New York Codes, Rules and Regulations
Title 11 - INSURANCE
Chapter XVII - Certified Capital Companies Under Section 11 Of The Tax Law
Part 400 - Certified Capital Companies Under Section 11 Of The Tax Law
Section 400.2 - Definitions

Universal Citation: 11 NY Comp Codes Rules and Regs ยง 400.2

Current through Register Vol. 46, No. 12, March 20, 2024

(a) Primary business activity, as used in section 11(a)(3) of the Tax Law, means that the investment of cash in qualified businesses constitutes at least 75 percent of the business activity of the certified capital company.

(b) As used in section 11(a)(6)(c) of the Tax Law, a business shall be deemed predominantly engaged in professional services provided by accountants, lawyers or physicians if:

(1) over 40 percent of the revenues of such business for the preceding fiscal year; or

(2) if a new enterprise, over 40 percent of its projected revenues for its first fiscal year, taken as a whole are derived from such professional services.

(c) Principal, as used in section 11(b)(5) of the Tax Law, shall mean officers, directors, or other management personnel of a certified capital company.

(d) A qualified investment, as used in section 11(a)(9) of the Tax Law, shall not include:

(1) an investment in any affiliate of the certified capital company (except any follow-on investment in a qualified business that was not an affiliate of the certified capital company at the time of the first investment in said business by a certified capital company);

(2) any debt investment that is evidenced solely by any loan receivable or note receivable which has a stated final maturity date of less than one year from the origination date of the loan or note; or

(3) any equity investment which the certified capital company may require the qualified business to redeem or repurchase within one year from the date of investment.

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