11Interpretation—meaning of “subsidiary”

11 Interpretation—meaning of “subsidiary”

11 Interpretation—meaning of “subsidiary”

(1) Subject to subsection (5), a body corporate is a subsidiary of a co-operative housing body if—

(a) the co-operative housing body—

(i) controls the composition of the body corporate’s board of directors, or

(ii) is in a position to cast, or control the casting of, more than 50% of the maximum number of votes that might be cast at a general meeting of the body corporate, or

(iii) holds more than 50% of the issued share capital of the body corporate (other than any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital), or

(b) the body corporate is a subsidiary of a body corporate that is a subsidiary of the co-operative housing body (including a body corporate that is a subsidiary of the co-operative housing body by another application of this paragraph).

(2) The composition of a body corporate’s board of directors is controlled by a co-operative housing body if the co-operative housing body can appoint or remove all or a majority of the directors by the exercise of a power exercisable with or without the consent or concurrence of another person.

(3) For the purposes of subsection (2), a co-operative housing body is taken to have power to make an appointment of directors if—

(a) a person cannot be appointed as director without the exercise of such a power by the co-operative housing body in the person’s favour, or

(b) a person’s appointment as a director follows necessarily from the person being a director or other officer of the co-operative housing body.

(4) Subsection (2) does not limit by implication the circumstances in which the composition of a body corporate’s board of directors is taken to be controlled by a co-operative housing body.

(5) In determining whether a body corporate is a subsidiary of a co-operative housing body—

(a) any shares held or power exercisable by the co-operative housing body in a fiduciary capacity must be treated as not held or exercisable by it, and

(b) subject to paragraphs (c) and (d), any shares held or power exercisable—