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CMA Intermediate · Business Laws and Ethics · Rights of Shareholders

Under Section 48 of the Companies Act, 2013, where the memorandum or articles of a company contain a provision for varying the rights of a class of shares, the rights of that class may be varied with the written consent of the holders of at least what part of the issued shares of that class?

The written consent of holders of at least three-fourths of the issued shares of the class is needed. Section 48(1) provides this route, or alternatively a special resolution at a separate meeting of the class, where the memorandum or articles provide for variation.

  1. AOne-half
  2. BThree-fourthsCorrect
  3. CTwo-thirds
  4. DNine-tenths

Explanation

Section 48(1) allows variation with the consent in writing of holders of not less than three-fourths of the issued shares of that class, or by a special resolution passed at a separate meeting of that class. Two-thirds is the proportion for a special resolution in general, but the section's written-consent threshold is three-fourths.

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