Private company share buybacks—procedure for payment out of capital under CA 2006, Pt 18, Ch 5


Published by a ÑÇÖÞÉ«ÇéÍø Corporate expert
Practice notes

Private company share buybacks—procedure for payment out of capital under CA 2006, Pt 18, Ch 5


Published by a ÑÇÖÞÉ«ÇéÍø Corporate expert

Practice notes
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A limited company may buy back shares in itself, if certain conditions set out in the Companies Act 2006 (CA 2006) are met. This is known as a share buyback or a purchase of own shares.

The restrictions in CA 2006 relating to share buybacks do not apply to unlimited companies. For further information on this type of company, see Practice Note: Unlimited companies.

For a summary of the regime for carrying out a share buyback, see Practice Note: How to carry out a share buyback.

For a consideration of the law applicable to a share buyback and information on why a company might wish to carry one out, see Practice Note: Share buybacks—the legal framework.

Off-market or on-market?

Only one type of share buyback is possible for a private limited company because it may only make an off-market purchase of shares (therefore, it can only carry out an off-market share buyback). As a result, this Practice Note does not deal with an on-market share buyback,

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Jurisdiction(s):
United Kingdom
Related legal acts:
Key definition:
Private company definition
What does Private company mean?

A private company is not a public company within the meaning of the Companies Act 2006 and is prohibited from making any offer of securities of the company to the public.

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