ACCA Applied Skills · Corporate and Business Law (Global) · Loan capital
Zeta Ltd, a company incorporated under a Companies Act-style regime, grants a bank a fixed charge over its factory building to secure a loan. Under the registration rules for company charges, which of the following best describes who is normally responsible for ensuring the charge is registered at the company registry?
The company has the statutory duty to register a charge it creates, but the chargee may also register it and usually does, because the chargee suffers the consequences of non-registration. Registration is not optional for registrable charges such as a fixed charge over land.
- AOnly the bank, because the registry cannot accept filings from the company
- BThe company has the duty to register, but the chargee (the bank) may also do so and often does to protect itselfCorrect
- CNeither party, because registration is voluntary for fixed charges
Explanation
Under the usual company law rules, the company is under a duty to register particulars of charges it creates, but any person interested, typically the chargee, may register. The bank usually does so because it bears the risk of non-registration. Registration is not voluntary for registrable charges.
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