Document ID: chunk:federal_register_of_legislation:C2010C00604:clause:7_2:p4
Version: federal_register_of_legislation:C2010C00604
Segment Type: clause
Provision Reference: sch 7 cl 2 (pt 4/7)
Character Range: 175167–177840

an *equity or loan interest in the *top company for the MEC group; or
 (b) an *indirect equity or loan interest in the top company.

Note: Sections 165‑115ZA and 165‑115ZB are about the consequences that an alteration time for a loss company has for relevant equity interests and relevant debt interests in the company.

 (3) In determining what is a relevant equity interest or relevant debt interest that an entity has in the *head company just before the *alteration time, make the assumptions in subsection 719‑720(5).

719‑735  Some alteration times affect only pooled interests

 (1) Sections 165‑115ZA and 165‑115ZB do not apply in relation to an *alteration time that happens for the *head company of a *MEC group because of subsection 719‑725(4) (trigger time for MEC group cost setting rules: pooling cases).

 (2) Instead, Subdivision 719‑K applies to the *MEC group, in relation to the trigger time, on the basis that:
 (a) what would, apart from this section, be the pooled cost amount for the purposes of the formulas in subsections 719‑570(1) and (2) is reduced by the amount of the *head company's overall loss under section 165‑115R or 165‑115S at that alteration time; but
 (b) paragraph (a) of this subsection only affects the application of those formulas because of subsection 719‑570(3) (to work out the *reduced cost base of a *membership interest).

[The next section is section 719‑755.]

How indirect value shifting rules apply to a MEC group

719‑755  Effect on MEC group cost setting rules if head company is losing entity or gaining entity for indirect value shift

 (1) This section has effect for the purposes of working out the consequences (if any) of an *indirect value shift if the *losing entity or *gaining entity is the *head company of a *MEC group. (Subsection (3) has effect in addition to section 727‑455.)

 (2) An *equity or loan interest can be an *affected interest in the *head company only if it is:
 (a) an *equity or loan interest in the *top company for the MEC group; or
 (b) an *indirect equity or loan interest in the top company.

 (3) Subdivision 719‑K (MEC group cost setting rules: pooling cases) applies to the *MEC group, in relation to the first time referred to in that Subdivision as a trigger time that happens at or after the *IVS time, on the basis that:
 (a) what would, apart from this section, be the pooled cost amount for the purposes of the formulas in subsections 719‑570(1) and (2) is:
 (i) if the *head company is the *losing entity—reduced; or
 (ii) if the head company is the gaining entity—increased;
  by the amount of the indirect value shift; and
 (b) paragraph (a) of this subsection also