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Companies Act 2006

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Companies Act 2006, Cross Heading: General rules is up to date with all changes known to be in force on or before 19 October 2017. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations. Help about Changes to Legislation

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  • Act amendment to earlier affecting provision S.I. 2008/373 reg. 11(1) by S.I. 2013/1971 reg. 9(a) (This amendment not applied to legislation.gov.uk. Amending Regulations revoked (1.10.2013) without ever being in force by S.I. 2013/2224, reg. 2)
  • Act amendment to earlier affecting provision S.I. 2008/373 reg. 3(4) by S.I. 2013/1971 reg. 4 (This amendment not applied to legislation.gov.uk. Amending Regulations revoked (1.10.2013) without ever being in force by S.I. 2013/2224, reg. 2)

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General rulesE+W+S+N.I.

580Shares not to be allotted at a discountE+W+S+N.I.

(1)A company's shares must not be allotted at a discount.

(2)If shares are allotted in contravention of this section, the allottee is liable to pay the company an amount equal to the amount of the discount, with interest at the appropriate rate.

581Provision for different amounts to be paid on sharesE+W+S+N.I.

A company, if so authorised by its articles, may—

(a)make arrangements on the issue of shares for a difference between the shareholders in the amounts and times of payment of calls on their shares;

(b)accept from any member the whole or part of the amount remaining unpaid on any shares held by him, although no part of that amount has been called up;

(c)pay a dividend in proportion to the amount paid up on each share where a larger amount is paid up on some shares than on others.

582General rule as to means of paymentE+W+S+N.I.

(1)Shares allotted by a company, and any premium on them, may be paid up in money or money's worth (including goodwill and know-how).

(2)This section does not prevent a company—

(a)from allotting bonus shares to its members, or

(b)from paying up, with sums available for the purpose, any amounts for the time being unpaid on any of its shares (whether on account of the nominal value of the shares or by way of premium).

(3)This section has effect subject to the following provisions of this Chapter (additional rules for public companies).

583Meaning of payment in cashE+W+S+N.I.

(1)The following provisions have effect for the purposes of the Companies Acts.

(2)A share in a company is deemed paid up (as to its nominal value or any premium on it) in cash, or allotted for cash, if the consideration received for the allotment or payment up is a cash consideration.

(3)A “cash consideration” means—

(a)cash received by the company,

(b)a cheque received by the company in good faith that the directors have no reason for suspecting will not be paid,

(c)a release of a liability of the company for a liquidated sum,

(d)an undertaking to pay cash to the company at a future date, or

(e)payment by any other means giving rise to a present or future entitlement (of the company or a person acting on the company's behalf) to a payment, or credit equivalent to payment, in cash.

(4)The Secretary of State may by order provide that particular means of payment specified in the order are to be regarded as falling within subsection (3)(e).

(5)In relation to the allotment or payment up of shares in a company—

(a)the payment of cash to a person other than the company, or

(b)an undertaking to pay cash to a person other than the company,

counts as consideration other than cash.

This does not apply for the purposes of Chapter 3 (allotment of equity securities: existing shareholders' right of pre-emption).

(6)For the purpose of determining whether a share is or is to be allotted for cash, or paid up in cash, “cash” includes foreign currency.

(7)An order under this section is subject to negative resolution procedure.

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Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I1S. 583 wholly in force at 1.10.2009; s. 583 not in force at Royal Assent, see s. 1300; s. 583 in force for specified purposes at 20.1.2007 by S.I. 2006/3428, art. 3(3) (subject to art. 5, Sch. 1 and with arts. 6, 8, Sch. 5); s. 583 otherwise in force at 1.10.2009 by S.I. 2008/2860, art. 3(k) (with arts. 5, 7, 8, Sch. 2) (as amended by S.I. 2009/1802, art. 18)

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