Hello, I am now about to print my last document to send to Companies House. After much reading of CIC documents, I came across with a last hurdle. The CIC we are setting up has got the word "society" in its name.
I have read at the Companies House website that "society" is considered a sensitive word (http://www.companieshouse.gov.uk/about/gbhtml/gp1.shtml#ch7)
And that : "To use this word the company should normally be limited by guarantee. The articles of association should include objects that reflect the specific purpose of the company and a non-profit distribution clause which provides that any profits should be used to further the objects of the company and not paid to the members as dividends. The articles should also include a one member one vote clause."
Our company is going to be a CIC limited by guarantee, no problem with that.
The objects reflect the purpose of the company. Now, I need some help about "a non-profit distribution clause which provides that any profits should be used to further the objects of the company and not paid to the members as dividends." and this: "The articles should also include a one member one vote clause."
Where in the articles shall I inscribe these extra clauses?
I would appreciate very much any help anyone could give me on this, as I would like to submit the paperwork as soon as possible!
Thanks in advance,
You shouldn't have any trouble with either of these requirements Claudia - for example if you are using one of the Regulator's models the 'Not-for-Profit' and 'Asset Lock' articles should cover the no-dividends requirement, and these models also contain the 'one member one vote' provisions that are indeed the norm in guarantee companies:
39.1 On a vote on a resolution on a show of hands at a meeting every person present in person (whether a member, proxy or Authorised Representative of a member) and entitled to vote shall have a maximum of one vote.
39.2 On a vote on a resolution on a poll at a meeting every member present in person or by proxy or Authorised Representative shall have one vote.
It is unusual to call a CIC a 'Society' because there are other legal structures that are 'Societies' (eg. Co-operative Societies) - that's why it's a restricted word - but perhaps you're using the word in a different way?
Many thanks for your answer! Yes, I am using the articles for small CICs limited by guarantee. What a relief to know that I am ready now! Thanks thanks thanks!