Section 137 | Shares acquired before prohibition became applicable

(1)Where a body corporate became a holder of shares in a company—

(a)before the relevant date, or

(b)on or after that date and before the commencement of this Chapter in circumstances in which the prohibition in section 23(1) of the Companies Act 1985 or Article 33(1) of the Companies (Northern Ireland) Order 1986 (S.I. 1986/1032 (N.I. 6)) (or any corresponding earlier enactment), as it then had effect, did not apply, or

(c)on or after the commencement of this Chapter in circumstances in which the prohibition in section 136 did not apply,

it may continue to be a member of the company.

(2)The relevant date for the purposes of subsection (1)(a) is—

(a)1st July 1948 in the case of a company registered in Great Britain, and

(b)1st April 1961 in the case of a company registered in Northern Ireland.

(3)So long as it is permitted to continue as a member of a company by virtue of this section, an allotment to it of fully paid shares in the company may be validly made by way of capitalisation of reserves of the company.

(4)But, so long as the prohibition in section 136 would (apart from this section) apply, it has no right to vote in respect of the shares mentioned in subsection (1) above, or any shares allotted as mentioned in subsection (3) above, on a written resolution or at meetings of the company or of any class of its members.