Document ID: chunk:federal_register_of_legislation:C2023C00080:clause:2_28:p7
Version: federal_register_of_legislation:C2023C00080
Segment Type: clause
Provision Reference: sch 2 cl 28 (pt 7/16)
Character Range: 211767–214510

a Registry account (within the meaning of the Australian National Registry of Emissions Units Act 2011); or
 (ii) a foreign account (within the meaning of that Act);
  kept by another entity (the transferee); and
 (c) either:
 (i) the transferor and the transferee did not deal with each other at arm's length; or
 (ii) the transferee is the transferor's *associate; and
 (d) the transferee did not pay or give consideration equal to the *market value of the unit for the transfer of the unit;
the transferor is treated as if the transferor were entitled to receive an amount equal to that market value because the transferor ceased to be the holder of the unit.
Note: In the application of Division 13 of Part III of the Income Tax Assessment Act 1936 (about international transfer‑pricing arrangements), this section is disregarded—see subsection 136AB(2) of the Income Tax Assessment Act 1936.

420‑35  Outgoing international transfers of emissions units
  If:
 (a) you stop *holding a *registered emissions unit; and
 (b) you do so as a result of the transfer of the unit to:
 (i) if the unit is a *carbon unit—your foreign account (within the meaning of the Clean Energy Act 2011) or your nominee's foreign account (within the meaning of that Act); or
 (ii) if the unit is an *international emissions unit—your foreign account (within the meaning of the Australian National Registry of Emissions Units Act 2011) or your nominee's foreign account (within the meaning of that Act); or
 (iii) if the unit is an *Australian carbon credit unit—your foreign account (within the meaning of the Carbon Credits (Carbon Farming Initiative) Act 2011) or your nominee's foreign account (within the meaning of that Act);
you are treated as if:
 (c) just before the transfer, you had sold the unit to someone else for its *market value just before the transfer; and
 (d) you had, immediately after the sale, bought it back for the same amount.
Example: An Australian resident company carries on a business of trading in emission units. The company owns 10,000 emission reduction units (a type of international emissions unit) that are registered in Australia. 5,000 of those units are transferred from the company's Australian registry account to the company's New Zealand registry account.
 The company is treated as having sold each unit to someone else at its market value just before it stopped being a registered emissions unit. As the unit was a registered emissions unit, the market value is included in the company's assessable income (section 420‑25).
 The company is also treated as having bought 5,000 emission reduction units for the same amount. As those units are trading stock, the company may be able to deduct that amount under section