602. Duty to cancel shares in public company held by or for the company
(1) This section applies in the case of a public company-
(a) where shares in the company are forfeited, or surrendered to the company in lieu of forfeiture, in pursuance of the articles, for failure to pay any sum payable in respect of the shares,
(b) where shares in the company are acquired by it (otherwise than in accordance with this Part or Part 28 (protection of members against unfair prejudice)) and the company has a beneficial interest in the shares,
(c) where a nominee of the company acquires shares in the company from a third party without financial assistance being given directly or indirectly by the company and the company has a beneficial interest in the shares, or
(d) where a person acquires shares in the company, with financial assistance given to him, directly or indirectly, by the company for the purpose of or in connection with the acquisition, and the company has a beneficial interest in the shares.
(2) Unless the shares or any interest of the company in them are previously disposed of, the company must-
(a) cancel the shares and diminish the amount of the company’s share capital by the value of the shares cancelled, and
(b) where the effect is that the value of the company’s allotted share capital is brought below the authorised minimum, apply for re-registration as a private company, stating the effect of the cancellation.
(3) It must do so no later than-
(a) in a case within subsection 602(1)(a), three years from the date of the forfeiture or surrender,
(b) in a case within subsection 602(1)(b) or (c), three years from the date of the acquisition,
(c) in a case within subsection 602(1)(d), one year from the date of the acquisition.
(4) The directors of the company may take any steps necessary to enable the company to comply with this section, and may do so without complying with the provisions of Chapter 8 of Part 16 (reduction of capital).
See also section 604 (re-registration as private company in consequence of cancellation).
(5) Neither the company nor, in a case within subsection 602(1)(c) or (d), the nominee or other shareholder may exercise any voting rights in respect of the shares.
(6) Any purported exercise of those rights is void.