Southampton spinouts back on track after pre-budget statement
The Director of the University of Southampton's Centre for Enterprise and Innovation (CEI) has welcomed the Chancellor's pledge to remove tax barriers to spin-out companies.
Dr Tony Raven led the team from the UK University Companies Association (UNICO) in lobbying the Government over Inland Revenue regulations that discouraged academics from becoming involved in companies created from their research. Unico estimates that the amount of spin-outs fell by around 50 per cent in the first year after the 2003 Finance Act, which contained the legislation, came into force.
The Unico team, led by Dr Raven, but also involving Dr Georgina Richards and Sue Sundstrom, of the CEI, spent over a year in negotiation with the Inland Revenue. The first Southampton company to be affected by the regulations, Synairgen, was founded in April 2003 and floated last month on the Alternative Investment Market of the London Stock Exchange.
On 2 December, the Chancellor Gordon Brown announced his intention to remove the tax barriers to the formation of university spin-outs. A working party, including Dr Raven representing Unico, and the Vice-Chancellor of Southampton, Professor Bill Wakeham, representing Universities UK, will aim to work out new legislation before a possible election in the spring.
"We are delighted that the work we have put in with the Inland Reveue has paid off," said Dr Raven. "There's still some work to do to get the new legislation drafted, but we are proud of Southampton's contribution, particularly that of the academic team behind Synairgen, to the work so far. Southampton academics should be confident that they will not now be penalised by the taxman for their involvement in commercialisation."
In addition to the Southampton representatives, the Unico team included enterprise directors from the Universities of Oxford, Glasgow, Cardiff, Cambridge, and Southampton's partner in enterprise activity, Bristol University, which shares with Southampton, Bath and Surrey a £13 million grant for enterprise development at the four universities.