Companies Act 2007 · As enacted · Part XXII · Miscellaneous Prohibition of Partnership with More Than Twenty Members
529. Interpretation
Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.
Official translationFrom Department of Government Printing, unchanged
In this Act, unless the context otherwise requires—
“accounting period” means in relation to any body corporate, the period in respect of which the financial statements of such body corporate are made up, whether the said period is a year or not ;
“agent” does not include any person’s attorney-at-law acting as such ;
“annual return” means the return required to be made by a company under section 131;
“articles” means articles of association of a company as originally framed or as altered by special resolution, including so far as they apply to the company, the regulations contained in Part C of the Schedule to the Joint Stock Companies Ordinance, 1861 or in
Table B in the Schedule to the Joint Stock Banking
Ordinance, 1897 or in Table A in the First Schedule to the Companies Ordinance (Cap. 145) or in Table
A in the First Schedule to the Companies Act, No.
17 of 1982, or the model articles ;
“balance sheet date” means the close of the 31st day of
March or of such other date as the Board of the company has adopted as the company’s balance sheet date and the notification of which is given forthwith to the Registrar ;
“board” and “board of directors” in relation to a company, means —
directors of the company who number not less than the required quorum acting together as a board of directors ; or
if the company has only one director, that director ;
“book and paper” and “book or paper” includes accounts, deeds, writings and documents ;
“certified” means certified in such manner as may be prescribed, or if no manner of certification is prescribed in relation to any document or class of documents, in such manner as the Registrar may require ;
“class” means a class of shares having attached to them identical rights, privileges, limitations and conditions ;
“company” means a company incorporated under this
Act or an existing company ;
“the court” means a High Court established under Article 154P of the Constitution for a Province, empowered with civil jurisdiction by Order published in the
Gazette under section 2 of the High Court of the
Provinces (Special Provisions) Act, No. 10 of 1996, within the Province for which such High Court is established, or where no such High Court vested with such civil jurisdiction is established for any
Province, the High Court established for the Western
Province ;
“debenture” includes debenture stock, bonds and any other securities of a company, whether constituting a charge on the assets of the company or not ;
“director” includes—
a person occupying the position of director of the company, by whatever name called ;
for the purposes of sections 187, 188, 189,
190, 197, 374 and 377 —
a person in accordance with whose directions or instructions a person referred to in paragraph (a) may be required or is accustomed to act ;
a person in accordance with whose directions or instructions the board of the company may be required or is accustomed to act ; and
a person who exercises or who is entitled to exercise or who controls or who is entitled to control the exercise of powers which, apart from the articles of the company, would be required to be exercised by the board ; and
for the purposes of sections 187 to 195 (both inclusive), 197, 374 and 377, a person to whom a power or duty of the board has been directly delegated by the board with that person’s consent or acquiescence, or who exercises the power or duty with the consent or acquiescence of the board.
The provisions of paragraphs (b) and (c) shall not apply to a person to the extent that the person acts only in a professional capacity ;
“distribution” means—
the direct or indirect transfer of money or property, other than the shares of a company, to or for the benefit of a shareholder ; or
the incurring of a debt to or for the benefit of a shareholder, in relation to a share or shares held by that shareholder, whether by means of a payment of a dividend, a redemption or other acquisition of the share or shares, a distribution of indebtedness or otherwise ;
“dividend” shall have the same meaning as given in section 60 ;
“document” means a document in any form, including—
any writing on material ;
information recorded or stored by means of a tape recorder, computer, or other device and material subsequently derived from information so recorded or stored ;
a book, graph, or drawing ; and
a photograph, film negative, tape or other device in which one or more visual images are embodied so as to be capable (with or without the aid of equipment) of being reproduced ;
“employees’ share scheme”, in relation to a company, means a scheme for encouraging or facilitating the holding of shares in the company by or for the benefit of—
the bona fide employees or former employees of the company or any related company ; or
the wives, husbands, widows, widowers or children or step-children of such employees or former employees ;
“existing company” means, a company formed and registered under the Joint Stock Companies
Ordinance, 1861, or the Joint Stock Banking
Ordinance, 1897, the Companies Ordinance (Cap.
