivered to or received by the
Department within 1 month after the execution of the deed containing the charge or, if
there is no such deed, after the execution of any debentures of the series the following
particulars —
(a) the total amount secured by the whole series; and
(b) the dates of the resolutions authorising the issue of the series and
the date of the covering deed, if any, by which the security is
created or defined; and
(c) a general description of the property charged; and
(d) the names of the trustees, if any, for the debenture holders;
together with the deed containing the charge, or, if there is no
such deed, one of the debentures of the series:
Provided that, where more than one issue is made of debentures in the series,
there shall be sent to the Department for entry in the register particulars of the date
and amount of each issue, but an omission to do this shall not affect the validity of the
debentures issued.110

(6) Where any commission, allowance, or discount has been paid or made
either directly or indirectly by a limited liability company to any person in
consideration of his subscribing or agreeing to subscribe, whether absolutely or
conditionally, for any debentures of the company, or procuring or agreeing to procure
subscriptions, whether absolute or conditional, for any such debentures, the particulars
required to be sent for registration under this paragraph shall include particulars as to
the amount or rate per cent. of the commission, discount, or allowance so paid or
made, but omission to do this shall not affect the validity of the debentures issued:
Provided that the deposit of any debentures as security for any debt of the
company shall not for the purposes of this subsection be treated as the issue of the
debentures at a discount.
(7) In this Schedule, the expression “charge
” includes mortgage.
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c AT 19 of 1996 Page 41

Duty of limited liability company to register charges created by company
3. (1) It shall be the duty of a limited liability company to send to the
Department for registration the particulars of every charge created by the company
and of the issue of debentures of a series, requiring registration under paragraph 1, but
registration of any such charge may be effected on the application of any person
interested therein.111

(2) Where registration is effected on the application of some person other
than the company that person shall be entitled to recover from the company the
amount of any fees properly paid by him to the Department on the registration.112

(3) If any limited liability company makes default in sending to the
Department for registration the particulars of any charge created by the company, or of
the issues of debentures of a series, requiring registration as aforesaid, then, unless the
registration has been effected on the application of some other person, the company
and every member, registered agent, or other person, who is knowingly a party to the
default shall be guilty of an offence and shall be liable —
(a) on conviction on information, to a fine;
(b) on summary conviction, to a fine not exceeding £5,000.113

Duty of limited liability company to register charges on property acquired
4. (1) Where a limited liability company acquires any property which is subject
to a charge of any such kind as would, if it had been created by the company after the
acquisition of the property, have been required to be registered under this Schedule,
the company shall cause the prescribed particulars of the charge, together with the
instrument or a copy (certified in the prescribed manner to be a correct copy) of the
instrument, if any, by which the charge was created or is evidenced, to be delivered to
the Department for registration within one month after the date on which the
instrument or the acquisition is completed:
Provided that, if the property is situate and the charge was created outside the
Island, 1 month after the date on which the instrument or copy of the instrument could,
in due course of post, and if dispatched with due diligence, have been received in the
Island, shall be substituted for one month after the completion of the acquisition as the
time within which the particulars and the instrument or the copy of the instrument are
to be delivered to the Department.114

(2) If default is made in complying with this paragraph, the limited liability
company and every officer of the company who is knowingly a party to the default
shall be guilty of an offence and shall be liable —
(a) on conviction on information, to a fine;
(b) on summary conviction, to a fine not exceeding £5,000.
Registration of supplemental particulars
4A. (1) Further particulars of a charge registered under paragraph 1 or
paragraph 4, which supplement or vary the registered particulars, may be delivered to
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the Department under this paragraph by the limited liability company or the chargee
or any person interested for registration at any time, provided that —
(i) the further particulars do not of themselves, constitute the
creation of a charge by the company;
(ii) the further particulars are in the prescribed form signed by or on
behalf of the company or the chargee or the person interested; and
(iii) if further particulars are delivered to the Department for
registration and appear to it to be duly signed, the Department
shall file the particulars in the register relating to the company
and shall note, in such form as it thinks fit, the date on which they
were delivered to it.115

