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Introduction to statutory interpretation The aim of statutory interpretation is to determine the legal meaning of a statute, that is, the sense that expresses the legislator’s intention. The clearest guide to that intention is the statutory wording itself, read in its context and with its overall purpose in mind, and its broader legislative setting. Courts should seek to fulfil the purpose of legislation by construing its language, so far as they can, in the manner that most effectively serves that purpose. Put differently, the courts’ default method is purposive, and every enactment is to be construed with that end in view. There is a starting presumption that the grammatical and ordinary sense of an enactment reflects the meaning intended by the legislator. Where an enactment reasonably bears only a single meaning, and no other interpretative tools or
This Practice Note addresses identifying a fiduciary, fiduciary duties and obligations, the no conflict rule, the no profit rule, a fiduciary's duty of confidence, and the remedies available for breach of fiduciary duty. Who is a fiduciary? There is no definitive catalogue of relationships that give rise to fiduciary obligations at common law in every situation universally. Certain relationships are inherently fiduciary, eg trustee and beneficiary, solicitor and client, principal and agent, business partner and co-partners, together with mortgagor and mortgagee. The obligations of some fiduciaries have been set out in statute; for instance, trustees owe a statutory duty of skill and care under section 1 of the Trustee Act 2000 (TrA 2000), and directors' relationships with their companies are addressed in the Companies Act 2006 too. For guidance on directors' fiduciary duties, see Practice Note: of directors for further detailed
Definition of ADR Alternative dispute resolution (ADR) is defined in the CPR Glossary as a collective label for methods of settling disputes other than through the usual trial process. Some courts adopt the term ‘negotiated dispute resolution’ (NDR) to describe resolution by alternative means; for ease, this Practice Note uses ADR. For guidance on how ADR is addressed in the various court guides, see Practice Note: ADR and NDR in the court guides. In essence, ADR is a means of resolving a dispute outside the court system. It typically involves a neutral third party who either helps the parties reach a negotiated outcome, or issues a determination of the dispute that is legally binding. A binding result can follow where the agreement to refer the dispute to ADR so provides. There are multiple forms of ADR processes. For an outline of the different types and their
In brief The British constitution is uncodified, meaning it does not spring from a single constitutional document or code. It draws on a wide range of written and unwritten sources. Alongside the principal written sources of law in England and Wales—legislation (which has also introduced international and human rights principles into our constitution) and the common law—the constitution also rests on two further unwritten bases within this system: the prerogative, and non-legal constitutional conventions. In addition, on one view the basic or prevailing principle of our constitution, Parliamentary sovereignty, is ultimately grounded in political fact rather than in law. Legislation Legislation is the foremost source of constitutional law. Acts of Parliament may set out detailed constitutional rules, or even pass authority to create them to ministers or to others. Under the doctrine of Parliamentary sovereignty, legislation is traditionally regarded as taking precedence over any other form or kind of
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Dealings— Setting the scene This Resource Note explains the meaning of dealings in the City Code on Takeovers and Mergers ( Code). It signposts key materials, commentary and guidance from the Panel on Takeovers and Mergers ( Panel), together with Lexis+® UK analysis and tools, to provide practical help with interpreting and applying that expression. Materials referenced in this Resource Note comprise: Practice Statements from the Panel Executive (the body responsible for day‑to‑day takeover oversight and regulation) ( Executive), offering informal guidance on the Executive’s usual approach to interpreting and applying the Code Panel Statements issued by the Panel ( P/ S) and Panel Instruments Public Consultation Papers ( PCP) and Response Statements ( RS) released by the Code Committee Annual Reports from the Panel addressing broader matters ( Annual Reports) relevant Lexis+® UK...
