UK

UK Company Law rules on share buybacks relaxed: FSA consults on changes to Listing Rules

Joanna Gray. University of Strathclyde

Corporate Finance Law Background

A small but nonetheless significant change to UK company law will take place later this year when the Companies (Acquisition of Own Shares) (Treasury Shares) Regulations 2003 (SI 2003/1116) which have recently been laid before Parliament for its approval, come into effect. This change, which was first the subject of consultation from the Department of Trade and Industry in 1998, will relax the restrictions contained in the Companies Act 1985 on the ability of UK companies to purchase their own shares or engage in ‘share buybacks’ to use the corporate finance shorthand.