Section 457 | Section 456: meaning of “material interest in a company”

(1)A person has a material interest in a company for the purposes of section 456 if condition A or B is met.

(2)Condition A is that the person (with or without one or more associates) or any associate of that person (with or without one or more other such associates) is—

(a)the beneficial owner of, or

(b)directly or indirectly able to control,

more than 5% of the ordinary share capital of the company.

(3)Condition B is that, in the case of a close company, the person (with or without one or more associates) or any associate of that person (with or without one or more other such associates) possesses or is entitled to acquire such rights as would—

(a)in the event of the winding up of the company, or

(b)in any other circumstances,

give an entitlement to receive more than 5% of the assets which would then be available for distribution among the participators.