Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p12
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 12/30)
Character Range: 7810316–7813115

not effectively non‑contingent merely because you will suffer some detrimental practical or commercial consequences if you do not fulfil the obligation.
Note: For example, a contingent obligation to make payments in respect of an income security issued by an approved deposit‑taking institution (ADI) is not effectively non‑contingent merely because of the detrimental effect non‑payment would have on the ADI's business.
 (8) The regulations may make further provisions relating to the following:
 (a) what constitutes a non‑contingent obligation;
 (b) what does not constitute a non‑contingent obligation;
 (c) what constitutes an *effectively non‑contingent obligation;
 (d) what does not constitute an effectively non‑contingent obligation.

974‑140  Ordinary debt interest
 (1) A *debt interest arising from a scheme is an ordinary debt interest if none of the obligations under the scheme is in substance or effect *contingent on aspects of the economic performance of:
 (a) the issuer of the interest; or
 (b) a *connected entity; or
 (c) a part of the operations of the issuer or a connected entity.
 (2) The regulations may specify rules for determining whether a *debt interest is an *ordinary debt interest.

974‑145  Benchmark rate of return
 (1) The benchmark rate of return for an interest (the test interest) in an entity is the annually compounded internal rate of return on an *ordinary debt interest that:
 (a) is issued, immediately before the test interest is issued, by the entity, or an equivalent entity, to an entity that is not a *connected entity; and
 (b) has a comparable maturity date; and
 (c) is in the same currency; and
 (d) is issued in the same market; and
 (e) has the same credit status; and
 (f) has the same degree of subordination to debts owed to the ordinary creditors of the issuer.
 (2) If there is no interest that satisfies subsection (1), the benchmark rate of return for the test interest is the annually compounded internal rate of return on an interest that is closest to the test interest in the respects referred to in that subsection (adjusted appropriately to take account of the differences between that interest and the test interest).
 (3) The regulations may:
 (a) specify the meaning to be given to an expression used in this section; or
 (b) provide for a different method of determining the *benchmark rate of return.

974‑150  Schemes
 (1) The Commissioner:
 (a) may determine that what would otherwise be a single *scheme is to be treated for the purposes of this Division as 2 or more separate schemes; and
 (b) may determine that the schemes are to be taken for the purposes of this Division to not be *related schemes.
 (2) Without limiting subsection 974‑10(5), the Commissioner must, in exercising the power to make a determination