(2) 116

(3) Paragraph 3 (duty of limited liability company to register charges created
by company) and paragraph 4 (duty of company to register charges on property
acquired) shall not apply in respect of this paragraph.117

Entry of satisfaction
5. The Department may, on evidence being given to its satisfaction that the debt
for which any registered charge was given has been paid or satisfied, register a
memorandum of satisfaction in the prescribed form.118

Rectification of register of charges
6. The High Court, on being satisfied that the omission to register a charge within
the time required by this Schedule, or that the omission or mis-statement of any
particular with respect to any such charge or in a memorandum of satisfaction, was
accidental, or due to inadvertence or to some other sufficient cause, or is not of a nature
to prejudice the position of creditors or shareholders of the company, or that on other
grounds it is just and equitable to grant relief, may, on the application of the company
or any person interested, and on such terms and conditions as seem to the court just
and expedient, order that the time for registration shall be extended, or, as the case
may be, that the omission or mis-statement shall be rectified.
Registration of enforcement of security
7. (1) If any person obtains an order for the appointment of a receiver or
manager of the property of a limited liability company, or appoints such a receiver or
manager under any powers contained in any instrument, he shall within 7 days from
the date of the order or of the appointment under the said powers deliver a notice in
the prescribed form to the Department.119

(2) Where any person appointed receiver or manager of the property of a
limited liability company under the powers contained in any instrument ceases to act
as such receiver or manager, he shall, on so ceasing, deliver to the Department notice in
the prescribed form.120

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(3) If any person makes default in complying with the requirements of this
paragraph he shall be guilty of an offence and shall be liable —
(a) on conviction on information, to a fine;
(b) on summary conviction, to a fine not exceeding £5,000.
Provisions as to Limited Liability Company’s Register of Charges and as to Copies of
Instruments creating Charges
Copies of instruments creating charges to be kept by limited liability company
8. Every limited liability company shall cause a copy of every instrument creating
any charge requiring registration under this Schedule to be kept at the registered office
of the company:
Provided that, in the case of a series of uniform debentures, a copy of one debenture of
the series shall be sufficient.
Limited liability company’s register of charges
9. (1) Every limited liability company shall keep at the registered office of the
company a register of charges and enter therein all charges specifically affecting
property of the company and all floating charges on the undertaking or any property
of the company, giving in each case a short description of the property charged, the
amount of the charge and the names of the persons entitled thereto.121

(2) If any member, registered agent, manager, or other officer of the
company knowingly and wilfully authorises or permits the omission of any entry
required to be made in pursuance of this paragraph, he shall be guilty of an offence
and shall be liable on summary conviction to a fine not exceeding £5,000.
Right to inspect copies of instruments creating mortgages and charges and limited
liability company’s register of charges
10. (1) The copies of instruments creating any charge requiring registration
under this Schedule with the Department, and the register of charges kept in
pursuance of paragraph 9, shall be open during business hours, but subject to such
reasonable restrictions as the company in general meeting may impose, so that not less
than two hours in each day shall be allowed for inspection, to the inspection of any
creditor or member of the company without fee, and the register of charges shall also
be open to the inspection of any other person on payment of such reasonable fee, for
each inspection, as the company may require.122

(2) If inspection of the said copies or register is refused, any officer of the
company refusing inspection, and every member, registered agent and manager of the
company authorising or knowingly and wilfully permitting the refusal, shall be guilty
of an offence and shall be liable on summary conviction to a fine not exceeding £5,000.
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Page 44 AT 19 of 1996 c

(3) If any such refusal occurs in relation to a limited liability company, the
High Court may by order compel an immediate inspection of the copies or register.
Schedule 4

