[F1762AExchange of interests of different classesU.K.
(1)This section applies where—
(a)classes of interest in an offshore fund (the “main fund”) are treated as separate offshore funds under section 756C; and
(b)as the result of—
(i)a reorganisation within the meaning of section 126 of the 1992 Act, or
(ii)a conversion of securities within the meaning of section 132 of that Act,
a person exchanges an interest of one class (A) in the main fund for an interest of another class (B) in that fund.
(2)Where—
(a)the interest of class A—
(i)is at the time of the exchange an interest in a non-qualifying offshore fund, or
(ii)has been an interest in such a fund at any material time, and
(b)the interest of class B is at the time of the exchange an interest in a fund which is certified by the Board as a distributing offshore fund,
section 127 of the 1992 Act (equation of original shares and new holding) shall not prevent the exchange constituting a disposal for the purposes of this Chapter.
(3)Any such disposal shall be treated as a disposal for a consideration equal to the market value of the rights at the time of the exchange.
(4)In this section—
“class of interest” has the same meaning as in section 756C(1);
“material time” has the same meaning as in section 757.]
Textual Amendments
F1S. 762A inserted (with effect in accordance with s. 145(2) of the amending Act) by Finance Act 2004 (c. 12), Sch. 26 para. 15(1) (with Sch. 26 para. 17)