CFM72340 - Other tax rules on corporate finance: securitisation: periods beginning on or after 1 January 2007: the regulations: interpretation

Regulation 2: terms used in the regulations

Regulation 2 provides definitions of terms used in the regulations.

Types of securitisation company

The definitions of the five types of ‘securitisation company’ are set out in Regulations 4 to 9 (CFM72370). These are termed as the

  • note-issuing company
  • asset-holding company
  • intermediate borrowing company
  • warehouse company
  • commercial paper funded company.

Capital market arrangement

Capital market arrangement and capital market investment take their meanings from the Insolvency Act 1986 - see CFM72300.

‘Independent persons’

The securities must be issued to ‘independent persons’, which draws on the definition of ‘connected persons’ in CTA10/S1122. See CFM72390.

‘Related transaction’

Regulation 2 also explains the meaning of ‘related transaction’. This is relevant to the ‘unallowable purposes’ test (see CFM72570) and to the definition of ‘retained profit’ (see CFM72480).

‘Financial assets’

The assets held by certain of the above types of securitisation company must be ‘financial assets’. CFM72350 explains this term.

‘Specified regulations’

The ‘specified regulations’ are Regulation 14 (the corporation tax charge), 14A (removal of withholding obligation), Regulations 16 to 20 and 22 (which modify certain tax rules). These particular regulations do not apply to securitisation companies in certain circumstances (CFM72500).