Industry News

We publish regular industry news from our Trademark, corporate compliance and international services departments.

21.05.10 HIP's - Update on Suspension of HIP's

17.05.10 HIP's - Update on current position following the election.

30.07.08 Consumer focused HIP's

30.07.08 HIP's Consultation launched by Government

29.07.08 Need to review Articles of Association?

29.07.08 HIP or no HIP?

28.07.08 Biggest Expansion to Internet in Forty Years Approved for Implementation

25.07.08 EU Proposals aimed at helping small and medium-sized businesses

22.07.08 Forthcoming Companies Act Changes

 

 

 

 

HIP's - Update on suspension of HIPS.

The new regulations are in force from 21 May 2010.

What is the Current Position?

  • Following the Government’s announcement suspending HIPs but retaining the EPC, the Energy Performance of Buildings (Amendment) Regulations 2010 have now been released.
  • If there is not already an EPC for the property, the estate agent must be satisfied that an EPC has been ordered BEFORE marketing begins
  • Written particulars which include two out of three of: photographs, floor plan, room sizes, must also include the asset rating graph as soon as the EPC is available
  • The penalty on an estate agent for failure to order an EPC or include the asset rating graph in written particulars is £200

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HIP's - Update on current position following the election.

Just as a week is a long time in politics, headlines rarely tell the whole story. There has been much speculation in the media over the last couple of days about the future of HIPs with some comments that HIPs have already been scrapped. At the time of writing there has been no further clarity provided by Government in terms of their proposed process and timeline for scrapping HIPs. This update endeavours to separate the reality from the hype and sets out the facts as they exist today.

What is the Current Position?

  • HIPs have not been scrapped by the Election result. The law still requires a HIP to be in place to market a property. The penalties for non-compliance still apply.
  • Grant Shapps (the new Housing Minister), has said he will not condone non-compliance by Estate Agents who fail to order HIPs
  • Grant Shapps has already committed to a full industry consultation before scrapping HIPs
  • The Coalition Agreement refers to scrapping HIPs in the “Environment” section rather than being linked with the Grand Repeal Bill.
  • Unless a suspension order for the scrapping of HIPs is announced HIPs will remain in place for the foreseeable future. Legislation to adapt or replace them will take some time to pass in Parliament

What Happens Next?

  • The new Parliament will be sworn in on 18th May. The first Queen’s Speech setting out the initial legislative programme is expected to be held on 25th May. An Emergency Budget will be presented to the House in the first 50 days of the new Parliament and debates on its contents will dominate the initial period before the Summer recess
  • The first parliamentary session will run from the end of May to November 2011 (which is the date of the next Queen’s Speech). This means that the Coalition Government has a longer time than normal to get legislation through the Houses of Parliament. This will allow a larger volume of legislation to be passed, particularly as there is a Parliamentary convention that the Lords will not oppose legislation based on a Manifesto Commitment. Ministers are likely to exploit these two factors to pass the complicated and potentially controversial legislation they believe to be necessary.
  • We are unlikely to get significantly more detail on how the pledge to scrap HIPs will be taken forward when the Queen’s Speech is published – if indeed it does form part of the initial legislative package. The Speech itself is often little more than a statement of intent and many of the Bills listed in it may not be published until after the summer recess.
  • The Conservatives have pledged a consultation on transition and any successive legal framework. It is unlikely that this will be reversed, especially as David Cameron and Nick Clegg have pledged to restore the public’s faith in politicians.
  • The pledge on HIPs is unsurprising – it was a commitment delivered in both Parties’ Election Manifestos. The Agreement provides no additional detail on how this will be achieved or delivered. The inclusion of it in the Environment section rather than under deregulation is perhaps significant. It suggests that there is an understanding that scrapping HIPs cannot be undertaken in isolation. It has also been decoupled from the Great Repeal Bill – which has already been flagged as being a very early Bill to be introduced to Parliament ahead of the summer recess.

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Consumer focused HIP's

The Association of Home Information Pack Providers has welcomed the recent consultation by Caroline Flint to enhance the consumer information in Home Information Packs (HIPs) - announced 29 July 2008.

