Paragraph 3 I1

(1)

An interest or right held indirectly by a person is to be treated as held by the person.

(2)

A person holds an interest or right “indirectly” if the person has a majority stake in an entity and that entity—

(a)

holds the interest or right, or

(b)

is part of a chain of entities—

(i)

each of which (other than the last) has a majority stake in the entity immediately below it in the chain, and

(ii)

the last of which holds the interest or right.

(3)

For these purposes, A has a “majority stake” in B if—

(a)

A holds a majority of voting rights in B,

(b)

A is a member of B and has the right to appoint or remove a majority of the board of directors of B,

(c)

A is a member of B and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in B, or

(d)

A has the right to exercise, or actually exercises, dominant influence or control over B.

(4)

In the application of this paragraph to the right to appoint or remove a majority of the board of directors, an entity is to be treated as having the right to appoint a director if—

(a)

a person's appointment as director follows necessarily from that person's appointment as director of the entity, or

(b)

the directorship is held by the entity itself.

(5)

In this paragraph—

(a)

the reference to the right to appoint or remove a majority of the board of directors of an entity is to the right to appoint or remove directors holding a majority of the voting rights at meetings of the board on all or substantially all matters,

(b)

the reference to the board of directors, in the case of an entity that does not have such a board, is to be read as a reference to the equivalent management body of that entity,

(c)

references to “voting rights” are to be read in accordance with section 8(7).

Annotations

Commencement

I1: Sch. 1 para. 3 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)