Companies Act 2006, section 901D

Statement to be circulated or made available

PART 26A Arrangements and reconstructions: companies in financial difficulty

(1)Where a meeting is summoned under section 901C—

(a)every notice summoning the meeting that is sent to a creditor or member must be accompanied by a statement complying with this section, and

(b)every notice summoning the meeting that is given by advertisement must either—

(i)include such a statement, or

(ii)state where and how creditors or members entitled to attend the meeting may obtain copies of such a statement.

(2)The statement must—

(a)explain the effect of the compromise or arrangement, and

(b)in particular, state—

(i)any material interests of the directors of the company (whether as directors or as members or as creditors of the company or otherwise), and

(ii)the effect on those interests of the compromise or arrangement, in so far as it is different from the effect on the like interests of other persons.

(3)Where the compromise or arrangement affects the rights of debenture holders of the company, the statement must give the like explanation as respects the trustees of any deed for securing the issue of the debentures as it is required to give as respects the company’s directors.

(4)Where a notice given by advertisement states that copies of an explanatory statement can be obtained by creditors or members entitled to attend the meeting, every such creditor or member is entitled, on making application in the manner indicated by the notice, to be provided by the company with a copy of the statement free of charge.

(5)If a company makes default in complying with any requirement of this section, an offence is committed by—

(a)the company, and

(b)every officer of the company who is in default.

This is subject to subsection (7).

(6)For this purpose the following are treated as officers of the company—

(a)a liquidator or administrator of the company, and

(b)a trustee of a deed for securing the issue of debentures of the company.

(7)A person is not guilty of an offence under this section if the person shows that the default was due to the refusal of a director or trustee for debenture holders to supply the necessary particulars of the director’s or (as the case may be) the trustee’s interests.

(8)A person guilty of an offence under this section is liable—

(a)on conviction on indictment, to a fine;

(b)on summary conviction in England and Wales, to a fine;

(c)on summary conviction in Scotland or Northern Ireland, to a fine not exceeding the statutory maximum.

Read section 901D in the full Act → Definitions (6) Cases (6)

Definitions used in section 901D

member

(2) In sub-paragraph (1) “member” has the same meaning as it has by virtue of section 7(1) of that Act .

Defined in Sch.2 Pt.1 · see it in the full Act
arrangement

“arrangement” includes a reorganisation of the company’s share capital by the consolidation of shares of different classes or by the division of shares into shares of different classes, or by both of those methods;

Defined in s.901A(4) · see it in the full Act
director

In the Companies Acts “director” includes any person occupying the position of director, by whatever name called.

Defined in s.250 · see it in the full Act
company

“company” means a company formed and registered under this Act, that is—

(a)

a company so formed and registered after the commencement of this Part, or

(b)

a company that immediately before the commencement of this Part—

(i)

was formed and registered under the Companies Act 1985 (c. 6) or the Companies (Northern Ireland) Order 1986 (S.I. 1986/1032 (N.I. 6)), or

(ii)

was an existing company for the purposes of that Act or that Order,

(which is to be treated on commencement as if formed and registered under this Act).

Defined in s.1(1) · see it in the full Act

“company”—

(a)

in section 901J (powers of court to facilitate reconstruction or amalgamation) means a company within the meaning of this Act, and

(b)

elsewhere in this Part means any company liable to be wound up under the Insolvency Act 1986 or the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)).

Defined in s.901A(4) · see it in the full Act

(4) In this section and that Schedule “company” includes any body corporate.

Defined in s.1159(4) · see it in the full Act
debenture

In the Companies Acts“debenture” includes debenture stock, bonds and any other securities of a company, whether or not constituting a charge on the assets of the company.

Defined in s.738 · see it in the full Act
officer

“officer”, in relation to a body corporate, includes a director, manager or secretary;

Defined in s.1173(1) · see it in the full Act

Cases considering section 901D (6)

Poundland Limited, Re

[2025] EWHC 1822 (Ch) · 8 July 2025

The court assessed the explanatory statement and required fuller disclosure concerning shareholder effects, management incentives and a potential concern about the independence of financial advice. (see para [24])

NGI Systems & Solutions Limited v The Good Box Co Labs Limited

[2023] EWHC 274 (Ch) · 14 February 2023

Applied to the explanatory statement. The court held that it fairly and accurately identified the plan, its effects and its risks, and that the information supplied was sufficient for class members to make an informed decision in the circumstances. (see paras [68]-[72]; [80]-[82])

Madagascar Oil Limited, Re

[2025] EWHC 1015 (Ch) · 28 April 2025

Applies the disclosure requirement concerning directors’ material interests. The explanatory statement disclosed the directors’ interests and releases granted to them (see paras [129]-[133]).

What each judgment says about section 901D is in the case-law panel in the full Act.

Amendments and notes

2 notes from legislation.gov.uk

Modifications

  1. C1317Ss. 901A-901J applied (with modifications) by S.I. 2009/1804, reg. 45A (as inserted (26.6.2020) by The Limited Liability Partnerships (Amendment etc.) Regulations 2020 (S.I. 2020/643), reg. 1(1), Sch. 3 para. 3 (which amending S.I. is revoked (16.2.2021) by S.I. 2021/60, reg. 1(1), 2))
  2. C1318Ss. 901A-901J applied (with modifications) (16.2.2021) by S.I. 2009/1804, reg. 45A (as inserted by The Limited Liability Partnerships (Amendment etc.) Regulations 2021 (S.I. 2021/60), reg. 1(1), Sch. 3 para. 3 (with reg. 4(2)))