Amendment of Part 2 of Schedule 266.

(1)

Amend paragraph 12 (definition of terms relating to derivative contracts) as follows.

(2)

In sub-paragraph (1)6—

(a)

after paragraph (b) insert—

“(bza)

a contract of long-term insurance (see sub-paragraph (16));”

(b)

in paragraph (cc)—

(i)

before “hedging” insert “a”; and

(ii)

after “an asset” insert “or a liability”; and

(3)

In sub-paragraph (14)—

(a)

in the words before paragraph (a) after “an asset” insert “or a liability”;

(b)

in paragraph (b) after “asset”, in both places, insert “or liability”; and

(c)

after paragraph (b) add—

“For the purposes of this sub-paragraph the liabilities of a company include its own share capital.”.

(4)

In sub-paragraph (16), for “has” substitute “and “contract of long-term insurance” have”.