Deemed assignment of derivative contracts on company ceasing to be resident in UK etcU.K.
3(1)At the beginning of Part 6 (special computational provisions) insert—U.K.
“Deemed assignment of derivative contracts on company ceasing to be resident in UK etcU.K.
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.”.
(2)The amendment made by this paragraph has effect where the cessation in question occurs on or after 17th March 2004.