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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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Why not just reward staff with cash? Paying cash can be a straightforward, less onerous way to recognise and incentivise employees. However, this Practice Note explores the advantages and disadvantages of share schemes as a broad concept. For fuller guidance on the pros and cons of each specific scheme, see Practice Note: The advantages and disadvantages of each share incentive arrangement. This Practice Note covers: why companies implement share schemes what types of share schemes exist the advantages of share schemes (from both company and employee perspectives) the disadvantages of share schemes (from both company and employee perspectives) use of share schemes Why do companies implement share schemes for their employees? There are many reasons why companies choose to introduce employee share schemes, and these often reflect the organisation’s size and its particular objectives......
It is fundamental to ensuring the arrangement meets the company’s specific needs and objectives. This Practice Note aims to assist in pinpointing a company’s stated objectives so as to determine the most fitting share scheme arrangement for it. Types of schemes For the purposes of this note, the following categories of share scheme arrangements will be examined and evaluated against each objective: unapproved share option schemes enterprise management incentives ( EMI) schemes company share option plans ( CSOPs) share incentive plans ( SIPs) save as you earn/sharesave ( SAYE) schemes long term incentive plans ( LTIPs) growth or value share arrangements joint share ownership plans ( JSOPs) phantom share plans Company objectives Set out below are questions to help a company identify the most appropriate share incentive arrangement to meet its aims: Should the scheme be extended to all eligible employees, or offered only on a discretionary basis? Is the arrangement intended for employees alone, or both...
Why do companies have reorganisations? Groups of companies carry out reorganisations for numerous and varied reasons. These steps will frequently have implications for existing share plans and other employee equity arrangements. In some instances, the consequences are commercial in nature. Examples include: the reorganisation prompting early vesting, exercise and/or lapse of awards because the relevant provisions in the share plan rules on a change in control of the parent company, or on the participant’s employment ending, have been engaged; and a requirement for awards over shares in the current parent to be swapped for awards over shares in a newly formed parent company. In certain situations, if the right steps are not taken within a defined period, valuable tax advantages may ultimately be lost entirely. Common types of reorganisation The most frequent forms of reorganisation include the...
March 2023 ARCHIVED: This Practice Note is archived and no longer under maintenance...
The essential stages involved in rolling out a new share incentive arrangement are set out below: drafting a project plan (including design) gathering input from key stakeholders modelling and valuation securing approvals, and operation Certain phases are likely to be progressed in parallel and may overlap in timing. Creation of a project plan (including design) Capturing the plan’s aims and purpose in a single document is absolutely vital, as it will steer the remaining stages and act as the core point of reference when the finer details are settled and the plan is delivered. The document may take the form of: a board paper, and/or in a UK listed company, a remuneration committee paper For a questionnaire which helps the company elicit the most suitable share scheme for its objectives and needs, see Precedent: Questionnaire to select the right share scheme. See also Practice Note: Selecting the right share scheme. The board or...
What is share dilution? Share dilution arises when a company issues more of its own shares. As a result, the proportion owned by existing shareholders falls when the new shares are created. Example of share dilution A small business has 100 shares in issue. Ten shareholders each hold ten shares, so each owns 10% of the company. The following year, the company issues another ten shares to a different party (for example, directly to a single investor or to satisfy an option that a share plan participant has exercised over ten shares). There are now 110 shares in issue, and there are 11 shareholders each holding ten shares. Those ten shares now account for 9% of the company. In this way, by issuing an extra ten shares, the original shareholders are each diluted from 10% to 9%. How do shares cause...
When a company launches a new plan, it will typically decide to settle awards by either: issuing fresh shares, or using existing shares bought on the market, commonly via an employee benefit trust ( EBT) that purchases shares in the market or from individual shareholders to satisfy awards granted under the company’s share plans This practice note examines share hedging in the context of an employee share plan and outlines the key points to address to manage potential costs and the financial risks associated with share hedging. In essence, a company must balance: the need to acquire enough (but ideally not excess) shares ahead of option exercises/acquisition of shares by employees, and the need to contain costs by buying when the share price is low Why do companies use EBTs to share hedge? Companies operating share plans (for example through the grant of...
