Section 33 — Finance Act 2008: Enterprise management incentives: qualifying companies

Enterprise management incentives: qualifying companies 33 1 Part 3 of Schedule 5 to ITEPA 2003 (enterprise management incentives: qualifying companies) is amended as follows.

2 In paragraph 8 (qualifying companies: introduction), omit the “and” at the end of the entry relating to paragraph 12, and after that entry insert— “ number of employees (see paragraph 12A), and ” .

3 After paragraph 12 insert— The number of employees requirement 12A 1 The number of employees requirement in the case of a single company is that the full-time equivalent employee number for it is less than 250.

2 The number of employees requirement in the case of a parent company is that the sum of—

a the full-time equivalent employee number for it, and b the full-time equivalent employee numbers for each of its qualifying subsidiaries, is less than 250.

3 The full-time equivalent employee number for a company is calculated as follows— Step 1 Find the number of full-time employees of the company. Step 2 Add, for each employee of the company who is not a full-time employee, such fraction as is just and reasonable. The result is the full-time equivalent employee number.

4 In this paragraph references to an employee—

a include a director, but b do not include—

i an employee on maternity or paternity leave, or ii a student on vocational training.

4 In paragraph 16 (excluded activities), after paragraph (i) insert—

ia shipbuilding (see also paragraph 20A);

ib producing coal (see also paragraph 20B);

ic producing steel (see also paragraph 20C); .

5 After paragraph 20 insert— Excluded activities: shipbuilding 20A In paragraph 16(ia) “ shipbuilding ” has the same meaning as in the Framework on state aid to shipbuilding (2003/C 317/06), published in the Official Journal on 30 December 2003. Excluded activities: producing coal 20B 1 This paragraph supplements paragraph 16(ib). 2 “ Coal ” has the meaning given by Article 2 of Council Regulation ( (state aid to coal industry). EC ) No. 1407/2002 3 The production of coal includes the extraction of it. Excluded activities: producing steel 20C In paragraph 16(ic) “ steel ” means any of the steel products listed in Annex 1 to the Guidelines on national regional aid (2006/C 54/08), published in the Official Journal on 4 March 2006.

6 The amendments made by this section have effect in relation to options granted on or after the day on which this Act is passed.