Section 587 — Corporation Tax Act 2009: Contract relating to holding in OEIC , unit trust or offshore fund

Contract relating to holding in OEIC , unit trust or offshore fund 587 1 This section applies in relation to a relevant contract to which a company is a party in an accounting period if—

a it is not a derivative contract for the purposes of this Part but for this section, and b its underlying subject matter consists wholly or partly of a relevant holding in that period.

2 This Part has effect—

a for that accounting period, and b for any succeeding accounting period in which the relevant contract is a relevant contract of the company, as if the relevant contract were a derivative contract.

3 For the purposes of this section, the underlying subject matter of a contract consists wholly or partly of a relevant holding in an accounting period if—

a at any time in that period it consists wholly or partly of—

i any shares in an open-ended investment company, ii any rights under a unit trust scheme, or iii an interest in an offshore fund (within the meaning of section 355 of TIOPA 2010) , and b there is a time in the period when that company, scheme or fund fails to meet the qualifying investments test.

4 In subsection (3) “ meeting the qualifying investments test ” has the same meaning as in section 493 (the qualifying investments test).

5 See section 18(2)(c)(ii) of F(No.2)A 2005 (section 17(3): specific powers) for the power to modify the meaning of “ relevant holding ” for the purposes of this section by regulations under section 17(3) of that Act (regulations about authorised unit trusts and OEICs).

6 For the way in which credits and debits are to be brought into account where this section applies, see section 601 (application of fair value accounting).

7 See also—

a section 602 (contract becoming one relating to holding in OEIC, unit trust or offshore fund),

and b section 660 (company ceasing to be party to contract relating to holding in OEIC, unit trust or offshore fund).