Companies Act (Cap. 386), article 107

107. ( 1 ) A c o m p a n y m a y a c q u i r e a n y o f i t s o w n s h a r e s otherwise than by subscription without complying with the provisions of article 106, other than sub-article (1)(g) thereof, where the shares are - (a) acquired by the company in the course of a reduction of the issued share capital made in accordance with article 83; or (b) Deleted by Act XVIII.2025. 12. (c) forfeited or surrendere d in accordance with the provisions of article 112; or S.L. 386.26. S.L. 386.27. S.L. 386.28. (d) acquired in any new procedure for the conversion, the amalgamation or the division of companies pursuant to the provisions contained in Parts VII, VIII and IX of this Act respectively, or otherwise acquired in any procedure for the cross-border conversio n, the cross-border merger or the cross-border division of companies pursuant to the Cross-border Divisions of Limited Liability Companies Regulations , Cross-border Conversions of Limited Liability Companies Regulations a n d t h e Cross-border Mergers of Limited Liability Companies Regulations ; or (e) acquired in any procedure fo r the change of status of a company pursuant to the provisions of article 213; or (f) acquired by the company from dissenting shareholders in accordance with the provisions of this Act and regulations issued thereunder or pursuant to an order of the Court made under the provisions of this Act and regulations issued thereunder for the re-purchase of shares held by dissenting shareholders, including any order made in terms of article 402(3)(d); or (g) fully paid up and acquired by an investment company with fixed share capital or by another company forming part of the same group at the member’s request provided that such acquisitions shall not have the effect of reducing the company’s net assets below the amount of the issued share capital plus any reserves the distribution of which is forbidden by law; (h) acquired by the company during a redemption of preference shares in accordance with article 115. (2) Where shares acquired pursuant to sub-article (1)( b) to ( f) are retained by the company and are not disposed of within thir ty months of their acquisition the company shall by extraordinary COMP ANIES [CAP. 386. 67 resolution cancel such shares within six months of the expiry o f the said thirty months. (3) The provisions of article 83 dealing with the reduction of issued share capital shall apply where shares are cancelled pur suant to sub-article (2): Provided that the court may not disallow the cancellation but, if good cause is shown, it shall only order that sufficien t security be given to the creditor who had objected to the cancellation, and if sufficient security is not immediately ava ilable, the court shall order the provision of such security immediatel y it becomes available to the company and no distribution of dividen d may be effected by the co mpany in the meantime: Provided further that this sub-article shall not apply where th e company has acquired the shares otherwise than for valuable consideration. (4) If the company fails to comply with sub-article (2) within the time limit prescribed, any member or director of the compan y may apply to the court for an or der that such shares be cancell ed. (5) Where the nominal value of the shares held by the company in pursuance of any of the provisions of sub-article (1), inclu ding shares which the company may have acquired through a person acting in his own name but on behalf of the company, does not exceed ten per cent of the issued share capital thereof, the provisions of sub-articles ( 2) to (4) shall not apply. Shares acquired or held in contravention of articles 106 and 107.