What is the definition of body corporate as used in s 1159 of the Companies Act 2006?

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Published by a ��Ӱ�� Corporate expert

Published on: 02 October 2014

Section 1159 of the Companies Act 2006 (CA 2006), for the purposes of defining a ‘Subsidiary’, states that ‘...”company” includes any body corporate’.

CA 2006, s 1173 in turn states that:

'"body corporate" and "corporation" include a body incorporated outside the United Kingdom, but do not include:
•
a corporation sole, or
•
a partnership that, whether or not a legal person, is not regarded as a body corporate under the law by which it is governed'

A corporation may be defined as a body of persons (in the case of a corporation aggregate) or an office (in the case of a corporation sole) which is recognised by the law as having a personality which is distinct from the separate personalities of the members of the body or the personality of the

Jurisdiction(s):

United Kingdom

Key definition:

Subsidiary definition

What does Subsidiary mean?

There are two suggested definitions for the term 'subsidiary', as commonly used in agreements. CA 2006, s 1159 provides that a company is a holding company of another company (its subsidiary) if it satisfies one of three tests, two of which require it to be a member of the other company (as well as to possess certain rights, which go to its voting powers). Membership of a company is a question of fact and the court has found that if a company (company A) has transferred shares in another company (company B) to a lender in connection with the taking of security and the name of that lender or the lender’s nominee has been entered in the register of members, then company A is not a member of company B in respect of those shares: see Enviroco Ltd v Farstad Supply A/S.

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