The most important new features are as follows:
- The term “de facto director” is given a statutory definition for the first time.
- The definition of “de facto” director (Section 222) goes beyond the jurisprudence as expressed in Re Lynrowan and states that a person who is not formally appointed as director but who “occupies the position of director” shall be treated as a director of the company. They are not to be treated as directors solely for the purposes of a restriction application. Directors’ duties as set out in the Act apply just as much to de facto as to de jure
- Just as is the case in relation to shadow directors, there is a saving provision in relation to de facto directors: a person will not be found to be a de facto director by reason only of the giving of advice in a professional capacity to the directors or the company.
- The definition of “shadow director” is the same, but the new Act expressly provides that a body corporate is not to be regarded as a shadow director of its subsidiaries (Section 221).
- There is a form of directors’ compliance statement (Section 225).
- Greater clarity in distinguishing between directors and secretaries in so far as each officer can ensure compliance with the Act.
- The codification of directors’ fiduciary duties (Section 228).
- New provision concerning directors’ liability to account for profits or make good company losses where either of these has taken place as a result of their breach of duty.
- Rebuttable presumption that loans to directors by the company which are not in writing are repayable on demand (Section 236).
Important definitions which are unchanged
The following two definitions are now found here:
- “Connected person” (Section 220)
- “Credit transaction” (Section 219(3))