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- Point in Time (07/07/2014)
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Version Superseded: 31/12/2020
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(1)An investment company may make a distribution out of its accumulated, realised revenue profits if the following conditions are met.
(2)It may make such a distribution only if, and to the extent that, its accumulated, realised revenue profits, so far as not previously utilised by a distribution or capitalisation, exceed its accumulated revenue losses (whether realised or unrealised), so far as not previously written off in a reduction or reorganisation of capital duly made.
(3)It may make such a distribution only—
(a)if the amount of its assets is at least equal to one and a half times the aggregate of its liabilities to creditors, and
(b)if, and to the extent that, the distribution does not reduce that amount to less than one and a half times that aggregate.
(4)For this purpose a company's liabilities to creditors include—
(a)in the case of Companies Act accounts, provisions of a kind specified for the purposes of this subsection by regulations under section 396;
(b)in the case of IAS accounts, provisions for liabilities to creditors.
(5)The following conditions must also be met—
[F1(a)the company's shares must be shares admitted to trading on a regulated market;]
(b)during the relevant period it must not have—
(i)F2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(ii)applied any unrealised profits F3. . . in paying up debentures or amounts unpaid on its issued shares;
(c)it must have given notice to the registrar under section 833(1) (notice of intention to carry on business as an investment company)—
(i)before the beginning of the relevant period, or
(ii)as soon as reasonably practicable after the date of its incorporation.
(6)For the purposes of this section—
(a)F4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(b)the “relevant period” is the period beginning with—
(i)the first day of the accounting reference period immediately preceding that in which the proposed distribution is to be made, or
(ii)where the distribution is to be made in the company's first accounting reference period, the first day of that period,
and ending with the date of the distribution.
(7)The company must not include any uncalled share capital as an asset in any accounts relevant for purposes of this section.
Textual Amendments
F1S. 832(5)(a) substituted (6.4.2012) by The Companies Act 2006 (Amendment of Part 23) (Investment Companies) Regulations 2012 (S.I. 2012/952), regs. 1, 2(2)(a)
F2S. 832(5)(b)(i) and following word omitted (6.4.2012) by virtue of The Companies Act 2006 (Amendment of Part 23) (Investment Companies) Regulations 2012 (S.I. 2012/952), regs. 1, 2(2)(b)
F3Words in s. 832(5)(b)(ii) omitted (6.4.2012) by virtue of The Companies Act 2006 (Amendment of Part 23) (Investment Companies) Regulations 2012 (S.I. 2012/952), regs. 1, 2(2)(c)
F4S. 832(6)(a) and following word omitted (6.4.2012) by virtue of The Companies Act 2006 (Amendment of Part 23) (Investment Companies) Regulations 2012 (S.I. 2012/952), regs. 1, 2(3)
Commencement Information
I1S. 832 wholly in force at 6.4.2008; s. 832 not in force at Royal Assent see s. 1300; s. 832 in force at 6.4.2008 by S.I. 2007/3495, art. 3(1)(k) (with savings in arts. 7, 12 and subject to transitional adaptations in Sch. 1 paras. 14-20 and with savings in Sch. 4 paras. 33-35)
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