Document ID: chunk:federal_register_of_legislation:C2010C00690:clause:1_6:p18
Version: federal_register_of_legislation:C2010C00690
Segment Type: clause
Provision Reference: sch 1 cl 6 (pt 18/26)
Character Range: 219870–222613

right is acquired under an employee share scheme. Section 139DF prevents shares and rights relating to certain companies from being qualifying shares and rights.

 (4) A *share may be disregarded under subsection (2) even though the condition in paragraph (3)(c) is not met, if the Commissioner has made a determination under subsection 139CD(8) of the Income Tax Assessment Act 1936 in relation to the share.

719‑35  Treating entities held through non‑fixed trusts as wholly‑owned subsidiaries

 (1) This section operates to ensure that an entity (the test entity) is not prevented from being a *wholly‑owned subsidiary of a company, just because there is a trust that is not a *fixed trust interposed between the test entity and the company.

 (2) For the purposes of this Division, in determining whether the test entity is a *wholly‑owned subsidiary of the company, assume that the interposed trust is a *fixed trust and all its objects are beneficiaries.

719‑40  Special conversion event—potential MEC group

 (1) A special conversion event happens at a particular time to a *potential MEC group derived from an *eligible tier‑1 company of a *top company if:
 (a) at that time, the group is not a *MEC group as a result of a choice under section 719‑50; and
 (b) immediately before that time, a company is:
 (i) that eligible tier‑1 company; and
 (ii) the *head company of a *consolidated group; and
 (c) at that time, one or more other companies become eligible tier‑1 companies of the top company; and
 (d) immediately after that time, no *membership interests in the company mentioned in paragraph (b) are beneficially owned by another member of the potential MEC group derived from:
 (i) the company mentioned in paragraph (b); and
 (ii) the companies mentioned in paragraph (c); and
 (e) within the applicable period worked out under subsection (2), the company mentioned in paragraph (b) gives the Commissioner a written notice, in the *approved form:
 (i) specifying one or more of the companies mentioned in paragraph (c); and
 (ii) stating that a MEC group is to come into existence as a result of the specified companies becoming eligible tier‑1 companies of the top company; and
 (f) either:
 (i) the companies specified in the notice under paragraph (e) were not members of another MEC group at that time; or
 (ii) the companies specified in the notice under paragraph (e) were members of another MEC group at that time, and each eligible tier‑1 company in that other MEC group is specified in the notice or not mentioned in paragraph (c).

 (2) For the purposes of paragraph (1)(e), the applicable period is:
 (a) if the company mentioned in paragraph (1)(b) is required to give the Commissioner an *income tax return for