Schedule 4 Company Share Option Plan (CSOP): Eligibility of individuals to participate: The "no material interest" requirement: Material interest overview
Paragraph 9 contains the main “material interest” provisions. It aims to prohibit anyone who already has a substantial interest in a company extending it by means of tax-relieved share options under Schedule 4 CSOP schemes, the grant of which the person concerned may be able to influence.
A Schedule 4 CSOP scheme must provide that an individual is not eligible to participate in the scheme on any date if that individual has on that date:
- they and/or their associates (see ETASSUM42340),
- have, or have had in the previous 12 months (see ETASSUM42320),
- a material interest (see ETASSUM42330),
- in a close company (see ETASSUM42320).
Scheme rules for option schemes should ensure that they apply the paragraph 9 prohibition both at the time an option is granted and at the time an option is exercised.