OFFENCES ETC ANTECEDENT TO OR IN THE COURSE OF WINDING UP

Section 36
Offences by members etc of companies in liquidation
1. (1) If any person, being a past or present member, manager or registered
agent of a limited liability company which at the time of the commission of the alleged
offence is being wound up or is subsequently wound up —
(a) does not to the best of his knowledge and belief fully and truly
discover to the liquidator all the property, real and personal, of
the company, and how and to whom and for what consideration
and when the company disposed of any part thereof, except such
part as has been disposed of in the ordinary way of the business
of the company; or
(b) does not deliver up to the liquidator, or as he directs, all such part
of the real and personal property of the company as is in his
custody or under his control, and which he is required by law to
deliver up; or
(c) does not deliver up to the liquidator, or as he directs, all books
and papers in his custody or under his control belonging to the
company and which he is required by law to deliver up; or
(d) within 12 months next before the commencement of the winding
up or at any time thereafter conceals any part of the property of
the company, or conceals any debt due to or from the company; or
(e) within 12 months next before the commencement of the winding
up or at any time thereafter fraudulently removes any part of the
property of the company; or
(f) makes any material omission in any statement made to the
liquidator of the company relating to the affairs of the company;
or
(g) knowing or believing that a false debt has been proved by any
person under the winding up, fails for the period of one month to
inform the liquidator thereof; or
(h) after the commencement of the winding up prevents the
production of any book or paper affecting or relating to the
property or affairs of the company; or
(i) within 12 months next before the commencement of the winding
up or at any time thereafter, conceals, destroys, mutilates, or
falsifies, or is privy to the concealment, destruction, mutilation, or
Limited Liability Companies Act 1996 Schedule 4



c AT 19 of 1996 Page 45

falsification of, any book or paper affecting or relating to the
property or affairs of the company; or
(j) within 12 months next before the commencement of the winding
up or at any time thereafter makes or is privy to the making of
any false entry in any book or paper affecting or relating to the
property or affairs of the company; or
(k) within 12 months next before the commencement of the winding
up or at any time thereafter fraudulently parts with, alters, or
makes any omission in, or is privy to the fraudulent parting with,
altering, or making any omission in, any document affecting or
relating to the property or affairs of the company; or
(l) within 12 months next before the commencement of the winding
up or at any time thereafter attempts to account for any part of the
property of the company by fictitious losses or expenses; or
(m) has within 12 months next before the commencement of the
winding up or at any time thereafter, by any false representation
or other fraud, obtained any property for or on behalf of the
company on credit which the company does not subsequently pay
for; or
(n) within 12 months next before the commencement of the winding
up or at any time thereafter, under the false pretence that the
company is carrying on its business, obtains on credit, for or on
behalf of the company, any property which the company does not
subsequently pay for; or
(o) within 12 months next before the commencement of the winding
up or at any time thereafter pawns, pledges, or disposes of any
property of the company which has been obtained on credit and
has not been paid for, unless such pawning, pledging, or
disposing is in the ordinary way of the business of the company;
or
(p) is guilty of any false representation or other fraud for the purpose
of obtaining the consent of the creditors of the company or any of
them to an agreement with reference to the affairs of the company
or to the winding up,
he shall be guilty of an offence and shall be liable —
(a) on conviction on information to custody for a term not exceeding
5 years or to a fine, or to both;
(b) on summary conviction to custody for a term not exceeding 12
months or to a fine not exceeding £5,000, or to both.
(2) It shall be a good defence —
(a) to a charge under sub-paragraph (1)(a), (b), (c), (d), (f), (n), or (o),
if the accused proves that he had no intent to defraud, and
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(b) to a charge under sub-paragraph (1)(h), (i) or (j), if he proves that
he had no intent to conceal the state of affairs of the company.
Penalty for falsification of books
2. If any member, manager or registered agent of any limited liability company
being wound up destroys, mutilates, alters, or falsifies any books, papers, or securities,
or makes or is privy to the making of any false or fraudulent entry in any register, book
of account, or document belonging to the company with intent to defraud or deceive
any person, he shall be guilty of an offence, and be liable to custody for a term not
exceeding 2 years or to a fine, or to both.
Frauds by members etc of companies which have gone into liquidation
3. If any person, being at the time of the commission of the alleged offence a
member, manager or registered agent of a limited liability company —
(a) has by false pretences or by means of any other fraud induced any
person to give credit to the company; or
(b) with intent to defraud creditors of the company, has made or
caused to be made any gift or transfer of or charge on, or has
caused or connived at the levying of any execution against the
property of the company; or
(c) with intent to defraud creditors of the company, has concealed or
removed any part of the property of the company since or within
2 months before the date of any unsatisfied judgment or order for
payment of money obtained against the company;
he shall be guilty of an offence and shall be liable —
(a) on conviction on information to custody for a term not exceeding
2 years or to a fine, or to both;
(b) on summary conviction to custody for a term not exceeding 12
months or to a fine not exceeding £5,000, or to both.
Responsibility for fraudulent trading
4. (1) If in the course of the winding up of a limited liability company it
appears that any business of the company has been carried out with intent to defraud
creditors of the company or creditors of any other person or for any fraudulent
purpose, the High Court, on the application of the liquidator, or any creditor of the
company, may, if it thinks proper so to do, declare that any of the members, managers
or registered agents, whether past or present, of the company who were knowingly
parties to the carrying on of the business in manner aforesaid shall be personally
responsible, without any limitation of liability, for all or any of the debts or other
liabilities of the company as the court may direct.
(2) Where the High Court makes any such declaration, it may give such
further directions as it thinks proper for the purpose of giving effect to that declaration
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c AT 19 of 1996 Page 47

