Finance Act 2019
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Cancellation schemes of arrangement | ||
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61. The Principal Act is amended by the insertion of the following section after section 31C: | ||
“Cancellation schemes of arrangement | ||
31D. ((1) In this section— | ||
‘Act of 2014’ means the Companies Act 2014 ; | ||
‘agreement’ includes any arrangement, contract, compromise, understanding, scheme, offer, transaction or series of transactions; | ||
‘company’ means a company formed and registered under the Act of 2014 or an existing company within the meaning of that Act; | ||
‘registrar’ has the same meaning as it has in the Act of 2014; | ||
‘scheme order’ has the same meaning as it has in Chapter 1 of Part 9 of the Act of 2014. | ||
(2) Where— | ||
(a) there is an agreement to effect the acquisition of a company (in this section referred to as the ‘target company’), | ||
(b) the target company enters into an arrangement— | ||
(i) that has become binding in accordance with section 453 of the Act of 2014, and | ||
(ii) in accordance with which there is a cancellation of shares in the target company pursuant to Chapter 4 of Part 3 of that Act, | ||
and | ||
(c) the shareholders of the target company receive consideration for the cancellation of those shares held by them, | ||
the agreement referred to in paragraph (a) shall be— | ||
(I) chargeable with the same stamp duty as if it were a conveyance or transfer on sale of those shares, and | ||
(II) deemed to be executed on the date on which a copy of the scheme order relating to the arrangement is delivered to the registrar in accordance with section 454 of the Act of 2014. | ||
(3) Where subsection (2) applies, the consideration for the purpose of charging stamp duty shall be the consideration received by the shareholders of the target company for the cancellation of shares held by them. | ||
(4) For the purposes of this Act, the accountable person shall be the person paying the consideration for the cancellation of the shares by the shareholders of the target company. | ||
(5) This section shall have effect in relation to a scheme order made on or after 9 October 2019.”. |