The simple answer to this question is – yes, very!
The Companies Act 2006 (the Act) and previous versions of the Act, requires all companies to keep a register of its members (section 113 of the Act), and the Act sets out the required particulars to be documented within such register.
To be a member of the company the person must either be one of the initial subscribers to the company's memorandum of association on incorporation or someone who has agreed to become a member of the company and whose name is entered in its register of members.
The initial subscribers are automatically members of the company even if, for any reason, they have not been noted in the register of members. Anyone else will not be a member of the company unless they have firstly agreed to become a member and secondly their name is entered on the company's register of members.
This means that holding a share certificate or being named on the annual filing at Companies House will not be sufficient evidence to prove that someone is a member of a company.
The Court of Appeal has recently highlighted the importance of the register in its decision (Bland v Keegan [2024] EWCA Civ934 August 2024). In this case the Judge looked at whether, at the time of the issue he was being asked to consider, the appellant in the case was a member of the company or not – and in doing so referenced section 112 of the Act which states that a member is someone whose name is entered on the company's register of members. Consequently, only in cases where he is registered, is he able to vote on a shareholder resolution. The case in question was actually to do with the passing of a resolution of the company on a winding up, but it handily highlights the significance of a company's administration and in particular the requirement to register its members correctly.
It is always surprising to us how many companies either do not have, have not kept up to date or lost their register of members, especially as these are a statutory requirement. Perhaps this recent case will bring to the fore and highlight the importance of this particular statutory register.
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