Paragraph 21: Only certain kinds of restriction allowed
3299.This paragraph takes the material from the rest of paragraph 12 of Schedule 9 to ICTA and covers the rules about the kind of restrictions permitted for eligible shares.
3300.Broadly restrictions are not allowed unless they apply to all shares in the same class. There is an exception. This is contained in sub-paragraphs (2) and (3) and derives from sub-paragraphs (2) and (3) of paragraph 12 of Schedule 9 to ICTA. This allows companies to require ex-employees to dispose of their shares; this will usually be to the existing shareholders.
3301.In sub-paragraph (2)(a) and (b) “or offered for sale” covers the situation in which employees cannot actually secure the sale of their shares. See Change 168 in Annex 1.
3302.In sub-paragraph (5) a reference to section 74(4) of the Financial Services and Markets Act 2000 has been inserted to update the reference to the Model Code issued by the Stock Exchange, in paragraph 13(2) of Schedule 9 to ICTA. See also Change 168 in Annex 1.
3303.Sub-paragraph (6) enacts the contents of a Revenue Press Release, concerning the “directors veto”, issued on 11 June 1985. See also Change 168 in Annex 1.
3304.There is a new sub-paragraph (7), which gives statutory effect to the Inland Revenue’s interpretation of the reference in paragraph 12 of Schedule 9 to ICTA to “articles of association”. See also Change 168 in Annex 1, which refers to Note 44 in Annex 2.
