Companies (Jersey) Law 1991: Public and private companies

This guide supplements Mourant Ozannes (Jersey) LLP’s guide to the Companies (Jersey) Law 1991 (the Companies Law) and provides additional detail on how the Companies Law distinguishes between public and private companies.

Distinction between public and private companies

Under the Companies Law, a company will be a public company where the memorandum of association of the company states that it is a public company or it became a public company on 30 March 1992 by virtue of deeming provisions which came into force on that date and has not subsequently become a private company. All other companies are classified as private. Following the coming into force of the Companies (Jersey) Amendment Law 2026 (the Amendment Law) on 1 June 2026 (the Effective Date), two key changes have been introduced to the rules governing company status:

• the requirement for a public company to have at least two members has been abolished. This means that a sole member of a public company will no longer be at risk of becoming liable for the debts of the company; and
• the rule which deems a private company with more than 30 members to be a public company has also been repealed. This change allows a private company to retain its status regardless of the number of members it has and to avoid the additional statutory requirements applicable to a public company, most notably having to audit and file accounts. A company that was treated as a public company solely by reason of having more than 30 members is no longer treated as a public company on or after the Effective Date.

Conversion of a public company to a private company

A public company, regardless of the number of its members, may convert to a private company by amending its memorandum to state that it is a private company. However, a public company may not convert to a private company if it:

• has circulated a prospectus, unless either all securities issued or sold under the prospectus have been repaid, redeemed, purchased by the company, or cancelled or the Jersey Financial Services Commission (JFSC) consents to the conversion;
• is a company, other than an exempt company (as defined below), in respect of which or whose transferable securities have been admitted to trading on a UK regulated market or an EU/EFTA regulated market (a market traded company); or
• is a company, other than an exempt company, in respect of which or whose transferable securities have been admitted to trading on a regulated market in the US, Canada, Australia and Japan (being jurisdictions regarded as having accounts and audit requirements at least equivalent to those applicable to a market traded company) (an equivalently regulated company).

A company is an exempt company if it:

• is an issuer exclusively of debt securities admitted to trading on a regulated market with a denomination of at least €50,000 (or other currency equivalent) if admitted to trading before 31 December 2010 or €100,000 (or other currency equivalent) if admitted to trading or on or after 31 December 2010; or
• is an open-ended investment company that is either regulated under the Collective Investment Funds (Jersey) Law 1988 or classified as an unregulated fund for the purposes of the Collective Investment Funds (Unregulated Funds) (Jersey) Order 2008.

Private company treated as a public company

A private company will be subject to the provisions of the Companies Law as if it were a public company if it circulates a prospectus, is a market traded company, or is an equivalently regulated company.

Private company ceasing to be treated as a public company

A private company that is treated as a public company ceases to be treated as a public company if:

• all securities issued or sold under a prospectus circulated by the company have either been repaid, redeemed, purchased by the company, or cancelled or the JFSC consents to the conversion; or
• it ceases to be a market traded company or an equivalently regulated company.

Transitional provision

The Amendment Law contains a transitional provision applicable to a private company that was treated as a public company solely by reason of circulating a prospectus before 19 October 2021. If a prospectus circulated by a private company before that date would not fall in the revised definition of “prospectus” adopted on 19 October 2021, the company ceases to be treated as a public company with effect from that date.

Takeover Code

The City Code on Takeovers and Mergers (the Takeover Code) was amended to narrow the scope of companies to which it will apply with effect from 3 February 2025 (the Implementation Date). As of this date, The Takeover Code applies to public companies but it does not apply to a private company unless:

• any of its securities are admitted to trading on a regulated market or multilateral trading facility in the UK, or a stock exchange in the Channel Islands or the Isle of Man (collectively referred to as UK quoted),
• it was a UK quoted company at any time during the two years prior to the relevant date, being the date of announcement of an offer or possible offer for the company or some other event in relation to the company which has significance under the Takeover Code.

The amended Takeover Code also provides for a two-year transitional period ending on 2 February 2027 for “transition companies”, being companies which were subject to the Takeover Code prior to the Implementation Date but will be excluded from the amended regime.

