SCHEDULES

SCHEDULE 16U.K.Venture capital schemes etc

Part 3U.K.Excluded activities: receipt of royalties and licence fees

Enterprise investment schemeU.K.

11(1)In section 297 of ICTA (qualifying trades)—U.K.

(a)in subsection (5), for paragraphs (a) and (b) substitute—

“(a)by the company mentioned in section 293(1), or

(b)by a company which was a subsidiary of that company throughout a period during which it created the whole or greater part (in terms of value) of the intangible asset.”,

(b)in subsection (5A), omit paragraphs (b) and (c) and the words after paragraph (c), and

(c)after subsection (5C) insert—

“(5D)If—

(a)the company mentioned in section 293(1) (“the issuing company”) acquired all the shares (“old shares”) in another company (“the old company”) at a time when the only shares issued in the issuing company were subscriber shares, and

(b)the consideration for the old shares consisted wholly of the issue of shares in the issuing company,

references in subsection (5) above to the company mentioned in section 293(1) include the old company.”

(2)In section 304A of that Act (acquisition of share capital by new company)—

(a)in subsection (3), after “Chapter” insert “ ;(except section 297(5D)) ”, and

(b)in subsection (4), after “Chapter” insert “ ;(except section 297(5D)) ”.

F1(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F1(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)In section 137 of ITA 2007 (share loss relief: trading requirement for shares to which EIS relief not attributable), after subsection (8) insert—

“(9)In section 195 as applied by subsection (7) for the purposes mentioned in subsection (8), references to the issuing company are to be read as references to the company mentioned in subsection (1).”

(6)In section 146 of that Act (share loss relief: substitution of new shares for old), after subsection (2) insert—

“(3)Nothing in subsection (2) applies in relation to section 195(7) as applied by section 137(7) for the purposes mentioned in section 137(8).”

(7)In section 195 of ITA 2007 (EIS: excluded activities: receipt of royalties and licence fees)—

(a)in subsection (4), for paragraphs (a) and (b) substitute—

“(a)by the issuing company, or

(b)by a company which was a qualifying subsidiary of the issuing company throughout a period during which it created the whole or greater part (in terms of value) of the intangible asset.”,

(b)in subsection (6), omit the definition of “holding company”, and

(c)after that subsection insert—

“(7)If—

(a)the issuing company acquired all the shares (“old shares”) in another company (“the old company”) at a time when the only shares issued in the issuing company were subscriber shares, and

(b)the consideration for the old shares consisted wholly of the issue of shares in the issuing company,

references in subsection (4) to the issuing company include the old company.”

(8)In section 249 of that Act (substitution of new shares for old shares)—

(a)in subsection (2), after “Part” insert “ ;(except section 195(7)) ”, and

(b)in subsection (4), after “Part” insert “ ;(except section 195(7)) ”.