Companies Act · s 48

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48.
Prohibition of provision of financial assistance by company for purchase of own shares
(1) Subject as provided in this section, it shall not be lawful for a company to give, whether directly or indirectly, and whether by means of a loan, guarantee, the provision of security or otherwise, any financial assistance for the purpose of or in connection with a purchase made or to be made by any person of any shares in the company:
Provided that nothing in this section shall be taken to prohibit -
(a) where the lending of money is part of the ordinary business of a company, the lending of money by the company in the ordinary course of its business;
(b) the provision by a company, in accordance with any scheme for the time being in force, of money for the purchase by trustees of fully-paid shares in the company to be held by or for the benefit of employees of the company, including any director holding a salaried employment or ofice in the company;
(c) the making by a company of loans to persons, other than directors, genuinely in the employment of the company with a view to enabling those persons to purchase fully-paid shares in the company to be held by themselves by way of beneficial ownership.

Companies
(2) The aggregate amount of any outstanding loans made under the authority of provisos (b) and (c) to subsection ( 1 )  shall be shown as a separate item in every balance sheet of the company.
(3) If a company acts in contravention of this section, the company and every officer of the company who is in default is guilty of an offence and liable on conviction to a fine of $5,000.

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s 48Prohibition of provision of financial assistance by company for purchase of own shares

(1)

Subject as provided in this section, it shall not be lawful for a company to give, whether directly or indirectly, and whether by means of a loan, guarantee, the provision of security or otherwise, any financial assistance for the purpose of or in connection with a purchase made or to be made by any person of any shares in the company:

Provided that nothing in this section shall be taken to prohibit -

(a)

where the lending of money is part of the ordinary business of a company, the lending of money by the company in the ordinary course of its business;

(b)

the provision by a company, in accordance with any scheme for the time being in force, of money for the purchase by trustees of fully-paid shares in the company to be held by or for the benefit of employees of the company, including any director holding a salaried employment or ofice in the company;

(c)

the making by a company of loans to persons, other than directors, genuinely in the employment of the company with a view to enabling those persons to purchase fully-paid shares in the company to be held by themselves by way of beneficial ownership.

Companies

(2)

The aggregate amount of any outstanding loans made under the authority of provisos (b) and (c) to subsection ( 1 ) shall be shown as a separate item in every balance sheet of the company.

(3)

If a company acts in contravention of this section, the company and every officer of the company who is in default is guilty of an offence and liable on conviction to a fine of $5,000.