Document ID: chunk:federal_register_of_legislation:C2025C00029:section:2:p47
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 2 (pt 47/59)
Character Range: 2649018–2651581

has the right to *acquire, *ownership interests in the company that carry between them:
 (a) the right to receive more than 20% of any distribution of income or capital by the company; or
 (b) the right to exercise, or control the exercise of, more than 20% of the voting power of the company.
 (7) A trust is a demerger subsidiary of another trust or a company that is a member of a *demerger group if the other trust or the company, either alone or together with other members of the group, owns, or has the right to *acquire, *ownership interests in the trust that carry between them the right to receive more than 20% of any distribution of income or capital by the trustee.

125‑70  Meanings of demerger, demerged entity and demerging entity
 (1) A demerger happens to a *demerger group if:
 (a) there is a restructuring of the demerger group; and
 (b) under the restructuring:
 (i) members of the demerger group *dispose of at least 80% of their total *ownership interests in another member of the demerger group to owners of original interests in the *head entity of the demerger group; or
 (ii) at least 80% of the total ownership interests of members of the demerger group in another member of the demerger group end and new interests are issued to owners of original interests in the head entity; or
 (iii) the demerged entity issues sufficient new ownership interests in itself with the result that owners of original interests in the head entity own at least 80% of the total ownership interests in the demerged entity; or
 (iv) some combination of the processes referred to in subparagraphs (i), (ii) and (iii) happens with the effect that members of the demerger group stop owning at least 80% of the total ownership interests owned by members of the demerger group in another member of the group; and
Note: CGT event C2 and CGT event C3 are the only relevant CGT events in a subparagraph (ii) case.
 (c) under the restructuring:
 (i) a *CGT event happens to an original interest owned by an entity in the head entity of the group and the entity *acquires a new interest and nothing else; or
 (ii) no CGT event happens to an original interest owned by an entity in the head entity of the group and the entity acquires a new interest and nothing else; and
 (d) the acquisition by entities of new interests happens only because those entities own or owned original interests; and
 (e) the new interests acquired are:
 (i) if the head entity is a company—ownership interests in a company; or
 (ii) if the head entity is a trust—ownership interests in a