32. Participation in Holding Company

(1) A Body Corporate cannot be a Shareholder of a Company that is its Holding Company, unless subsection (2) applies. An Allotment or transfer of Shares in a Company to its Subsidiary is void, except to the extent otherwise provided in this section.

(2) If a Subsidiary is, when it becomes a Subsidiary, a Shareholder of its Holding Company, the Subsidiary may continue to be a Shareholder of its Holding Company for 1 year after the day it becomes a Subsidiary, if either:

• (a) both of the following subparagraphs are satisfied:

(i) it has no right to vote at meetings of the Holding Company or a class of its Shareholders;

(ii) it does not acquire further Shares in the Holding Company except on an Allotment of Shares to all Shareholders, in proportion to the number of Shares held by the Shareholders immediately before the Allotment, by way of bonus issue; or

• (b) it is a Shareholder in its Holding Company only as a Personal Representative or trustee.

(3) Subsection (1) also applies to a nominee acting on behalf of the Subsidiary as if the nominee were the Subsidiary itself.