SCHEDULES

SCHEDULE 28B Venture Capital Trusts: Meaning of “qualifying holdings”

Provisions supplemental to paragraph 4

5

1

In paragraph 4 above—

  • “film” means an original master negative of a film, an original master film disc or an original master film tape;

  • F1“nursing home” means any establishment which exists wholly or mainly for the provision of nursing care for persons suffering from sickness, injury or infirmity or for women who are pregnant or have given birth to children;

  • “oil rig” means any ship which is an offshore installation for the purposes of the M1Mineral Workings (Offshore Installations) Act 1971;

  • “pleasure craft” means any ship of a kind primarily used for sport or recreation;

  • F2“property development” means the development of land—

    1. a

      by a company which has, or at any time has had, an interest in the land, and

    2. b

      with the sole or main object of realising a gain from the disposal of an interest in the land when it is developed;

  • “research and development” means any activity which is intended to result in a patentable invention (within the meaning of the M2Patents Act 1977) or in a computer program;

  • F3“residential care home” means any establishment which exists wholly or mainly for the provision of residential accommodation, together with board and personal care, for persons in need of personal care by reason of old age, mental or physical disabilities, past or present dependence on alcohol or drugs or any past illnesses or past or present mental disorders; and

  • “sound recording”, in relation to a film, means its sound track, original master audio disc or original master audio tape.

2

For the purposes of paragraph 4 above, in the case of a trade carried on by a company, a person has a controlling interest in that trade if—

a

he controls the company;

b

the company is a close company and he or an associate of his, being a director of the company, either—

i

is the beneficial owner of more than 30 per cent. of the ordinary share capital of the company, or

ii

is able, directly or through the medium of other companies or by any other indirect means, to control more than 30 per cent. of that share capital;

or

c

not less than half of the trade could, in accordance with section 344(2), be regarded as belonging to him for the purposes of section 343;

and, in any other case, a person has a controlling interest in a trade if he is entitled to not less than half of the assets used for, or of the income arising from, the trade.

3

For the purposes of sub-paragraph (2) above there shall be attributed to any person any rights or powers of any other person who is an associate of his.

4

References in paragraph 4 above or this paragraph to a trade, except the references in paragraph 4(2)(f) to the trade for which services or facilities are provided, shall be construed without reference to so much of the definition of trade in section 832(1) as relates to adventures or concerns in the nature of trade; and those references in paragraph 4(2)(f) above to a trade shall have effect, in relation to cases in which what is carried on is carried on by a person other than a company, as including references to any business, profession or vocation.

5

In this paragraph—

  • “associate” has the meaning given in subsections (3) and (4) of section 417, except that in those subsections, as applied for the purposes of this paragraph, “relative” shall not include a brother or sister; and

  • “director” shall be construed in accordance with subsection (5) of that section;

  • F4“interest in land” means (subject to sub-paragraph (6) below)—

    1. a

      any estate, interest or right in or over land, including any right affecting the use or disposition of land; or

    2. b

      any right to obtain such an estate, interest or right from another which is conditional on the other’s ability to grant the estate, interest or right.

F56

References in paragraph 4 above, in relation to an hotel, to a comparable establishment are references to a guest house, hostel or other establishment the main purpose of maintaining which is the provision of facilities for overnight accommodation (whether with or without catering services).

7

References in this paragraph to an interest in land do not include references to—

a

the interest of a creditor (other than a creditor in respect of a rentcharge) whose debt is secured by way of mortgage, an agreement for a mortgage or a charge of any kind over land; or

b

in the case of land in Scotland, the interest of a creditor in a charge or security of any kind over land.