This Practice Note aims to outline the key advantages and disadvantages of the following commonly used employee share incentive arrangements: enterprise management incentives ( EMI) schemes company share option plans ( CSOPs) share incentive plans ( SIPs) save as you earn/sharesave ( SAYE) schemes unapproved share option schemes long term incentive plans ( LTIPs) growth/value share arrangements joint share ownership plans ( JSOPs) phantom share plans EMI schemes For broader information on EMI schemes, refer to Practice Note: How EMI schemes work and key features. Advantages of EMI schemes Among tax-advantaged share plans, EMI schemes offer the greatest scope to tailor the scheme’s terms and conditions HMRC may provide advance assurance confirming a company’s eligibility to grant EMI options......
The Share Incentives glossary This glossary gathers essential definitions for share incentives terminology and points to relevant resources. It is updated on an ongoing basis as we identify additional terms for inclusion, and currently covers the following: Accelerated vesting – Permits an employee to bring forward the standard vesting timetable under which they obtain access to share awards and/or shares. This commonly (though not always, and not exclusively) occurs on an ‘exit’ event. AIM – A securities market set up and operated by London Stock Exchange plc, launched on 19 June 1995. It enables smaller and medium-sized growth companies to float shares with lighter admission requirements and continuing obligations than the main regulated markets. Previously the Alternative Investment Market, it is now referred to simply as AIM. For further information on share scheme requirements and matters affecting an AIM-traded company, see...
Ways of accruing pension benefits Employees have several pension arrangements through which they can accumulate benefits. The principal options are: occupational pension schemes personal pension schemes employer-financed retirement benefits schemes ( EFRBS) master trusts (including the National Employment Savings Trust ( NEST) since October 2012) the state pension Employees may belong to, and pay into, more than one pension arrangement at the same time, for example the employer’s occupational pension scheme together with the employee’s own personal pension scheme......
What is UK EMIR? This Practice Note sets out high‑level guidance on Assimilated Regulation ( EU) 648/2012, known as UK EMIR. In 2009, the G20 committed to reforms designed to enhance transparency and reduce systemic counterparty risk in the over‑the‑counter ( OTC) derivatives market. The European Market Infrastructure Regulation ( EU) 648/2012 ( EU EMIR) delivered most of these commitments in the EU and covers OTC derivatives, central clearing counterparties ( CCPs) and trade repositories ( TRs). The onshored version, UK EMIR, applies within the UK. Practice Note: EU EMIR and UK EMIR—comparison offers a navigation aid for examining UK EMIR by setting it alongside the corresponding provisions of the EU EMIR regime. Under section 1(1) and Schedule 1 Part 1 of the Financial Services and Markets Act 2023 ( FSMA 2023), UK EMIR is to be revoked from a date, or dates, to be...
Commentary and explanation Financial Conduct Authority of the United Kingdom...
UK EMIR—key requirements Assimilated Regulation ( EU) 648/2012 ( UK EMIR) is the main UK regime overseeing the over-the-counter ( OTC) derivatives market. It centres on: an obligation for specified counterparties to clear certain standardised OTC derivatives via a central counterparty ( CCP)—see Practice Note: UK EMIR—essentials — Clearing obligation an obligation to submit derivatives contracts to a trade repository ( TR)—see Practice Note: UK EMIR—essentials — Trade reporting obligation margin rules for non-centrally cleared OTC derivatives traded by certain counterparties—see Practice Note: UK EMIR—essentials — Margin requirements, and further risk mitigation for uncleared transactions, covering prompt confirmation, portfolio reconciliation, portfolio compression and dispute resolution—see Practice Note: UK EMIR—essentials — Additional risk mitigation requirements Who is the counterparty? The obligations applying to fund counterparties or fund manager counterparties depend on their UK EMIR categorisation and the identity of their trading partner. Where a...
This Practice Note has been archived and is no longer maintained. This archived Practice Note is not being updated. It offers high-level insight into the position of the European Market Infrastructure Regulation ( EU) 648/2012 ( EMIR) in UK law from 1 January 2021. This Quick Look Brexit Financial Services Legislation Status Guide provides concise information on the status of the European Market Infrastructure Regulation ( EU) 648/2012 ( OJ L 201/1) ( EU EMIR) in the UK from that date. For more detail, see Practice Note: Impact of Brexit: EMIR—quick guide. During the implementation period from 31 January 2020 to 31 December 2020 ( IP completion day), EMIR applied directly in the UK pursuant to the European Union ( Withdrawal) Act 2018 ( EU( W) A 2018), as amended by the European Union ( Withdrawal Agreement) Act 2020 ( EU( WA) A 2020), and the...
