Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Financial assistance definition

What does Financial assistance mean? Financial assistance describes funding or other support a company gives to help someone acquire its shares (or those of its holding company), such as a loan, guarantee, security or indemnity, whether provided before, at the time of, or after the acquisition. The concept is used across corporate and banking practice and is framed broadly in statute. United Kingdom (England & Wales, Scotland and Northern Ireland): Under the Companies Act 2006, the historic prohibition was abolished for private companies. A statutory ban still applies where a public company (or its subsidiaries) gives financial assistance for the acquisition of shares in...

UK financial assistance rules and employee share schemes under the Companies Act 2006: scope, exemptions, public company conditions, EBT funding, and offences

Published by a LexisNexis Share Incentives expert

Practice notes

The meaning of financial assistance—overview

Financial assistance is defined in the Companies Act 2006 (CA 2006). In essence, it covers any support a company provides to enable the purchase of its own shares, where funding is supplied to make that acquisition possible. See below for the categories of company to which these rules apply, together with what amounts to financial assistance for these purposes. Where help is given, it will constitute financial assistance if money, or anything with monetary value, is involved. That said, the help need not involve any expense for the person providing it. The following authorities offer further guidance on the meaning of financial assistance:

Charterhouse Investment Trust Ltd v Tempest Diesels Ltd
Wallersteiner v Moir

The consequences of giving unlawful financial assistance can be serious—see: Consequences of contravening the financial assistance rules, below.

Types of companies to which the rules apply

UK public companies
private companies that are subsidiaries of UK public companies
private companies with UK public company subsidiaries (where financial assistance is being given by the public company)...

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Web page updated on 21/05/2026

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