SCHEDULES
C2 SCHEDULE 5 Employee Share Ownership Trusts
Rules about acquisition etc.
C111
1
The trust deed must provide that, for the purposes of the deed, thetrustees—
a
acquire securities when they become entitled to them;
b
transfer securities to another person when that other becomes entitled tothem;
c
retain securities if they remain entitled to them.
2
But if the deed provides as mentioned in paragraph 8 above, it mustprovide for the following exceptions to any rule which is included in it andconforms with sub-paragraph (1)(a) above, namely, that—
a
b
if the trustees become entitled to securities as a result of areorganisation, they shall be treated as having acquired them when they becameentitled to the original shares which those securities represent (construing “reorganisation” and “original shares” in accordance with section [F1126] of that Act).
3
The trust deed must provide that—
a
if the trustees agree to take a transfer of securities, for the purposesof the deed they become entitled to them when the agreement is made and noton a later transfer made pursuant to the agreement;
b
if the trustees agree to transfer securities to another person, for thepurposes of the deed the other person becomes entitled to them when theagreement is made and not on a later transfer made pursuant to the agreement.
Sch. 5 applied (6.3.1992 with effect as mentioned in s. 289(1)(2) of the applying Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 228(7), 235(8), 289 (with ss. 60, 101(1), 171, 201(3))