and in particular may make provision for making the liability of any such person
under the declaration a charge on any debt or obligation due from the company to him,
or on any mortgage or charge or any interest in any mortgage or charge on any assets
of the company held by or vested in him, or any company or person on his behalf, or
any person claiming as assignee from or through such person or company, and may
from time to time make such further order as may be necessary for the purpose of
enforcing any charge imposed under this sub-paragraph.
(3) For the purposes of this sub-paragraph the expression “assignee”
includes any person to whom or in whose favour, by the directions of the member,
manager or registered agent, the debt, obligation, mortgage or charge was created,
issued or transferred or the interest created, but does not include an assignee for
valuable consideration (not including consideration by way of marriage) given in good
faith and without notice of any of the matters on the ground of which the declaration is
made.
(4) Where any business of a company is carried on with such intent or for
such purpose as is mentioned in sub-paragraph (1), every member, manager or
registered agent of the company who was knowingly a party to the carrying on of the
business in manner aforesaid, shall be liable —
(a) on conviction on information to custody for a term not exceeding
2 years or to a fine, or to both;
(b) on summary conviction to custody for a term not exceeding 6
months or to a fine not exceeding £5,000, or to both.
(5) The court may, in the case of any person in respect of whom a
declaration has been made under sub-paragraph (1) or who has been convicted of an
offence under sub-paragraph (4), order that such person shall not, without the leave of
the court, be a registered agent or manager of or in any way, whether directly or
indirectly, be concerned in or take part in the management of a company for such
period, not exceeding 5 years, from the date of the declaration or of the conviction, as
the case may be, as may be specified in the order, and if any person acts in
contravention of an order made under this paragraph he shall, in respect of each
offence, be liable —
(a) on conviction on information to custody for a term not exceeding
2 years or to a fine, or to both;
(b) on summary conviction to custody for a term not exceeding 6
months or to a fine not exceeding £5,000, or to both.
(6) In sub-paragraph (5) the expression “the court” in relation to the making
of an order, means the court by which the declaration was made or the court before
which the person was convicted as the case may be, and in relation to the granting of
leave means the High Court.
(7) The provisions of this paragraph shall have effect notwithstanding that
the person concerned may be criminally liable in respect of the matters on the ground
of which the declaration is to be made, and where the declaration under sub-paragraph
(1) is made in the case of a winding up the declaration shall be deemed to be a final
judgment within the meaning of the Bankruptcy Acts.
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(8) It shall be the duty of the liquidator to appear on the hearing of an
application for leave under sub-paragraph (5), and on the hearing of an application
under that sub-paragraph or under sub-paragraph (1) the liquidator may himself give
evidence or call witnesses.
Power of court to assess damages against delinquent members etc
5. (1) If in the course of winding up a limited liability company it appears that any
person who has taken part in the formation or promotion of the company, or any past
or present member, manager, registered agent or liquidator of the company, has
misapplied or retained or become liable or accountable for any money or property of
the company, or been guilty of any misfeasance or breach of trust in relation to the
company, the High Court may, on the application of the liquidator or of any creditor or
member, examine into the conduct of the promoter, member, manager, registered
agent or liquidator, and compel him to repay or restore the money or property or any
part thereof respectively with interest at such rate as the court thinks just, or to
contribute such sum to the assets of the company by way of compensation in respect of
the misapplication, retainer, misfeasance, or breach of trust as the court thinks just.
(2) The provisions of this paragraph shall have effect notwithstanding that
the offence is one for which the offender may be criminally liable.
(3) Where in the case of a winding up an order for payment of money is
made under this paragraph, the order shall be deemed to be a final judgment within
the meaning of the Bankruptcy Acts.
Definition
6. In this Schedule, “liquidator
” includes provisional liquidator.
Limited Liability Companies Act 1996 Endnotes


