Intangible assets: related party rules: definition of control: general
For the purposes of the first two tests of relatedness in section 835 (see CIRD45105) section 836 applies essentially the same definition of control as that in CTA10/S1124. Section 836 reads:
‘…in relation to a company, “control” means the power of a person to secure that the company’s affairs are conducted in accordance with the person’s wishes—
- by means of the holding of shares or the possession of voting power in or in relation to the company or any other company, or
- as a result of powers conferred by the articles of association or other document regulating the company or any other company.’
Points to note
- For the purpose of determining whether a person (‘A’) controls a company the rights and powers of other persons can be attributed to A under the provisions described in CIRD45180 onwards.
- Subject to this attribution power, the test is concerned with whether, as a question of fact (rather than inference from, say, powers on a winding-up), a person can control a company. It therefore differs from the definition of control in the close company provisions (see CTA10/S450 and CTM60200 onwards).
- The CTA10/S450 definition of control does apply, however, in determining whether a company is a close company for the purpose of the third test of relatedness (section 835 (5)), outlined in CIRD45105.