Income Tax Assessment Act 1997
CHAPTER 3
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SPECIALIST LIABILITY RULES
PART 3-90
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CONSOLIDATED GROUPS
Division 719
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MEC groups
Subdivision 719-B
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MEC groups and their members
Basic concepts
SECTION 719-40
Special conversion event
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potential MEC group
719-40(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:
(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:
(e) the company mentioned in paragraph (b) makes a choice in writing no later than the day mentioned in subsection (2):
(f) if:
719-40(2)
The day mentioned in paragraph (1)(e) is:
(a) if the company is required to give the Commissioner its *income tax return for the income year during which that time occurs - the day on which the company gives the Commissioner that income tax return; or
(b) otherwise - the last day in the period within which the company would be required to give the Commissioner such a return if it were required to give the Commissioner such a return.
View history note
Hide history noteA 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) the company mentioned in paragraph (b) makes a choice in writing no later than the day mentioned in subsection (2):
(i) specifying one or more of the companies mentioned in paragraph (c); and
(ii) stating that a MEC group is to come into existence at that time as a result of the specified companies becoming eligible tier-1 companies of the top company; and
(f) if:
(i) a company specified in the choice was a member of another MEC group immediately before that time; and
each eligible tier-1 company in that other MEC group is specified in the choice.
(ii) all of the eligible tier-1 companies in that other MEC group became eligible tier-1 companies of the top company at that time;
Note:
The company mentioned in paragraph (b) must give the Commissioner a notice in the approved form containing information about the special conversion event (see sections 719-78 and 719-80 ).
The day mentioned in paragraph (1)(e) is:
(a) if the company is required to give the Commissioner its *income tax return for the income year during which that time occurs - the day on which the company gives the Commissioner that income tax return; or
(b) otherwise - the last day in the period within which the company would be required to give the Commissioner such a return if it were required to give the Commissioner such a return.
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