Plain language law

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Companies Act 1993

Shares and debentures - Treasury stock

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

You could also call this:

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

When a company owns shares in itself, it can’t use the rights or carry out the obligations that come with those shares. This means the company can’t do anything with these shares while it holds them.

To be more specific, when a company has its own shares, it’s not allowed to do two main things. First, it can’t vote using these shares. Second, it can’t give out or receive any money or other benefits that would normally come with owning these shares.

These rules apply to any shares that a company holds in itself under section 67A.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM320403.

Topics:

Business > Industry rules

Business > Fair trading

67A: Company may hold its own shares, or

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

67C: Reissue of shares company holds in itself, or

“Rules for a company selling its own shares”

Part 6 Shares and debentures
Treasury stock

67BRights and obligations of shares company holds in itself suspended

The rights and obligations attaching to a share that a company holds in itself pursuant to section 67A shall not be exercised by or against a company while it holds the share.
Without limiting subsection (1), while a company holds a share in itself pursuant to section 67A, the company shall not—
exercise any voting rights attaching to the share; or
make or receive any distribution authorised or payable in respect of the share.

Notes

Section 67B: inserted, on 1 July 1994, by section 3 of the Companies Act 1993 Amendment Act (No 2) 1994 (1994 No 82).