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| |
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| | (b) | references to title to securities include any legal or equitable interest in |
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| | |
| | (c) | references to a transfer of title include a transfer by way of security; |
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| | (d) | references to transfer without a written instrument include, in relation to |
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| | bearer securities, transfer without delivery.’. |
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| |
| | Power to make regulations |
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| To move the following Clause:— |
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| | ‘(1) | The power to make regulations under this Chapter is exercisable by the Treasury |
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| | and the Secretary of State, either jointly or concurrently. |
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| | (2) | References in this Chapter to the authority having power to make regulations |
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| | shall accordingly be read as references to both or either of them, as the case may |
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| | |
| | (3) | Regulations under this Chapter are subject to affirmative resolution procedure.’. |
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| |
| | Provision enabling procedures for evidencing and transferring title |
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| |
| | |
| To move the following Clause:— |
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| | ‘(1) | Provision may be made by regulations for enabling title to securities to be |
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| | evidenced and transferred without a written instrument. |
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| | (2) | The regulations may make provision— |
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| | (a) | for procedures for recording and transferring title to securities, and |
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| | (b) | for the regulation of those procedures and the persons responsible for or |
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| | involved in their operation. |
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| | (3) | The regulations must contain such safeguards as appear to the authority making |
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| | the regulations appropriate for the protection of investors and for ensuring that |
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| | competition is not restricted, distorted or prevented. |
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| | (4) | The regulations may, for the purpose of enabling or facilitating the operation of |
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| | the procedures provided for by the regulations, make provision with respect to the |
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| | rights and obligations of persons in relation to securities dealt with under the |
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| | |
| | (5) | The regulations may include provision for the purpose of giving effect to— |
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| | (a) | the transmission of title to securities by operation of law; |
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| | (b) | any restriction on the transfer of title to securities arising by virtue of the |
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| | provisions of any enactment or instrument, court order or agreement; |
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| | (c) | any power conferred by any such provision on a person to deal with |
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| | securities on behalf of the person entitled. |
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| |
| |
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| | (6) | The regulations may make provision with respect to the persons responsible for |
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| | the operation of the procedures provided for by the regulations— |
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| | (a) | as to the consequences of their insolvency or incapacity, or |
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| | (b) | as to the transfer from them to other persons of their functions in relation |
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| | |
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| | Provision requiring arrangements to be adopted |
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| |
| | |
| To move the following Clause:— |
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| | ‘(1) | Regulations under this Chapter may make provision— |
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| | (a) | enabling the members of a company or of any designated class of |
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| | companies to adopt, by ordinary resolution, arrangements under which |
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| | title to securities is required to be evidenced and transferred without a |
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| | |
| | (b) | requiring companies, or any designated class of companies, to adopt such |
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| | |
| | (2) | The regulations may make such provision— |
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| | (a) | in respect of all securities issued by a company, or |
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| | (b) | in respect of all securities of a specified description. |
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| | (3) | The arrangements provided for by regulations making such provision as is |
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| | mentioned in subsection (1) must not be such that a person who, but for the |
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| | arrangements would be entitled— |
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| | (a) | to have his name entered in the company’s register of members, or |
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| | (b) | to give instructions in respect of any securities, |
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| | | ceases to be so entitled. |
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| | |
| | (a) | prohibit the issue of any certificate by the company in respect of the issue |
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| | or transfer of securities, |
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| | (b) | require the provision by the company to holders of securities of |
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| | statements (at specified intervals or on specified occasions) of the |
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| | securities held in their name, and |
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| | (c) | make provision as to the matters of which any such certificate or |
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| | statement is, or is not, evidence. |
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| | |
| | (a) | references to a designated class of companies are to a class designated in |
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| | the regulations or by order under section (Provision requiring |
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| | arrangements to be adopted: order-making powers); and |
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| | (b) | “specified” means specified in the regulations.’. |
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| |
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| |
| |
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| | Provision requiring arrangements to be adopted: order-making powers |
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| |
| | |
| To move the following Clause:— |
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| | ‘(1) | The authority having power to make regulations under this Chapter may by |
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| | |
| | (a) | designate classes of companies for the purposes of section (Provision |
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| | requiring arrangements to be adopted) (provision requiring |
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| | arrangements to be adopted); |
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| | (b) | provide that, in relation to securities of a specified description— |
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| | (i) | in a designated class of companies, or |
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| | (ii) | in a specified company or class of companies, |
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| | | specified provisions of regulations made under this Chapter by virtue of |
