{
  "url": "https://openlegislation.uk/companies-act-2006/schedule-10/paragraph-7",
  "json_url": "https://openlegislation.uk/companies-act-2006/schedule-10/paragraph-7.json",
  "legislation": "ukpga/2006/46",
  "legislation_title": "Companies Act 2006",
  "legislation_url": "https://openlegislation.uk/companies-act-2006",
  "path": "schedule/10/paragraph/7",
  "kind": "paragraph",
  "number": "7",
  "heading": null,
  "text": "(1) This paragraph explains what is meant in paragraph 6(1)(b) by a firm being “controlled by qualified persons”.\n(2) In this paragraph references to a person being qualified are—\n(a) in relation to an individual, to that individual's—\n(i) holding an appropriate qualification, or\n(ii) being a third country auditor and meeting the requirements of paragraph 6(1)(aa)(ii) or 6(1A);\n(b) in relation to a firm, to its—\n(i) being eligible for appointment as a statutory auditor, ...\n(ii) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .\n(3) A firm is to be treated as controlled by qualified persons if, and only if—\n(a) a majority of the members of the firm are qualified persons, and\n(b) where the firm's affairs are managed by a board of directors, committee or other management body, a majority of that body are qualified persons or, if the body consists of two persons only, at least one of them is a qualified person.\n(4) A majority of the members of a firm means—\n(a) where under the firm's constitution matters are decided upon by the exercise of voting rights, members holding a majority of the rights to vote on all, or substantially all, matters;\n(b) in any other case, members having such rights under the constitution of the firm as enable them to direct its overall policy or alter its constitution.\n(5) A majority of the members of the management body of a firm means—\n(a) where matters are decided at meetings of the management body by the exercise of voting rights, members holding a majority of the rights to vote on all, or substantially all, matters at such meetings;\n(b) in any other case, members having such rights under the constitution of the firm as enable them to direct its overall policy or alter its constitution.\n(6) Paragraphs 5 to 11 of Schedule 7 to this Act (rights to be taken into account and attribution of rights) apply for the purposes of this paragraph.",
  "extent": "E+W+S+N.I.",
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "F",
      "label": "F1",
      "text": "Sch. 10 para. 7(2)(a) substituted (31.12.2020) by S.I. 2019/177, regs. 2, 29(a) (as substituted by The Companies and Statutory Auditors etc. (Consequential Amendments) (EU Exit) Regulations 2020 (S.I. 2020/523), regs. 1(2), 14(f)); 2020 c. 1, Sch. 5 para. 1(1)"
    },
    {
      "type": "F",
      "label": "F2",
      "text": "Sch. 10 para. 7(2)(b)(ii) and word omitted (31.12.2020) by virtue of S.I. 2019/177, regs. 2, 29(b) (as substituted by The Companies and Statutory Auditors etc. (Consequential Amendments) (EU Exit) Regulations 2020 (S.I. 2020/523), regs. 1(2), 14(f)); 2020 c. 1, Sch. 5 para. 1(1); and (E.W.) (1.1.2021) by virtue of The Local Audit (England and Wales) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/504), regs. 1(3), 2"
    }
  ],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/ukpga/2006/46/schedule/10/paragraph/7",
    "retrieved_at": "2026-10-29T09:13:40.060156+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}