Section 162E Treasury shares: mandatory cancellation

England, Wales and Scotland

(1)

If shares held as treasury shares cease to be qualifying shares, the company must forthwith cancel the shares in accordance with section 162D.

(2)

For the purposes of subsection (1), shares are not to be regarded as ceasing to be qualifying shares by virtue only of—

(a)

the suspension of their listing in accordance with the applicable rules in the EEA State in which the shares are officially listed, or

(b)

the suspension of their trading in accordance with—

(i)

in the case of shares traded on the market known as the Alternative Investment Market, the rules of London Stock Exchange plc, and

(ii)

in any other case, the rules of the regulated market on which they are traded.

(3)

For the purposes of this section “regulated market” means a market which F1appears on the list drawn up by an EEA State pursuant to Article 47 of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments .

Annotations

Textual amendments

F1: Words in s. 162E(3) substituted (1.4.2007 for certain purposes and 1.11.2007 otherwise) by The Financial Services and Markets Act 2000 (Markets in Financial Instruments) Regulations 2007 (S.I. 2007/126), reg. 3(6), Sch. 6 para. 7(4)

Notes on Chapter VII

Textual amendments

F1: Ss. 126-182 repealed (1.10.2009) by Companies Act 2006 (c. 46), ss. 1295, 1300, Sch. 16; S.I. 2008/2860, art. 4, Sch. 1 (with arts. 5, 7, 8, Sch. 2 (as amended by S.I. 2009/1802, art. 18, Sch.))