Finance Act 1987

Revision of nominations U.K.

8 (1) Except as provided by this paragraph, a nomination may not be amended or withdrawn. U.K.

(2) If a participator who has made a nomination of a proposed sale does not, in whole or in part, fulfil his obligations under the contract of sale by the delivery of oil forming part of his equity production for the proposed delivery month, then, in accordance with regulations made by the Board, he may amend or withdraw the nomination if in his opinion—

(a) there was good commercial reasons for the failure to fulfil those obligations; or

(b) the failure was occasioned by circumstances over which neither he nor any person connected or associated with him had control.

[F1 (2A) If a participator who has made a nomination of a proposed supply, proposed appropriation or a proposed transaction falling within paragraph 2(1)(d) above fails, in whole or in part, to supply, to appropriate or otherwise to complete the proposed transaction by the delivery or appropriation of oil forming part of his equity production for the proposed delivery month, then, in accordance with regulations made by the Board, he may amend or withdraw the nomination as mentioned in sub-paragraph (2B) below.

(2B) The circumstances in which, in a case falling within sub-paragraph (2A) above, a participator may amend or withdraw a nomination are,—

(a) in the case of a nomination of a proposed supply or proposed appropriation, if the participator is of the opinion that the failure referred to in that sub-paragraph was caused by circumstances over which neither he nor any person connected or associated with him had control; or

(b) in the case of a nomination of a proposed transaction falling within paragraph 2(1)(d) above, in such circumstances as may be prescribed by regulations made by the Board; or

(c) in any case where the nomination is of a proposed supply or proposed appropriation and the participator is either the field operator or the operator of a relevant system, if the participator is of the opinion that the failure referred to in sub-paragraph (2A) above was caused by action necessarily taken by him in the interests of safety or the prevention of pollution or in accordance with good oil field practice.

(2C) In relation to such a nomination as is referred to in subparagraph (2B)(c) above,—

(a) a participator is the field operator if, in relation to the field specified in the nomination, he is the person having the function of organising or supervising operations for searching or boring for or getting oil in pursuance of a licence; and

(b) the expression “relevant system” is applicable only where the oil to which the nomination relates is blended oil and is a reference to any system by which blended oil (in relation to which the field specified in the nomination is one of the originating fields) is transported, treated or stored prior to its disposal or relevant appropriation; and

(c) a participator in an oil field is an operator of a relevant system, as defined above, if he is the person charged, or principally charged, with the operation of the system;

and expressions used in paragraph (b) above have the same meaning as in section 63 of this Act.]

(3) An amendment or withdrawal of a nomination by a participator in accordance with [F1 the preceding provisions of this paragraph] above shall not be effective unless the Board give notice to the participator that the amendment or withdrawal is accepted, and the Board shall not give such a notice unless they are satisfied—

(a) as to the matters mentioned in either paragraph (a) or paragraph (b) of sub-paragraph (2) above [F1 or, where sub-paragraph (2B) above applies, that the failure was caused as mentioned in paragraph (a) or paragraph (c) of that sub-paragraph or that the circumstances prescribed for the purposes of paragraph (b) of that sub-paragraph exist]; and

(b) [F1 except where sub-paragraph (2)(b) or sub-paragraph (2B)(a)] above applies, that the failure was not part of a scheme or arrangement the main purpose of which was the avoidance of tax.

(4) For the purposes of sub-paragraph (2)(b) [F2 and sub-paragraph (2B)] above,—

(a) section [F2 839] of the Taxes Act (connected persons) applies; and

(b) two companies of which one is a participator in an oil field are associated with each other if one has control over the other or both are under the control of the same person or persons;

and in paragraph (b) above “control” shall be construed in accordance with section [F2 416] of the Taxes Act.

(5) Where a nomination is amended in accordance with this paragraph, the [F1 provisions of this Schedule (other than this paragraph)] shall apply in relation to it subject to such modifications as may be specified in regulations made by the Board.

Textual Amendments

F1 Finance (No. 2) Act 1987 (c. 51, SIF 63:1), s. 101(1)(5) and Sch. 8 para. 3 for calendar months in chargeable periods beginning with March 1987

F2 Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), Sch. 29 para. 32

Modifications etc. (not altering text)

C1 See S.I. 1987 No. 1338 (in Part III) regns. 11–17