Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p86
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
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Character Range: 215336–218178

the jurisdiction in which it is located (see section 3‑195), on the assumption that the MOCE is the only Constituent Entity of the MNE Group located in the jurisdiction.
 (4) For the purposes mentioned in subsection (5), treat the MOCE as not being a Constituent Entity of the MNE Group.
 (5) The purposes are as follows:
 (a) computing the Top‑up Tax of each Constituent Entity of the MNE Group (other than the MOCE);
 (b) determining whether each Constituent Entity of the MNE Group (other than the MOCE) is a Low‑Taxed Constituent Entity.
 (6) Subsections (2) and (4) do not apply for the purposes of Part 5‑5 (De minimis exclusion).

5‑130  Meaning of Minority‑Owned Constituent Entity and Minority‑Owned Parent Entity
 (1) A Constituent Entity of an MNE Group is a Minority‑Owned Constituent Entity if the Ultimate Parent Entity of the MNE Group has an Ownership Interest Percentage in the Constituent Entity of 30% or less.
 (2) A Minority‑Owned Constituent Entity is a Minority‑Owned Parent Entity if:
 (a) it holds a Controlling Interest in another Minority‑Owned Constituent Entity; and
 (b) a Controlling Interest in it is not held by another Minority‑Owned Constituent Entity.

5‑135  Meaning of Minority‑Owned Subsidiary and Minority‑Owned Subgroup
 (1) A Minority‑Owned Constituent Entity in which a Controlling Interest is held by a Minority‑Owned Parent Entity is a Minority‑Owned Subsidiary of the Minority‑Owned Parent Entity.
 (2) A Minority‑Owned Subgroup means a Minority‑Owned Parent Entity and its Minority‑Owned Subsidiaries.

Chapter 6—Corporate restructurings and holding structures

Part 6‑1—Application of consolidated revenue threshold to Group mergers and demergers

6‑5  Applicable MNE Groups—mergers
 (1) This section specifies conditions for the purposes of paragraph 12(1)(b) of the Act.
 (2) An MNE Group (the merged Group) meets the conditions specified in this section for a Fiscal Year (the test year) if:
 (a) during the test year or the previous 4 Fiscal Years (the test period):
 (i) 2 or more Groups (the pre‑merger Groups) merged (see subsection (4)) to form the merged Group; or
 (ii) an Entity that is not part of a Group (the acquirer) acquired or merged (see subsection (4)) with one or more other Entities or Groups (the targets) to form the merged Group; and
 (b) the merged Group would be an Applicable MNE Group for the test year under paragraph 12(1)(a) of the Act, on the assumption in subsection (3) of this section.
 (3) For the purposes of paragraph (2)(b), assume that the following amounts were included in the annual revenue of the merged Group for a Fiscal Year in the test period (whether or not the merged Group existed in the Fiscal Year):
 (a) if subparagraph (2)(a)(i) applies—each amount shown as annual revenue in the Consolidated Financial Statements of the Ultimate Parent