Commentary on Sections Overview Part 3: Qualifying companies Paragraph 18: Excluded activities: leasing of certain ships
3494.This derives from paragraph 21 of Schedule 14 to FA 2000.
3495.One of the excluded activities listed in paragraph 16 of this Schedule is leasing (including letting ships on charter). This paragraph relaxes this exclusion in specified circumstances. This material derives from paragraph 21 of Schedule 14 to FA 2000. A qualifying trade can include certain kinds of short-term ship leasing, provided that the conditions set out in this paragraph are met. This relaxation does not apply to oil rigs or pleasure craft, the leasing of which remains an excluded activity.
3496.The additional material in sub-paragraph (2) makes it clear that the requirements of sub-paragraph (4) do not have to be met in relation to oil rigs and pleasure craft.
3497.An error in sub-paragraph (4) of paragraph 21 of Schedule 14 to FA 2000 has been corrected. This part of the rule in Schedule 14 is unworkable in that it is not possible for both the owner and the charterer to be subsidiaries of the company carrying on the trade, which has necessarily to be the owner of the ship.
3498.Sub-paragraph (6) is modelled on the approach taken in section 297(7) of ICTA (the Enterprise Investment Scheme). See Change 175 in Annex 1.