Companies Act 2014 section 57

Relief where company does not re-register as a designated activity company

Section 57 provides a court-based remedy for minority shareholders or debenture holders to compel an existing private company to re-register as a designated activity company (DAC) where it has failed to do so before the end of the transition period.

• If an existing private company does not re-register as a DAC before the transition period expires, certain members or creditors may apply to the court for an order directing re-registration.
• Members holding at least 15% of the company's issued share capital (or any class of it) are entitled to bring such an application.
• Creditors holding at least 15% of the company's debentures that carry the right to object to changes in the company's objects may also apply.
• The court will normally grant the order unless there is good reason not to, but it retains discretion to make whatever alternative order it considers just.