Section 195A — Taxation of Chargeable Gains Act 1992: Oil licence swaps

Oil licence swaps 195A 1 Sections 195B to 195F apply for the purposes of corporation tax on chargeable gains.

2 In those sections— “ licence-consideration swap ” means a case where conditions A, B, C and D are met; “ mixed-consideration swap ” means a case where conditions A, B, C and E are met.

3 Condition A is that a company (“company A”) disposes of one or more UK licences to another company (“company B”), by way of a bargain at arm's length (“disposal A”).

4 Condition B is that company B disposes of one or more UK licences to company A, by way of a bargain at arm's length (“disposal B”).

5 Condition C is that either or both of the following paragraphs applies—

a the licence, or at least one of the licences, comprised in disposal A relates to a developed area;

b the licence, or at least one of the licences, comprised in disposal B relates to a developed area.

6 Condition D is that both—

a disposal A is the only consideration given for disposal B, and b disposal B is the only consideration given for disposal A.

7 Condition E is that either—

a disposal A is the only consideration given for disposal B, or b disposal B is the only consideration given for disposal A, (and accordingly one of the disposals is part of the consideration given for the other disposal).

8 In this section and sections 195B to 196 a reference to disposal of a UK licence includes—

a a disposal of an interest in a UK licence, and b a disposal of a UK licence, or an interest in a UK licence, only so far as the licence relates to part of the licensed area.