PART 2Amendment of Part 2 of Schedule 26 to the Finance Act 2002
7
After paragraph 5 insert—
Qualified exclusion: embedded derivatives whose underlying subject matter is shares5A
1
Paragraph 4 does not prevent a relevant contract to which this paragraph applies from being a derivative contract.
2
This paragraph applies to a relevant contract of a company if—
a
it is a deemed relevant contract to which the company is treated as party under section 94A(2)(b) of the Finance Act 1996,
b
its underlying subject matter consists, or is treated as consisting, wholly of shares in a company, and
c
the company is party as a creditor to the host contract under section 94A(2)(a) of that Act.
3
Paragraph 9 applies for the purpose of determining whether the underlying subject matter of a relevant contract is to be treated as consisting wholly of shares in a company.