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1.14
After careful consideration of this controversial subject,
we recommend with regard to the purchase by a company of its own shares -
1.15
(a) that unlisted companies only, be given power to
purchase their own shares subject to the same
conditions, and in accordance with the same
procedures as apply in Britain, mutatis mutandis,
but subject always to the prior or contemporaneous
enactment of the Standing Committee's recommendations
on distributable profits; and
(b) that the question of allowing listed companies
to purchase their own shares be considered again
after satisfactory legislation has been enacted
dealing with -
(i)
Disclosure of Beneficiary Ownership of
Shareholdings
(ii) Insider Dealing
(iii) Distributable Profits
(iv) Fiduciary Duties of Directors.
With regard to Section 48 of the Companies Ordinance, the
Standing Committee's Report for 1985 explained that this is based on
a section in the British Companies Act of 1929 which had been replaced
by an improved section in the Companies Act 1948, which in turn had been
repealed and replaced by a completely new set of sections in the Companies
Act 1981 (now Sections 151 - 158 of the Companies Act 1985). In short
our section is very much out-of-date.
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