It is already the case that HIPs are having a beneficial impact through reduced costs for consumers in relation to property searches and increased speed to exchange of contracts, greatly reducing the stress and uncertainty prevalent prior to the introduction of HIPs.

Paul Broadhead, Deputy Director General AHIPP said ‘The launch of this consultation today is good news for home buyers and sellers, they are already the beneficiaries of an expedited conveyancing process when HIPs are used fully and it is welcome that the minister has listened to industry to make HIPs more consumer friendly’

The consultation suggests adding a property information questionnaire, including additional information for leasehold transactions. Broadhead added ‘The information included in the questionnaire is commonly provided after terms have been agreed. Making it available in the HIP at the start of the process will greatly assist home buyers to decide whether or not the property is suitable for them and meets their needs. ’

Subject to the outcome of the consultation the Property information Questionnaire will form a mandatory part of a HIP from 1st January. Broadhead concluded ‘It is only right that people should have full information up front when deciding whether to buy a home. HIPs provide the right regulatory framework to deliver reform to the process and increasing the information available to prospective purchasers early in the process is key to driving out real benefits.’

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HIP's Consultation launched by Government

On 29 July 2008, the Government launched a consultation into 'Improving the Consumer Information in the HIP' to which responses are invited.

Housing Minister, Caroline Flint said: 'having the right information about a property at the beginning of the home buying process is essential if we are to reduce delays and cut down on wasted costs for both buyers and sellers. HIPs are an important first step in achieving greater efficiency and the Property Information Questionnaire will only improve on this, ensuring the buying and selling process is simpler for all'.

Views are sought on the proposed changes to the provision of leasehold information and on the inclusion of a Property Information Questionnaire. Responses need to be sent by 30 September 2008.

Further information can be found at CLG website at www.communities.gov.uk/publications/housing/improvingconsumerinformation

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Need to review Articles of Association?

Need to review Articles of Association? You will only need to review your articles if you wish to take advantage of the provisions in the new Act. Here are some typical scenarios:

o You want to dispense with holding an AGM: you need to check whether your articles do not specifically say that you must hold an AGM in which case you must no matter what the Act says. Exception to the rule: if you had already passed an elective resolution under the 1985 to dispense with AGMs this will still apply even if your articles say you must hold one!

o You are a not for profit company and you want to make sure that you hold an AGM each year: your articles may well stipulate that you must hold an AGM but on the other hand they may not so you must check and update if necessary.

o You want to dispense with having a company secretary. Do your articles say that a secretary must be appointed or do they refer to certain acts needing to be done by the secretary? If so they may need attention. One particular point to look at is the company seal. If the company has a sole director then, under standard provisions, it can’t be affixed without a secretary or a second director. It is possible to affix a seal with a single signature if the articles permit it.

York Place specialise in company formation and alterations to memorandum and articles of association. For further advice and a free review of your memorandum and articles please contact nicola.smith@yorkplace.com.

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HIP or no HIP?

The general rule is that all residential properties in England and Wales need a Hip but there are exceptions and CLG has recently published guidance on what can and cannot be be excepted:

1) Two buildings sold together. Seller not willing to accept offers on individual properties. HIP or No HIP? No HIP. This falls within the exception for portfolio sales.

2) One building, sub-divided into two dwellings and sold together. Seller not willing to accept offers on individual dwellings. HIP or No HIP? No HIP. This falls within the exception for portfolio.

3) One building, sub-divided into two dwellings. Each property vacant and sold separately. HIP or No HIP? A valid HIP is required for each dwelling although If relevant, some documents could be duplicated.

4) One building originally constructed or adapted for use as a single dwelling, sub-divided into two or more dwellings and sold together. At least one dwelling is occupied and will remain occupied on sale, but at least one dwelling is to be sold with vacant possession. HIP or No HIP? HIP required. This is a sub-divided building. A valid HIP is required for the vacant dwellings, although if relevant, some documents could be duplicated.

5) One building, sub-divided with long lease/tenants in each. HIP or No HIP? No HIP. Property does not have any element of vacant possession.

