VCM62050 - VCT scheme: qualifying holdings: securities

ITA/S285(2)

`Securities' covers not only loan and debenture stock but also any loan, whether secured or not, subject to the restriction set out below.

The meaning of `securities' is restricted to cases where the terms on which the investment in them is made do not allow either the VCT or anyone else to require repayment of the loan, or repurchase or redemption of the stock, within five years. (Thus, for example, if the loan was made on 10 June 1998 its terms should not allow repayment to be required before 11 June 2003.) But where a loan is made on normal commercial terms which include a clause allowing for repayment to be enforced in the event of default (for example, on interest payments) that clause is ignored for this purpose - see SP8/95.