c AT 19 of 1996 Page 49

ENDNOTES

Table of Legislation History

Legislation Year and No Commencement






Table of Renumbered Provisions

Original Current






Table of Endnote References

1
Para (b) repealed by Limited Liability Companies and Financial Supervision
(Amendment) Act 1999 s 1. 2
Subs (1) amended by Limited Liability Companies (Amendment) Act 2014 s 2. 3
S 1A inserted by Limited Liability Companies (Amendment) Act 2014 s 2. 4
Paras (a) to (c) repealed by Companies, etc. (Amendment) Act 2003 Sch 2. 5
Para (d) amended by Companies, etc. (Amendment) Act 2003 Sch 2. 6
Subs (3) substituted by Company and Business Names etc Act 2012 Sch. 7
Subs (4) substituted by Company and Business Names etc Act 2012 Sch. 8
Subss (5) to (7) repealed by Company and Business Names etc Act 2012 Sch. 9
Subss (8) to (10) repealed by Companies, etc. (Amendment) Act 2003 Sch 1. 10
Para (b) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 11
Para (b) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 12
Subs (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1, by
Corporate Service Providers Act 2000 Sch 3, by SD155/10 Sch 2 and by Limited Liability
Companies (Amendment) Act 2014 s 2. 13
Para (b) repealed by Limited Liability Companies and Financial Supervision
(Amendment Act 1999 s 1.] 14
Subs (1A) inserted by Limited Liability Companies and Financial Supervision
(Amendment Act 1999 s 1. 15
Subs (5) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2.
Endnotes Limited Liability Companies Act 1996


