ESCA37

Nominee directors

Where a company (the first company) has the right to appoint a director to the board of another company (the second company) because of its shareholdings in, or a formal agreement with, the second company, the director appointed in this way is a nominee director.

If a nominee director is obliged to hand over to the first company any fees or other emoluments the director receives from the nominee directorship, and does in fact do so, if the first company accepts liability, the fees and other emoluments may be treated as income of the first company.

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