Amendment of Part 2 of Schedule 26
Amendment of paragraph 4 of Schedule 266
1
Amend paragraph 44 (contracts excluded by virtue of their underlying subject matter) as follows.
2
In sub-paragraph (2)(b) after “(2C)” insert “, (2CA)”.
3
For sub-paragraph (2A) substitute—
2A
The conditions specified in this sub-paragraph are that the relevant contract—
a
is a plain vanilla contract entered into by a company carrying on life assurance business;
b
is an approved derivative for the purposes of Rule 4.3.5 of the Integrated Prudential Sourcebook; and
c
does not fall within paragraph 3(1)(b).
4
In sub-paragraph (2B)—
a
in paragraph (b)(ii) after “of the company” insert “or any liability related to share capital of the company”, and
b
in paragraph (c) for the words from “a deemed relevant contract" to the end substitute “a loan-contract embedded derivative.”
5
After sub-paragraph (2C) insert—
2CA
The conditions specified in this sub-paragraph are—
a
the relevant contract is entered into or acquired—
i
by a company otherwise than in the course of activities forming an integral part of a trade carried on by it, or
ii
by a company which is a mutual trading company;
b
the relevant contract is—
i
an option to acquire shares in a company, or
ii
a future requiring delivery of shares in a company;
c
the relevant contract is not a loan-contract embedded derivative; and
d
the shares to be acquired or delivered constitute, or would (if acquired or delivered) constitute a substantial shareholding within the meaning of paragraph 8 of Schedule 7AC to TCGA 1992.