Part 1: Companies House Reform Directors Section 44: Prohibition on acting unless directorship notified
This section inserts section 167N into the Companies Act 2006. Section 167N creates an offence for an individual to act as a director, unless their directorship is notified to the Registrar. The company must communicate this to the Registrar within 14 days of this individual becoming a director by delivering a notice under section 167G (Duty to notify Registrar of change in directors). The notice must include a statement that the director’s identity is verified. The section 167N offence will only apply, if a notice under section 167G was not given on time. The director can legally act as long as the company notifies the Registrar of their appointment within the 14 day deadline.
	Under subsection (5) a person found guilty of the offence under this section is subject to a fine.
	The purpose of this obligation and offence in addition to directors having to verify their identity is to ensure that all directors are included on the companies register. Whilst the obligation to notify directors’ appointments is placed under section 167G on a company, placing an additional obligation on directors not to act until notified increases the motivation of both parties to comply.
	Subsection (4) creates a defence for directors, who can prove they reasonably believed the company had given notice of their appointment to the Registrar.
	Under subsection (7) the only result of a director’s breach of section 167N(1) is commission of offence in subsections (3) and (4). Despite the commission of these offences, any action taken by the director is valid.