Qualifying investments: open ended investment companies (OEIC)
Investors in open ended investment companies (OEICs) will own shares in the company,but they do not have any rights to the underlying investments. They can be accepted asqualifying investments for loss on sale of shares relief.
OEICs were introduced to the UK in 1997. They are authorised unit trusts in corporateform. While the unit trust was and to some extent remains the traditional(non-insured) UK retail vehicle for pooled investment in shares and securities, it has notproved popular with non-UK investors. Internationally, the corporate structure is farbetter understood than the trust structure. The OEIC, very much the UK counterpart to theLuxembourg SICAV, was therefore intended to be a corporate investment product. Further,the structure of an OEIC can prove more flexible and cost-efficient than unit trusts. Inconsequence many unit trusts have been converted into OEICs in recent years.
As OEICs are companies, their situs (IHTM27000) and the situsof investments in them follow the normal rules for companies and shares.