Page 50 AT 19 of 1996 c

16
Subs (6) amended by Companies (Transfer of Functions) Act 2000 Sch 1, by SD155/10
Sch 2 and by Company and Business Names etc Act 2012 Sch. 17
Subs (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1, by
Interpretation Act 1976 s 16A and by SD155/10 Sch 2. 18
Subs (2) amended by Companies (Transfer of Functions) Act 2000 Schs 1 and 3 and
by SD155/10 Sch 2. 19
Subs (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 20
Para (b) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 21
Subs (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1, by
Companies, etc. (Amendment) Act 2003 Sch 1 and by SD155/10 Sch 2. 22
Para (c) amended by Companies, etc. (Amendment) Act 2003 Sch 1. 23
Para (b) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 24
Subs (1) amended by SD155/10 Sch 2. 25
Subs (3) amended by SD155/10 Sch 2. 26
Subs (4) amended by SD155/10 Sch 2. 27
Subs (5) amended by SD155/10 Sch 2. 28
Subs (6) amended by SD155/10 Sch 2. 29
Subs (7) amended by SD155/10 Sch 2. 30
Subs (8) amended by SD155/10 Sch 2. 31
Para (b) amended by SD155/10 Sch 2. 32
S 11 substituted by Companies, etc. (Amendment) Act 2003 s 17 and amended by
SD155/10 Sch 2. 33
Subs (1) amended by SD155/10 Sch 2. 34
Para (b) amended by SD2015/0090 as amended by SD2015/0276. 35
Subs (3) amended by SD155/10 Sch 2. 36
Subs (4) amended by SD155/10 Sch 2. 37
Subs (5) amended by SD155/10 Sch 2. 38
Subs (6) amended by SD155/10 Sch 2. 39
Subs (7) amended by SD155/10 Sch 2. 40
Para (b) amended by SD155/10 Sch 2. 41
Subs (8) amended by SD155/10 Sch 2. 42
Subs (9) amended by SD155/10 Sch 2. 43
Subs (10) amended by SD155/10 Sch 2. 44
Subs (12) amended by SD155/10 Sch 2. 45
S 11A inserted by Companies, etc. (Amendment) Act 2003 s 18. 46
Subs (1) amended by SD155/10 Sch 2. 47
Subs (2) amended by SD155/10 Sch 2. 48
Para (b) amended by SD155/10 Sch 2 and by SD2015/0090 as amended by
SD2015/0276.
Limited Liability Companies Act 1996 Endnotes


c AT 19 of 1996 Page 51

49
Subs (4) amended by SD155/10 Sch 2. 50
Subs (5) amended by SD155/10 Sch 2. 51
Subs (6) amended by SD155/10 Sch 2. 52
Subs (7) amended by SD155/10 Sch 2. Para (c) amended by SD155/10 Sch 2. 53
Subs (8) amended by SD155/10 Sch 2. 54
Subs (9) amended by SD155/10 Sch 2. 55
S 11B inserted by Companies, etc. (Amendment) Act 2003 s 18. 56
Subs (1) amended by SD155/10 Sch 2. 57
Subs (2) amended by SD155/10 Sch 2. 58
Subs (3) amended by SD155/10 Sch 2. 59
S 11C inserted by Companies, etc. (Amendment) Act 2003 s 18 and amended by
SD155/10 Sch 2. 60
Subs (1) amended by SD155/10 Sch 2. 61
Subs (2) amended by SD155/10 Sch 2. 62
Subs (3) amended by SD155/10 Sch 2. 63
Subs (4) amended by SD155/10 Sch 2. 64
Para (a) amended by SD155/10 Sch 2. 65
S 11D inserted by Companies, etc. (Amendment) Act 2003 s 18 and amended by
SD155/10 Sch 2. 66
Para (b) amended by Limited Liability Companies and Financial Supervision
(Amendment) Act 1999 s 1. 67
Subs (2) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 68
Subs (3) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 69
Subs (1) amended by Companies (Transfer of Functions) Act 2000 Sch 2, by SD155/10
Sch 2 and by SD2015/0090 as amended by SD2015/0276. 70
Subs (5) amended by Companies (Transfer of Functions) Act 2000 Sch 2, by SD155/10
Sch 2 and by SD2015/0090 as amended by SD2015/0276. 71
Subs (8) amended by Companies (Transfer of Functions) Act 2000 Sch 2 and by
SD155/10 Sch 11. 72
Para (a) amended by Limited Liability Companies and Financial Supervision
(Amendment) Act 1999 s 1. 73
Para (c) amended by Companies (Amendment) Act 2009 s 25(1)(b). 74
Subs (1) amended by Companies (Amendment) Act 2009 s 25(1)(a) and by SD155/10
Sch 2. 75
S 27 amended by Companies (Transfer of Functions) Act 2000 Sch 1. Subs (2) added
by Companies (Amendment) Act 2009 s 25(1)(c). 76
Para (b) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 77
Subs (1) amended by Companies (Amendment) Act 2009 s 25(2)(a). 78
Para (a) amended by Companies (Amendment) Act 2009 s 25(2)(c).
Endnotes Limited Liability Companies Act 1996


