1018.This section replaces section 171(1) of the 1985 Act and restates section 171(2) of that Act. It removes the current requirement for prior authorisation in the articles where a private company makes a payment out of capital in respect of a redemption or purchase of its own shares. If they wish, the members may, however, restrict or prohibit such a payment by including a provision to this effect in the company’s articles.
Commentary Part 18: Acquisition by Limited Company of Its Own Shares Chapter 5: Redemption Or Purchase by Private Company Out of Capital Section 709: Power of private limited company to redeem or purchase own shares out of capital