Taxation of Chargeable Gains Act 1992 Schedule A1 paragraph 23

Qualifying shareholdings in joint venture companies

Paragraph 23 of Schedule A1 sets out the conditions under which a company's shareholding in a joint venture company can be treated as a qualifying shareholding for the purposes of the substantial shareholdings exemption.

• A company may hold shares in a joint venture company rather than directly in a trading company, and still qualify for the substantial shareholdings exemption if certain conditions are met.
• The joint venture company must itself hold shares in trading companies or trading groups, and the investing company must hold a substantial interest in the joint venture company.
• The investing company's indirect interest in the underlying trading activities, traced through the joint venture company, must meet the same economic substance requirements as a direct qualifying shareholding.
• These provisions were amended by the Finance Act 2008, Schedule 2, paragraph 45, to update the rules governing how joint venture arrangements interact with the substantial shareholdings exemption.