Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017

PART 2 E+W ISSUE, TRANSFER AND REDEMPTION OF RIGHTS UNDER BOND NOT TO BE TREATED AS CHARGEABLE TRANSACTION

Bond-holder not to be treated as having an interest in the bond assets E+W

3 E+W For the purposes of this Act—

(a) the bond-holder under an alternative finance investment bond is not treated as having an interest in the bond assets;

(b) the bond-issuer under such a bond is not treated as a trustee of the bond assets.

Commencement Information

I1 Sch. 11 para. 3 in force at 1.4.2018 by S.I. 2018/34, art. 3

Bond-holder treated as having an interest if control of underlying asset acquired E+W

4 (1) Paragraph 3 does not apply if control of the underlying asset is acquired by— E+W

(a) a bond-holder, or

(b) a group of connected bond-holders.

(2) A bond-holder (““BH””), or a group of connected bond-holders, acquires control of the underlying asset if—

(a) the rights of bond-holders under an alternative finance investment bond include the right of management and control of the bond assets, and

(b) BH, or the group, acquires sufficient rights to enable BH, or the members of the group acting jointly, to exercise management and control of the bond assets to the exclusion of any other bond-holders.

(3) But sub-paragraph (1) does not operate to disapply paragraph 3 in either of the following cases.

(4) The first case is where—

(a) at the time that the rights were acquired BH (or all of the connected bond-holders) did not know and had no reason to suspect that the acquisition enabled the exercise of the right of management and control of the bond assets, and

(b) as soon as reasonably practicable after BH (or any of the bond-holders) becomes aware that the acquisition enables that exercise, BH transfers (or some or all of the bond-holders) transfer sufficient rights for that exercise no longer to be possible.

(5) The second case is where BH—

(a) underwrites a public offer of rights under the bond, and

(b) does not exercise the right of management and control of the bond assets.

(6) In this paragraph, “"underwrite””, in relation to an offer of rights under a bond, means to agree to make payments of capital under the bond in the event that other persons do not make those payments.

Commencement Information

I2 Sch. 11 para. 4 in force at 1.4.2018 by S.I. 2018/34, art. 3