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Jason

Company Names (Ltd), Registration Numbers

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Ok, I'm throwing this out to the HPC massive to get some advice on a company I work for. I won't mention the company.

I (and all my colleagues) where employed by ABC ltd (reg number 123456). The company was sold to new owners (years ago), the new owners started a holding company called XYC ltd (reg number 987654) (they took on debt to buy ABC ltd). XYC ltd clearly owns ABC ltd (at this point). Now the debt is paid off, the directors decided they didn't need the two companies any more, however they want to keep the company name ABC ltd.

They renamed ABC ltd (reg 123456) to WTF ltd (reg 123456).

They then renamed XYZ ltd (987654) to ABC ltd (reg 987654).

Now, a few years later WTF ltd goes dormant (no outstanding debts or anything) - well due very soon.

To them, the company never changed name and no one knew about this, it's still ABC ltd. However the company registration number changed, so it is really a totally new entity.

Problems, several suppliers still send letters to WTF ltd - I dare say this is because they have credit checking software/company and were notified of the company name change.

Also, the company ABC (987654) has a shit credit rating, whereas WTF ltd (123456) has a great credit rating.

Questions:

1. Is it a legal requirement for the company to notify all suppliers (who give us credit) of the company change?

2. Is it a legal requirement for the company to notify staff are employed under the new company?

3. Is it illegal to use letter headed paper which now has the wrong company name reg number on (it still has ABC ltd (123456) on it).

4. When WTF ltd (123456) goes dormant, will this cause problems for suppliers who think we are WTF ltd?

5. I (and others) was employed under ABC ltd (123456), but are now employed under ABC ltd (987654) - if a redundancy was to happen, when did we start (when we originally started, or when the company transferred to the new company number)?

Sorry to be a little unclear why I am asking these questions, however I need to know exactly where people stand. All the above was done without any employees knowing, it was only suppliers questioning the name change that we found out. The directors just brush this under the carpet as a non issue (hence the question about letter headed paper, and notifying stakeholders).

I only know the above by looking on companies house.

In my mind, this is like red letter days - i.e. it's a totally new company with the same brand which Rachel Elnaugh started (they went bust leaving creditors with little, but the other dragon investors started the brand again under a new company). However, in my case, no one was left out of pocket - no debts were left, and all accounts (companies house) made up. I just need to know where we stand if redundancies start to happen.

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You should be covered by TUPE laws employment wise.

All sounds highly underhand but nothing anyone's likely to be barred from directorships for. Ultimately suppliers are just another unsecured creditor typically. Regardless whether they're trading with the entity they think they are or not.

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1. Is it a legal requirement for the company to notify all suppliers (who give us credit) of the company change?

Probably not, as long as the company name change has been filed at Companies House. It would be illegal for the company to continue using it's old name in any further correspondence with it's suppliers, except using the old name as a trading name. The full, correct, current business name and number would still have to be given in all correspondence under the Business Names Act.

2. Is it a legal requirement for the company to notify staff are employed under the new company?

If the employment is with a new company, rather than continuing with a company that has changed it's name, yes.

3. Is it illegal to use letter headed paper which now has the wrong company name reg number on (it still has ABC ltd (123456) on it).

I think there is a grace period of about 14 days after a name change; otherwise, yes.

4. When WTF ltd (123456) goes dormant, will this cause problems for suppliers who think we are WTF ltd?

Quite possibly. However, it is up to the supplier to keep abreast using easily available and free information from Companies House.

5. I (and others) was employed under ABC ltd (123456), but are now employed under ABC ltd (987654) - if a redundancy was to happen, when did we start (when we originally started, or when the company transferred to the new company number)?

Pass. Employment law is complex.

Generally, all business correspondence must by law carry the full registered name of a business and company number, place of registration (e.g. England and Wales), registered business address, and name all or none of the directors (not just some of the directors). Refer to the Business Names Act.

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Questions:

1. Is it a legal requirement for the company to notify all suppliers (who give us credit) of the company change?

2. Is it a legal requirement for the company to notify staff are employed under the new company?

3. Is it illegal to use letter headed paper which now has the wrong company name reg number on (it still has ABC ltd (123456) on it).

4. When WTF ltd (123456) goes dormant, will this cause problems for suppliers who think we are WTF ltd?

5. I (and others) was employed under ABC ltd (123456), but are now employed under ABC ltd (987654) - if a redundancy was to happen, when did we start (when we originally started, or when the company transferred to the new company number)?

I think the point here is that until the above happen the old company hasn't ceased trading since legally all of the contracts are with that company. I suppose that newco could claim that oldco is acting as their undeclared agent but from my point of view I'd need some convincing that any accounts filed at companies house are correct.

I looked at a similar situation a while back and my advice was "why bother?" The annual running cost of a dormant holding company is in reality < £100 wheras the costs and agro of doing a hive up properly were going to be in the thousands, IIRC the biggest stumbling block was the lease on the company's premises.

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Questions:

1. Is it a legal requirement for the company to notify all suppliers (who give us credit) of the company change?

Some suppliers require that you open an account with them, especially if they supply you goods at trade prices.

You fill an application form in stating the company's name, registration number, directors details and sometimes a copy

of the Articles of Association etc.

Any such accounts would still be for the old company, new accounts should have been opened for the new one.

That saying, any company running large balances with suppliers would be constantly credit checked. A lot can happen since

the credit check 3 years back.

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Cheers. I think the interesting times is when WTF ltd goes dormant.

I'm guessing all this was done because of the incompetence of the directors, however they have external accountants etc, so who on earth advised them to do this? I don't think anything is underhand, however it has all been done unprofessionally imo.

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I knew a company once that used the name change to try to avoid payments to suppliers...claiming that the invoices were to a now defunct company, the summons was to a defunct company and that signatures and proofs of delivery were to a defunct company.

A marave injunction on the Board members sorted that out pretty fast after 12 months of fracking about.

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