It depends on the rights and their practical effect. Review whether the applicant genuinely can develop and direct the business, rather than treating all vetoes as disqualifying or harmless. Distinguish protection for exceptional transactions from restrictions that leave the investor unable to manage the proposed enterprise.
Examine authority at the level of actual decisions
Choose important decisions from the operating plan and identify who can make them under the agreement. If another person may block every essential action, assess how the business will function and whether the investor’s role is accurately described. Ownership percentages matter, but the control analysis needs the actual governance facts and professional review.
Describe the percentage, the rights attached, and whether any management role exists, because a holding carrying board or operational authority may be characterized differently from a purely passive one. A reviewer looks for a real, operating business, and a management company with fifteen owner contracts, a booking platform, three employees and a five-year track record is one. The regulation instead asks whether the enterprise has the present or future capacity to produce more than a minimal living for the investor and family, and it allows future capacity to be shown where it is likely to be reached within five years.