6) Main dwelling with separate ancillary dwelling (eg. manor house with staff quarters). HIP or No HIP? Two HIPs, one for each dwelling, although, if relevant, some documents could be duplicated. This does not come under the portfolio exception as second dwelling is ancillary.

7) One main dwelling with attached annex. Annex is self-sufficient with its own access, heating, water, kitchen and bathroom. HIP or No HIP? Two HIPs, one for each dwelling. This does not come under the portfolio exception as second dwelling is ancillary.

8) One main dwelling with attached annex. Annex shares some of the services of the main house (eg. heating system, access, bathroom, kitchen). HIP or No HIP? One HIP for whole property

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Biggest Expansion to Internet in Forty Years Approved for Implementation

Biggest Expansion to Internet in Forty Years Approved for Implementation The Board of ICANN (ICANN is responsible for the global coordination of the Internet's domain suffixes, eg .com, .uk) has just approved a recommendation that could see a whole range of new names introduced to the Internet's addressing system.

'The Board today accepted a recommendation from its global stakeholders that it is possible to implement many new names to the Internet, paving the way for an expansion of domain name choice and opportunity' said Dr Paul Twomey, President and CEO of ICANN.

A final version of the implementation plan must be approved by the ICANN Board before the new process is launched. It is intended that the final version will be published in early 2009. ‘The potential here is huge. It represents a whole new way for people to express themselves on the Net,’ said Dr Twomey. ‘It's a massive increase in the 'real estate' of the Internet.’ Presently, users have a limited range of 21 top level domains to choose from — names that we are all familiar with like .com, .org, .info.

This proposal allows applicants for new names to self-select their domain name so that choices are most appropriate for their customers or potentially the most marketable. It is expected that applicants will apply for targeted community strings such as .hip for home information pack providers (as well as generic strings like .brandname or .yournamehere). There are already interested consortiums wanting to establish city-based top level domain, like .nyc (for New York City), .berlin and .paris.

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EU Proposals aimed at helping small and medium-sized businesses

EU proposals aimed at helping small and medium-sized businesses The 'Small Business Act' for Europe is the European Commission's ambitious plan to address the needs of Europe's small and medium-sized businesses. It is a major step to make Europe more entrepreneurial and help its businesses thrive as it improves framework conditions for SMEs while taking full account of their diversity.

The Commission has worked in close cooperation with all the stakeholders, SMEs representatives, Member States, regional and local authorities and SMEs. The 'Small Business Act' for Europe is the result of these joint efforts. It comprises a set of common principles to guide SME policy as well as a number of proposed actions to translate the principles into practice. It focuses on promoting entrepreneurship, anchoring the Think Small First principle in policy-making and supporting SMEs' growth. The implementation and monitoring of the 'Small Business Act' will be ensured by the Commission and Member States, within the Lisbon Strategy for Growth and Jobs Further details available at http://ec.europa.eu/enterprise/entrepreneurship/sba_en.htm

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Forthcoming Companies Act Changes
The next batch of changes take effect on 1 October 2008 including:
- Companies and Business Names: new rules will set out the characters that may be used in a company name (including letters, numbers and symbols). It also sets out when a company may exclude the word ‘limited’ from its name and provides a limit of 160 characters.
- Any person under 16 on that date will automatically cease to be a director.
- Every company must have a ‘natural person’ on the board so sole corporate directors will no longer be allowed BUT if, on 8 November 2006, the company only had corporate directors then the company will not have to appoint a natural personal until 1 October 2010
Important provisions already in force

All sections in force could have an impact on your company but these are some important areas that will affect the majority of small private companies:
1. Notice periods - the notice period for general meetings is now fixed at 14 days
2. Written resolutions - these can now be passed by members holding the required number of shares to reach the required majority rather than by signature of all members
3. Annual general meetings. A private company need no longer hold an AGM
4. Accounting reference periods. For accounting periods starting on or after 6 April 2008 the filing period has been reduced by one month so it is now 9 months for private and six for public companies
5. A private company does not need a secretary from 6 April onwards
6. Rules for execution of documents have changed

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