Source: http://ecfr.io/Title-26/se26.12.1_1993_65
Timestamp: 2019-11-23 01:13:23
Document Index: 611604206

Matched Legal Cases: ['§1', 'art 1', '§1', 'art 1', '§1', 'art 1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1', '§1']

[26 CFR §1.993-5] Title 26 Part 1 → §1.993-5 : Code of Federal Regulations ';
Title 26 Part 1 → §1.993-5
Title 26 → Chapter I → Subchapter A → Part 1 → §1.993-5
§1.993-5 Definition of related foreign export corporation.
(i) Qualified export assets. Under §1.993-2(g), the stock or securities of a related foreign export corporation held by the DISC are qualified export assets.
(ii) Qualified export receipts. Under §1.993-1 (e), (f), and (g), certain receipts of the DISC with respect to stock or securities of a related foreign export corporation held by the DISC are qualified export receipts.
(i) On each day during such taxable year of the DISC on which the foreign corporation has stock issued and outstanding, the DISC owns directly stock of the foreign corporation possessing more than 50 percent of the total combined voting power of all classes of stock of the foreign corporation entitled to vote as determined under the principles of §1.957-1(b) (relating to definition of controlled foreign corporation),
(ii) 95 percent or more of such foreign corporation's gross receipts (as defined in §1.993-6) for its taxable year ending with or within such taxable year of the DISC consists of qualified export receipts described in §1.993-1 (b) through (e) or interest described in §1.993-1(g) derived from any obligations described in §1.993-2 (d) or (e), and
(iii) The sum of the adjusted bases of the assets of the foreign corporation which are qualified export assets described in §1.993-2 (b) through (e) and which are held by the foreign corporation at the close of its taxable year which ends with or within such taxable year of the DISC equals or exceeds 95 percent of the sum of the adjusted bases of all assets held by the foreign corporation at the close of such taxable year.
(2) Certain determinations. The determinations as to whether gross receipts are qualified export receipts described in subparagraph (1)(ii) of this paragraph and as to whether assets are qualified export assets described in subparagraph (1)(iii) of this paragraph are made by applying the requirements of §§1.993-1 and 1.993-2 to the foreign corporation as if it were a domestic corporation being tested to determine whether it is a DISC. For purposes of making either of such determinations, the principles of accounting applicable for purposes of computing earnings and profits under §1.964-1 (relating to a controlled foreign corporation's earnings and profits) shall apply.
(i) On each day during such taxable year of the DISC on which the foreign corporation has stock issued and outstanding, the DISC owns directly stock of the foreign corporation possessing more than 50 percent of the total combined voting power of all classes of stock of the foreign corporation entitled to vote as determined under the principles of §1.957-1(b) and
(i) 90 percent or more of the qualified export receipts of the DISC for such year are derived from transactions with respect to which it is a commission agent for a related supplier (as defined in §1.994-1(a)(3)(ii)), and
(i) On each day during such taxable year of the DISC on which the foreign corporation has stock issued and outstanding, the DISC, or one or more members of the same controlled group of corporations (as defined in subparagraph (2) of this paragraph) as the DISC, owns (within the meaning of section 1563 (d) and (e)) stock of the foreign corporation possessing less than 10 percent of the total combined voting power of all classes of stock of the foreign corporation entitled to vote, as determined under the principles of §1.957-1(b), or owns no stock of such corporation, and
(ii) The ownership of stock, or of securities (as defined in §1.993-2(g)), of the foreign corporation by the DISC or by one or more members of such controlled group of corporations reasonably furthers a transaction or transactions giving rise to qualified export receipts for the DISC.
(2) Controlled group of corporations. For purposes of this paragraph, the term “controlled group of corporations” has the same meaning assigned to the term in section 1563(a) and not section 993(a)(3) and §1.993-1(k). Thus, for purposes of this paragraph, the test of control is 80 percent control and, since the rules of section 1563(b) apply, only domestic members are considered to be members of the controlled group.
(i) The ownership is necessary to obtain or maintain the foreign corporation as a customer of the DISC or of a related supplier, as defined in §1.994-1(a)(3)(ii) of the DISC or to aid the sales distribution system of the DISC or of such related supplier, and