C2C1Part 18Acquisition by limited company of its own shares
Pts. 1-39 (except for Pt. 7 and ss. 662-669), 45-47 extended (12.5.2011) by The Companies Act 2006 (Consequential Amendments and Transitional Provisions) Order 2011 (S.I. 2011/1265), art. 5(1), Sch. 1 para. 2
Chapter 6Treasury shares
726Treasury shares: exercise of rights
1
This section applies where shares are held by a company as treasury shares.
2
The company must not exercise any right in respect of the treasury shares, and any purported exercise of such a right is void.
This applies, in particular, to any right to attend or vote at meetings.
3
No dividend may be paid, and no other distribution (whether in cash or otherwise) of the company's assets (including any distribution of assets to members on a winding up) may be made to the company, in respect of the treasury shares.
4
Nothing in this section prevents—
a
an allotment of shares as fully paid bonus shares in respect of the treasury shares, or
b
the payment of any amount payable on the redemption of the treasury shares (if they are redeemable shares).
5
Shares allotted as fully paid bonus shares in respect of the treasury shares are treated as if purchased by the company, at the time they were allotted, in circumstances in which section 724(1) (treasury shares) applied.
Pts. 1-39 modified (31.12.2020) by Regulation (EC) No. 2157/2001, Art. AAA1(3) (as inserted by The European Public Limited-Liability Company (Amendment etc.) (EU Exit) Regulations 2018 (S.I. 2018/1298), regs. 1, 97 (with regs. 140-145) (as amended by S.I. 2020/523, regs. 1(2), 5(a)-(f)); 2020 c. 1, Sch. 5 para. 1(1))