Finance (No. 3) Act 2010

Ability to claim group relief where link company established in the EEA

4 (1) Section 133 (conditions to be met for consortium claims for group relief) is amended as follows.

(2) In subsection (1)—

(a) omit the “and” at the end of paragraph (e), and

(b) for paragraph (f) substitute—

“(f) the surrendering company and the claimant company are both UK related, and

(g) the link company is UK related or established in the EEA.”

(3) In subsection (2)—

(a) omit the “and” at the end of paragraph (e), and

(b) for paragraph (f) substitute—

“(f) the surrendering company and the claimant company are both UK related, and

(g) the link company is UK related or established in the EEA.”

(4) After subsection (4) insert—

“(5) Subsection (6) applies where the link company—

(a) is established in the EEA, but

(b) is not UK related.

(6) Neither consortium condition 2 nor consortium condition 3 is met unless the link company is a member of the same group of companies as the other company mentioned in subsection (1)(d) or (2)(d) without the involvement of a relevant company.

(7) A “relevant company” is a company that is not established in the EEA.

(8) For the purposes of subsection (6) a company (“A”) is a member of the same group of companies as another company (“B”) without the involvement of a relevant company if—

(a) in a case where A is the 75% subsidiary of B, B owns at least 75% of A’s ordinary share capital otherwise than through a relevant company,

(b) in a case where B is the 75% subsidiary of A, A owns at least 75% of B’s ordinary share capital otherwise than through a relevant company, and

(c) in a case where neither company is the 75% subsidiary of the other but both are 75% subsidiaries of a third company, the third company—

(i) is not a relevant company, and

(ii) owns at least 75% of A’s ordinary share capital, and at least 75% of B’s ordinary share capital, otherwise than through a relevant company.”