Paragraph 40: Meaning of “qualifying exchange of shares”
3534.Among the ways listed in paragraph 39 of this Schedule for a company to acquire control of another company is by a “qualifying exchange of shares”. Paragraph 40 sets out that a “qualifying exchange of shares” is an arrangement under which the new company issues shares in itself in exchange for acquiring all the shares in the old company, subject to certain conditions laid down in this paragraph. This paragraph derives from paragraph 60 of Schedule 14 to FA 2000.