628Transferor using fair value accounting
(1)This section applies instead of section 625 if, in a case where that section would otherwise apply, the transferor uses fair value accounting as respects the derivative contract.
(2)The amount which is to be brought into account by the transferor in respect of—
(a)the transaction mentioned in that section, or
(b)the series of transactions mentioned in that section taken together,
is the fair value of the derivative contract as at the date of transfer to the transferee.
(3)For any accounting period in which the transferee is a party to the contract, for the purpose of determining the credits and debits to be brought into account in respect of the contract in accordance with this Part, the transferee is treated as if it had acquired the contract for consideration of an amount equal to the fair value of the contract as at the date of transfer to it.
(4)If a discount arises in respect of the transaction or series of transactions, the amount to be brought into account under subsection (2) is increased by the amount of the discount.
(5)In this section—
“discount” has the same meaning as in section 480 (relevant non-lending relationships involving discounts), and
“the transferor” and “the transferee” have the same meaning as in section 625.