Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Private company definition

What does Private company mean? In company law practice, a private company is a company owned by private shareholders or members whose securities are not offered to the public. In England and Wales, Scotland and Northern Ireland, the term is defined by the Companies Act 2006: a private company (limited by shares or by guarantee) is not a public company and, where it has a share capital, must not offer its shares or debentures to the public (section 755). Typical features include the ability to have a single director, use written resolutions and-unless the articles require-operate without a company secretary; its shares are not admitted...

Private company off-market buybacks under the Companies Act 2006: contracts, shareholder approvals and payment mechanics where not financed from capital, including employees’ share scheme authorisations

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Practice notes

A limited company can repurchase its own Shares, provided it satisfies the specific requirements set out in the Companies Act 2006 (CA 2006). This is also called a Share Buyback, or a purchase of its own shares. In addition to the provisions of the CA 2006, there are additional Rules and guidance that are relevant and applicable to a listed company or an AIM company that intends to buy back its own shares. The CA 2006 restrictions on share buybacks do not apply to unlimited companies. For more detail on this kind of company, see Practice Note: Unlimited companies. For an overview and summary of the process for undertaking a share buyback, see Practice Note: How to carry out a share buyback. For further analysis of the legal framework governing a share buyback, together with the reasons a company might proceed, see Practice Note: Share buybacks—the legal framework.

Off-market or on-market?

Only one form of share buyback is available to a private limited company. It may undertake only an off-market purchase of its shares. Consequently, this Practice Note does not cover an on-market (or market) purchase of shares...

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Web page updated on 27/05/2026

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