Section 357GCZE — Corporation Tax Act 2010: Treatment of expenditure in connection with formation of CSA etc

Treatment of expenditure in connection with formation of CSA etc 357GCZE 1 Where—

a a company makes a payment to a person (“P”) in consideration of that person entering into a cost-sharing arrangement with the company, and b P holds a qualifying IP right granted in respect of the invention or holds an exclusive licence in respect of such a right, a just and reasonable amount of the payment is to be treated for the purposes of section 357BLE as if it was an amount paid in respect of the assignment to the company of the right or (as the case may be) the transfer to the company of the licence.

2 Where—

a a company makes a payment to a party to a cost-sharing arrangement (“P”) in consideration of P agreeing to the company becoming a party to the arrangement (whether in place of P or in addition to P),

and b any party to the arrangement holds a qualifying IP right in respect of the invention or holds an exclusive licence in respect of such a right, a just and reasonable amount of the payment is to be treated for the purposes of section 357BLE as if it was an amount paid in respect of the assignment to the company of the right or (as the case may be) the transfer to the company of the licence.

3 Where—

a a company that is a party to a cost-sharing arrangement makes a payment to another party to the arrangement in consideration of that party agreeing to the company becoming entitled to a greater share of the income attributable to the invention or acquiring additional rights in relation to the invention, and b any party to the arrangement holds a qualifying IP right in respect of the invention or holds an exclusive licence in respect of such a right, a just and reasonable amount of the payment is to be treated for the purposes of section 357BLE as if it was an amount paid in respect of the assignment to the company of the right or (as the case may be) the transfer to the company of the licence.