Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p91
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
Provision Reference: 
Character Range: 227736–230574

the assets and liabilities of the target:
 (i) unless subparagraph (ii) applies—the jurisdiction in which the target is located;
 (ii) if the target is a Tax Transparent Entity—the jurisdiction in which those assets are located; and
 (c) that jurisdiction imposes a Covered Tax on the person disposing of the Controlling Interest based on the difference between:
 (i) the tax basis of those assets and liabilities; and
 (ii) the consideration paid in exchange for the Controlling Interest, or the fair value of the assets and liabilities.
 (2) Division 1 of this Part does not apply in relation to the acquisition or disposal of the Controlling Interest.
 (3) For the purposes of this instrument, treat the acquisition or disposal of the Controlling Interest as an acquisition or disposal of the assets and liabilities of the target.
Note: For acquisitions and disposals of assets and liabilities, see Part 6‑3.

Part 6‑3—Transfer of assets and liabilities

6‑55  Acquisitions and disposals of assets and liabilities
 (1) If a Constituent Entity of an MNE Group (the disposing Constituent Entity) disposes of an asset or liability, in computing the GloBE Income or Loss of the disposing Constituent Entity for the Fiscal Year in which the disposal occurs, include the gain or loss on the disposal.
 (2) If a Constituent Entity of an MNE Group (the acquiring Constituent Entity) acquires an asset or liability, in determining the GloBE Income or Loss of the acquiring Constituent Entity for a Fiscal Year ending after the acquisition:
 (a) if subsections 6‑50(2) and (3) apply in relation to the acquisition—use the fair value of the asset or liability; or
 (b) otherwise—use the acquiring Constituent Entity's carrying value of the asset or liability determined under the accounting standard used in preparing Consolidated Financial Statements of the Ultimate Parent Entity of the MNE Group.

6‑60  GloBE Reorganisations
 (1) This section applies if the disposal or acquisition of the asset or liability is part of a GloBE Reorganisation.
 (2) Despite section 6‑55:
 (a) in the case of a disposal—in computing the disposing Constituent Entity's GloBE Income or Loss for the Fiscal Year in which the disposal occurs:
 (i) if the disposing Constituent Entity recognises a Non‑qualifying Gain or Loss in the GloBE Reorganisation—include the Non‑qualifying Gain or Loss; or
 (ii) otherwise—exclude the gain or loss on the disposal; and
 (b) in the case of an acquisition—in computing the GloBE Income or Loss of the acquiring Constituent Entity for a Fiscal Year ending after the acquisition:
 (i) use the disposing Entity's carrying value of the asset or liability immediately before the disposal; and
 (ii) adjust the carrying value in a manner consistent with the tax laws of the jurisdiction in which the acquiring Constituent Entity is