26(1)Schedule 4 to the Taxes Act 1988 (deep discount securities) shall be amended as follows.
(2)In paragraph 1 (interpretation) the following sub-paragraph shall be inserted after sub-paragraph (1)—
“(1A)Notwithstanding anything in sub-paragraph (1) above, for the purposes of this Schedule a security is not a deep discount security if—
(a)it was issued by a company on or after 1st August 1990, and
(b)under the terms of issue it can be converted into share capital in a company (whether or not the company is the one which issued the security).”
(3)The following shall be inserted after paragraph 20—
21In a case where—
(a)a security is a qualifying convertible security, for the purposes of Schedule 10 to the Finance Act 1990, at the time of its issue, and
(b)apart from this paragraph it would be a deep discount security at that time,
the security shall be treated, at the time of its issue and at all subsequent times, as not being a deep discount security.”