A gain accruing to a company (“the investing company”) on a disposal of shares or an interest in shares in another company (“the company invested in”) is not a chargeable gain if the requirements of this Schedule are met.

The requirements are set out in—

• Part 2 (the substantial shareholding requirement), and

• Part 3 (requirements to be met in relation to the investing company and the company invested in).

The exemption conferred by this paragraph does not apply in the circumstances specified in paragraph 5 or the cases specified in paragraph 6.