RR04 Notice by the Applicants of Application to the Court for Cancellation of Resolution for Re-registration

A public limited company may choose to change its status to private limited company by passing a special resolution which approves this change and applying to Companies House for re-registration.

Public companies provide much more protection and influence to minority shareholders, and if they do not agree with the direction which the company takes, they can easily sell their shares on the open market. However, in a private company, minority shareholders can often find themselves trapped because there are restrictions on how they can sell their shares. Because of this, when a public  company passes a resolution approving its re-registration, this can be challenged in court by minority shareholders as long as they represent at least 5% of the company’s members or shareholders by value. When a legal challenge is brought, the resolution is cancelled and If the challenge is successful, the Court may order the company to ‘buy out’ the minority shareholders or to amend its Articles of Association ot afford them greater protection.

Where a public company has applied to Companies House for re-registration and a legal challenge has been mounted, the minority shareholders who are mounting the challenge must notify Companies House by completing and sending this form. Representatives of all shareholders involved in the legal challenge should sign the form, using the separate signature continuation form available for download if necessary.