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 47/66)
Character Range: 6445824–6448392

loss, if it makes the loss apart from a transfer under Subdivision 707‑A (even if the company later transfers the loss to itself under that Subdivision); or
 (b) at the time the loss is transferred to the company under that Subdivision, if the company makes the loss because of that transfer.
 (4) Disregard section 719‑90 for the purposes of making an assumption on the basis of item 1 of the table in subsection (2) of this section if (apart from that section):
 (a) the *COT transfer mentioned in that item was from the *head company of the *MEC group to itself; and
 (b) for an income year starting after the transfer, another company was the head company of the group.

719‑280  Assumptions about the test company failing to meet the conditions in section 165‑12
 (1) Assume that the test company fails to meet the conditions in section 165‑12 at the time an event described in subsection (2), (3) or (4) happens after the start of the *ownership test period for the focal company in relation to:
 (a) the *MEC group whose *head company was the focal company; or
 (b) the *potential MEC group whose membership was the same as the membership of that MEC group.
Note: If the test company is assumed to fail to meet the conditions in section 165‑12 for the claim year and the loss, the focal company is taken (under section 719‑260) to have failed to meet those conditions.
 (2) One event is the *potential MEC group ceasing to exist.
 (3) Another event is something happening that meets these conditions:
 (a) the thing happens at a time in relation to *membership interests in one or more of these entities:
 (i) a company that was just before that time a *member of the *MEC group and an *eligible tier‑1 company of the *top company for the MEC group;
 (ii) an entity interposed between a company described in subparagraph (i) and the company that was the top company for the group just before that time;
 (b) the thing does not cause the *potential MEC group to cease to exist but does cause a change in the identity of the top company for the potential MEC group.
 (4) Another event is the *MEC group ceasing to exist because there ceases to be a *provisional head company of the group.

Other causes of failure to meet conditions in section 165‑12
 (5) To avoid doubt, this section does not limit the circumstances in which the test company would have failed to meet the conditions in section 165‑12 on the relevant assumptions set out in sections 719‑270 and 719‑275.

Business continuity test and change of head company

719‑285  Business continuity test and