Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p49
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 49/53)
Character Range: 3031729–3034374

circumstances, the relevant equity interests or relevant debt interests were *acquired by the affected entity; and
 (d) the loss company's overall loss at the alteration time; and
 (e) the extent to which that overall loss has reduced the *market values of the equity or debt; and
 (f) to prevent double counting, the extent of any adjustments required under this Subdivision because of any application of this Subdivision to another loss company in which the affected entity has a relevant equity interest or relevant debt interest;
and the amount so worked out is to be applied in making reductions in an appropriate way.

How to work out the extent to which the overall loss has reduced the market value of an equity or debt
 (7) To avoid doubt in applying paragraph (6)(e) in relation to an equity or a debt, if factors other than an overall loss altered the *market value of the equity or debt, the extent to which the overall loss reduced that market value is taken to be the extent to which that market value would have been reduced apart from those other factors.
Note 1: For a company's overall loss see subsections 165‑115R(5) and 165‑115S(5).
Note 2: An example of a factor other than the overall loss is the unrealised value of assets (including assets in respect of which there is an unrealised gain) of the loss company, whether or not generated by outlays or economic losses reflected in the loss for income tax purposes.

165‑115ZC  Notices to be given

Application
 (1) This section applies when an alteration time occurs in respect of a *loss company.
Note: Section 165‑115ZC of the Income Tax (Transitional Provisions) Act 1997 affects the operation of this section.

Controlling entity
 (2) For the purposes of this section, an entity is a controlling entity of a *loss company if:
 (a) the entity is not an individual; and
 (b) the entity, disregarding any of its *associates, has a controlling stake in the loss company; and
 (c) no other entity (except an individual or 2 or more individuals between them) has a controlling stake in the entity.

Foreign resident controlling entity to be disregarded in certain circumstances
 (3) If:
 (a) apart from this subsection, an entity that is a foreign resident would be a controlling entity of a *loss company; and
 (b) there is an entity that is an Australian resident and would be a controlling entity of the loss company if all the foreign residents that held direct or indirect interests in the Australian resident were individuals;
then, for the purposes of this section, the entity referred to in paragraph (a) is taken not to be a controlling entity of the company but the