Community Interest Companies are in a particularly vulnerable time during the coronavirus crisis. Pupil barrister at Kings, Shaylla Shabbir, outlines the help available.
A Community Interest Company
A community interest company (CIC) is a type of limited company that’s been specially designed for social enterprises. Unlike purely commercial companies, which exist to make profits for their owners, community interest companies trade for the benefit of the community. Some social enterprises are charities, but having charitable status means they’re subject to strict regulation, for example, regarding trading activities. A CIC can’t also be a charity, but it can pass profits to a charity.
Guidance from the Office of the Regulator.
The guidance comes from the Office of the Regulator of CICs to maintain services for these companies and in turn protect employees.
The Regulator’s approach to registration and regulation will be as flexible and pragmatic as possible during this period. The regulator acknowledges that there will be a delay in processing applications, and further means of filing are being considered
The processes available
Currently the following processes can be followed:
· Incorporate a CIC · File your accounts · File your confirmation statement · Many other online filings can also be completed online via the Companies House website:
· Directors and company secretaries – new appointments, resignations & changes to personal details
· Changing a company name
· Changing a registered office address
· Changing an accounting reference date
· Changes to ‘people with significant control’ (PSC) information
· Changes to a company’s share structure
· Details of new mortgages or mortgages paid
The flexible approach
If CICs are unable to provide services during the outbreak and as such cannot meet the community benefit requirement, then this may be reported in the Annual CIC report.
Furthermore, any CICs may apply for an extension oi filing accounts and annual reports. Applications for extensions must be made before the passage of initial filing dates or the CICs may be penalised.
CICs are also eligible to apply for the government grants in place to help pay their employees’ salaries as long as employees remain on the payroll and are temporarily not working.
Across the range support
The Government recognises the pressures that CICs, and the social enterprise sector more widely, is facing at this time. CICs are therefore eligible to access the range of government support packages being offered to business, subject to the specific requirements of each.
Finding the guidance
The guidance is available online – here.