The EA guidance says that only trust assets capable of receiving a supply of electricity, gas or other fuels will be affected by the CRC. The EA anticipates that such assets will be:

The analysis in this part of our update assumes that the trustee in question is an Undertaking not an individual. For more information about how the CRC applies in situations where trust assets are held by individual trustees, see Individual trustees below.

The CRC does not apply to individuals. Where the trustees are individuals they cannot be a Parent Undertaking of any Undertaking held by them for the purpose of the trust.

In this situation, an Undertaking that is the subject of the trust will have to assess whether it is required to participate in the relevant Phase of the CRC or make an Information Disclosure (as any other Undertaking with UK electricity supplies will have to).

Where trust assets are held jointly by more than one trustee, the EA guidance states that the distinction set out above between real property assets and shareholdings will still apply.

Where a number of trustees hold shares in a company for the trust, for the reason set out above, the trustees are not deemed to hold the rights attaching to the shares so they cannot qualify as a Parent Undertaking of the company in whose shares they have legal title. This analysis is not affected by the number of trustees who hold the legal title to the shares.

Where a number of trustees hold the real property asset(s) of a trust, the EA guidance says that the Qualifying Electricity supplies to the real property asset(s) have to be aggregated with the Qualifying Electricity supplies of the particular trustee which assumes responsibility for the electricity supplies to each of the properties in order to assess if it is required to participate in the CRC or to make an Information Disclosure.

The EA guidance says that where no one trustee assumes individual responsibility for such supplies (for example, if the Qualifying Electricity supplies to the real property asset(s) are managed by a facilities management company) the trustees must decide amongst themselves which of them is to assume such responsibility for the purposes of the CRC. In the event that the trustees cannot decide who is to assume responsibility, they should notify the EA of this and the EA will then liaise with them to broker an agreement as to which of them should assume responsibility for the supplies.

In a scenario that there are a number of trustees holding real property asset(s) of a trust, and all of whom are Undertakings (that is, all the trustees are corporate trustees), they would have to participate together in the CRC where there was an Undertaking that was the Parent Undertaking of all of them. The EA guidance does not expressly address this point.

The EA guidance says that whether a trust is offshore or whether a trustee is incorporated overseas is not relevant to any analysis regarding participation in the CRC. The only relevant criterion is whether there is a supply in the UK, of Qualifying Electricity to an organisation.

The EA guidance says that the analysis and proposed treatment of trusts will also be applied to limited partnerships where the general partner holds the assets of the limited partnership in a fiduciary capacity as this situation is analogous to the position of a trustee.

Where a general partner is an Undertaking and it (rather than a nominee company) holds legal title to real property assets, the Qualifying Electricity supplied to those assets must be aggregated with all other Qualifying Electricity supplied to the general partner (and the general partner's Group where relevant) to assess qualification for the relevant Phase of the CRC.

Where a general partner holds shares on behalf of a UK limited partnership (which does not have a separate legal personality and is, therefore, not capable of owning assets in its own name) those shares will be held in a fiduciary capacity and are treated as held by the limited partnership (and not by the general partner). If the limited partnership is beneficially entitled to over 50% of the voting shares in any Undertaking (so that the limited partnership would meet the test of Parent Undertaking in section 1162, CA 2006) the Qualifying Electricity supplied to the Undertaking must be aggregated with all other Qualifying Electricity supplied to the limited partnership to assess qualification for the relevant Phase of the CRC.

Additionally, where the general partner exercises a dominant influence over the limited partnership so that it meets the "control tests" in section 1162 of the CA 2006, the general partner may be the Parent Undertaking of the limited partnership and the limited partnership (and its Subsidiary Undertakings) will be grouped together with the general partner for CRC purposes.

For more information about the use of the Companies Act 2006 control tests to establish a Parent/ Subsidiary Undertaking relationship, see Practice note, CRC Energy Efficiency Scheme: the impact on private equity fund structures: Is the Fund a Subsidiary Undertaking?.

The EA has published guidance on the application of the CRC to private equity funds. A draft of the guidance dated 24 May 2010 was briefly available on the EA's website but this was replaced with a final version on 18 June 2010.

The EA guidance sets out:

The EA guidance is based on the application of the CRC to the most common type of Fund structure using an English limited partnership based on the Memorandum of Understanding between the BVCA and HMRC.

The EA guidance considers the position of the limited partnership, the general partner, the fund manager and the limited partners, and provides guidance on how these entities may be grouped together with the private equity portfolio companies for the purposes of participating in the CRC.

For more information on whether the various entities comprising a Fund will form a Group for CRC purposes, see Practice note, CRC Energy Efficiency Scheme: the impact on private equity fund structures.

The EA guidance states that:

The EA guidance also considers the role of the general partner:

Where there is a separate fund manager, the EA Guidance states that the analysis will be the same as applies to the general partner. Therefore, the fund manager could potentially be treated as the Parent Undertaking of the limited partnership for CRC purposes.

According to the EA Guidance, it is very unlikely that a limited partner will form a Group with the limited partnership for CRC purposes, although this should be considered in each case.

The EA guidance states that the concept of SGUs will apply to Funds in the same way that it applies to any other Group that contains SGUs. For more information, see Practice note, CRC Energy Efficiency Scheme: how to apply the Qualification Criteria to private equity funds: Significant Group Undertakings.