Finance Act, 1986

Qualifying sponsoring company.

22.—(1) A company is a qualifying sponsoring company if it is incorporated in the State and complies with the requirements of this section.

(2) The company shall, throughout the relevant period—

(a) be resident in the State and not resident elsewhere, and

(b) exist wholly for the purpose of carrying on wholly or mainly in the State one or more qualifying trades.

(3) As respects any qualifying research and development project, a company shall be a qualifying sponsoring company only if it provides satisfactory evidence and it appears to the satisfaction of the Revenue Commissioners after such consultation, if any, as may seem to them necessary with such person or body of persons as in their opinion may be of assistance to them that any benefits accruing to the company from the qualifying research and development project will be applied by the company wholly or mainly for the purposes of a qualifying trade or trades carried on by the company.

(4) Without prejudice to the generality of subsection (2) but subject to subsection (5), a company ceases to comply with subsection (2) if before the end of the relevant period a resolution is passed, or an order is made, for the winding up of the company (or, in the case of a winding up otherwise than under the Companies Act, 1963 , any other act is done for the like purposes) or the company is dissolved without winding up.

(5) A company shall not be regarded as ceasing to comply with subsection (2) if it does so by reason of being wound up or dissolved without winding up and it is shown that the winding up or dissolution was for bona fide commercial reasons and not part of a scheme or arrangement the main purpose or one of the main purposes of which was the avoidance of tax.