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Section 168: Payments apart from purchase price to be made out of distributable profits.

Companies Act 1985 · 1985 c. 6View on legislation.gov.uk

Part V: Share Capital, its Increase, Maintenance and Reduction — Chapter VII: Redeemable Shares; Purchase by a Company of its Own Shares

A payment made by a company in consideration of—

acquiring any right with respect to the purchase of its own shares in pursuance of a contract approved under section 165, or
the variation of a contract approved under section 164 or 165, or
the release of any of the company's obligations with respect to the purchase of any of its own shares under a contract approved under section 164 or 165 or under a contract for a purchase authorised under section 166,

must be made out of the company's distributable profits.

If the requirements of subsection (1) are not satisfied in relation to a contract—

in a case within paragraph (a) of the subsection, no purchase by the company of its own shares in pursuance of that contract is lawful under this Chapter,
in a case within paragraph (b), no such purchase following the variation is lawful under this Chapter, and
in a case within paragraph (c), the purported release is void.

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This legislation text comes from legislation.gov.uk. Contains public sector information licensed under the Open Government Licence v3.0. These source and reuse terms cover the legislation text, not Remedy's commentary.

Reuse reviewed 21 August 2026 under Open Government Licence v3.0.