The Companies (Northern Ireland) Order 1986 (revoked)

PART XIF46N.I.ENFORCEMENT OF FAIR DEALING BY DIRECTORS

F46Order repealed (prosp.) by Companies Act 2006 (c. 46), ss. 1284(2), 1295, 1300(2), Sch. 16 and the repeal being partly in force, as to which see individual Articles (with savings (with adaptations) by Companies Act 2006 (Commencement No. 6, Saving and Commencement Nos. 3 and 5 (Amendment)) Order 2008 (S.I. 2008/674), arts. 2(3), {4}, Sch. 2) and subject to amendments (6.4.2008) by Companies Act 2006 (Consequential Amendments etc) Order 2008 (S.I. 2008/948), arts. 2(2), 3(1)(b)(2), Sch. 1 paras. 135, 147, 148 {Sch. 2 Note 1} (with arts. 6, 11, 12) and subject to amendments (6.4.2008) by S.R. 2008/133, {regs. 2, 3}

Restrictions on directors taking financial advantageF46N.I.

Prohibition on tax-free payments to directorsN.I.

319.  F1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Payment to director for loss of office, etc.N.I.

320.  F2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Company approval for property transferN.I.

321.  F3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Director's duty of disclosure on takeover, etc.N.I.

322.  F4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consequences of non-compliance with Article 322N.I.

323.  F5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Provisions supplementing Articles 320 to 323N.I.

324.  F6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Directors to disclose interest in contractsN.I.

325 .F7—(1) It is the duty of a director of a company who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the company to declare the nature of his interest at a meeting of the directors of the company.

(2) In the case of a proposed contract, the declaration shall be made—

(a)at the meeting of the directors at which the question of entering into the contract is first taken into consideration; or

(b)if the director was not at the date of that meeting interested in the proposed contract, at the next meeting of the directors held after he become so interested;

and, in a case where the director becomes interested in a contract after it is made, the declaration shall be made at the first meeting of the directors held after he becomes so interested.

(3) For the purposes of this Article, a general notice given to the directors of a company by a director to the effect that—

(a)he is a member of a specified company or firm and is to be regarded as interested in any contract which may, after the date of the notice, be made with that company or firm; or

(b)he is to be regarded as interested in any contract which may after the date of the notice be made with a specified person who is connected with him (within the meaning of Article 354),

is deemed a sufficient declaration of interest in relation to any such contract.

(4) However, no such notice is of effect unless either it is given at a meeting of the directors or the director takes reasonable steps to secure that it is brought up and read at the next meeting of the directors after it is given.

(5) A reference in this Article to a contract includes any transaction or arrangement (whether or not constituting a contract) made or entered into on or after 1st July 1983.

(6) For the purposes of this Article, a transaction or arrangement of a kind described in [F8section 197, 198, 200, 201 or 203 of the Companies Act 2006] (prohibition of loans, quasi-loans, etc. to directors) made by a company for a director of the company or a person connected with such a director is treated (if it would not otherwise be so treated, and whether or not it is prohibited by that Article) as a transaction or arrangement in which that director is interested.

(7) A director who fails to comply with this Article is liable to a fine.

(8) This Article applies to a shadow director as it applies to a director, except that a shadow director shall declare his interest, not at a meeting of directors, but by a notice in writing to the directors which is either—

(a)a specific notice given before the date of the meeting at which, if he had been a director, the declaration would be required by paragraph (2) to be made; or

(b)a notice which under paragraph (3) falls to be treated as a sufficient declaration of that interest (or would fall to be so treated apart from paragraph (4)).

(9) Nothing in this Article prejudices the operation of any rule of law restricting directors of a company from having an interest in contracts with the company.

F7mod. by 2000 c. 38

Directors' service contracts to be open to inspectionN.I.

326.  F9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Director's contract of employment for more than 5 yearsN.I.

327.  F10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Substantial property transactions involving directors, etc.N.I.

328 .F11  F12. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exceptions from Article 328N.I.

329.  F13. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Liabilities arising from contravention of Article 328N.I.

330.  F14. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F15Invalidity of certain transactions involving directors, etc.N.I.

