BC government opens labour-sponsored VC market

The British Columbia government has moved quickly to implement a recommendation to open up the market for labour-sponsored venture capital (LSVC) funds but has retained the cap on the relevant provincial tax credit at $12 million. Legislation enabling competition in the LSVC sector was introduced May 14, just weeks after a report by the Premier’s Technology Council (PTC) recommended such a move (R$, April 17/02). The decision to allow new and existing funds to enter the provincial market effectively ends the monopoly of the Working Opportunity Fund, which last year was given permission to increase the amount of money it could raise from $60 million to $80 million. In its report, the PTC argued that existing legislation was unfair and placed the government in the position of picking winners. While the new legislation allows competition, the $12-million cap on the tax credit limits the amount the government is willing to invest in early-stage technology plays, significantly reducing the attractiveness of investing in LSVCs….