Part 6Venture capital trusts
Chapter 3VCT approvals
Giving of approval
278Conditions relating to value of investments: general
1
This section and section 279 apply for the purposes of the 15% holding limit condition, the 70% qualifying holdings condition and the 30% eligible shares condition (“the relevant conditions”).
2
The value of a holding of investments of any description is to be taken, unless subsection (3) applies, to be its value when acquired.
3
If, in the case of a holding of investments of any description—
a
the holding is added to by a further holding of investments of that description, or
b
any payment is made in discharge, in whole or in part, of any obligation attached to the holding that (by discharging the whole or any part of the obligation) increases the value of the holding,
the value of the holding is to be taken to be its value immediately after the most recent addition or payment.
4
For the purposes of this section an addition is made to a holding of investments of any description whenever the company whose holding it is—
a
acquires further investments of that description, but
b
does not do so by being allotted shares or securities in a company without becoming liable to give any consideration.
5
Subsection (6) applies if, in connection with a scheme of reconstruction—
a
a company issues shares or securities,
b
the shares or securities are issued to persons holding shares or securities in a second company in respect of and in proportion to (or as nearly as may be in proportion to) their holdings in the second company, and
c
those persons do not become liable to give any consideration for the shares or securities.
In this subsection “scheme of reconstruction” has the same meaning as in section 136 of TCGA 1992.
6
For the purposes of this section—
a
a holding of the shares or securities of any description in the second company, and
b
a corresponding holding of the shares or securities issued by the company,
are to be regarded as the same holding.