It is now possible to register a Community Interest Company (CIC). These companies are designed for social enterprises where it is necessary for them to use their profits and assets for the public good.
CICs will have a regulator based in Companies House, Cardiff.
A CIC can be one of:
a private company limited by shares;
a company limited by guarantee; or
a public limited company.
Assets and profits have to be used for the community interest so there will be a limit on the levels of distributions of profits or assets that may be made to members – this is known as the asset lock.
Registering a CIC will be similar to registering any other company with the Registrar of Companies in Cardiff. One difference will be the need to apply to the regulator for confirmation that the company is eligible for CIC status.
A CIC’s Memorandum and Articles of Association will need to contain specific provisions provided for by prescribed regulations.
The application to Companies House will need to be accompanied by a “Community Interest Statement” and this will be in a form prescribed by the regulator and signed by the first directors.
Community Interest Companies will need to use the initials “CIC”, or the words “Community Interest Company” in their title, though in the case of PLCs it will read “Community Interest Public Limited Company” or “Community Interest PLC”.
Each year CICs will be required to produce an annual Community Interest Report as well as the annual accounts which are delivered to Companies House.
An organisation which is a CIC cannot also be a charity. CICs are expected to be less regulated than charities. Even if a CIC has charitable objects it will still not be a charity.
