Companies Act 2014 section 1071

Additional (general) provisions relating to acquisition by PLCs of own shares

Section 1071 sets out additional requirements that a public limited company (PLC) must satisfy when it acquires its own shares, over and above the general rules in sections 105 and 106 of the Act.

• Where a PLC uses distributable profits to fund the purchase of its own shares, it must also comply with the asset distribution restrictions in section 1082.
• A PLC may not buy its own shares if doing so would reduce the nominal value of its non-redeemable issued share capital to less than one-tenth of the nominal value of its total issued share capital.
• All shareholders in the same position must be treated equally when a PLC purchases its own shares.
• The PLC must also comply with the market abuse rules in Chapter 2 of Part 23 and any regulations made under that chapter.