You have received an email from your manager with an attached schedule in connection with the Forti Ltd group of
companies. The schedule and the email are set out below.

Email from your manager

The Forti Ltd group

Forti Ltd has an issued share capital of 120,000 ordinary shares. It is owned by 12 shareholders, each of whom owns 10,000 ordinary shares.

All six of the companies are trading companies. Gordini Co is resident in and trades in the country of Arrowsia; it does not carry out any activities in the UK. The other five companies are all resident in the UK. There is no double tax treaty between Arrowsia and the UK.

The only changes to the group structure in recent years relate to the purchase and subsequent sale of Marussia Ltd as set out in note 2 to the attached schedule.

Ligier Ltd has no links to the Forti Ltd group other than its shareholding in Eagle Ltd.
The work I require you to do is set out below.

(b) Other corporate matters
(i) Brawn Ltd will only be a close company if Forti Ltd is a close company.
Set out the matters which need to be considered in order to determine whether or not Forti Ltd is a close company.

Tax manager

Required:
Carry out the work required as set out in the email from your manager. The following marks are available.

(b) Other corporate matters.
(i) Close companies; (5 marks)

Note: Ignore value added tax (VAT). (12 marks)