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67: Enforceability of contract to repurchase shares
or “When a company can be made to buy back its shares”
You could also call this:

“Companies can keep their own shares if their rules allow it”

You can hold your own shares if your company’s rules allow it. This means when you buy back shares, you don’t have to cancel them right away. But there are some rules you need to follow.

First, your company’s constitution must say it’s okay to hold your own shares. Then, your board of directors needs to decide not to cancel the shares when you buy them. Also, you can only hold up to 5% of the total shares of that type that your company has issued before.

If you follow these rules, the shares you buy back will be held by your company. You can decide to cancel these shares later if you want to. To do this, your board just needs to make a decision that the shares should be cancelled.

Remember, this only applies to shares you buy back under section 59 or sections 112 to 112C of the Companies Act. If you’re not sure what these sections mean, you might want to ask someone who knows about company law to explain them to you.

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Next up: 67B: Rights and obligations of shares company holds in itself suspended

or “Company-owned shares have no voting rights or financial benefits”
Next

Part 6 Shares and debentures
Treasury stock

67ACompany may hold its own shares

  1. Shares acquired by a company pursuant to section 59 or sections 112 to 112C shall not be deemed to be cancelled under section 66(1) if—

  2. the constitution of the company expressly permits the company to hold its own shares; and
    1. the board of the company resolves that the shares concerned shall not be cancelled on acquisition; and
      1. the number of shares acquired, when aggregated with shares of the same class held by the company pursuant to this section at the time of the acquisition, does not exceed 5% of the shares of that class previously issued by the company, excluding shares previously deemed to be cancelled under section 66(1).

        1. Shares acquired by a company pursuant to section 59 or sections 112 to 112C that, pursuant to this section, are not deemed to be cancelled shall be held by the company in itself.

        2. A share that a company holds in itself under subsection (2) may be cancelled by the board of the company resolving that the share is cancelled; and the share shall be deemed to be cancelled on the making of such a resolution.

        Notes
        • Section 67A: inserted, on , by section 3 of the Companies Act 1993 Amendment Act (No 2) 1994 (1994 No 82).
        • Section 67A(1): amended, on , by section 6 of the Companies (Minority Buy-out Rights) Amendment Act 2008 (2008 No 69).
        • Section 67A(2): amended, on , by section 6 of the Companies (Minority Buy-out Rights) Amendment Act 2008 (2008 No 69).