ARCHIVED: This Practice Note has been archived and is not maintained This note distils the principal legal changes anticipated to affect corporate lawyers in 2025 and is supplied for background use only. To monitor legal and regulatory developments on particular themes, refer to: National Security and Investment Act—progress tracker UK listing and prospectus regime reform—progress tracker SPAC tracker Dual class share structure tracker UK Listing Rules tracker Prospectus Regulation Rules tracker UK Prospectus Regulation tracker EU Prospectus Regulation tracker (2001–2020) Disclosure Guidance and Transparency Rules tracker Transparency Directive tracker [ Archived] Market Abuse Regulation—timeline Markets in Financial Instruments Directive ( Mi FID II) and Markets in Financial Instruments Regulation ( Mi FIR)—timeline (2007–2023) [ Archived] For key cases of interest to corporate practitioners, see: Case tracker—2025—...
ARCHIVED: This archived note, originally issued in October 2008 and revised in 2013, was produced by The Chartered Governance Institute (previously called ICSA......
This Practice Note explains the accounting for business combinations, along with key financial reporting issues that may emerge from how M& A transactions are structured, and the ways in which these matters can influence negotiation of the acquisition agreement......
Practice Note This Practice Note sets out a summary of the contract governing the sale and purchase of shares in a private limited company (target), commonly also referred to as the share purchase agreement ( SPA). An SPA formally captures the terms under which a buyer agrees to acquire from the seller(s) shares in the target’s capital (sale shares), whether that is the whole of the target’s share capital or only a partial stake. The buyer undertakes to pay the seller the price for the acquisition of the sale shares (consideration), and in exchange the seller passes legal title in the sale shares to the buyer (by executing a stock transfer form). This becomes effective on completion of the transaction (completion), which may take place when the SPA is signed or on a later agreed date (where completion is...
Subscription and shareholders’ agreement This Practice Note offers guidance for drafters preparing and/or reviewing a subscription and shareholders’ agreement relating to the allotment of shares (and, potentially, loan notes) in a private limited company incorporated in England and Wales by a private equity (or venture capital) fund investor (the investor) within a venture capital ( VC) deal, where the structure provides for split exchange and completion, ie conditions must be met before completion of the subscription and shareholders’ agreement. The investment contemplated is into an existing company (the Company), with the current shareholders (typically the business’s founders) keeping the shares they have already been issued in the Company. Set out below are matters to weigh up when drafting and/or reviewing the principal provisions of a subscription and shareholders’ agreement ( SSA). Parties The investee company Although the principal parties to the SSA will be the relevant...
This Practice Note This Practice Note sets out an overview of what constitutes Mi FID business as that term appears in the Financial Conduct Authority ( FCA) Glossary, as defined there, and includes a flowchart to navigate the particular components involved in deciding whether the UK provisions derived from the Markets in Financial Instruments Directive ( Directive 2014/65/ EU) ( Mi FID II) apply within the UK. It also flags the exemptions that could allow firms to fall outside Mi FID II’s scope. Firms that are within the reach of the UK provisions implementing Mi FID II must be authorised under Part 4A of the Financial Services and Markets Act 2000 ( FSMA 2000) and observe a range of organisational, conduct of business and other requirements. The Note also sketches the regime that governs UK data reporting services. Although the UK has now left the EU, the FCA...
A UK limited liability partnership ( LLP) For company law purposes, a UK limited liability partnership ( LLP) is a corporate body, but for tax it is generally treated like a partnership—that is, it is tax transparent. Where an LLP carries on a trade, profession or business with a view to profit, profits and gains are ordinarily taxed on the members, not on the LLP itself. Transparency also means members are taxed on the LLP’s profits and gains as they arise, whether or not any amounts have been distributed. In some cases this treatment may not apply, or can be lost; see When is an LLP not tax transparent? below. Members are taxed on their shares of the LLP’s profits in the same way as partners in other forms of partnership; see Practice Note: Taxation of general...
