Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Transaction definition

What does Transaction mean? A transaction describes a legally binding dealing or arrangement by which assets, securities, services or obligations are created, transferred, varied or extinguished, whether as a single step or a series of steps. In practice this includes corporate acquisitions and disposals, real estate conveyancing, lending and taking security, restructurings, derivatives and other commercial dealings. In capital markets, a transaction commonly means the purchase, sale, subscription or underwriting of a particular investment. The term is a descriptive umbrella used across multiple legal contexts rather than a term with a single statutory meaning. Specific legislation, regulatory rules and contracts may define “transaction”...

Finance transactions with English companies: investigating capacity, authority, statutory protections, approvals by board, committee, sole director and shareholders, and execution of deeds, guarantees, security, hedging and powers of attorney

Published by a LexisNexis Banking & Finance expert

Practice notes

This Practice Note examines the actions commonly undertaken by companies in the setting of finance transactions and outlines the steps that can be taken to confirm the capacity and authority of a company incorporated under English law. There are various types of company incorporated in England and Wales that may participate in a finance transaction. For more information on different types of company, see: Types of borrowers—Companies. For the purposes of this Practice Note, the assumption is that the entity in question is a private company limited by shares, since most finance transactions in England and Wales will feature at least one such company as borrower or as a provider of security...

Why is it important to understand the acts a company will perform in a finance transaction?

Lender's perspective

A lender will seek to understand the acts a company will carry out in a finance transaction so that it can investigate whether the company has the necessary capacity and authority to undertake those acts. If the company did not have the requisite capacity or authority, this can have serious consequences for its contractual counterpart (see below)...

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Web page updated on 21/05/2026

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