Business and enterprise – guidance

Buy bona vacantia shares (BVC7)

How to buy unquoted shares that belonged to a dissolved company and now belong to the Crown.

Overview

The Bona Vacantia division (BVD) of the Government Legal Department deals with the disposal of shares previously owned by a dissolved company which are now owned by the Crown.

BVD usually sell shares for their market value or disclaim (give up) the Crown’s interest in them.

BVD do not:

  • transfer shares for no consideration
  • transfer the shares with any title guarantee. This means that when BVD sell the shares they do not guarantee that they have the legal right to sell them
  • assist with any disputes that may arise from the transfer of the shares
  • usually exercise any of the powers of a shareholder, such as voting at a company meeting or appointing a proxy to vote

Buy shares

Complete the following:

  1. check that BVD is the correct office by reading BVC1 on jurisdiction
  2. write to BVD at

Bona Vacantia - Companies

Government Legal Department
PO Box 70165

London
WC1A 9HG

Please use this email address for all enquiries relating to the non cash assets of dissolved companies (eg, land, shares, intellectual property, chattels, etc).

You must include:

  • the name, company number and last registered office of the dissolved company that owned the shares. You can get this information from Companies House
  • a copy of any share certificate
  • a copy of the share register of the issuing company showing that the dissolved company was registered as holder of the shares
  • details of any dividends which were declared by the issuing company in the last 3 years
  • details of any dividends declared since the date the company was dissolved, which are now payable to the Crown as bona vacantia
  • a copy of the last 3 years audited accounts of the issuing company, so that the value of the shares can be calculated
  • a copy of the Articles of Association of the issuing company

Please answer all of the above questions and send BVD copies of all the documents requested as they will not normally be able to progress your case without the above information.

Please send your application either by post/DX or email but not both. Please do not send multiple copies.

Valuation and what happens next

BVD will check that the evidence you have provided shows that the dissolved company owned them. If BVD are not satisfied with the evidence provided they may ask you to make further enquiries.

If BVD agree the shares are bona vacantia they will decide how to dispose of them. There is no guarantee that BVD will sell them to you or at all.

Before BVD take steps to dispose of the shares they may approach the former members, directors or liquidator of the dissolved company to ask if they intend to restore the company to the Companies Register. This is because the shares would automatically go back to the company if it is restored. BVD would normally do this if the company was dissolved within the last 12 months.

BVD will usually offer the bona vacantia shares first to the former members of the dissolved company or back to the issuing company.

BVD may consider sales to other people, but do not have to do so.

If the shares are sold back to the issuing company, a warranty will be required that:

  • all the requirements of Part 18 of the Companies Act 2006 relating to an ‘off-market purchase’ by a company of its own shares have been complied with
  • the purchase is made out of distributable profits of the issuing company, as defined in the Companies Act 2006, and in accordance with Part 18 of the 2006 Act

Before BVD sell unquoted shares, they will ask HM Revenue & Customs’ Share Valuation Team to calculate the full open market value of the shares.

BVD will sell the shares for the open market value subject to a minimum price for unquoted shares of £1,000.

As well as the sale price, the buyer of unquoted bona vacantia shares will also have to pay a contribution of £300 + VAT towards BVD’s legal costs, and any disbursements.

The buyer will have to find the share certificates. If the share certificates can’t be found, the buyer will have to make any necessary statutory declaration covering the enquiries that were made, and will have to deal with any enquiries from the issuing company. They will also have to pay any fees for the issue of duplicate share certificates.

The buyer of unquoted bona vacantia shares will have to prepare the necessary Stock Transfer Form for execution by the Treasury Solicitor. The buyer will have to deal with the registration of the Transfer Form, and pay any fees due for registering the transfer.

If the Articles of Association of the issuing company require that the shares must be offered to existing shareholders at a price to be agreed with the Board of Directors or assessed by the company’s auditors, the buyer will have to obtain that agreement or assessment.

If the total cost of the shares is £10,000 or more BVD will ask for proof of identity and address in accordance with anti-money laundering procedures.