A core principle of English company law is that a limited company with a share capital must preserve that capital. Consequently, a company is not permitted to reduce its capital save as authorised by law. The capital maintenance doctrine serves to protect a company’s creditors by ensuring that the assets constituting the company’s capital remain available to them as a source of future recourse. The Companies Act 2006 ( CA 2006) contains rules on the means by which a limited company may reduce its capital. The CA 2006 restrictions concerning reductions of capital do not extend to unlimited companies. For further guidance on that form of company, see Practice Note: Unlimited companies. This Practice Note focuses on capital reductions carried out in accordance with CA 2006, Pt 17, Ch 10, particularly those implemented by a special resolution confirmed by a court order (the court...
Issued in June 2015, this guidance from The Chartered Governance Institute ( CGI) offers advice...
If a deal qualifies as a notifiable ‘concentration’ under the EU Merger Regulation ( EUMR) and meets the relevant jurisdictional thresholds, it must be notified to the European Commission (the Commission). The Commission will then review the deal according to a prescribed process. Until clearance is granted by the Commission, the parties must put implementation on hold. The Commission’s review begins once the parties formally notify it by filing a completed Form CO. From that point, the review follows a set timetable with strict deadlines: all mergers undergo a phase I review—the Commission has 25 working days to issue its phase I decision (extendable to 35 working days if the parties propose commitments), and if the Commission is concerned a merger may impede competition, it will refer the case for a more detailed phase II review, unless the parties submit suitable...
Where a company, within the charge to corporation tax, receives a dividend or other distribution from a company, it is taxed as income for corporation tax purposes unless the distribution qualifies for exemption. Two distinct exemption regimes apply to corporate distributions: one for small companies for companies that are not small For guidance on the reliefs available to small companies, see Practice Note: How are small companies taxed on distributions received? For an explanation of what counts as a small company for these exemption rules, refer to Practice Note: What is a small company for the purposes of the distribution exemption?......
This Resource Note summarises the principal provisions of the Introduction to the City Code on Takeovers and Mergers ( Code) (as amended with effect from 3 February 2025). It addresses the standing of the Panel on Takeovers and Mergers ( Panel), the nature and purpose of the Code, the circumstances in which the Code applies, the Panel and its Committees, the Panel Executive ( Executive), the rules for interpreting the Code, the Takeover Appeal Board ( Appeal Board), the Panel’s powers to require documents and information, enforcement of the Code, and the Panel’s disciplinary powers. Materials covered in this Resource Note include: Notes accompanying the Code ( Notes), which elaborate on how the Rules are intended to be implemented and on Appendices dealing with specific issues Practice Statements issued by the Panel Executive (the body that conducts the day-to-day work of takeover...
Background There are legal requirements governing the notices and statements that must be made when an auditor leaves office. Section 18 and Schedule 5 of the Deregulation Act 2015 ( DA 2015), effective from 1 October 2015, introduced a series of auditor-related reforms, including the rules on notices and statements on an auditor’s cessation of office. Those measures apply to financial years starting on or after 1 October 2015. For these notice and statement obligations, the DA 2015 amended the Companies Act 2006 ( CA 2006) so that a distinction is drawn between companies and non-companies (with each category treated slightly differently), replacing the earlier split between quoted and unquoted companies (again, each treated slightly differently) that applied before the DA 2015 amended the CA 2006. This change reoriented the framework and aligned the obligations with entity status rather than listing status, while...
Private M& A transactions Private M& A transactions, whether involving the sale and purchase of a company or a business, are brought to a close by an exchange (or signing) of contracts and a subsequent completion (or closing) of the deal. At exchange, the parties sign and deliver the formal documentation for the transaction, including a share purchase agreement or an asset purchase agreement. At completion, the necessary formalities to finalise and implement the transaction are carried out, such as delivery of title certificates (for shares or otherwise) and any other assets. Exchange and completion may take place simultaneously or be separated, depending on whether the agreement governing the transaction is unconditional or conditional, respectively. They can also occur at face-to-face meetings or be conducted virtually (by telephone, email or other electronic means of communication). For further information, see Practice Note: Issues arising where there is...
