45U.K.Part 7 of ITEPA 2003 (employment income: income and exemptions relating to securities) is amended as follows.
46U.K.Part 4 of Schedule 2 (types of shares that may be awarded) is amended as follows.
47U.K.In paragraph 25 (introduction) in sub-paragraph (1)—
(a)after the entry for paragraph 28 insert “ and ”, and
(b)omit the entry for paragraph 30 and the “and” before it.
48U.K.Omit paragraphs 30 to 33 (only certain kinds of restrictions allowed).
49U.K.In Part 5 of Schedule 2 (free shares) in paragraph 35 (maximum annual award) omit sub-paragraphs (3) and (4).
50U.K.In Part 6 of Schedule 2 (partnership shares) in paragraph 43 (introduction) after sub-paragraph (2) insert—
“(2A)The plan must provide that partnership shares are not to be subject to any provision for forfeiture.”
51U.K.In Part 7 of Schedule 2 (matching shares) in paragraph 59 (general requirement for matching shares) omit sub-paragraph (2).
52U.K.In Part 9 of Schedule 2 (trustees) in paragraph 75 (duty to give notice of award of shares etc) in sub-paragraphs (2) and (3) after paragraph (a) insert—
“(aa)if the shares are subject to any restriction, giving details of the restriction,”.
53(1)In Part 10 of Schedule 2 (approval of plans) paragraph 84 (disqualifying events) is amended as follows.U.K.
(2)In sub-paragraph (3)—
(a)after paragraph (b) insert “ or ”, and
(b)omit paragraph (c) and the “or” after it.
(3)In sub-paragraph (4)(b) for “provision for forfeiture” substitute “ restriction ”.
54U.K.Part 11 of Schedule 2 (supplementary provision) is amended as follows.
55U.K.In paragraph 92 (determination of market value) for sub-paragraph (2) substitute—
“(2)For the purposes of this Schedule the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.”
56U.K.In paragraph 99 (minor definitions) after sub-paragraph (3) insert—
“(4)For the purposes of the SIP code—
(a)shares are subject to a “restriction” if there is any contract, agreement, arrangement or condition which makes provision to which any of subsections (2) to (4) of section 423 (restricted securities) would apply if the references in those subsections to the employment-related securities were to the shares, and
(b)the “restriction” is that provision.”
57U.K.In paragraph 100 (index of defined expressions) at the appropriate place insert—
| “restriction (in relation to shares) | paragraph 99(4)”. |
58(1)The amendments made by paragraphs 46 to 48 and 50 to 52 above have effect in relation to awards of shares made on or after the day on which this Act is passed.U.K.
(2)A SIP approved, or a trust instrument made, before that day has effect with any modifications needed to reflect the amendments made by paragraphs 46 to 57 above.
(3)In particular, in relation to awards of shares on or after that day, such a SIP has effect with the omission of any provision falling within a provision of Schedule 2 to ITEPA 2003 omitted by paragraph 48 above.
59U.K.Part 4 of Schedule 3 (shares to which schemes can apply) is amended as follows.
60U.K.In paragraph 17 (introduction) in sub-paragraph (1)—
(a)after the entry for paragraph 20 insert “ and ”, and
(b)omit the entry for paragraph 21 and the “and” after it.
61U.K.Omit paragraph 21 (only certain kinds of restrictions allowed).
62U.K.In Part 6 of Schedule 3 (requirements etc relating to share options) in paragraph 28 (requirements as to price of acquisition of shares) after sub-paragraph (4) insert—
“(5)At the time a share option is granted—
(a)it must be stated whether or not the shares which may be acquired by the exercise of the option may be subject to any restriction, and
(b)if so, the details of the restriction must also be stated.
(6)For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.”
63U.K.In Part 7 of Schedule 3 (exchange of share options) in paragraph 39 (requirements about share options granted in exchange) after sub-paragraph (6) insert—
“(7)For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.”
64U.K.Part 9 of Schedule 3 (supplementary provisions) is amended as follows.
65U.K.In paragraph 48 (minor definitions) after sub-paragraph (2) insert—
“(3)For the purposes of the SAYE code—
(a)shares are subject to a “restriction” if there is any contract, agreement, arrangement or condition which makes provision to which any of subsections (2) to (4) of section 423 (restricted securities) would apply if the references in those subsections to the employment-related securities were to the shares, and
(b)the “restriction” is that provision.”
66U.K.In paragraph 49 (index of defined expressions) at the appropriate place insert—
| “restriction (in relation to shares) | paragraph 48(3)”. |
67(1)The amendments made by paragraphs 59 to 62 above have effect in relation to options granted on or after the day on which this Act is passed.U.K.
(2)The amendment made by paragraph 63 above has effect for cases where the old options are granted on or after that day.
(3)A SAYE option scheme approved before that day has effect with any modifications needed to reflect the amendments made by paragraphs 59 to 66 above.
(4)In particular, in relation to options granted on or after that day, such a SAYE option scheme has effect with the omission of any provision falling within a provision of Schedule 3 to ITEPA 2003 omitted by paragraph 61 above.
68U.K.In Part 2 of Schedule 4 (general requirements for approval) in paragraph 6 (limit on value of shares subject to options) after sub-paragraph (3) insert—
“(4)For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.”
69U.K.Part 4 of Schedule 4 (shares to which schemes can apply) is amended as follows.
70U.K.In paragraph 15 (introduction)—
(a)after the entry for paragraph 18 insert “ and ”, and
(b)omit the entry relating to paragraph 19 and the “and” after it.
71U.K.Omit paragraph 19 (only certain kinds of restrictions allowed).
72U.K.In Part 5 of Schedule 4 (requirements etc relating to share options) in paragraph 22 after sub-paragraph (4) insert—
“(5)At the time a share option is granted—
(a)it must be stated whether or not the shares which may be acquired by the exercise of the option may be subject to any restriction, and
(b)if so, the details of the restriction must also be stated.
(6)For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.”
73U.K.In Part 6 of Schedule 4 (exchange of share options) in paragraph 27 (requirements about share options granted in exchange) after sub-paragraph (6) insert—
“(7)For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.”
74U.K.Part 8 of Schedule 4 (supplementary provisions) is amended as follows.
75U.K.In paragraph 36 (minor definitions) after sub-paragraph (2) insert—
“(3)For the purposes of the CSOP code—
(a)shares are subject to a “restriction” if there is any contract, agreement, arrangement or condition which makes provision to which any of subsections (2) to (4) of section 423 (restricted securities) would apply if the references in those subsections to the employment-related securities were to the shares, and
(b)the “restriction” is that provision.”
76U.K.In paragraph 37 (index of defined expressions) at the appropriate place insert—
| “restriction (in relation to shares) | paragraph 36(3)”. |
77(1)The amendment made by paragraph 68 above has effect for the purpose of determining whether options may be granted to an individual on or after the day on which this Act is passed; but the amendment is to be ignored in determining the market value of any shares to which an option granted before that day relates.U.K.
(2)The amendments made by paragraphs 69 to 72 above have effect in relation to options granted on or after that day.
(3)The amendment made by paragraph 73 above has effect for cases where the old options are granted on or after that day.
(4)A CSOP scheme approved before that day has effect with any modifications needed to reflect the amendments made by paragraphs 68 to 76 above.
(5)In particular, in relation to options granted on or after that day, such a CSOP scheme has effect with the omission of any provision falling within a provision of Schedule 4 to ITEPA 2003 omitted by paragraph 71 above.