SCHEDULE 28B Venture Capital Trusts: Meaning of “qualifying holdings”
Requirement that securities should not relate to a guaranteed loan
10A
(1)
The requirement of this paragraph is that there are no securities relating to a guaranteed loan in the relevant holding.
(2)
For the purposes of this paragraph a security relates to a guaranteed loan if (and only if) there are arrangements for the trust company to be or become entitled, in the event of a failure by any person to comply with—
(a)
the terms of the loan to which the security relates, or
(b)
the terms of the security,
to receive anything (whether directly or indirectly) from a third party.
(3)
For the purposes of sub-paragraph (2) above it shall be immaterial whether the arrangements apply in all cases of a failure to comply or only in certain such cases.
(4)
For the purposes of this paragraph “third party” means any person except—
(a)
the relevant company; and
(b)
if the relevant company is the parent company of a trading group for the purposes of paragraph 3 above, the subsidiaries of the relevant company.