Part 9Leasing plant or machinery
Chapter 3Sales of lessors: leasing business carried on by a company alone
F1 “Relevant change in relationship”
394Consortium relationships
1
A company (“E”) is a principal company of A if—
a
A is owned by a consortium of which E is a member, or
b
A is a qualifying F275% subsidiary of a company owned by a consortium of which E is a member,
and E is not a qualifying 75% subsidiary of another company.
2
There is a relevant change in the relationship between A and E (as a principal company) on any day if the ownership proportion at the end of the day is less than the ownership proportion at the start of the day.
3
In this section “the ownership proportion” is whichever is the lowest of the following percentages—
a
the percentage of the ordinary share capital of A that is beneficially owned by E,
b
the percentage to which E is beneficially entitled of any profits available for distribution to equity holders of A, and
c
the percentage to which E would be beneficially entitled of any assets of A available for distribution to its equity holders on a winding up.
4
But if A is a qualifying F375% subsidiary of a company, subsection (3) is to be read as if references to that company were substituted for references to A.
5
A company (“F”) is a principal company of A if, in a case where E is a qualifying 75% subsidiary of F but F is not a qualifying 75% subsidiary of another company—
a
A is owned by a consortium of which E is a member, or
b
A is a qualifying F475% subsidiary of a company owned by a consortium of which E is a member.
6
There is a relevant change in the relationship between A and F (as a principal company) on any day if—
a
the ownership proportion at the end of the day is less than the ownership proportion at the start of the day, or
b
E ceases to be a qualifying 75% subsidiary of F on that day.
7
If F is a qualifying 75% subsidiary of another company (“G”), G is a principal company of A unless G is a qualifying 75% subsidiary of another company, and so on.
8
Accordingly, there is a relevant change in the relationship between A and a principal company of A on any day if—
a
in determining which company is a principal company, regard is had to any company which is a qualifying 75% subsidiary of another, and
b
that company ceases to be a qualifying 75% subsidiary of the other on that day,
(as well as if the ownership proportion at the end of the day is less than the ownership proportion at the start of the day).
9
This section is supplemented by—
a
section 397 (companies owned by consortiums and members of consortiums), and
b
section 398 (“qualifying 75% F5... subsidiary” etc).
S. 392 and cross-heading substituted (with effect in accordance with Sch. 18 para. 9 of the amending Act) by Finance Act 2010 (c. 13) , Sch. 18 para. 4