Section 647 — Corporation Tax Act 2009: Meaning of certain expressions in section 645

Meaning of certain expressions in section 645 647 1 This section applies for the purposes of section 645. 2 “ Mandatorily convertible preference shares ” means shares which—

a represent the creditor relationship mentioned in section 645(2),

b are not qualifying ordinary shares, and c are issued upon terms which stipulate that they must be converted into, or exchanged for, qualifying ordinary shares by a relevant time.

3 In subsection (2) “ relevant time ” means a time no more than 24 hours after the acquisition of the shares by a person who, immediately before that acquisition, had the creditor relationship. 4 “ Qualifying ordinary shares ” means shares in a company which satisfy conditions A and B.

5 Condition A is that the shares are all or part of the issued share capital (however described) of the company, other than—

a capital the holders of which have a right to a dividend at a fixed rate but have no other right to share in the profits of the company, or b capital the holders of which have no right to a dividend of any description nor any other right to share in the profits of the company.

6 Condition B is that the shares—

a are listed on a recognised stock exchange, or b are shares in a holding company or a trading company.

7 In subsection (6) “ holding company ” and “ trading company ” have the same meaning as in section 165 of TCGA 1992 (see section 165A of that Act).