Section 337 — Corporation Tax Act 2009: Transfers of loans on insurance business transfers

Transfers of loans on insurance business transfers 337 1 The case referred to in section 335(1)(b) is where—

a a transfer between two companies occurs to which this section applies, and b as a result one of the companies (“ the transferee ”) directly or indirectly replaces the other (“ the transferor ”) as a party to a loan relationship.

2 This section applies to the transfers specified in subsection (3), so far as they are not excluded by subsection (4).

3 They are—

a a transfer between two companies of business consisting of the effecting or carrying out of contracts of long-term insurance which has effect under an insurance business transfer scheme, and b any transfer between two companies which is a qualifying overseas transfer. 3A In subsection (3)(b) “ qualifying overseas transfer ” means so much of a transfer of the whole or any part of the business of an overseas life insurance company carried on through a permanent establishment in the United Kingdom as takes place in accordance with an authorisation granted outside the United Kingdom for the purposes of Article 39 of Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) .

4 Subsection (3) does not apply to a transfer of an asset, or of rights under or an interest in an asset, if the asset—

a was within one of the applicable categories immediately before the transfer, and b is not within that category immediately after it. 4A For the purposes of subsection (4)(a) “ the applicable categories ” means—

a in the case of a UK life insurance company, the long-term business categories or a category of assets which are not held for the purposes of its long-term business, and b in the case of an overseas life insurance company, the UK long-term business categories, a category of UK assets which are not held for the purposes of its long-term business or a category of assets which are held by it but which are not UK assets. 4B For the purposes of subsection (4A)—

a “ the long-term business categories ” has the same meaning as in section 116 of FA 2012, b “ the UK long-term business categories ” and “ UK assets ” have the same meanings as in section 117 of that Act, and c section 122 of that Act applies as it applies for the purposes of Chapter 8 of Part 2 of that Act.

5 Subsection (6) applies for the purposes of subsection (4) if one of the companies mentioned in subsection (3) is an overseas life insurance company.

6 An asset is taken as being in the same category both immediately before and immediately after a transfer if the asset—

a was in one category immediately before the transfer, and b is within the corresponding category immediately after it.

7 In this Chapter, in relation to a case within subsection (1), “ the transferee ” and “ the transferor ” have the same meaning as in that subsection.