Acquisition of its Own Shares by a Company in the United Kingdom From The Perspective of Capital Maintenance Rules

B- A Relaxed Approach for Private Companies

As the Second Directive’s applications are limited to public companies, the UK took the opportunity to apply a more relaxed regime, which is based on the arguments expressed above, for private companies. The basic aspect of the relaxation is that, unlike public companies who are under the obligation to finance redemption and repurchases with the funds coming from the distributable profits or the new capital obtained by a fresh issue of shares(161),…