Introduction Details of the Section
2.Subsection (2) sets out the meaning of “the first party” and “the second party”. For the purposes of section 80 these are, respectively, the UK-resident company (“C”) and another person (“P”). For the purposes of section 86 these are, respectively, the foreign company and another person (“A”).
3.Subsection (3) provides that the participation condition is met if condition A is met in relation to the material provision, so far as that provision is one relating to financing arrangements, and condition B is met in relation to the material provision, so far as that provision is not one relating to financing arrangements.
4.Subsection (4) sets out condition A, which considers the relationship between the parties at the time the material provision was made or imposed, or within the period of 6 months beginning with the day the material provision was made or imposed.
5.Subsection (5) sets out condition B which considers the relationship between the parties at the time the material provision was made or imposed.
6.Subsection (6) defines the term “financing arrangements”.
7.Subsection (7) provides for section 157(2) of the Taxation (International and Other Provisions) Act 2010 to apply for the purposes of the section and for sections 158 to 163 of that Act to apply in relation to subsections (4) and (5).