Company: BBU
Filing Date: 2025-02-28
Form Type: F-3
Source: 0001104659-25-019207
Chunk: 44

Company: Brookfield Business Partners L.P.
Filing Date: 2025-02-28
Form: F-3
Chunk 44
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ential rates. The deductibility of capital losses is subject to limitations.

The U.S. federal income tax consequences described in the preceding paragraph should also apply to a U.S. holder whose exchange request is satisfied by the delivery of units by Brookfield pursuant to the Rights Agreement. For the U.S. federal income tax consequences to a U.S. holder whose exchange request is satisfied by the delivery of units pursuant to the partnership’s exercise of the partnership call right, see the discussion below under the heading “— Exercise of the Partnership Call Right. ” The U.S. federal income tax consequences to a U.S. holder whose exchange request is satisfied by the delivery of units by BBUC is described in the following paragraph.

An exchange of exchangeable shares satisfied by BBUC will result in the recognition of gain or loss by a U.S. holder, as described above, if the exchange is (i) in “complete redemption” of the U.S. holder’s equity interest in BBUC (within the meaning of Section 302(b)(3) of the Code), (ii) a “substantially disproportionate” redemption of stock (within the meaning of Section 302(b)(2) of the Code), or (iii) “not essentially equivalent to a dividend” (within the meaning of Section 302(b)(1) of the Code). In determining whether any of these tests has been met with respect to the exchange, each U.S. holder may be required to take into account not only the exchangeable shares and other equity interests in BBUC actually owned by the holder, but also other equity interests in BBUC that are constructively owned by the holder within the meaning of Section 318 of the Code. If a U.S. holder owns (actually or constructively) only an insubstantial percentage of the total equity interests in BBUC and exercises no control over BBUC’s corporate affairs, the holder may be entitled to sale or exchange treatment with respect to the exchange of exchangeable shares if the holder experiences a reduction in its equity interest in BBUC (taking into account any constructively owned equity interests) as a result of the exchange.

If a U.S. holder meets none of the alternative tests of Section 302(b) of the Code, the exchange would be treated as a distribution with respect to exchangeable shares. Subject to the discussion below under the heading “— Passive Foreign Investment Company Considerations ”, the gross amount of a distribution paid to a U.S. holder with respect to exchangeable shares (including amounts withheld to pay