The Companies Act (Electronic Communications) Order 2000 came into force on 22 December 2000. It removes legal obstacles in the Companies Act 1985 to companies communicating electronically with their shareholders and widens the scope of information that can be delivered electronically to Companies House. Companies will therefore no longer have to rely solely on company information being sent by post.

Under the amendments to the Companies Act most companies will, with immediate effect, be able to:

• seek the agreement of shareholders to the distribution of annual reports, accounts and other information on a web site, or through other electronic communications;
• allow shareholders to use e-communications to appoint proxies, and give them voting instructions.

Furthermore, in addition to the information that can already be sent to the Registrar electronically, it will be possible later in 2001 to incorporate companies electronically. The precise timing of this will depend on having the necessary systems in place and the Registrar of Companies issuing the appropriate directions.

Companies will be able to choose what type of electronic communications medium best serves their purposes, such as publication of information on a web site, or sending information by e-mail, fax or other methods.

Neither companies nor their shareholders will be obliged to use electronic communications; those companies wishing to use electronic communications will have to agree with individual shareholders. Best practice guidance on "Electronic Communications with Shareholders" is available from the Institute of Company Secretaries and Administrators (ICSA) at 16 Park Crescent, London, W1B 1AH and a summary of key recommendations can be accessed on the ICSA web site at http://www.icsa.org.uk.

The full text of the Order is available at the HMSO website. If you have further general queries on the Order contact Company Law Directorate (Chris Massey, telephone 020 7215 2529 e-mail chris.massey@dti.gsi.gov.uk). For further information on communicating electronically with Companies House contact Phil Coates Tel: 029 20 380208; e-mail Pcoates@companieshouse.gov.uk.

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