Council noted the exempt appendix.

The Head of Financial Services submitted a report to Cabinet on 10 November 2021 seeking authorisation for the restructure of the OxWED Joint Venture.

OxWED Ltd is a Joint Venture between the Council and Nuffield College, the intention is to facilitate the redevelopment of the land adjacent to the Ice Rink. The creation of a new Limited Liability Partnership is recommended.

The Cabinet decisions are set out in the minutes of that meeting (included in this agenda).

Cabinet Members Cllr Turner and Cllr Hollingsworth will present the report and propose Cabinet’s recommendations.

Recommendations:

Cabinet recommends that Council resolves to

1.    agree the sale of shares in OxWED for up to £360,000 along with the purchase of shares in the Limited Liability Partnership and allocate a budget of up to £360,000;

2.    agree the novation of the existing loan agreements in the sum of £15.850 million from OxWED to the Limited Liability Partnership on the same terms; and

3.    agree that a capital budget of up to £700,000 is established for the tax charge resulting from this transaction.

Council considered a report from the Head of Financial Services seeking authorisation for the restructure of the OxWED Joint Venture.

Cllr Turner, the Cabinet Member for Finance and Asset Management introduced the report, proposed the recommendations and answered questions.

The recommendations were agreed on being seconded and put to the vote.

Council resolved to:

1.     agree the sale of shares in OxWED for up to £360,000 along with the purchase of shares in the Limited Liability Partnership and allocate a budget of up to £360,000;

2.     agree the novation of the existing loan agreements in the sum of £15.850 million from OxWED to the Limited Liability Partnership on the same terms; and

3.     agree that a capital budget of up to £700,000 is established for the tax charge resulting from this transaction

The Head of Financial Services has submitted a reportwhich seeks agreement to restructure OxWED Ltd (currently a Joint Venture between the Council and Nuffield College) as a more efficient Limited Liability Partnership.  

Cabinet is recommended to:

1.    Agree the structure of the transaction in relation to the restructure of the Joint Venture between Oxford City Council and Nuffield College in the University of Oxford;

2.    Delegate authority to the Head of Financial Services, in consultation with the Head of Law and Governance and the Cabinet Member for Finance and Asset Management, to agree the final documentation, including whether the tax charge payment is made by way of capital payment or loan, and enter into the transaction to create the Limited Liability Partnership;

3.    Delegate authority to the Head of Financial Services, in consultation with the Head of Law and Governance and the Cabinet Member for Finance and Asset Management, to agree the Members agreement with the same core principals as the current OxWED shareholders agreement;

4.    Recommend to Council, for the sale of shares in OxWED for up to £360,000 along with the purchase of shares in the Limited Liability Partnership and allocate a budget of up to £360,000;

5.    Recommend to Council the novation of the existing loan agreements in the sum of £15.850 million from OxWED to the Limited Liability Partnership on the same terms; and

6.    Recommend to Council that capital budget of up to £700,000 is established for the tax charge resulting from this transaction.

The Head of Financial Services had submitted a reportwhich sought agreement to restructure OxWED Ltd (currently a Joint Venture between the Council and Nuffield College) as a Limited Liability Partnership. 

Cllr Ed Turner, Cabinet Member for Finance & Asset Management, introduced the report. There were good commercial reasons for the proposed establishment of Limited Liability Company by the Council and Nuffield College  as well as being a more tax efficient vehicle than the current Joint Venture  between the two. It was noted that the proposed option had not been available when OxWED was first established.

Cabinet resolved to:

1.    Agree the structure of the transaction in relation to the restructure of the Joint Venture between Oxford City Council and Nuffield College in the University of Oxford;

2.    Delegate authority to the Head of Financial Services, in consultation with the Head of Law and Governance and the Cabinet Member for Finance and Asset Management, to agree the final documentation, including whether the tax charge payment is made by way of capital payment or loan, and enter into the transaction to create the Limited Liability Partnership;

3.    Delegate authority to the Head of Financial Services, in consultation with the Head of Law and Governance and the Cabinet Member for Finance and Asset Management, to agree the Members agreement with the same core principals as the current OxWED shareholders agreement;

4.    Recommend to Council, for the sale of shares in OxWED for up to £360,000 along with the purchase of shares in the Limited Liability Partnership and allocate a budget of up to £360,000;

5.    Recommend to Council the novation of the existing loan agreements in the sum of £15.850 million from OxWED to the Limited Liability Partnership on the same terms; and

6.    Recommend to Council that capital budget of up to £700,000 is established for the tax charge resulting from this transaction.

The SJVG is asked to consider the restructure of the Joint Venture between Oxford City Council and Nuffield College (University of Oxford)

[report to follow]

The SJVG considered the report of the Head of Financial Services setting out recommendations to restructure the current Joint Venture between Oxford City Council and Nuffield College to develop land at Oxpens and create a new Limited Liability Partnership.

The SJVG noted that the proposed change from the current Limited Company to an LLP structure would reduce tax payments incurred as a result of the current structure to the level which the two shareholding organisations would normally incur.  The High Court’s ruling in the case of Peters v London Borough of Haringey (2018) confirmed that in certain circumstances a local authority may legitimately use a Limited Liability Partnership structure to create joint ventures to promote regeneration objectives.

The Shareholder and Joint Venture Group agreed a detailed set of recommendations to Cabinet on 10 November including:

·         the recommended structure of the transaction in relation to the restructure of the Joint Venture between Oxford City Council and Nuffield College in the University of Oxford;

·         recommendations to correctly authorise and complete the financial transactions, and to delegate authority to complete the legal transactions.