Deemed assignment of derivative contracts on company ceasing to be resident in UKetc

22A

1

This paragraph applies if at any time (“the relevant time”)—

a

a company ceases to be resident in the United Kingdom, or

b

in the case of a company not resident in the United Kingdom, the rights and liabilities of the company under a derivative contract to any extent cease to be held or owed for the purposes of a permanent establishment of the company in the United Kingdom in circumstances not involving a related transaction.

2

In a case falling within sub-paragraph (1)(a), this Schedule shall have effect as if the company had—

a

immediately before the relevant time, assigned its rights and liabilities under its derivative contracts for a consideration of an amount equal to their fair value at that time, and

b

immediately reacquired them for a consideration of the same amount.

3

Sub-paragraph (2) does not apply in relation to a derivative contract to the extent that, immediately after the relevant time, the company’s rights and liabilities under the contract are held or owed for the purposes of a permanent establishment of the company in the United Kingdom.

4

In a case falling within sub-paragraph (1)(b), this Schedule shall have effect as if the company had—

a

immediately before the relevant time, assigned the rights and liabilities, so far as ceasing to be held or owed for the purposes of the permanent establishment, for a consideration of an amount equal to their fair value at that time, and

b

immediately reacquired them for a consideration of the same amount.

5

In this paragraph “fair value” shall be construed in accordance with paragraph 17.