Substantial property transactions involving directors (section 190 companies act 2006)
Under section 190(1) of the CA 2006 substantial property transactions between a company and: (a) its director, or (b) a director of its holding company, or (c) in each case a person 'connected' with such a director are prohibited, unless the property transaction is either approved by ordinary resolution of the members of the company or is conditional upon such approval being granted. If the company is also a charity, the consent of the charity commissioners is also required. If the director or connected person is a director of the company's holding company or a person connected with such a director, the arrangement must also be approved by a resolution of the members of the holding company or be conditional on such approval being obtained (section 190(2), CA 2006). The purpose of the substantial property transaction regime is to “give shareholders specific protection in respect of arrangements and transactions which will or may benefit directors to the detriment of the com
