Document ID: chunk:federal_register_of_legislation:C2004A00898:clause:1_4:p8
Version: federal_register_of_legislation:C2004A00898
Segment Type: clause
Provision Reference: sch 1 cl 4 (pt 8/12)
Character Range: 73621–76360

an *equity interest.

Note: Paragraph (a) is likely to be relevant for debt interests, paragraph (b) for equity interests and paragraph (c) for both.

 (3) The following are examples of *schemes that are generally not entered into or undertaken to raise finance:
 (a) a derivative that is used solely for managing financial risk;
 (b) a contract for personal services entered into in the ordinary course of a business.

Note: These may be relevant for both debt interests and equity interests.

 (4) For the purposes of subsection (1), the following *schemes are taken not to be entered into or undertaken to raise finance:
 (a) a lease or bailment that satisfies all of the following:
 (i) the property leased or bailed is not property to which Division 16D of Part III of the Income Tax Assessment Act 1936 (arrangements relating to the use of property) applies;
 (ii) the lease or bailment is not a relevant agreement for the purposes of section 128AC of that Act (deemed interest in respect of hire‑purchase and certain other arrangements);
 (iii) the lease or bailment is not an arrangement to which Division 42A in Schedule 2E to that Act (leasing of luxury cars) applies;
 (iv) the lease or bailment is not an arrangement to which Division 240 of Part 3‑10 of this Act (hire‑purchase arrangements treated as a sale and loan) applies;
 (v) the lessee or bailee, or a *connected entity of the lessee or bailee, is not to, and does not have an obligation (whether contingent or not) or a right to, acquire the leased or bailed property;
 (b) a securities lending arrangement under section 26BC of the Income Tax Assessment Act 1936;
 (c) a life insurance or general insurance contract undertaken as part of the issuer's ordinary course of business;
 (d) a scheme for the payment of royalties (within the meaning of the Income Tax Assessment Act 1936) other than:
 (i) a qualifying arrangement for the purposes of Division 16D of Part III of the Income Tax Assessment Act 1936; or
 (ii) a relevant agreement for the purposes of section 128AC of that Act.

 (5) The regulations may:
 (a) specify that particular *schemes are not financing arrangements; and
 (b) specify circumstances in which a scheme will not be a financing arrangement.

974‑135  Effectively non‑contingent obligation

 (1) There is an effectively non‑contingent obligation to take an action under a *scheme if, having regard to the pricing, terms and conditions of the scheme, there is in substance or effect a non‑contingent obligation (see subsections (3), (4) and (6)) to take that action.

 (2) Without limiting subsection (1), that subsection applies to:
 (a) providing a *financial benefit under the *scheme; or
 (b) terminating the scheme.

 (3) An obligation