For an investment in a small business to qualify as an "eligible investment", a number of requirements set out in the Small Business Venture Capital Act must be met.  These requirements include the following:

• a business must qualify as an "eligible small business".

• the VCC must purchase treasury shares directly from the small business for cash;

• the VCC may purchase the shares of a small business indirectly through the conversion of convertible debt that is prescribed under regulation (prior Administrator approval is required);

• the investment must be at risk and at arm's length;

• the VCC together with related parties and other VCCs must not control the small business;

• the shares held by the VCC must not carry prescribed rights and restrictions (see Policy Statement “Equity Shares” for more details); andt he total investment by all VCCs in the small business (and affiliates of the small business) must not exceed $5 million.

A VCC should ensure all requirements are met prior to the investment and request for a IPA Release.  Complete the following report to notify the Investment Capital Branch of each eligible investment made by the VCC.

   IPA Release Application and Investment Report ( 42 kb) ( 123 kb)