330A.—(1) This Article applies where a company enters into a transaction to which the parties include—

(a)a director of the company or of its holding company, or

(b)a person connected with such a director or a company with whom such a director is associated,

and the board of directors, in connection with the transaction, exceed any limitation on their powers under the company's constitution.

(2) The transaction is voidable at the instance of the company.

(3) Whether or not it is avoided, any such party to the transaction as is mentioned in paragraph (1)(a) or (b), and any director of the company who authorised the transaction, is liable—

(a)to account to the company for any gain which he has made directly or indirectly by the transaction, and

(b)to indemnify the company for any loss or damage resulting from the transaction.

(4) Nothing in the above provisions shall be construed as excluding the operation of any other statutory provision or rule of law by virtue of which the transaction may be called in question or any liability to the company may arise.

(5) The transaction ceases to be voidable if—

(a)restitution of any money or other asset which was the subject-matter of the transaction is no longer possible, or

(b)the company is indemnified for any loss or damage resulting from the transaction, or

(c)rights acquired bona fide for value and without actual notice of the directors' exceeding their powers by a person who is not party to the transaction would be affected by the avoidance, or

(d)the transaction is ratified by the company in general meeting, by ordinary or special resolution or otherwise as the case may require.

(6) A person other than a director of the company is not liable under paragraph (3) if he shows that at the time the transaction was entered into he did not know that the directors were exceeding their powers.

(7) This Article does not affect the operation of Article 45A in relation to any party to the transaction not within paragraph (1)(a) or (b).

But where a transaction is voidable by virtue of this Article and valid by virtue of that Article in favour of such a person, the court may, on the application of that person or of the company, make such order affirming, severing or setting aside the transaction, on such terms, as appear to the court to be just.

(8) In this Article “transaction” includes any act; and the reference in paragraph (1) to limitations under the company's constitution includes limitations deriving—

(a)from a resolution of the company in general meeting or a meeting of any class of shareholders, or

(b)from any agreement between the members of the company or of any class of shareholders.]

Contracts with sole members who are directorsN.I.

330B.  F16. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Share dealings by directors and their familiesF46N.I.

Prohibition on directors dealing in share optionsN.I.

331.  F17. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Duty of director to disclose shareholdings in own companyN.I.

332.  F18. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Register of directors' interests notified under Article 332N.I.

333.  F19. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Sanctions for non-complianceN.I.

334.  F20. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Extension of Article 331 to spouses [F21, civil partners] and childrenN.I.

335.  F22. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Extenstion of Article 332 to spouses [F23, civil partners] and childrenN.I.

336.  F24. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Duty to notify stock exchange of matters notified under Articles 332 to 336N.I.

337.  F25. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Restrictions on a company's power to make loans, etc. to directors and persons connected with themF46N.I.

General restriction on loans, etc. to directors and persons connected with themN.I.

338.  F26. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Interpretation for Articles 338ff.N.I.

339.  F27. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Short-term quasi-loansN.I.

340.  F28. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Inter-company loans in the same groupN.I.

341.  F29. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Loans of small amountsN.I.

342.  F30. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Minor and business transactionsN.I.

343.  F31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Transactions at behest of holding companyN.I.

344.  F32. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Funding of director's expenditure on duty to companyN.I.

345.  F33. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F34Funding of director's expenditure on defending proceedingsN.I.

345A.  F35. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

Loan or quasi-loan by money-lending companyN.I.

346.  F36. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

“Relevant amounts” for the purposes of Articles 342ff.N.I.

347.  F37. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

“Value” of transactions and arrangementsN.I.

348.  F38. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Civil remedies for breach of Article 338N.I.

349.  F39. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Criminal penalties for breach of Article 338N.I.

350.  F40. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Record of transactions not disclosed in company accountsN.I.

351.  F41. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exceptions from Article 351N.I.

352.  F42. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SupplementaryF46N.I.

Power to increase financial limitsN.I.

353.  F43. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

“Connected persons”, etc.N.I.

354.  F44. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Transactions under foreign lawN.I.

355.  F45. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .