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SCHEDULES

Section 10

SCHEDULE 1U.K.Trigger events: holding of interests and rights

Joint interestsU.K.

1U.K.If two or more persons each hold an interest or right jointly, each of them is treated as holding that interest or right.

Commencement Information

I1Sch. 1 para. 1 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Joint arrangementsU.K.

2(1)If interests or rights held by a person and interests or rights held by another person are the subject of a joint arrangement between those persons, each of them is treated as holding the combined interests or rights of both of them.U.K.

(2)A “joint arrangement” is an arrangement between the holders of interests or rights that they will exercise all or substantially all the rights conferred by their respective interests, or their respective rights, jointly in a way that is pre-determined by the arrangement.

Commencement Information

I2Sch. 1 para. 2 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Indirect holdingsU.K.

3(1)An interest or right held indirectly by a person is to be treated as held by the person.U.K.

(2)A person holds an interest or right “indirectly” if the person has a majority stake in an entity and that entity—

(a)holds the interest or right, or

(b)is part of a chain of entities—

(i)each of which (other than the last) has a majority stake in the entity immediately below it in the chain, and

(ii)the last of which holds the interest or right.

(3)For these purposes, A has a “majority stake” in B if—

(a)A holds a majority of voting rights in B,

(b)A is a member of B and has the right to appoint or remove a majority of the board of directors of B,

(c)A is a member of B and controls alone, pursuant to an agreement with other shareholders or members, a majority of the voting rights in B, or

(d)A has the right to exercise, or actually exercises, dominant influence or control over B.

(4)In the application of this paragraph to the right to appoint or remove a majority of the board of directors, an entity is to be treated as having the right to appoint a director if—

(a)a person's appointment as director follows necessarily from that person's appointment as director of the entity, or

(b)the directorship is held by the entity itself.

(5)In this paragraph—

(a)the reference to the right to appoint or remove a majority of the board of directors of an entity is to the right to appoint or remove directors holding a majority of the voting rights at meetings of the board on all or substantially all matters,

(b)the reference to the board of directors, in the case of an entity that does not have such a board, is to be read as a reference to the equivalent management body of that entity,

(c)references to “voting rights” are to be read in accordance with section 8(7).

Commencement Information

I3Sch. 1 para. 3 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Interests held by nomineesU.K.

4U.K.An interest held by a person as nominee for another is to be treated as held by the other (and not by the nominee).

Commencement Information

I4Sch. 1 para. 4 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Rights treated as held by person who controls their exerciseU.K.

5(1)Where a person controls a right, the right is to be treated as held by that person (and not by the person who in fact holds the right, unless that person also controls it).U.K.

(2)A person “controls” a right if, by virtue of any arrangement between that person and others, the right is exercisable only—

(a)by that person,

(b)in accordance with that person's directions or instructions, or

(c)with that person's consent or concurrence.

Commencement Information

I5Sch. 1 para. 5 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Rights exercisable only in certain circumstances etcU.K.

6(1)Rights that are exercisable by a person only in certain circumstances are to be treated as held by the person only—U.K.

(a)when the circumstances have arisen, and for so long as they continue to obtain, or

(b)when the circumstances are within the control of the person.

(2)But rights that are exercisable by an administrator or by creditors while an entity is in relevant insolvency proceedings are not to be regarded as held by the administrator or creditors even while the entity is in those proceedings.

(3)Relevant insolvency proceedings” means—

(a)administration within the meaning of the Insolvency Act 1986,

(b)administration within the meaning of the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)), or

(c)proceedings under the insolvency law of another country or territory during which an entity's assets and affairs are subject to the control or supervision of a third party or creditor.

(4)Rights that are normally exercisable but are temporarily incapable of exercise are not for that reason to be treated as not being held.

Commencement Information

I6Sch. 1 para. 6 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Rights attached to shares held by way of securityU.K.

7U.K.Rights attached to shares held by way of security provided by a person are to be treated as held by that person—

(a)where apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights are exercisable only in accordance with that person's instructions, and

(b)where the shares are held in connection with the granting of loans as part of normal business activities and apart from the right to exercise them for the purpose of preserving the value of the security, or of realising it, the rights are exercisable only in that person's interests.

Commencement Information

I7Sch. 1 para. 7 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Connected personsU.K.

8U.K.Two or more persons who are connected with each other (within the meaning given by paragraph 9 or 10) are each to be treated as holding the combined interests or rights of both or all of them.

Commencement Information

I8Sch. 1 para. 8 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

9(1)Two or more undertakings are connected if they are group undertakings in respect of each other.U.K.

(2)In sub-paragraph (1), “undertaking” and “group undertaking” have the same meanings as in the Companies Act 2006 (see section 1161 of that Act).

Commencement Information

I9Sch. 1 para. 9 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

10(1)An individual, A, is connected with another individual, B, if—U.K.

(a)A is B's spouse, civil partner or cohabitee,

(b)A is a relative of B,

(c)A is the spouse, civil partner or cohabitee of a relative of B,

(d)A is a relative of B's spouse, civil partner or cohabitee, or

(e)A is the spouse, civil partner or cohabitee of a relative of B's spouse, civil partner or cohabitee.

