Section 89 of the Small Business Act amends section 170(5) of the Companies Act 2006 to provide that the general duties of directors apply to shadow directors where and to the extent they are capable of applying.
The Secretary of State also has the power to make regulations concerning the application of general duties of directors to shadow directors.
Section 90 of the Act also amends the Companies Act definition of shadow director. Section 251(2) of the Companies Act currently provides that a person is not to be regarded as a shadow director by reason only that the directors act on advice given by him in a professional capacity. Section 90 expands this provision to make it clear that directions or instructions given in exercise of a function conferred by or under legislation is not sufficient to meet the definition, nor is any advice or guidance issued by a Minister of the Crown.
Sections 89 and 90 come into force on 26 May 2015.