This Practice Note This Practice Note examines the European Market Infrastructure Regulation ( EMIR), Assimilated Regulation ( EU) 648/2012 ( UK EMIR) as it has operated in the UK since IP completion day (11 pm on 31 December 2020) and the duties it places on pension schemes. For details on how UK EMIR departs from EMIR ( EU) 648/2012 ( OJ L 201, 27.7.2012, p. 1) ( EU EMIR) and the circumstances in which EU EMIR applies, see Practice Note: UK EMIR—essentials. EU EMIR is the key EU instrument governing the over the counter ( OTC) derivatives market. It extends to counterparties to derivatives transactions, including EU pension arrangements and common investment funds, central counterparties ( CCPs) and trade repositories, although the range of obligations in EU EMIR has been introduced on a staged basis. EU EMIR took effect on 16 August 2012, with most...
This Practice Note outlines the following: the EMI end‑of‑year return form pre‑registration and the timetable for completing the annual return events that must be reported nil returns unapproved options penalties for non‑compliance frequent ERS annual return mistakes the employee’s self assessment obligation, and where to obtain further information The EMI annual return form For guidance on the distinct process (and separate form) used to notify HMRC of the grant of EMI options, see Practice Note: EMI—notification of grant of options to HMRC. On 26 November 2025, as part of Budget 2025, it was announced that, with effect from 6 April 2027, the need to notify HMRC of EMI option grants for them to be qualifying options will be removed. This change will be legislated in Finance Bill 2026–27 and means that, for options granted on or after 6 April 2027, no separate notification of grant is required. Instead, HMRC will require grant...
Trade finance frequently relies on instruments like bills of lading, bills of exchange and promissory notes (see: Bills of exchange and promissory notes—overview). The Electronic Trade Documents Act 2023 ( ETDA 2023) reshapes their use where they exist electronically and are maintained within a reliable system. As cross-border technology matures and organisations look to capture the efficiencies of electronic trade documents, practitioners advising on trade finance must grasp the implications of the ETDA 2023. In particular, they should assess what constitutes a ‘reliable system’ and guide clients on dealings with third-party system providers, so that electronic trade documents satisfy the ETDA 2023’s conditions and can secure the advantages the statute offers. Given evolving systems across jurisdictions and the growing appetite to realise the benefits of digitised trade instruments, lawyers working on such transactions should stay alert to how the ETDA 2023 operates in...
This Practice Note outlines the UK’s regulatory framework for electronic communications, commonly called telecommunications (telecoms), clarifying which services are regulated and, where they are, what obligations apply. In the UK, the primary regime is founded on the Communications Act 2003 ( CA 2003), the Wireless Telegraphy Act 2006 ( WTA 2006), Ofcom’s General Conditions of Entitlement ( General Conditions), together with Ofcom’s related regulatory functions and powers. This Practice Note summarises these principal elements of regulation and explains how and when they operate. Other regulatory regimes may affect the telecoms sector, including general consumer and competition law. However, the emphasis of this Practice Note is the telecoms regulatory regime. For general guidance on the other regimes mentioned above, see the following: UK competition regime—overview Data protection...
FORTHCOMING CHANGES to EIS and VCT financial limits and call for evidence on tax support for entrepreneurs: At Budget 2025, the government set out a cut to the upfront income tax relief for individuals investing in VCTs, reducing it from 30% to 20%. The upfront relief for EIS investments will stay at 30%. It also outlined three changes spanning both EIS and VCT: Annual company fundraising limits will rise from £5m to £10m, and from £10m to £20m for knowledge‑intensive companies ( KICs). The lifetime company risk finance investment cap will increase from £12m to £24m, and from £20m to £40m for KICs. The gross assets cap an investee must not exceed will move from £15m to £30m before share issuance, and from £16m to £35m afterwards. These measures are to be legislated in the Finance Bill 2026 and will take effect from 6 April...
FORTHCOMING CHANGES to EIS and VCT financial limits and call for evidence on tax support for entrepreneurs: In Budget 2025, the government confirmed that the initial income tax relief for individuals investing in a VCT will drop from 30% to 20%. The upfront income tax relief for EIS remains at 30%. It also set out three updates affecting both EIS and VCT: a rise in the annual funding caps companies may secure under EIS and VCT from £5m to £10m, and from £10m to £20m for knowledge-intensive companies ( KICs) a doubling of the lifetime company risk finance limit from £12m to £24m, and from £20m to £40m for KICs a higher gross assets threshold that an investee company must not exceed: from £15m to £30m before shares are issued, and from £16m to £35m after that...
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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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