Difference between revisions of "Can one person set up a FairShares Company or Co-operative?"
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==UK Restrictions on Single Person Organisations== | ==UK Restrictions on Single Person Organisations== | ||
| − | In UK Company Law, it is possible for one person to act as secretary/director of their own company. The Model Articles for a [[FairShares Company]] are designed to allow a single person to establish it if they are self-funding the enterprise. However, rule provisions state that 3 directors are needed if the company is in receipt of public or charitable | + | In UK Company Law, it is possible for one person to act as secretary/director of their own company. The Model Articles for a [[FairShares Company]] are designed to allow a single person to establish it if they are self-funding the enterprise. However, rule provisions state that 3 directors are needed if the company is in receipt of public or charitable funding. This reflects advice from social enterprise advisers that many public/charitable funders require 3 directors before ‘public interest’ or 'community interest' funding will be agreed. |
A [[FairShares Company]] will automatically develop into a co-operative by following the provisions in the rules for issuing shares to Users and Labour and electing directors, but it is not a ''bone fide'' under UK Co-operative Law. A ''bone fide'' co-operative in UK Law requires at least three people for a primary co-operative, and two legal entities for a secondary co-operative, and has to be set up in accordance with Co-operative, Community Benefit and Credit Union Acts. A FairShares Co-operative ''is'' a "bone fide" co-operative under UK Law. | A [[FairShares Company]] will automatically develop into a co-operative by following the provisions in the rules for issuing shares to Users and Labour and electing directors, but it is not a ''bone fide'' under UK Co-operative Law. A ''bone fide'' co-operative in UK Law requires at least three people for a primary co-operative, and two legal entities for a secondary co-operative, and has to be set up in accordance with Co-operative, Community Benefit and Credit Union Acts. A FairShares Co-operative ''is'' a "bone fide" co-operative under UK Law. | ||
Revision as of 02:51, 1 March 2019
UK Restrictions on Single Person Organisations
In UK Company Law, it is possible for one person to act as secretary/director of their own company. The Model Articles for a FairShares Company are designed to allow a single person to establish it if they are self-funding the enterprise. However, rule provisions state that 3 directors are needed if the company is in receipt of public or charitable funding. This reflects advice from social enterprise advisers that many public/charitable funders require 3 directors before ‘public interest’ or 'community interest' funding will be agreed.
A FairShares Company will automatically develop into a co-operative by following the provisions in the rules for issuing shares to Users and Labour and electing directors, but it is not a bone fide under UK Co-operative Law. A bone fide co-operative in UK Law requires at least three people for a primary co-operative, and two legal entities for a secondary co-operative, and has to be set up in accordance with Co-operative, Community Benefit and Credit Union Acts. A FairShares Co-operative is a "bone fide" co-operative under UK Law.
(At the time of writing, the FairShares Institute for Co-operative Social Entrepreneurship at Sheffield Hallam University was working on securing model rules approved by the Financial Conduct Authority)
Outside the UK, there may be a requirement from as few as 2 directors when forming a company and up to 20 to form a co-operative. From a FairShares perspective, the number of directors is taken to be less important that the commitment of existing directors / managers to take on new workers as Labour Shareholders and/or customers and users as User Shareholders.
[Country] Restrictions on Single Person Organisations
(Please copy this section and add information about restrictions in company and co-operative law in your country)
Return me to the FairShares Articles of Association page.
Return me to the FairShares Company page.