Page 52 AT 19 of 1996 c

79
Subs (2) amended by Companies (Transfer of Functions) Act 2000 Sch 1, by
Companies (Amendment) Act 2009 s 25(2)(b) and by SD155/10 Sch 2. 80
Subs (3) amended by Companies (Amendment) Act 2009 s 25(2)(d). 81
Subs (4) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 82
Para (b) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 83
Para (e) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 84
Para (a) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 85
Subs (10) added by Companies (Amendment) Act 2009 s 25(2)(e). 86
Subs (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 87
Subs (2) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 88
Subs (2) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 89
Subs (3) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 90
Subs (5) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 91
Chapter 1 (ss 37 to 45) repealed by Income Tax (Corporate Taxpayers) Act 2006 Sch. 92
S 46 amended by Statute Law Revision Act 1997 Sch 1. 93
Para (a) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 94
S 50 substituted by Companies, etc. (Amendment) Act 2003 s 19 and by SD155/10 Sch
2. 95
Subs (1) amended by Companies (Transfer of Functions) Act 2000 Sch 2. 96
Subs (1A) inserted by Companies (Transfer of Functions) Act 2000 Sch 2 and
amended by SD155/10 Sch 2. 97
S 51A inserted by Companies, etc. (Amendment) Act 2003 Sch 1 and amended by
SD155/10 Sch 2 and by SD2015/0090 as amended by SD2015/0276. 98
Para (a) repealed by Companies, etc. (Amendment) Act 2003 Sch 2. 99
Para (b) repealed by Foreign Companies Act 2014 Sch. 100
Para (c) repealed by Companies, etc. (Amendment) Act 2003 Sch 2. 101
Para (d) repealed by Foreign Companies Act 2014 Sch. 102
Subs (1) amended by SD155/10 Sch 2 and by SD2015/0090 as amended by
SD2015/0276. 103
Subs (2) amended by SD155/10 Sch 2. 104
S 52A inserted by Companies, etc. (Amendment) Act 2003 s 20. Subs (3) amended by
SD155/10 Sch 2.
Limited Liability Companies Act 1996 Endnotes


c AT 19 of 1996 Page 53

105
S 53 amended by Companies (Transfer of Functions) Act 2000 Sch 1,by SD155/10 Sch
2 and by Sd2015/0090 as amended by SD2015/0276. 106
ADO (ss 52(1) and 54 ): 1/8/1996 (SD476/96); (remainder): 17/10/1996 (SD553/96). 107
Heading amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 108
Subpara (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 109
Subpara (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 110
Subpara (5) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 111
Subpara (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 112
Subs (2) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 113
Subpara (3) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 114
Subpara (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 115
Subpara (1) inserted by Companies, etc. (Amendment) Act 2003 Sch 1 and amended
by SD155/10 Sch 2. 116
Section 4A(2) not yet in operation. For text see Companies, etc. (Amendment) Act
2003 Sch 1 para 5. 117
Subpara (3) inserted by Companies, etc. (Amendment) Act 2003 Sch 1. 118
Para 5 amended by Companies (Transfer of Functions) Act 2000 Sch 1, by
Interpretation Act 1976 s 16A and by SD155/10 Sch 2. 119
Subpara (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 120
Subpara (2) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2. 121
Subpara (1) amended by Companies (Prohibition of Bearer Shares) Act 2011 Sch 2. 122
Subpara (1) amended by Companies (Transfer of Functions) Act 2000 Sch 1 and by
SD155/10 Sch 2.