Companies Act 2006, section 996

Powers of the court under this Part

Part 30 Protection of members against unfair prejudice

(1)If the court is satisfied that a petition under this Part is well founded, it may make such order as it thinks fit for giving relief in respect of the matters complained of.

(2)Without prejudice to the generality of subsection (1), the court's order may—

(a)regulate the conduct of the company's affairs in the future;

(b)require the company—

(i)to refrain from doing or continuing an act complained of, or

(ii)to do an act that the petitioner has complained it has omitted to do;

(c)authorise civil proceedings to be brought in the name and on behalf of the company by such person or persons and on such terms as the court may direct;

(d)require the company not to make any, or any specified, alterations in its articles without the leave of the court;

(e)provide for the purchase of the shares of any members of the company by other members or by the company itself and, in the case of a purchase by the company itself, the reduction of the company's capital accordingly.

Read section 996 in the full Act → Definitions (5) Cases (155)

Definitions used in section 996

the court

(1) Except as otherwise provided, in the Companies Acts “the court” means—

(a)in England and Wales, the High Court or the county court;

(b)in Scotland, the Court of Session or the sheriff court;

(c)in Northern Ireland, the High Court.

Defined in s.1156(1) · see it in the full Act

(2) The provisions of the Companies Acts conferring jurisdiction on “the court” as defined above have effect subject to any enactment or rule of law relating to the allocation of jurisdiction or distribution of business between courts in any part of the United Kingdom.

Defined in s.1156(2) · see it in the full Act
company

(3) In this section, and so far as applicable for the purposes of this section in the other provisions of this Part, “company” means—

(a)a company within the meaning of this Act, or

(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Defined in s.994(3) · see it in the full Act

(4) In this section, and so far as applicable for the purposes of this section in the other provisions of this Part, “company” means any body corporate that is liable to be wound up under the Insolvency Act 1986 (c. 45) or the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)).

Defined in s.995(4) · see it in the full Act

“company” means a company formed and registered under this Act, that is—

(a)

a company so formed and registered after the commencement of this Part, or

(b)

a company that immediately before the commencement of this Part—

(i)

was formed and registered under the Companies Act 1985 (c. 6) or the Companies (Northern Ireland) Order 1986 (S.I. 1986/1032 (N.I. 6)), or

(ii)

was an existing company for the purposes of that Act or that Order,

(which is to be treated on commencement as if formed and registered under this Act).

Defined in s.1(1) · see it in the full Act

(4) In this section and that Schedule “company” includes any body corporate.

Defined in s.1159(4) · see it in the full Act
articles

(4) References in the Companies Acts to a company's “articles” are to its articles of association.

Defined in s.18(4) · see it in the full Act
share

(1) In the Companies Acts “share”, in relation to a company, means share in the company's share capital.

Defined in s.540(1) · see it in the full Act
member

(2) In sub-paragraph (1) “member” has the same meaning as it has by virtue of section 7(1) of that Act .

Defined in Sch.2 Pt.1 · see it in the full Act

Cases considering section 996 (155)

THG Plc v Zedra Trust Company (Jersey) Ltd

[2026] UKSC 6 · 25 February 2026Interprets

The section gives the court the widest possible discretion to select relief. A payment obligation arises from the resulting judicial order, not by virtue of the section itself. The jurisdiction therefore falls outside sections 8 and 9 of the Limitation Act 1980 (see paras [137]; [145]-[146]; [155]-[158]). The power to make such order as the court thinks fit means that a petitioner has no entitlement to compensation or any other particular remedy. This wide remedial discretion prevents a requested monetary order from being a sum recoverable by enactment (see paras [137]; [145]-[146]). The listed remedies are non-exhaustive illustrations of the court’s remedial discretion and include both monetary and non-monetary possibilities. Their variety makes remedy-dependent limitation arbitrary and unworkable (see paras [137]; [145]-[152]).

Shanda Games Ltd v Maso Capital Investments Ltd and others

[2020] UKPC 2 · 27 January 2020Limits

The unfair-prejudice remedy under section 996 was distinguished because valuation occurs within a discretionary purchase remedy. The quasi-partnership exception did not govern section 238. (see paras [37]-[40])

Saxon Woods Investments Limited v Francesco Costa

[2025] EWCA Civ 708 · 9 June 2025

Once unfair prejudice is established, the provision gives a wide discretion to remedy past prejudice and cure it for the future. A controlling director’s fiduciary breach justified an unconditional, non-discounted buy-out rather than relief confined by contractual causation. (see paras [129]-[139])

135 more judgments, and what each says about section 996, are in the case-law panel in the full Act.

Amendments and notes

2 notes from legislation.gov.uk

Modifications

  1. C1366Ss. 994-996 applied (with modifications) (1.10.2009) by The Limited Liability Partnerships (Application of Companies Act 2006) Regulations 2009 (S.I. 2009/1804), regs. 2, 48 (as amended (1.4.2013) by S.I. 2013/472, Sch. 2 para. 174)

Commencement

  1. I335S. 996 wholly in force at 1.10.2007; s. 996 not in force at Royal Assent see s. 1300; s. 996 in force at 1.10.2007 by S.I. 2007/2194, art. 2(1)(j) (with saving in art. 12 and subject to transitional adaptations specified in Sch. 1 and with transitional provisions and savings in Sch. 3) this amendment is subject to savings and/or transitional provisions, see the commentary.