831A Treatment of distributions to certain parent companies.

(1) (a) In this section—

“company”, in relation to a company that is resident for the purposes of tax in Switzerland, means a company which—

(i) takes one of the forms specified in Article 15 of the Agreement attached to the Council Decision (2004/911/EC) of 2 June 2004 on the signing and conclusion of the Agreement between the European Community and the Swiss Confederation providing for measures equivalent to those laid down in Council Directive 2003/48/EC of 3 June 2003 on taxation of savings income in the form of interest payments and the accompanying Memorandum of Understanding¹, and

(ii) is subject to tax in Switzerland without being exempt;

“parent company” means a company which controls not less than 25 per cent of the voting power in another company;

“tax”, in relation to Switzerland, means any tax imposed in Switzerland which corresponds to income tax or corporation tax in the State.

(b) For the purposes of this section a company shall be a subsidiary of another company which holds voting rights in it where the other company’s holding of those rights is sufficient for that other company to be a parent company.

(2) Chapter 8A of Part 6, other than section 172K, shall not apply to a distribution made to a parent company which is, by virtue of the law of Switzerland, resident for the purposes of tax in Switzerland by its subsidiary which is a company resident in the State.