16(1)The unquoted status requirement is that, at the time the relevant shares are issued, none of the issuing company’s shares, debentures or other securities is (and there are no arrangements in existence for any of them to be)—U.K.
(a)listed on a recognised stock exchange,
(b)listed on a designated exchange in a country outside the United Kingdom, or
(c)dealt in outside the United Kingdom by such means as may be designated.
This is subject to sub-paragraph (3).
(2)The unquoted status requirement applies whether or not the company is resident in the United Kingdom.
(3)The unquoted status requirement is treated as not met if at the time the relevant shares are issued—
(a)arrangements are in existence for the issuing company to become a subsidiary of another company (“the new company”) by virtue of an exchange of shares, or shares and securities, in relation to which paragraph 83 (certain exchanges resulting in acquisition of share capital by new company) applies, and
(b)arrangements have been made with a view to any of the new company’s shares, debentures or other securities being listed or dealt in as mentioned in paragraph (a), (b) or (c) of sub-paragraph (1).
(4)For the purposes of sub-paragraph (1) “designated” means designated by an order (“a designation order”) made for the purposes of subsection (1B) of section 312 of the Taxes Act 1988 [F1or section 184(3) of ITA 2007] (definition of “unquoted company” for the purposes of EIS).
(5)Where the issuing company meets the unquoted status requirement when the relevant shares are issued, it shall not cease to meet it by virtue of—
(a)any designation order, or
(b)any order under section 841 of the Taxes Act 1988 (designation of exchange as “recognised stock exchange”),
made after that time.
Textual Amendments
F1Words in Sch. 15 para. 16(4) inserted (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 1 para. 394(2) (with Sch. 2)