(1)This section applies where a lease is granted to a company (“A”) and—
(a)the person granting the lease (“B”) is connected with A; or
(b)some or all of the consideration for the grant of the lease consists of the issue or transfer of shares in a company with which B is connected.
(2)Subsection (3) has effect for the purposes of stamp duty chargeable under Part II of Schedule 13 to the M1Finance Act 1999 (stamp duty on a lease) by reference to Part I of that Schedule (conveyance or transfer on sale).
(3)If, apart from this subsection, the amount or value of the consideration for the grant would be less than the value determined under subsection (4), the consideration shall be taken to be the value determined under subsection (4).
(4)That value is—
(a)the market value, immediately before the instrument granting the lease is executed, of the lease granted; but
(b)reduced by the value of so much of any actual consideration as does not consist of property.
(5)This section applies only if, in consequence of its application, the lease is chargeable with a greater amount of stamp duty than it would be apart from this section.
(6)For the purposes of this section, the market value of property at any time is the price which that property might reasonably be expected to fetch on a sale at that time in the open market.
(7)In this section—
“company” means any body corporate;
“” includes stock and the reference to shares in a company includes a reference to securities issued by a company.
(8)For the purposes of this section, the question whether any person is connected with another shall be determined in accordance with the provisions of section 839 of the Taxes Act 1988.
(9)This section shall be construed as one with the M2Stamp Act 1891.
(10)This section applies to instruments executed on or after 28th March 2000.
(11)But this section does not apply to an instrument giving effect to a contract made on or before 21st March 2000, unless—
(a)the instrument is made in consequence of the exercise after that date of any option, right of pre-emption or similar right; or
(b)the instrument transfers the property in question to, or vests it in, a person other than the purchaser under the contract, because of an assignment (or, in Scotland, assignation) or further contract made after that date.
(12)This section shall be deemed to have come into force on 28th March 2000.