Corporate Venturing

Glossary of terms

'Arrangements' includes any scheme, agreement or understanding, whether or not legally enforceable.

'Associate', in relation to a person, means

• any relative or partner of that person
• any trustee( s) of any settlement which the person or any relative is or was a settlor
• where the person has an interest in any shares or obligations of a company that are subject to any trust, or are part of the estate of a deceased person,
  • the trustee( s) of the settlement concerned or the personal representatives of the deceased, or
  • if the person is a company, any other company interested in those shares or obligations.

'Connected persons', for the purpose of the CVS, is the definition at Section 839 of the Taxes Act 1988.

.A company is connected with another company if

• the same person has control of both
• a person has control of one, and persons connected with him, or he and persons connected with him, have control of the other, or
• a group of two or more persons has control of each company, and the groups either consist of the same persons, or of persons connected with the same persons.

Any two or more persons acting together to secure or exercise control of a company will be treated as connected with one another in relation to that company, and with any person acting on the directions of any of them to secure or exercise control of the company.

A company is connected with an individual if

• that individual has control of the company, or
• the individual and persons connected with him or her together have control of it.

An individual is connected with another individual if

• they are spouses
• they are relatives
• one is the spouse of a relative of the other, or
• one is a relative of the spouse of the other.

'Relative' means parent or grandparent etc., child or grandchild etc. 'Director' has the meaning that it has in section 417( 5) of The Income and Corporation Taxes Act 1988.

'Disposal' has the meaning that it has in The Taxation of Chargeable Gains Act 1992 (unless the meaning is altered by a special rule in the CVS).

'Group' in relation to groups of companies, means a parent company and its 51% subsidiaries, and 'parent company' means a company that has one or more 51% subsidiaries, but is not itself a subsidiary of another company.

'Ordinary shares' means shares forming part of a company's share capital and 'ordinary share capital', except in relation to the rules on 'material interest' (see 'The Investing Company'), has the same meaning as in section 832( 1) of the Income and Corporation Taxes Act 1988.

'Person' includes individuals and companies.

'Relevant shares' are the shares issued to the investing company by the issuing company and in respect of which investment relief is claimed.

The meanings of the following expressions are given on the page indicated

• Attribution
• Non-financial trade
• Period of restriction
• Qualification period
• Qualifying subsidiaries
• Qualifying trade
• Relevant preference shares
• Research and development