PART XEnforcement of Fair Dealing by Directors
Share dealings by directors and their families
324Duty of director to disclose shareholdings in own company
1
A person who becomes a director of a company and at the time when he does so is interested in shares in, or debentures of, the company or any other body corporate, being the company's subsidiary or holding company or a subsidiary of the company's holding company, is under obligation to notify the company in writing—
a
of the subsistence of his interests at that time; and
b
of the number of shares of each class in, and the amount of debentures of each class of, the company or other such body corporate in which each interest of his subsists at that time.
2
A director of a company is under obligation to notify the company in writing of the occurrence, while he is a director, of any of the following events—
a
any event in consequence of whose occurrence he becomes, or ceases to be, interested in shares in, or debentures of, the company or any other body corporate, being the company's subsidiary or holding company or a subsidiary of the company's holding company;
b
the entering into by him of a contract to sell any such shares or debentures;
c
the assignment by him of a right granted to him by the company to subscribe for shares in, or debentures of, the company; and
d
the grant to him by another body corporate, being the company's subsidiary or holding company or a subsidiary of the company's holding company, of a right to subscribe for shares in, or debentures of, that other body corporate, the exercise of such a right granted to him and the assignment by him of such a right so granted;
and notification to the company must state the number or amount, and class, of shares or debentures involved.
3
Schedule 13 has effect in connection with subsections (1) and (2) above; and of that Schedule—
a
Part I contains rules for the interpretation of, and otherwise in relation to, those subsections and applies in determining, for purposes of those subsections, whether a person has an interest in shares or debentures ;
b
Part II applies with respect to the periods within which obligations imposed by the subsections must be fulfilled ; and
c
Part III specifies certain circumstances in which obligations arising from subsection (2) are to be treated as not discharged;
and subsections (1) and (2) are subject to any exceptions for which provision may be made by regulations made by the Secretary of State by statutory instrument.
4
Subsection (2) does not require the notification by a person of the occurrence of an event whose occurrence comes to his knowledge after he has ceased to be a director.
5
An obligation imposed by this section is treated as not discharged unless the notice by means of which it purports to be discharged is expressed to be given in fulfilment of that obligation.
6
This section applies to shadow directors as to directors ; but nothing in it operates so as to impose an obligation with respect to shares in a body corporate which is the wholly-owned subsidiary of another body corporate.
7
A person who—
a
fails to discharge, within the proper period, an obligation to which he is subject under subsection (1) or (2), or
b
in purported discharge of an obligation to which he is so subject, makes to the company a statement which he knows to be false, or recklessly makes to it a statement which is false,
is guilty of an offence and liable to imprisonment or a fine, or both.
8
Section 732 (restriction on prosecutions) applies to an offence under this section.