2(1)Where immediately before the relevant day the company referred to in section 11(2) of the Taxes Act 1988 is an overseas life insurance company, then, subject to sub-paragraph (4) below, it shall be deemed for the purposes of corporation tax on chargeable gains—U.K.
(a)to have disposed immediately before the relevant day of every asset to which sub-paragraph (2) below applies, and
(b)immediately to have reacquired every such asset,
at its market value at the time of the deemed disposal.
(2)This sub-paragraph applies to any asset which—
(a)was held by the company immediately before the relevant day, and
(b)at the beginning of that day is a chargeable asset in relation to the company.
(3)For the purposes of sub-paragraph (2) above an asset is at the beginning of the relevant day a chargeable asset in relation to the company if, were it to be disposed of at that time, any chargeable gains accruing to the company on the disposal would form part of its chargeable profits by virtue of paragraph (c), (d) or (e) of section 11(2) of the Taxes Act 1988 (as that paragraph has effect by virtue of Schedule 19AC to that Act).
(4)Sub-paragraph (1) above shall not have effect in applying paragraph 2(2) of Schedule 28 to that Act in the case of a disposal by the company.
(5)For the purposes of this paragraph the relevant day is the first day of the company’s first accounting period to begin after 31st December 1992.