For further information on the application of the Takeover Code to Jersey companies, please see our guide: The Takeover Code in Jersey.

Issue of prospectuses

As mentioned above, a private company may not issue a prospectus without becoming subject to the law as if it were a public company.

• A ‘prospectus’ is defined in the Companies Law as an invitation to the public to become a member of a company or to acquire or apply for any securities of a company. However, an invitation will not be considered to be made to the public where:
  • the invitation is addressed to qualified investors (as defined in Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017)) or professional investors (as defined in the Financial Services (Investment Business (Special Purpose Investment Business – Exemption))(Jersey) Order 2001, or both;
  • the number of persons (other than qualified investors and professional investors) to whom the invitation is addressed does not exceed 50 in Jersey and 150 elsewhere;
  • the minimum consideration which may be paid or given for securities to be acquired by a person is at least EUR 100,000 (or an equivalent amount in another currency);
  • the securities to be acquired or applied for are denominated in amounts of at least EUR 100,000 (or an equivalent amount in another currency);
  • the invitation relates to scrip dividends (i.e. the issue of shares or other securities to its members in satisfaction of a dividend);
  • the invitation relates to an employee share scheme; or
  • any combination of the above sub-paragraphs applies.
• ‘Securities’ are widely defined as:
  shares in or debentures of a body corporate;
• interests in any such shares or debentures;
• rights to acquire any of the foregoing.

A private placement document which otherwise falls outside the definition of an invitation to the public will not result in a private company being treated as a public company.

Public company requirements

The Companies Law contains a number of provisions which relate specifically to public companies:

• The certificate of incorporation of a public company will state that the company is a public company.
• A public company must have at least two directors whereas a private company need have only one director.
• Whilst the register of members of both a public company and a private company may be inspected by a member without charge and by any other person on payment of a prescribed fee, a copy of the register may be required by a person on payment of a sum not exceeding the prescribed maximum, and in the case of a public company, on submission of a declaration that the information it contains will not be used except for the purposes permitted under the Companies Law.
• A public company must notify the Registrar of Companies when shares are allotted with rights which are not specified in the company’s memorandum or articles of association.
• The register of directors of a public company or a company which is a subsidiary of a public company must be made available for public inspection.
• The secretary of a public company must be appropriately qualified in accordance with the Companies Law.
• A public company must hold an annual general meeting within 18 months of the last annual general meeting unless such company has dispensed with the requirement to hold an annual general meeting. A private company must hold an annual general meeting within 22 months of the last annual general meeting if the private company is required to hold annual general meetings under the Companies Law. A private company (a relevant private company) will be required to hold annual general meetings if:
  • this is required by a provision in its articles of association made after 1 August 2014; or
  • this was required by a provision in its articles of association made before 1 August 2014 and which was confirmed by a special resolution passed after 1 August 2014.
  • A public company must appoint auditors qualified in accordance with the Companies Law and have its accounts audited. This is not required in the case of private companies (unless it is a requirement of the private company’s articles of association, of a resolution of the company in general meeting) or the company is deemed to be a public company.
• A company’s accounts must be prepared and, where applicable, examined and reported on by auditors as well as laid before a general meeting together with a copy of the auditors’ report (if any). This action must be undertaken within seven months of the end of a public company’s financial year. For a private company, this period is extended to ten months. This obligation does not apply where the company has dispensed with the requirement to hold an annual general meeting or, in the case of a private company, is not a relevant private company. In such circumstances, the company is not required to lay the accounts or any auditors’ report before a general meeting unless a member provides written notice to the company, no later than 11 months after the end of the financial period, requiring that this be done.
• A public company must ensure that its accounts together with the auditor’s report are filed with the Registrar within seven months of the end of the financial year to which they relate. Private companies are not required to file accounts with the Registrar.
• Additional formalities apply in the case of a creditor’s winding up of a public company.
• The liquidator of a public company must be qualified in accordance with the Companies (General Provisions) (Jersey) Order 2002.

Contacts

For support on the issues covered in this guide, please get in touch with our Jersey corporate law specialists.