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SI2003/96 Schedule 1(2) & (3) & SI2023 No. 518 (4)

Loans to profit-distributing enterprises are not relevant investments for the purposes of SI2003/96 Regulation 8 (see CITM3030) if:

• the loan exceeds £250,000 on or after 2 June 2023 (£100,000 before this date) or
• it is not made on terms equivalent to those offered by conventional sources of finance, or
• the loan is not made at interest rates at or above the market rates, or
• where no interest is charged, the fee structure relating to the loan is not at or above the equivalent market level.

For these purposes the “market rate� of interest is the European Commission’s Hurdle Rate, which is the Reference Rate (see ), plus four percentage points, or more.

Where the £250,000 limit from 2 June 2023 (£100,000 limit to 1 June 2023) is breached

• as a result of two or more loans being made on the same day, or
• in circumstances where it is not possible to establish which loan caused the limit to be exceeded,

the Secretary of State at the Department for Business and Trade (DBT) Economics & Markets Directorate determines which of those loans are not to be treated as relevant investments. »Ê¹ÚÌåÓýapp determination will seek to minimise the amount of those loans that are not relevant investments.

Companies registered as community interest companies (CICs) are regarded as non-profit-distributing enterprises for the purposes of CITR.