The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Fines on Summary Conviction) Regulations 2015 are now in force. The Regulations provide for all fines and maximum fines in magistrates’ courts of £5,000 or more to become unlimited for offences under the Companies Act 2006 (and other common law and statutory criminal offences), meaning that magistrates will be able to impose higher fines than previously.

For example, if a company fails to comply with any provision of section 386 of the Companies Act 2006 (duty to keep accounting records), an offence is committed by every officer of the company who is in default. A person guilty of an offence under this section of the Companies Act 2006 was subject to a maximum Level 5 fine, which equated to £5,000, that fine will now be unlimited for offences committed on or after 12 March 2015.

Many criminal offences under the Companies Act 2006 are punishable by a fine “not exceeding level 5 on the standard scale“, which will now be unlimited.  Unlimited fines may therefore now be imposed for offences such as failing to file an annual return within 28 days and failing to keep a register of directors’ residential addresses.

Fines that were stated to be capped at a level below £5,000 remain unaffected.

Directors should ensure that they comply with their statutory obligations under the Companies Act 2006 and should be aware that relatively minor offences can now attract high fines.

For more information, please contact Deborah Angel, corporate senior associate.

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