VCM12130 - The investment process: arrangements to reduce risk: underpinning value

ICTA/S299B; ITA/S177; TCGA92/SCH5B/PARA11; FA00/SCH15/PARA37

For EIS and CVS only, no relief is available in respect of shares if the arrangements under which they were issued, or any arrangements which otherwise relate to or are connected with the issue, include arrangements which are intended to protect the value of the investment in any way. This includes, for example, schemes which insure investors against making a loss, and schemes to maintain the value of the shares artificially. There is an exception for ordinary commercial matters such as insurance by the company against normal trading risks.