Individual holds 20% of a company that itself holds 20% of a company considering an EIS issue of shares. The individual is also a director of the top company but otherwise is unconnected with the 'EIS' company. I'm happy that he meets/will meet the 30% direct/indirect test for connection. However, will he meet the requirements of s164A? That section simply refers to an existing holding by the individual of shares in the issuing company - I can find no reference to direct or indirect holding so on a strict reading it would seem that s164A should not apply. Thoughts anyone?
The other 80% of the issuing company is held by various unconnected individuals - the independence test is/will be met.