Regulation 76 | The genuine diversity of ownership condition: further provisions

(1)For the purposes of regulation 75(3) a limiting or deterring effect means an effect which—

(a)limits investors to a limited number of specific persons or specific groups of connected persons, or

(b)deters a reasonable investor falling within one of the intended categories of investor from investing in the fund.

(2)Condition C (see regulation 75(4) shall be treated as being met even if at the relevant time the fund has no capacity to receive additional investments, unless—

(a)the capacity of the fund to receive investments in it is fixed by the fund documents (or otherwise), and

(b)a pre-determined number of specific persons or specific groups of connected persons make investments in the fund which collectively exhausts all, or substantially all, of that capacity.

(3)For the purposes of this regulation—

(a)sections 993 and 994 of ITA 2007 (connected persons) apply in the case of a person chargeable to income tax, and

(b)section 839 of ICTA (connected persons) applies in the case of a person chargeable to corporation tax.