1 October 2009 saw the implementation of the final stages of the 2006 Companies Act. Heralded as one of the largest statutes on record, the changes to company law have been gradually introduced over the last 2 years and 1 October was the final stage.
These most recent changes are perhaps the most radical, updating documentation had been in force for well over a century as well as changing how companies are formed. In the process, new regulations and forms have been introduced. Furthermore, rules and regulations relating to, for instance, the names one can use when forming a company have been drastically altered in a quite restrictive way.
To coincide with these changes, Companies House embarked some time ago on a major re-write of their incorporation system moving from quite old fashioned data transfer methods to embracing up to date XML technology. The knock on effect for all the many incorporation agents offering online formations was always going to be an interesting challenge. The interaction between an online incorporation agent’s website and Companies House is critical to the successful formation of a company. It’s one thing taking money from end users for the formation of a company, checking name availability and sending off electronic documents to Companies House. It’s another to make a successful incorporation.
So how has it gone?
Well understandably, the first week to ten days after October 1 were somewhat traumatic for everyone involved and the reports emanating from Companies House suggested that no one was getting much sleep. Turnaround times were maybe as much as 20 times what they were normally and on their own admission, there was a substantial backlog of unformed companies. However, as we enter the third week of October, it does seem that things have settled down and speaking on behalf of our own company formation agent Companiesmadesimple.com, everything is working quite smoothly. We do have one or two little matters to deal with and are still getting our heads around the quite constraining rules on company names, but most companies are getting formed within a few hours and the interaction with Companies House is working smoothly.
However, not so necessarily for other company formation agents. Our insider at Companies House has advised us that a few incorporation agents have serious problems with their XML coding and have thus far failed to incorporate a single company since October 1. Companies House have also said that some XML code is so bad that its impacting on Companies House own system causing crashes. One agent in particular apparently has over 600 outstanding formations and hasn’t received one back.
Rest assured that Companies Made Simple worked literally around the clock to ensure that our code was clean and effective and liaised with Companies House to make sure that companies would be formed properly. The efforts of all concerned have resulted in a system that is robust and effective.