Commentary on Sections Overview Part 4: Types of shares that may be awarded Paragraph 29: Prohibited shares
3036.This paragraph specifies types of shares that may not be awarded under a SIP. The paragraph derives from paragraph 67 of Schedule 8.
3037.The title of this paragraph is now “prohibited shares” as opposed to “prohibited companies”. The new wording should provide a better indication of what is being prohibited.
3038.This paragraph now refers to a “service company” as opposed to an “employer company”. The new term is more descriptive and accords better with actual commercial usage. The expression “the employer company” is used elsewhere in this Act to mean the employee’s employer.
3039.Amendments have been made to sub-paragraphs (1)(b) and (4)(b) with a view to making those provisions easier to understand.
3040.Sub-paragraph (4) has wording differing from that in the source legislation. Schedule 1 to the Interpretation Act 1978 provides that “‘person’ includes a body of persons corporate or unincorporate”; and the view is taken that there can be no doubt that the word “person” includes a partnership.