The Joint Stock Companies Act 1856 (19 & 20 Vict c 47) was an
Act of the
Parliament of the United Kingdom
The Parliament of the United Kingdom is the supreme legislative body of the United Kingdom, the Crown Dependencies and the British Overseas Territories. It meets at the Palace of Westminster, London. It alone possesses legislative suprem ...
. It was a consolidating statute, recognised as the founding piece of modern
United Kingdom company law legislation.
Overview
Unlike other
Acts of Parliament that preceded it, the 1856 Act provided a simple administrative procedure by which any group of seven people could register a limited liability company for themselves. Companies involved in banking and insurance were explicitly excluded from the provisions of the Act.
Debate
The Joint Stock Companies Bill was introduced to Parliament by the then Vice President of the
Board of Trade
The Board of Trade is a British government body concerned with commerce and industry, currently within the Department for International Trade. Its full title is The Lords of the Committee of the Privy Council appointed for the consideration of ...
,
Robert Lowe. In doing so he proclaimed the right of every citizen to have
freedom of contract and with it obtain limited liability for operating a business. Companies had until recently been prohibited, as a result of the
Bubble Act
The Bubble Act 1720 (also Royal Exchange and London Assurance Corporation Act 1719) was an Act of the Parliament of Great Britain passed on 11 June 1720 that incorporated the Royal Exchange and London Assurance Corporation, but more significant ...
and the stock market panics of the early 18th century. There was still a lot of suspicion of companies, but Lowe rejected the idea that a limited company is inherently subject to fraud, and proposed the suffix "Ltd" to make businesses aware of limited liability.
The Third Reading of the Bill took place on 2 June 1856, and passed easily.
[HC Deb, 2 June 1856 vol 142]
cols 897–9
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See also
*Companies Act
Companies Act (with its variations) is a stock short title used for legislation in Botswana, Hong Kong, India, Kenya, Malaysia, New Zealand, South Africa and the United Kingdom in relation to company law. The Bill for an Act with this short title ...
* Joint Stock Companies Act 1844
* Limited Liability Act 1855
Notes
References
*W Paterson (ed). "Joint Stock Companies Act". The Practical Statutes of the Session 1856. London. 1856. Page
61
to 119.
*Welsby and Beavan. Chitty's Collection of Statutes. Third Edition. 1865. Volume 1. Title "Companies (Joint Stock). Page
684
to 717.
*Charles Wordsworth. The Joint Stock Companies Act, 1856
Fourth Edition
Shaw and Sons. London. 1856.
*Charles Wordsworth. The New Joint Stock Company Law. Shaw and Sons. London. 1859. Page
1
to 70.
*Henry Thring
The Joint Stock Companies Act, 1856
London. 1856.
*William George Harrison and George A Cape. The Joint Stock Companies Act, 1856. London. 1856
BibliographyCatalogue
*Edward W Cox. "The Joint Stock Companies Act, 1856". The New Law and Practice of Joint Stock Companies. Fourth Edition. London. 1857. Page
1
to 83.
*
*
*
External links
Joint Stock Companies Act 1856 Table B
original text
Joint Stock Companies Act 1856
explanations
{{UK legislation
1856 in law
United Kingdom Acts of Parliament 1856
History of corporate law
United Kingdom company law