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| | that section either do not apply or apply subject to specified |
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| | |
| | (2) | In subsection (1) “specified” means specified in the order. |
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| | (3) | An order under this section is subject to negative resolution procedure.’. |
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| |
| | Provision that may be included in regulations |
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| |
| | |
| To move the following Clause:— |
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| | ‘Regulations under this Chapter may— |
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| | (a) | modify or exclude any provision of any enactment or instrument, or any |
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| | |
| | (b) | apply, with such modifications as may be appropriate, the provisions of |
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| | any enactment or instrument (including provisions creating criminal |
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| | |
| | (c) | require the payment of fees, or enable persons to require the payment of |
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| | fees, of such amounts as may be specified in the regulations or |
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| | determined in accordance with them; |
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| | (d) | empower the authority making the regulations to delegate to any person |
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| | willing and able to discharge them any functions of the authority under |
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| | |
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| |
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| | |
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| | |
| To move the following Clause:— |
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| | |
| | (a) | regulations under this Chapter, or |
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| | (b) | any order under section (Provision requiring arrangements to be |
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| | adopted: order making powers), |
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| | the authority having power to make regulations under this Chapter must carry out |
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| | such consultation as appears to it to be appropriate.’. |
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| |
| | Meaning of “distribution” |
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| |
| | |
| To move the following Clause:— |
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| | ‘(1) | In this Part “distribution” means every description of distribution of a company’s |
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| | assets to its members, whether in cash or otherwise, subject to the following |
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| | |
| | (2) | The following are not distributions for the purposes of this Part— |
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| | (a) | an issue of shares as fully or partly paid bonus shares; |
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| | (b) | the reduction of share capital— |
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| | (i) | by extinguishing or reducing the liability of any of the members |
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| | on any of the company’s shares in respect of share capital not |
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| | |
| | (ii) | by paying off paid up share capital; |
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| | (c) | the redemption or purchase of any of the company’s own shares out of |
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| | capital (including the proceeds of any fresh issue of shares) or out of |
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| | unrealised profits in accordance with Chapter (Redeemable shares) or |
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| | (Purchase of own shares) of Part (Acquisition by limited company of its |
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| | |
| | (d) | a distribution of assets to members of the company on its winding up.’. |
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| |
| | Distributions to be made only out of profits available for the purpose |
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| |
| | |
| To move the following Clause:— |
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| | ‘(1) | A company may only make a distribution out of profits available for the purpose. |
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| | (2) | A company’s profits available for distribution are its accumulated, realised |
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| | profits, so far as not previously utilised by distribution or capitalisation, less its |
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| |
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| | accumulated, realised losses, so far as not previously written off in a reduction or |
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| | reorganisation of capital duly made. |
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| | (3) | Subsection (2) has effect subject to sections (Distributions by investment |
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| | companies out of accumulated revenue profits) and (Power to extend provisions |
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| | relating to investment companies) (investment companies etc: distributions out of |
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| | accumulated revenue profits).’. |
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| |
| | Net asset restriction on distributions by public companies |
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| |
| | |
| To move the following Clause:— |
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| | ‘(1) | A public company may only make a distribution— |
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| | (a) | if the amount of its net assets is not less than the aggregate of its called- |
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| | up share capital and undistributable reserves, and |
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| | (b) | if, and to the extent that, the distribution does not reduce the amount of |
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| | those assets to less than that aggregate. |
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| | (2) | For this purpose a company’s “net assets” means the aggregate of the company’s |
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| | assets less the aggregate of its liabilities. |
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| | (3) | “Liabilities” here includes— |
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| | (a) | where the relevant accounts are Companies Act accounts, provisions of a |
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| | kind specified for the purposes of this subsection by regulations under |
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| | |
| | (b) | where the relevant accounts are IAS accounts, provisions of any kind. |
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| | (4) | A company’s undistributable reserves are— |
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| | (a) | its share premium account; |
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| | (b) | its capital redemption reserve; |
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| | (c) | the amount by which its accumulated, unrealised profits (so far as not |
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| | previously utilised by capitalisation) exceed its accumulated, unrealised |
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| | losses (so far as not previously written off in a reduction or reorganisation |
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| | |
| | (d) | any other reserve that the company is prohibited from distributing— |
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| | (i) | by any enactment (other than one contained in this Part), or |
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| | |
| | | The reference in paragraph (c) to capitalisation does not include a transfer of |
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| | profits of the company to its capital redemption reserve. |
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| | (5) | A public company must not include any uncalled share capital as an asset in any |
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| | accounts relevant for purposes of this section. |
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| | (6) | Subsection (1) has effect subject to sections (Distributions by investment |
