A company has just been incorporated and registered as a public company. Before it can do business or exercise any borrowing powers, what must it obtain?

Correct answer: B) A trading certificate from the Registrar, confirming that the nominal value of its allotted share capital is not less than the authorised minimum

Explanation

Under s761 Companies Act 2006 a company registered as public on its original incorporation must not do business or exercise borrowing powers until the Registrar has issued a trading certificate. The certificate is issued only if the nominal value of the allotted share capital is not less than the authorised minimum set under s763, and each allotted share must be paid up to at least one-quarter of its nominal value and the whole of any premium. Doing business without one is an offence, and the directors may be personally liable if the company fails to meet the resulting obligations. A private company never needs a trading certificate, and nor does a private company that later re-registers as public, because its share capital is checked on re-registration instead.