Limited
Liability Companies (Amendment) (Jersey) Law 2020
A LAW to amend the Limited Liability
Companies (Jersey) Law 2018.
Adopted
by the States 12th May 2020
Sanctioned
by Order of Her Majesty in Council 21st July 2020
Registered by the Royal Court 7th August 2020
Coming into force in accordance with Article 19
THE STATES, subject to the sanction of Her Most
Excellent Majesty in Council, have adopted the following Law –
1 Limited Liability Companies
(Jersey) Law 2018 amended
(1) The
Limited Liability Companies (Jersey) Law 2018[1] is amended in
accordance with this Law.
(2) In
this Law, a reference to an Article by number only is a reference to the
Article of the same number in the Limited Liability Companies (Jersey) Law 2018.
2 Article 1 (interpretation) amended
In Article 1(1), for the
definition of “amendment statement” there is substituted –
“ “amendment
statement” is to be construed in accordance with Article 5(2).”.
3 Article 3 (LLC agreement generally)
amended
In Article 3, for
paragraph (6) there is substituted –
“(6) An LLC agreement may confer rights on a
third party and provide for the way in which those rights may be varied or
extinguished. However, if an LLC agreement does not provide otherwise, those
rights may only be varied or extinguished with the consent of the third party.
(6A) Despite not being a party to an LLC
agreement, a third party is entitled to enforce any rights conferred on the
third party in an LLC agreement.”.
4 Article 5 (amendment of declaration) amended
For Article 5, there is
substituted –
“5 Amendment of declaration
(1) This Article applies to a limited liability
company if, during the existence of the limited liability company, a manager of
the limited liability company or, if there is no manager, a member of the
limited liability company becomes aware that, at the time the declaration was
delivered to the registrar under Article 4(1) –
(a) a statement in the declaration was false;
or
(b) information in the declaration (other than
details of the registered office of the limited liability company) was
inaccurate.
(2) A limited liability company to whom this
Article applies must, within 21 days of becoming aware, deliver an amendment
statement to the registrar that –
(a) is signed by an authorized person;
(b) specifies the information in the
declaration that was false or inaccurate; and
(c) specifies the correction that should be
made to the declaration.
(3) A limited liability company to whom this
Article applies commits an offence if the limited liability company fails to
comply with paragraph (2).
(4) If the registrar is satisfied that the
correction complies with the requirements of this Law, the registrar must
register the amendment statement and give effect to the change –
(a) in the certificate of formation issued under
Article 4; or
(b) if a certificate of formation has been
issued, by issuing an amended certificate of formation.”.
5 Article 7 (name of limited liability company) amended
In Article 7 –
(a) in paragraph (2), for “the
prescribed form” there is substituted “a form approved by the registrar”;
(b) in paragraphs (8) and
(10), for “Article 5(2)” there is substituted “Article 5(4)(b)”.
6 Article 8 (registered
office) amended
In Article 8 –
(a) for paragraph (6)(a) there
is substituted –
“(a) a document containing a list of the name and address of each
member, manager, deputy secretary and secretary of the limited liability
company;”;
(b) for paragraph (7) there
is substituted –
“(7) If a limited liability company has 25 or more members, the list
of names referred to in paragraph (6)(a) must be kept in alphabetical order.”;
(c) after paragraph (7) there
is inserted –
“(7A) In relation to the list that is required to be kept under paragraph (6)(a),
a limited liability company –
(a) must not enter notice of a trust, whether express, implied or
constructive; and
(b) subject to the LLC agreement, is not required to record the
details of an assignee of an LLC interest (being a person not yet admitted as a
member).”;
(d) in paragraph (9)(a), “and
under the LLC agreement such information is intended to be kept confidential”
is deleted.
7 Article 12 (series of
members, managers, LLC interests or assets) amended
In Article 12 –
(a) in paragraph (8)(a), for
“contract” there is substituted “contract,”;
(b) in paragraph (9)(a), for
“liabilities,” there is substituted “liabilities”.
8 Article 13 (admission
of members and LLC interests) amended
In Article 13(10), after “company” there is inserted “and any
interest of a member who has not acquired an LLC interest in a limited
liability company”.
9 Article 16 (voting of
members) amended
In Article 16(5), “or as” is deleted.
10 Article 21 (management of
limited liability company) amended
In Article 21(2), for “LLC shall vest” there is substituted “limited
liability company vests”.
11 Article 25 (voting of
managers) amended
In Article 25(2), “shall be decided” is deleted.
12 Article 30 (liability for
contribution) amended
In Article 30, for paragraph (4) there is substituted –
“(4) Subject to the LLC agreement, any liability for, or obligation on,
a member to make a contribution under this Article or to return money or other
property paid or distributed in contravention of Part 6 may be compromised
only with the consent of all the members.”.
13 Article 37 (limitation on
distribution) amended
For Article 37, there is substituted –
“37 Limitation
on distribution
(1) A limited liability company must not make a distribution to a
member or release a member from the performance of an obligation if the limited
liability company is insolvent.
(2) For a period of 6 months from the date of receipt by a
member of a distribution or purported release from the performance of an
obligation in contravention of paragraph (1) or in the case of fraud, the
member is liable to the limited liability company for the amount of the
distribution or for performance of the obligation purportedly released.
(3) In this Article, “distribution” does not include amounts
constituting reasonable compensation for present or past services or reasonable
payments made in the ordinary course of business under a bona fide retirement
plan or other benefits programme.”.
14 Article 39 (assignee right to participate in management of
limited liability company) amended
In Article 39, for “not admitted as a member shall have” there is
substituted “(being a person not yet admitted as a member) has”.
15 Article 46 (rules of
customary law) deleted
Article 46 is deleted.
16 Article 47 (fiduciary and
other duties owed and not owed) amended
In Article 47 –
(a) for paragraph (1) there
is substituted –
“(1) Subject to the LLC agreement, a manager does not owe any duty
(fiduciary or otherwise) to the limited liability company or any member or
other person in respect of the limited liability company other than a duty to
act in good faith in respect of the rights, authorities and obligations that
are exercised or performed or to which such manager is subject in connection
with the management of the limited liability company.”;
(b) after paragraph (2) there
is inserted –
“(3) Subject to the LLC agreement, an act or omission of a manager
that constitutes a breach of a duty to act in good faith may be authorised or
ratified if –
(a) all the members of the limited liability company authorise or
ratify the act or omission; and
(b) after the act or omission, the limited liability company will be
able to discharge its liabilities as they fall due.”.
17 Article 56 (offences of
giving false or misleading etc. information) amended
In Article 56(1), for “or to delivered” there is substituted “or to
be delivered”.
18 Article 57 (criminal
liability of partners, directors and other officers) substituted
For Article 57 there is substituted –
“57 Criminal liability of
managers
(1) Where an offence under this Law committed by a limited liability
company is proved to have been committed with the consent or connivance of, or
to be attributable to any neglect on the part of a person who is a manager of
the limited liability company or any person purporting to act in any such
capacity, the person is also guilty of the offence and liable in the same
manner as the limited liability company to the penalty provided for that
offence.
(2) Where the affairs of a limited liability company are managed by
its members, paragraph (1) applies in relation to acts and defaults of a member
in connection with the member’s functions of management as if the member were a
manager of the limited liability company.”.
19 Citation and commencement
This Law may be cited as the Limited Liability Companies (Amendment)
(Jersey) Law 2020 and comes into force on such day or days as the States may by
Act appoint.