Acquiring Own Shares

Acquisition of Own Shares

The provisions applicable to the purchase and acquisition by a PLC of its own shares are those which apply to private companies together with additional requirements.  An acquisition by a PLC of its own shares must be made from distributable profits (as in the case of private companies). In addition, its net assets must be not less than its called up share capital and undistributable reserves (see below). This requirement applies generally to distributions by PLCs.

A PLC may not purchase any of its shares if as a result of the purchase, the nominal value of the issued share capital which is not redeemable, would be less than one-tenth of the nominal value of the total share capital of the company.

A PLC must by an ordinary resolution or in some cases or by a special resolution approve the purchase of its shares. An ordinary resolution is required for a market purchase. A special resolution is required for an off-market purchase. A market purchase is one which is made on a regulated securities markets, within the EU or in certain internationally recognised market/ stock exchanges.

A PLC may not take a mortgage charge over its own shares other than in respect of amounts payable on foot of those shares. A mortgage may be taken where the business of the PLC is lending and equivalent financial service transactions, and the mortgage or charge over its own shares arises in the ordinary course of its business. The restriction on transfer of shares does not apply in respect of a transfer of uncertificated / dematerialised shares in a PLC.

Members’ Approval

The purchase must be made in accordance with an ordinary resolution by the PLC’s members. The authority must specify the maximum number of shares and the maximum prices that can be paid, either directly or through a formula. It is to specify the date, which shall be no more than five years later when the resolution’s authority shall expire. A company may make a purchase after this period, which has been contracted for, within the period.

A PLC may only purchase off-market with the approval of a special resolution. The authority is to specify the date of expiry of the authority which should be not later than 18 months after the resolution. Contracts entered within that period may be completed.

Any assignment of the rights of a PLC under a contract which has been authorised is void unless it has been authorised by the relevant ordinary or special resolution.


In addition to the general requirements applicable to private companies in respect of returns to the CRO in relation to the repurchase of shares, a PLC must provide additional information, including the aggregate amount paid and the maximum and minimum prices in respect of each class purchased.

Additional publication obligations apply in respect of overseas market purchases. They must be published on the company’s website or in another prescribed manner within a 28 day period, beginning on the day after the overseas market purchase concerned. It must contain certain information including the place where the relevant market is, the price paid or the highest and lowest such prices paid and the number of shares purchased.

When shares which are held for dealing purposes on a regulated market are purchased by the PLC or its subsidiary, the PLC is obliged to notify the authorised market maker concerned of the purchaser. The operator of the market may publish the information. Failure to fulfil the duty is an offence.

Acquired Shares

Where a PLC acquires its own shares, whether by forfeiture, surrender or acquisition from third-party, it must hold them as treasury shares, cancel them, dispose of them or reduce its share capital by the nominal amount of the shares within three years. This must be done in some cases within one year, where financial assistance has been given. Failure to do so is an offence.

The obligation also applies where a nominee of the PLC acquires shares in the PLC from a third person without financial assistance being given directly or indirectly by the PLC and the PLC has a beneficial interest in those shares. It also applies where any person acquires shares in the PLC with financial assistance given directly or indirectly by the PLC for the purpose of the acquisition and the PLC has a beneficial interest in those shares.

Unless the shares or any interest of the PLC in them have been previously disposed of, the PLC shall, not later than the end of the relevant period after the date of their forfeiture or surrender or, their acquisition

  • cancel them and reduce the amount of the share capital by the nominal value of the shares, and
  • where the effect of cancelling the shares will be that the nominal value of the PLC’s allotted share capital is brought below the authorised minimum, apply for re-registration as another type of company, stating the effect of the cancellation.

Treasury Shares

Where a company acquires its own shares and they are not cancelled or otherwise dealt with as above, they are to be held as treasury shares. The treasury shares are subject to limitations. A company may not exercise rights in respect of treasury shares held by it.

The maximum and minimum prices, at which treasury shares may be re-allotted off market, is to be determined in advance at a general meeting. Where treasury shares which are to be allotted are derived from shares purchased in accordance with the repurchase of shares provisions, the re-allotment price range is to be determined by the special resolution passed at the meeting at which the resolution authorising the purchase been passed. It may be varied by special resolution. A re-allotment by PLC of treasury shares in contravention of the requirements is void and unlawful.

The PLC and, where applicable its nominee or, in certain cases another shareholder, shall not exercise any voting rights in respect of the shares and any purported exercise of those rights shall be void.

References and Sources

Primary References

Companies Act 2014 (Irish Statute Book)

Companies Act 2014: An Annotation (2015) Conroy

Law of Companies 4th Ed.  (2016)     Courtney

Keane on Company Law 5th Ed. (2016) Hutchinson

Other Irish Sources

Tables of Origins & Destinations Companies Act 2014 (2016) Bloomsbury

Introduction to Irish Company Law    4th Ed. (2015) Callanan

Bloomsbury’s Guide to the Companies Act 2015      Courtney & Ors

Company Law in Ireland 2nd Ed. (2015) Thuillier

Pre-2014 Legislation Editions

Modern Irish Company Law   2nd Ed. (2001) Ellis

Cases & Materials Company Law 2nd Ed. (1998) Forde

Company Law 4th Ed. (2008)  Forde & Kennedy

Corporations & Partnerships in Ireland (2010) Lynch-Fannon & Cuddihy

Companies Acts 1963-2012   (2012)  MacCann & Courtney

Constitutional Rights of Companies   (2007)  O’Neill

Court Applications Under the Companies Act (2013) Samad

Shorter Guides

Company Law – Nutshell 3rd Ed. (2013) McConville

Questions & Answers on Company Law (2008)        McGrath, N & Murphy

Make That Grade Irish Company Law 5th Ed. (2015) Murphy

Company Law BELR Series (2015)   O’Mahony

UK Sources

Companies Act 2006 (UK) (

Statute books Blackstone’s statutes on company law (OUP)

Gower Principles of Modern Company Law 10th Ed. (2016) P. and S. Worthington

Company Law in Context 2nd Ed. (2012) D Kershaw

Company Law (9th Ed.) OUP (2016) J Lowry and A Dignam

Cases and Materials in Company law 11th Ed (2016) Sealy and Worthington


UK Practitioners Services

Tolley’s Company Law Handbook

Gore Browne on Companies

Palmer’s Company Law