145), or the Companies Act, No. 17 of 1982 ;
“financial statements” means—
a balance sheet for the company as at the balance sheet date ; and
in the case of—
a company trading for profit, a profit and loss statement for the company in relation to the accounting period ending at the balance sheet date ; and
a company not trading for profit, an income and expenditure statement for the company in relation to the accounting period ending at the balance sheet date, together with any notes or documents giving information relating to the balance sheet or statement ;
“Fund” means, the Fund established under section 479;
“group financial statements” means—
a consolidated balance sheet for the group as at that balance sheet date ;
where a member of the group trades for profit, a consolidated profit and loss statement for the group in relation to the accounting period ending at that balance sheet date ; and
where no member of the group trades for profit, a consolidated income and expenditure statement for the group, in relation to the accounting period ending at that balance sheet date, together with any notes or documents giving information relating to the balance sheet or statement ;
“holding company”, a company shall beodeemed to be another company’s holding company, if and only if that other company is its subsidiary. For the purpose of this definition “company” includes any body corporate;
“interest group” in relation to any action or proposal affecting rights attached to shares, means a group of shareholders—
whose affected rights are identical; and
whose rights are affected by the action or proposal in the same way;
“legal representative” means, an executor or administrator or in the case of an estate not administrable in law, the next-of-kin who have adiated the inheritance;
“listed company” means, a company, any shares or securities of which are quoted on a licensed stock exchange;
“licensed commercial bank” means, a company or institution issued with a licence under the Banking
Act, No. 30 of 1988, to carry on business as a licensed commercial bank;
“manager” includes, any person occupying the position of manger by whatever name called;
“minimum subscription” means, the amount stated in a prospectus as the minimum amount, which in the opinion of the directors must be raised by the issue of share capital and reckoned exclusively of any amount payable otherwise than in cash;
“officer” in relation to a body corporate, includes a director, manager or secretary;
“ordinary resolution” means, a resolution that is approved by a simple majority of the votes of those shareholders entitled to vote and voting on the question;
“overseas company” shall have the same meaning as given in section 488;
“prescribed” means, prescribed by regulation;
“prospectus” means, any prospectus, notice, circular, advertisement, or other invitation, offering to the public for subscription to or purchase of any shares or debentures of a company, and includes any such notice, circular, advertisement, or other invitation, notwithstanding that it may contain on the face thereof, that it is not a prospectus or offer of shares to the public;
“receiver” means, a receiver of the whole or a part of the property and undertaking of a company, appointed under Part XV;
“redeemable” shall have the same meaning as given in section 66;
“Register” means, the Register required to be kept under section 473;
“Registrar” means, the Registrar-General of Companies or other officer performing under this Act, the duty of registration of companies;
“resolution altering articles” shall have the same meaning as given in section 15;
“share” means, a share issued by a company;
“share register” means, the register required to be kept under section 123;
“shareholder” shall have the same meaning as given in section 86;
“stated capital” shall have the same meaning as given in section 58;
“subsidiary”, a company shall be deemed to be a subsidiary of another, if and only if—
that other company either—
controls the composition of its board of directors ;
is in a position to exercise or control the exercise of more than half the maximum number of votes that can be exercised at a meeting of the company;
hold more than half of the issued shares of the company, other than shares that carry no right to participate beyond a specified amount in a distribution of profits or capital;
is entitled to receive more than half of every dividend paid on shares issued by the company, other than shares that carry no right to participate beyond a specified amount in a distribution of profits or capital; or
the first-mentioned company is a subsidiary of any company which is that other company’s subsidiary.
For the purpose of this definition, the composition of a company’s board of directors shall be deemed to be controlled by another company if, and only if, that other company by the exercise of any power exercisable by it without the consent or concurrence of any other person, can appoint or remove all or a majority of the directors, and that other company shall be deemed to have power to appoint a director, if—
a person cannot be appointed as a director without the exercise in his favour by that other company, of a power to so appoint ; or
a person’s appointment as a director follows necessarily from his appointment as a director of that other company.
In determining whether one company is a subsidiary of another—
any shares held or power exercisable by a company in a fiduciary capacity shall be treated as not held or exercisable by it;
subject to the provisions of paragraphs (c) and (d), any shares held or power exercisable—
by any person as a nominee for that other
(except where that other is concerned only in a fiduciary capacity); or
by or by a nominee for a subsidiary of that other, not being a subsidiary which is concerned only in a fiduciary capacity, shall be treated as held or exercisable by that other;
any shares held or power exercisable by any person by virtue of the provisions of any debentures of the first-mentioned company, or of a trust deed for securing any issue of such debentures, shall be disregarded;
any shares held or power exercisable by or by a nominee for that other or its subsidiary (not being held or exercisable as referred to in paragraph (c)), shall be treated as not held or exercisable by that other, if the ordinary business of that other or its subsidiary, as the case may be, includes the lending of money, and the shares are held or the power is exercisable by way of security only, for the purposes of a transaction entered into in the ordinary course of that business.
For the purpose of this definition “company” includes a body corporate; and
“working day” means a day other than Saturday,
Sunday or a public holiday.
For the purposes of this Act, —
a company is related to another company, if—
that company is the subsidiary or holding company of the other company;
the holding company of that company is also a holding company of the other company; or
that company is related to a company which is related to the other company ;
where any section of this Act provides that an officer of a company who is in default shall be liable to a penalty, the expression “officer who is in default”
means any director, manager, secretary or other officer of the company, who knowingly and wilfully authorizes or permits the default, refusal or contravention referred to in that section;
(i)
one or more groups may exist in relation to any action or proposal; and
if—
(A)
action is taken in relation to some holders of shares in a class and not others; or
(B)
a proposal expressly distinguishes between some holders of shares in a class and other holders of shares of that class, holders of shares in the same class, may fall into two or more interest groups.
Any reference in this Act—
(i)
to the shareholders of a company includes, in relation to a company which has only one shareholder, a reference to that shareholder;
to the directors of a company includes, in relation to a company which has only one director, a reference to that director ;
to a body corporate or to a corporation, shall be construed as not including a corporation sole but as including a company incorporated outside Sri
Lanka;
unless the context otherwise requires, to a person by whom, or in whose interests a receiver was appointed, includes a reference to a person to whom the rights and interests under any deed or agreement by or under which the receiver was appointed, have been transferred or assigned.
Where public notice of any matter is required to be given under this Act, that notice shall be given by publishing a notice of that matter—
in at least one issue of the Gazette; and
in at least one issue of a daily newspaper in the
Sinhala, Tamil and English languages, circulating in the area in which—
the company’s place of business;
if the company has more than one place of business, the company’s principal place of business; or
if the company has no place of business or the location of neither its principal place of business nor any other place of business is known to the person required to give the notice, the company’s registered office, is situated.
TRANSITIONAL PROVISIONS AND SAVINGS
Part XXIII