Definitions

(a) a trading company (i.e. one carrying on activities which do not include to a substantial extent activities other than those carried on in the course of, or for the purposes of, a trade which it carries on) which is not a member of a group; or 

(b) the principal company of a trading group. 

1. The condition is met if the trusts of the settlement do not permit:
   1. any of the trust property (including income arising from it) to be applied, at any time, otherwise than for the benefit of all the eligible employees on the same terms
   2. the trustees at any time: 
      1. to apply any of the trust property by creating a trust; 
      2. to apply any of the trust property by transferring property to the trustees of any other settlement unless this is by way of an “authorised transfer”, being a transfer of property consisting of or including any ordinary share capital of a company which meets the trading requirement and the transferee trust itself meets the controlling interest requirement immediately after the transfer and meets the ‘all-employee benefit requirement’; 
      3. to make loans to beneficiaries of the trust; 
      4. any person (including the trustees) at any time to amend the trusts so that the amended trusts would not comply with 1,2 or 3 above.