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| | companies out of accumulated revenue profits) and (Power to extend provisions |
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| | relating to investment companies) (investment companies etc: distributions out of |
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| | accumulated revenue profits).’. |
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| |
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| |
| |
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| | Distributions by investment companies out of accumulated revenue profits |
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| |
| | |
| To move the following Clause:— |
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| | ‘(1) | An investment company may make a distribution out of its accumulated, realised |
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| | revenue profits if the following conditions are met. |
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| | (2) | It may make such a distribution only if, and to the extent that, its accumulated, |
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| | realised revenue profits, so far as not previously utilised by a distribution or |
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| | capitalisation, exceed its accumulated revenue losses (whether realised or |
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| | unrealised), so far as not previously written off in a reduction or reorganisation of |
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| | |
| | (3) | It may make such a distribution only— |
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| | (a) | if the amount of its assets is at least equal to one and a half times the |
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| | aggregate of its liabilities, and |
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| | (b) | if, and to the extent that, the distribution does not reduce that amount to |
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| | less than one and a half times that aggregate. |
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| | (4) | For this purpose a company’s liabilities include— |
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| | (a) | in the case of Companies Act accounts, provisions of a kind specified for |
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| | the purposes of this subsection by regulations under section 378; |
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| | (b) | in the case of IAS accounts, provisions of any kind. |
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| | (5) | The following conditions must also be met— |
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| | (a) | the company’s shares must be listed on a recognised UK investment |
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| | |
| | (b) | during the relevant period it must not have— |
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| | (i) | distributed any capital profits otherwise than by way of the |
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| | redemption or purchase of any of the company’s own shares in |
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| | accordance with Chapter (Redeemable shares) or (Purchase of |
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| | own shares) of Part (Acquisition by limited company of its own |
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| | |
| | (ii) | applied any unrealised profits or any capital profits (realised or |
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| | unrealised) in paying up debentures or amounts unpaid on its |
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| | |
| | (c) | it must have given notice to the registrar under section (Meaning of |
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| | “investment company”)(1) (notice of intention to carry on business as an |
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| | |
| | (i) | before the beginning of the relevant period, or |
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| | (ii) | as soon as reasonably practicable after the date of its |
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| | |
| | (6) | For the purposes of this section— |
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| | (a) | “recognised UK investment exchange” means a recognised investment |
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| | exchange within the meaning of Part 18 of the Financial Services and |
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| | Markets Act 2000 (c. 8), other than an overseas investment exchange |
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| | within the meaning of that Part; and |
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| | (b) | the “relevant period” is the period beginning with— |
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| | (i) | the first day of the accounting reference period immediately |
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| | preceding that in which the proposed distribution is to be made, |
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| | |
| | (ii) | where the distribution is to be made in the company’s first |
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| | accounting reference period, the first day of that period, |
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| | | and ending with the date of the distribution. |
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| |
| |
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| | (7) | The company must not include any uncalled share capital as an asset in any |
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| | accounts relevant for purposes of this section.’. |
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| |
| | Meaning of “investment company” |
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| |
| | |
| To move the following Clause:— |
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| | ‘(1) | In this Part an “investment company” means a public company that— |
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| | (a) | has given notice (which has not been revoked) to the registrar of its |
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| | intention to carry on business as an investment company, and |
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| | (b) | since the date of that notice has complied with the following |
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| | |
| | (2) | Those requirements are— |
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| | (a) | that the business of the company consists of investing its funds mainly in |
|
| | securities, with the aim of spreading investment risk and giving members |
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| | of the company the benefit of the results of the management of its funds; |
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| | (b) | that the condition in section (Investment company: condition as to |
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| | holdings in other companies) is met as regards holdings in other |
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| | |
| | (c) | that distribution of the company’s capital profits is prohibited by its |
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| | |
| | (d) | that the company has not retained, otherwise than in compliance with this |
|
| | Part, in respect of any accounting reference period more than 15% of the |
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| | income it derives from securities. |
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| | (3) | Subsection (2)(c) does not require an investment company to be prohibited by its |
|
| | articles from redeeming or purchasing its own shares in accordance with Chapter |
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| | (Redeemable shares) or (Purchase of own shares) of Part (Acquisition by limited |
|
| | company of its own shares) out of its capital profits.) |
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| | (4) | Notice to the registrar under this section may be revoked at any time by the |
|
| | company on giving notice to the registrar that it no longer wishes to be an |
|
| | investment company within the meaning of this section. |
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| | (5) | On giving such a notice, the company ceases to be such a company.’. |
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| |
| | Investment company: condition as to holdings in other companies |
|
| |
| | |
| To move the following Clause:— |
|
| | ‘(1) | The condition referred to in section (Meaning of “investment company”)(2)(b) |
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| | (requirements to be complied with by investment company) is that none of the |
|
| | company’s holdings in companies (other than those that are for the time being |
|
| | investment companies) represents more than 15% by value of the company’s |
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| | |
|