Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p26
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 26/34)
Character Range: 3589444–3592278

partial interests, in the entity that are not held by, or directly or indirectly for the benefit of, prescribed persons are substantially borne by, or substantially accrue to, prescribed persons.
 (2) In deciding whether it would be reasonable to conclude as mentioned in paragraph (1)(b):
 (a) have regard to any *arrangement in respect of *membership interests (including unissued membership interests), or in respect of *partial interests, in the entity (including any derivatives held or issued in connection with those membership interests or partial interests) of which the entity is aware; but
 (b) do not have regard to risks involved in the ownership of membership interests, or partial interests, in the entity that are substantially borne by any person in the person's capacity as a secured creditor.
 (3) An entity has a partial interest in a *corporate tax entity if it has an interest in a *membership interest in the corporate tax entity.

208‑30  Accountable membership interests
 (1) The purpose of this section is to identify which *membership interests in an entity are relevant in determining whether the entity is effectively owned by prescribed persons.
 (2) A *membership interest in an entity is an accountable membership interest if it is not an excluded membership interest.
 (3) A *membership interest in an entity is an excluded membership interest if, having regard to:
 (a) the purposes for which the membership interest was issued; and
 (b) any special or limited rights connected with, arising from, or attached to:
 (i) the membership interest; or
 (ii) other membership interests in the entity held by the holder of the membership interest; or
 (iii) membership interests in the entity held by persons other than the holder of the membership interest; or
 (iv) interests in any of the above;
  including rights that are conferred or exercisable only if the holder of the membership interest or interests concerned is, or is not, a prescribed person; and
 (c) the extent to which any such special or limited rights are similar to or differ from the rights that are normally attached to the ownership of *ordinary membership interests in *corporate tax entities; and
 (d) the relationship between the value of the membership interest and the value of the entity; and
 (e) any relationship or connection (whether of a personal or business nature) between holders of membership interests in the entity of which the entity is aware; and
 (f) any *arrangement in respect of membership interests (including unissued membership interests) in the entity, or interests in membership interests in the entity, of which the entity is aware;
it would be reasonable to conclude that the membership interest is not relevant in determining whether the entity is effectively owned by prescribed persons because holding