Companies and shareholders: Overseas Branch Registers
UK-registered companies that conduct business in certain Commonwealth countries and former colonies are permitted by Company Law to set up Overseas Branch Registers (OBR) of members resident in that country (Section 133(3) Companies Act 2006). This is for historical reasons, to facilitate the keeping of company records in an era of paper documents and sea mail.
The Companies Act treats an OBR as part of the principal register of the company, but deems an instrument transferring shares held on an OBR (other than in Northern Ireland) to be a transfer of property outside the United Kingdom.
An instrument transferring shares held on an OBR is specifically exempt from stamp duty unless it is executed within the UK. This exemption extends to a return made to the Registrar of Companies in respect of a company’s purchase of its own shares held on an OBR.
By virtue of this exemption, such a transfer is also exempt from the principal 0.5 per cent charge to SDRT (FA86/S99(5(a)).
However, the OBR legislation is specifically disapplied for the purpose of defining ‘chargeable securities’ for the higher 1.5 per cent charge to SDRT (FA86/S99(10)), so the 1.5 per cent charge will apply when securities held on an OBR are transferred to a depositary bank or clearance service.