ExpertMedium2 marksMultiple Choice
ACCA · Question 21 · Corporate and Business Law
Under the Companies Act 2006, how can a director of a public company be removed from office before the expiration of their period of office?
Under the Companies Act 2006, how can a director of a public company be removed from office before the expiration of their period of office?
Answer options:
A.
By a special resolution of the shareholders.
B.
By a unanimous vote of the board of directors.
C.
By an ordinary resolution of the shareholders, requiring special notice.
D.
By an order of the court upon application by a creditor.
How to approach this question
Recall the statutory mechanism for removing a director under s.168 CA 2006.
Full Answer
C.By an ordinary resolution of the shareholders, requiring special notice.✓ Correct
Section 168 of the Companies Act 2006 provides that a company may by ordinary resolution (simple majority) remove a director before the expiration of their period of office. Special notice (28 days) must be given to the company of the intention to move such a resolution.
Common mistakes
Thinking a special resolution (75%) is required to remove a director.
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