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Charges and Mortgages (England and Wales and Northern Ireland)

A charge (or mortgage) is the security a company gives for a loan. Most charges must be registered at Companies House. The registration need not be by the company itself - in most cases, registration is by the lender or the lender’s agent. To register a charge, the details of the charge together with the original document creating or evidencing the charge, must be delivered to Companies House within the specified time limit.

You must deliver your application to register a charge within 21 days of the creation of the charge to ensure its security in the event of liquidation. You will need a court order to register it outside the 21-day limit.

Registration of Charges

1. Charges you must register at Companies House.

For companies incorporated in England and Wales, Wales and in Northern Ireland, the charges that must be registered are:

A charge on land or any interest in land, other than a charge for any rent or other periodical sum issuing out of land;
A charge created or evidenced by an instrument which, if executed by an individual, would require registration as a bill of sale;
A charge for the purposes of securing any issue of debentures;
A charge on uncalled share capital of the company;
A charge on calls made but not paid;
A charge on book debts of the company;
A floating charge on the company’s property or undertaking;
A charge on a ship or aircraft, or any share in a ship;
A charge on goodwill or on any intellectual property;

2. Which form should I use?

Purpose Form Number
Particulars of a Charge MG01
Particulars for the registration of a charge to secure a series of debentures MG07
Particulars of an issue of secured debentures in a series MG08
Certificate of registration of a charge comprising property in another UK jurisdiction MG09
Particulars of a charge subject to which property has been acquired MG06
Statement of satisfaction in full or in part of a mortgage or charge MG02
Application for registration of a memorandum of satisfaction
That part [or the whole] of the property charged
(a) has been released from the charge;
(b) no longer forms part of the company’s property MG04
Notice of appointment of administrative receiver, receiver or manager LQ01
Notice of ceasing to act as an administrative receiver, receiver or manager LQ02

3. Things to remember when filing a Form MG01

The Form MG01 is the most commonly filed charge form at Companies House. You must deliver the prescribed particulars of the charge, together with the original instrument (if any) by which the charge is created or evidenced, to Companies House within 21 days of the date of creation of the charge. It is important to act as quickly as possible and, when delivering the form to Companies House, remember to;

(i) complete the correct form and deliver it to the correct registration office while also following any relevant notes on the form;
(ii) deliver the original Instrument (if there is one) creating or evidencing the charge with the form;
(iii) check that the details on the form are correct and match the information given in the instrument; and
(iv) enclose the correct registration fee.

4. What if I do not register a charge within the 21 day filing deadline?

If you do not register the charge in time, then in the event of the company’s insolvency, the charge will be void against the liquidator or administrator and any creditor of the company. This means that the debt for which the charge was given will remain payable, but it will be unsecured. Only the court can grant an extension of time for registration of a charge that Companies House did not receive in time.

If a registrable charge is not registered in time, then the company that created the charge and every officer of the company who is in default are liable to a fine.

5. Acquisition of property which is already charged.

If you acquire property that is already subject to a charge, and the charge is of a type which the company would have had to register if it had created the charge itself, you must register this charge. The company must complete and deliver Form MG06 to Companies House, accompanied by a certified copy of any instrument that creates or evidences the charge.

You must do this within 21 days after the company completed the acquisition of the property.

6. What rights has the chargee?

If the company does not deliver a charge for registration at Companies House, the chargee (the person to whom the property is charged) can register the required documents. In certain circumstances a chargee can appoint an administrative receiver, receiver or manager (or ask the court to appoint one) over the property charged. Any person interested in the charge may notify the appointment to Companies House within 7 days, using the Form LQ01.

On ceasing to act the receiver or manager must notify Companies House using Form LQ02.

Satisfaction of Charges

7. What should I do when the company pays off the charge?

The company does not need to inform Companies House that it has fully or partly paid off a charge. However, it is in the company’s own interests that potential investors and lenders are aware that it has paid off all or part of the debt. You should deliver Form MG02 to Companies House as notification that the company has partly or fully paid off a charge.

8. What if the charged property ceases to be charged or to belong to the company?

As with partly or fully paid-off charges, there is no requirement for a company to inform Companies House that its property has been released from a charge or that the property no longer belongs to the company. However, it is the company own interests that potential investors and lenders are aware of this. You should deliver Form MG04 to Companies House to notify us when the charged property ceases to be charged or to belong to the company.

Further information on the Registration of Charges can be found in Part 25 of the Companies Act 2006.