Valid from 19/07/2006
Textual Amendments
F1Ss. 774A-774G and preceding cross-heading inserted (with effect in accordance with Sch. 6 para. 6(2)-(7) of the amending Act) by Finance Act 2006 (c. 25), Sch. 6 para. 6(1)
(1)For the purposes of section 774B an arrangement is a structured finance arrangement in relation to a person (“the borrower”) if the following condition is met in relation to the borrower.
(2)The condition is that—
(a)under the arrangement the borrower receives from another person (“the lender”) any money or other asset (“the advance”) in any period,
(b)in accordance with generally accepted accounting practice the accounts of the borrower for that period record a financial liability in respect of the advance,
(c)the borrower, or a person connected with the borrower, makes a disposal of an asset (“the security”) under the arrangement to or for the benefit of the lender or a person connected with the lender,
(d)the lender, or a person connected with the lender, is entitled under the arrangement to payments in respect of the security, and
(e)in accordance with generally accepted accounting practice those payments reduce the amount of the financial liability in respect of the advance recorded in the accounts of the borrower.
(3)For the purposes of this section, in any case where the borrower is a partnership, references to the accounts of the borrower include the accounts of any member of the partnership.
(4)For the purposes of this section and section 774B—
(a)references to a person connected with the borrower do not include the lender, and
(b)references to a person connected with the lender do not include the borrower.]