Q&As

In relation to substantial property transactions, may the director (in their capacity as a member) vote on the resolution to approve the transaction in which they are involved?

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Published on LexisPSL on 16/04/2019

The following Corporate Q&A provides comprehensive and up to date legal information covering:

  • In relation to substantial property transactions, may the director (in their capacity as a member) vote on the resolution to approve the transaction in which they are involved?

In relation to substantial property transactions, may the director (in their capacity as a member) vote on the resolution to approve the transaction in which they are involved?

Under section 190 of the Companies Act 2006 (CA 2006), a company may not enter into a substantial property transaction with:

  1. a director of the company, or

  2. a person connected with a director of the company

unless it is approved by the members of the company or it is conditional upon such approval being obtained, subject to certain exceptions.

The approval of the members of a company or a company’s holding company may be given by ordinary resolution, subject to the provisions of the articles of association of the company in question, which may require the approval of a higher majority of the members (or unanimity).

As noted in the final section of Practice

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