This Practice Note is part of Share purchase transaction collection. The disclosure process requires the seller to prepare a disclosure letter, which is finalised and signed on exchange. Although both it and due diligence involve supplying the buyer with information about the target, the letter serves a distinct function. It enables the seller to qualify the warranties set out in the warranties schedule to the share purchase agreement, thereby limiting potential liability under them. If, after a buyer’s warranty claim, the seller can demonstrate that a matter was disclosed to the buyer (and that the standard of disclosure in the share purchase agreement was met), the buyer’s claim will not succeed. The disclosure letter includes: general disclosures: information and documents of a general nature (such as searches of public registers) that are deemed disclosed to the buyer (even though general disclosures are usually a short list, the...
HMRC has power to require security from a registered person if it considers that there is a risk that a business will not fully meet its obligations to pay: Insurance Premium Tax Landfill Tax Aggregates Levy Climate Change Levy Once a Notice of Requirement to provide security is issued, continuing to trade constitutes a criminal offence. Specific offences are: Insurance Premium Tax — entering into taxable insurance agreements (as defined by section 73(1) of the Finance Act 1994) without providing security Landfill Tax — undertaking taxable activities (as defined by section 69(1) of the Finance Act 1996) without providing security Aggregates Levy — being responsible for the commercial exploitation of aggregates within the UK (as defined by section 17 of the Finance Act 2001) without providing security Climate Change Levy — being liable to account for the levy on a...
A ‘merger’ can come within the scope of the EU merger rules and require notification to the European Commission (the Commission) where at least two parties to the deal generate appreciable worldwide and EU turnover, both combined and individually. In particular, and subject to a few narrowly construed exceptions, a transaction must be notified to and cleared by the Commission if: it is a ‘concentration’ within the meaning of the EU Merger Regulation ( EUMR) the merger is permanent it satisfies the specified financial thresholds Where these requirements are satisfied then, subject to a few narrowly construed exceptions, EU merger control will apply to the exclusion of the national merger rules of any European Economic Area ( EEA) Member State. The EUMR defines a ‘concentration’ as follows: where two independent undertakings merge—this includes scenarios in which previously...
ARCHIVED This Practice Note is archived and is no longer maintained. It addresses the position where the UK and the EU fail to conclude arrangements on jurisdiction after the UK’s departure. Throughout the implementation period commencing on exit day, that is, the day the UK leaves the EU, the provisions of the withdrawal agreement will apply. For commentary on that period and its effect on jurisdiction, refer to Practice Note: Brexit implementation period—jurisdiction [ Archived]. This Note evaluates the consequences of the UK exiting the EU without a deal when addressing jurisdictional issues before courts in EU Member States, with particular focus on how the Brussels regime would be applied. It considers practical implications for proceedings and the treatment of jurisdictional rules accordingly in practice......
This Practice Note outlines, in brief, the European Venture Capital Funds Regulation ( EU) 345/2013 (the Eu VECA Regulation), as subsequently updated by Regulation ( EU) 2017/1991, Regulation ( EU) 2019/1156 and Regulation ( EU) 2023/2869. The Eu VECA Regulation constitutes a specialist alternative investment fund ( AIF) regime available to alternative investment fund managers ( AIFMs) under the Alternative Investment Fund Managers Directive (2011/61/ EU) ( AIFMD). AIFMs running qualifying venture capital funds may opt to apply the ‘ Eu VECA’ label to those funds, enabling marketing to professional and certain high net-worth investors right across the EU via the Eu VECA marketing passport itself. The Eu VECA regulatory framework The Eu VECA Regulation was brought alongside Regulation ( EU) 346/2013 on European social entrepreneurship funds (the Eu SEF Regulation). The Eu SEF Regulation, as amended, falls outside the scope of this Practice Note, but is...
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When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...
This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...
Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...
I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...
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