Finance Act 2003

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Amendment of Chapter 4 (transmission capacity rights) of Part 29 of Principal Act.

20.—(1) Chapter 4 of Part 29 of the Principal Act is amended—

(a) in section 769A(1), by inserting the following after the definition of “capacity rights”:

“ ‘control’ shall be construed in accordance with section 432;

‘qualifying expenditure’ means capital expenditure incurred on the purchase of capacity rights, but does not include expenditure incurred on or after 6 February 2003 which consists of a licence fee or other payment paid to the Commission for Communications Regulation in respect of a licence or permission granted by that Commission on or after that date under—

(a) the Wireless Telegraphy Acts 1926 to 1988, or

(b) the Postal and Telecommunications Services Act 1983 ;”,

(b) in section 769B—

(i) by substituting “qualifying expenditure” for “capital expenditure” in both places where it occurs in subsection (1) and in the meaning of “A” in subsection (2)(b), and

(ii) by inserting the following after subsection (2):

“(3) (a) Notwithstanding any other provisions of this Chapter, where a company (in this paragraph referred to as the ‘buyer’) incurs qualifying expenditure on the purchase from another company (in this paragraph referred to as the ‘seller’) of capacity rights, no allowances shall be made under this Chapter to the buyer in respect of that expenditure if both companies are companies within a group of companies, unless an allowance had been made under this Chapter to the seller (or would have been made to the seller if it had not sold those rights) in respect of the capital expenditure it incurred on the purchase of those rights.

(b) For the purposes of this subsection—

(i) a ‘group of companies’ means a company and any other companies of which it has control or with which it is associated, and

(ii) a company is associated with another company where it could reasonably be considered that—

(I) any person or any group of persons or groups of persons having a reasonable commonality of identity has or have, as the case may be, or had the means or power, either directly or indirectly, to determine the trading operations carried on or to be carried on by both companies, or

(II) both companies are under the control of any person or any group of persons or groups of persons having a reasonable commonality of identity.”,

(c) in section 769C, by substituting “qualifying expenditure” for “capital expenditure” in each place where it occurs in subsections (1) to (5),

(d) in section 769E(2), by substituting “qualifying expenditure” for “capital expenditure”, and

(e) in section 769F by the substitution of “on the date of the passing of the Finance Act 2003” for “on such day as the Minister for Finance may, by order, appoint”.

(2) This section applies as on and from the date of the passing of this Act.