Question to the Department for Business, Energy and Industrial Strategy:

To ask Her Majesty's Government what steps they take if a company in receipt of funding under the Future Fund Scheme has not begun trading; what systems are in place to reclaim funding under that Scheme; and what criteria are applied for reclaiming such funding.

The purpose of the Future Fund was to support UK companies that typically rely on equity investment and were affected by the Covid-19 pandemic. It was open to all companies that met the scheme’s eligibility criteria.

These included a requirement for the company to have been incorporated in the UK on or before 31 December 2019 and to have raised at least £250,000 in equity from third-party investors in previous funding rounds, in the five years prior to 19 April 2020. Provision was later made for certain non-UK parent companies to apply. The eligibility criteria did not include a requirement that companies must have begun trading.

The convertible loan agreement (CLA) included a warranty from the company that it satisfied the eligibility criteria in full.

Should a company be found to have failed to comply in any material respect with any of the provisions of the CLA, or if the company ceases to carry on all or a substantial part of its business, then the Future Fund has the right to call an Event of Default. In this case the Future Fund is entitled to request repayment of the loan and accrued interest, alongside a 100% redemption premium.