Part 4, Restricted Shares
29.Paragraph 45 introduces changes to Part 7 of ITEPA as it relates to the use of restricted shares in SIP, SAYE and CSOP.
30.Paragraphs 47 - 51 amend Schedule 2 to omit the requirement that shares awarded under a SIP may be subject to only certain kinds of restrictions, and make consequential changes. Paragraph 50 introduces new sub-paragraph (2A) of paragraph 43 of Schedule 2, which provides that partnership shares may not be subject to forfeiture.
31.Paragraph 52 sets out a requirement at new sub-paragraphs (2)(aa) and (3)(aa) of paragraph 75 of Schedule 2 for employees to be provided with details of any restrictions applying to SIP shares.
32.Paragraph 53 makes consequential changes to paragraph 84 of Schedule 2 concerning disqualifying events.
33.Paragraph 55 amends paragraph 92 of Schedule 2 to provide that, for the purposes of Schedule 2, SIP shares subject to restrictions are to be valued as if they were not restricted.
34.Paragraphs 56 and 57 set out a definition of a 'restriction' in relation to shares for the purposes of the SIP code and make consequential amendments.
35.Paragraph 58 provides that the changes take effect from the date the legislation receives Royal Assent and apply only to shares awarded after that date. SIP schemes approved before these changes take effect, whose scheme rules contain provisions of the type modified by paragraphs 46 - 57, are treated as if any such modification had been made.
36.Paragraphs 59 - 61 amend Schedule 3 to remove the requirement that shares to which an SAYE scheme can apply may be subject to only certain kinds of restrictions, and make consequential changes.
37.Paragraph 62 sets out requirements at new sub-paragraphs (5) and (6) of paragraph 28 of Schedule 3 for employees to be notified of the detail of restrictions applying to SAYE shares at the time options are granted; and for restricted shares to be valued as if they were not restricted in determining the price at which shares may be acquired.
38.Paragraph 63 introduces a rule at new sub-paragraph (7) of paragraph 39 of Schedule 3 in relation to exchanges of SAYE share options, requiring restricted shares to be valued as if they were not restricted.
39.Paragraphs 65 - 66 amend paragraph 48 of Schedule 3 to provide a definition of a 'restriction' in relation to shares for the purposes of the SAYE code, and make consequential amendments.
40.Paragraph 67 provides that the amendments take effect from the date the legislation receives Royal Assent in relation to options granted after that date. SAYE schemes approved before the present changes take effect, whose scheme rules contain provisions of the type modified by paragraphs 59 - 66, are treated as if any such modification had been made.
41.Paragraph 68 amends paragraph 6 of Schedule 4, to provide at new sub-paragraph (4) that when calculating the limit on the value of shares subject to a CSOP, shares subject to restrictions are valued as if they were not restricted.
42.Paragraphs 69 - 71 amend Part 4 of Schedule 4 to remove the requirement that shares to which a CSOP can apply may be subject to only certain kinds of restriction, and make consequential changes.
43.Paragraph 72 sets out requirements at new sub-paragraphs (5) and (6) of paragraph 22 of Schedule 4 for employees to be notified of the detail of restrictions applying to CSOP shares at the time options are granted; and for restricted shares to be valued as if they were not restricted in determining the price at which shares may be acquired.
44.Paragraph 73 introduces a rule at new sub-paragraph (7) of paragraph 27 of Schedule 4 in relation to exchanges of share options, requiring restricted shares to be valued as if they were not restricted.
45.Paragraphs 75 - 76 amend paragraph 36 of Schedule 4 to provide a definition of a 'restriction' in relation to shares for the purposes of the CSOP code, and make consequential amendments.
46.Paragraph 77 provides that the requirement for valuing restricted CSOP shares as if they were not restricted (paragraph 68 of this Schedule) does not apply in relation to options granted before Royal Assent. All other changes to the CSOP code take effect from the date the legislation receives Royal Assent. CSOP schemes approved before these changes take effect, whose scheme rules contain provisions of the type modified by paragraphs 68 - 76, are treated as if any such modification had been made.
