GLOSSARY
Company limited by guarantee definition
What does Company limited by guarantee mean?
A company limited by guarantee is a company whereby the liability of the members is limited to such amount as the members undertake to contribute to the assets of the company in the event of its being wound up.
A company limited by guarantee is defined by the Companies Act 2006 s 3(3). With effect from 22 December 1980, a company cannot be formed as, or become, a company limited by guarantee with a share capital. Also, a public company limited by guarantee and not having a share capital may not be formed as from that date. The company limited by guarantee must have a statement of guarantee.
Commercial
A company is a company limited by guarantee if the liability of its members is limited by its constitution to such amount as the members undertake to contribute to the assets of the company in the event of its being wound up.
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