(2)For the purposes of sub-paragraph (1)—

(a)two persons who are living together as if they were a married couple or civil partners are cohabitees,

(b)references to a spouse, civil partner or cohabitee include a former spouse, civil partner or cohabitee, and

(c)relative” means a brother, sister, uncle, aunt, nephew, niece, lineal ancestor or descendant (the stepchild of any person, or anyone adopted by a person, whether legally or otherwise, as their child, being regarded as a relative or taken into account to trace a relationship in the same way as that person's child).

Commencement Information

I10Sch. 1 para. 10 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Common purposeU.K.

11(1)Two or more persons who share a common purpose in relation to an asset or entity are each to be treated as holding the combined interests or rights of both or all of them.U.K.

(2)The cases in which persons share a common purpose in relation to an entity include (but are not limited to) cases in which the persons co-ordinate their influence on the activities, operations, governance or strategy of the entity.

(3)The cases in which persons share a common purpose in relation to an asset include (but are not limited to) cases in which the persons co-ordinate their influence on the way in which the asset is used, and section 9(2) applies for the purposes of this sub-paragraph.

Commencement Information

I11Sch. 1 para. 11 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

ArrangementsU.K.

12(1)In this Schedule “arrangement” includes—U.K.

(a)any scheme, agreement or understanding, whether or not it is legally enforceable, and

(b)any convention, custom or practice of any kind.

(2)But something does not count as an arrangement unless there is at least some degree of stability about it (whether by its nature or terms, the time it has been in existence or otherwise).

Commencement Information

I12Sch. 1 para. 12 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

Section 58

SCHEDULE 2U.K.Minor and consequential amendments and revocations

1U.K.The Enterprise Act 2002 is amended in accordance with paragraphs 2 to 10.

Commencement Information

I13Sch. 2 para. 1 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

2(1)Section 23 (relevant merger situations) is amended as follows.U.K.

(2)For subsections (1) and (2) substitute—

(1)For the purposes of this Part, a relevant merger situation has been created if—

(a)two or more enterprises have ceased to be distinct enterprises at a time or in circumstances falling within section 24; and

(b)the value of the turnover in the United Kingdom of the enterprise being taken over exceeds £70 million.

(2)For the purposes of this Part, a relevant merger situation has also been created if—

(a)two or more enterprises have ceased to be distinct enterprises at a time or in circumstances falling within section 24; and

(b)as a result, one or both of the conditions mentioned in subsections (3) and (4) below prevails or prevails to a greater extent.

(3)Omit subsections (2A), (4A) and (4B).

(4)In subsection (5), for “(3), (4), (4A) or (4B)” substitute “ (3) or (4) ”.

(5)In subsection (6), for “(3), (4), (4A) and (4B)” substitute “ (3) and (4) ”.

(6)Omit subsection (10).

Commencement Information

I14Sch. 2 para. 2 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

3U.K.Omit section 23A.

Commencement Information

I15Sch. 2 para. 3 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

4U.K.In section 35(7) (questions to be decided in relation to completed mergers), for “, for the purposes of section 23(2)(b), the share of supply test is met,” substitute “ any such result as is mentioned in section 23(2)(b) has arisen, ”.

Commencement Information

I16Sch. 2 para. 4 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

5U.K.In section 36(6) (questions to be decided in relation to anticipated mergers), for “, for the purposes of section 23(2)(b), the share of supply test will be met,” substitute “ any such result as is mentioned in section 23(2)(b) will arise, ”.

Commencement Information

I17Sch. 2 para. 5 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

6U.K.In section 48(3) (cases where references or certain questions need not be decided), for “, for the purposes of section 23(2)(b), the share of supply test is or will be met,” substitute “ any such result as is mentioned in section 23(2)(b) has arisen or the question whether any such result will arise, ”.

Commencement Information

I18Sch. 2 para. 6 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

7U.K.In section 58 (specified considerations), omit subsections (1) and (2).

Commencement Information

I19Sch. 2 para. 7 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

8U.K.In section 59 (intervention by Secretary of State in special public interest cases), omit subsections (3)(b)(i), (3B), (8) and (9).

Commencement Information

I20Sch. 2 para. 8 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

9U.K.In section 153 (specified considerations), omit subsection (2).

Commencement Information

I21Sch. 2 para. 9 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

10U.K.In paragraph 20(1) of Schedule 8 (national security) omit “(within the meaning of section 58(1))”.

Commencement Information

I22Sch. 2 para. 10 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)

11U.K.In consequence of the preceding paragraphs, the following are revoked—

(a)the Enterprise Act 2002 (Share of Supply Test) (Amendment) Order 2018 (S.I. 2018/578),

(b)the Enterprise Act 2002 (Turnover Test) (Amendment) Order 2018 (S.I. 2018/593),

(c)the Enterprise Act 2002 (Share of Supply) (Amendment) Order 2020 (S.I. 2020/748), and

(d)the Enterprise Act 2002 (Turnover Test) (Amendment) Order 2020 (S.I. 2020/763).

Commencement Information

I23Sch. 2 para. 11 in force at 4.1.2022 by S.I. 2021/1465, regs. 2, 3 (with regs. 4, 5)