Tax and Insolvency Litigation Solicitor

Director Disqualification FAQs

What is the effect of a disqualification order? It makes it unlawful for a person subject to a disqualification order to act as a company director or be concerned in the management of a company.

Is an Undertaking the same as a Court Order? Yes, it has the same effect.

What are the consequences of breaching an Order or Undertaking? This is a criminal offence the penalty of which may include a custodial sentence.

What periods of disqualification may be imposed by law? The Directors Disqualification Act 1986 allow periods of between 2 to 15 years depending upon the conduct found or admitted. Through cases decided by the Courts periods of between 2-5 years will be imposed for less serious conduct, periods of 6-10 years for intermediate conduct, and periods of 11-15 years for seriously unfit conduct.

What types of conduct will merit a disqualification period of over 10 years? Conduct involving dishonesty and significant creditor losses.

Will allegations of Crown Debts owed by the insolvent Company automatically lead to disqualification? No, there needs to be unfit conduct connected with those losses.

How quickly can an application for leave to continue acting as a Company Director be decided by the Court? In appropriate cases an emergency interim application can be made at Court. This is capable of happening at short notice and within a matter of days.

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