753E Anti-avoidance.

(1) In this section—

“the Acts” means—

(a) the Tax Acts,

(b) the Capital Gains Tax Acts,

(c) the Act of 1999, and the enactments amending or extending that Act, and

(d) the Value-Added Tax Consolidation Act 2010, and the enactments amending or extending that Act,

and any instrument made thereunder and any instrument that is made under any other enactment and which relates to those Acts;

“tax advantage” has the same meaning as it has in section 811C;

“transaction period” means the period after—

(a) qualifying securities have been obtained from a lender under a stock borrowing, or

(b) a stock transfer has taken place under a repurchase agreement,

but before the corresponding stock return has taken place.

(2) This Chapter shall not apply to a financial transaction, unless it would be reasonable to consider that the financial transaction—

(a) has been undertaken for bona fide commercial reasons, and

(b) does not form part of any arrangement or scheme of which the main purpose, or one of the main purposes, is the avoidance of tax.

(3) Notwithstanding subsection 753B(2)(a), when determining the capital, voting rights or entitlement to assets, whether on a winding up or in any other circumstances, held by a party to a financial transaction for the purposes of any provision of the Acts during a transaction period, regard shall be had to the—

(a) capital,

(b) voting rights, and

(c) entitlement to assets, whether on a winding up or in any other circumstances,

of each party to the financial transaction concerned, as the case may be—

(i) immediately prior to the time at which—

(I) qualifying securities have been obtained from the lender under the stock borrowing concerned, or

(II) the stock transfer has taken place under the repurchase agreement concerned,

as the case may be, and

(ii) during the transaction period,

such that the capital, voting rights or entitlement to assets, whether on a winding up or in any other circumstances, held by that party for that transaction period shall be the amount that does not give rise to a tax advantage for that party to the financial transaction or a person connected to that party.