When you sell your business the buyer and their advisers may well insist that it is a condition of the contract that completion accounts are prepared. That way they get to do a (post completion) check on the net asset value. The Court of Appeal case of Shafi –v- Rutherford shows the danger inherent in these […]
Japanese companies do battle over Share Purchase Agreement and North Sea Oil assets
A recent High Court claim involving two Japanese companies shows the importance of the length of the limitation period on a company sale. The target companies here owned North Sea Oil rights. Japanese company Idemitsu acquired those companies from Japanese giant Sumitomo. The limitation period in the Share Purchase Agreement was set at just 18 months. […]
Curious case on Entrepreneur’s Relief
Entrepreneur’s relief is a very valuable relief, reducing chargeable gains from 20% to 10%. It depends on the seller of shares holding not less than 5% of the ordinary share capital of a company (plus 5% of its voting rights). It might be supposed that the expression ordinary share capital would not be the cause of […]
A trojan’s horse and Government bearing gifts…
From 1 July 2016 Companies House has introduced a free new service: you can elect that your Register of Members (as well as your Register of Directors and Secretaries) are held as public registers. You can also choose to hold your Register of People of Significant Control as a public register with Companies House too. […]
Banker’s Bonus tax scam involving employee share scheme: Supreme Court rules in favour of HM Revenue & Customs
The judgement of Lord Reed in a case decided on 9 March 2016 in favour of HMRC begins with the line: “In our society a great deal of intellectual effort is devoted to tax avoidance”. The facts of the case for the ordinary tax paying public are truly shocking. The case concerned Deutsche Bank (and […]
EMI Options: buy-back trap for the unwary
Those setting up an EMI Option for their key employees sometimes end up in a muddle over share buy-back rights. The starting point for the confusion is that the business owner (and sometimes his inexperienced advisers) fail to distinguish between the two distinct phases of a scheme. The first phase is the option period when the […]
A Succession Plan – Your New Year’s Resolution?
Taking the first step … As the Chinese say, a journey of a thousand miles must begin with a single step. What should that step be for you, the owner-manager? When you set up your company it will no doubt have been with a mix of hope and fear. Many of us contemplating our retirement […]
David v Goliath: The potential dangers of giving indemnities in a Share Purchase Agreement
The world of price comparison websites and the misleading of consumers who are buying insurance for classic motor cars lay behind this case: Wood v Sure Term Direct Limited and Capita Insurance Services Limited. It concerned the sale of an insurance brokerage and was decided by the Court of Appeal. The murky world of insurance […]
Legal Blunders: seller escapes liability under a Share Purchase Agreement warranty claim
When it comes to selling your business the buyer will want you to give warranties and indemnities. A case decided last month in the High Court of Justice (IPSOS S.A. -v- Dentsu Aegis Network Ltd) shows the importance of expert legal advice when claims under a Share Purchase Agreement are to be made. The devil is in […]
Share Buy Backs
Share buy back regulations introduced in 2013 have been amended by 2015 regulations that came into effect in April 2015. The 2013 regulations introduced some ostensibly radical changes (to company lawyers at any rate :)) to the law on how shares should be bought back. 2013 Regulations For the first time, companies were to […]
