Distributions By Jersey Companies - April 2015

What is a distribution?

Article 114(1) of the Companies (Jersey) Law 1991, as amended, (the Law) defines a distribution, in relation to a company, as "every description of distribution of the company's assets to its members as members, whether in cash or otherwise."

Article 114(2) of the Law states that a distribution does not include:

• an issue of shares as fully or partly paid bonus shares
• the redemption or purchase of any of the company's own shares
• any reduction of share capital by extinguishing or reducing the liability of any of the members on any of the company's shares in respect of capital not paid up
• a distribution of assets to members of the company on its winding up.