Finance Act 2017
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Amendment of section 80 of Principal Act (reconstructions or amalgamations of companies) | ||
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67. Section 80 of the Principal Act is amended— | ||
(a) by substituting the following for subsections (1) to (6): | ||
“(1) (a) In this section— | ||
‘acquiring company’ means, subject to paragraph (b), a company with limited liability; | ||
‘merger’ means a merger undertaken in accordance with Chapter 3 of Part 9 or Chapter 16 of Part 17 of the Companies Act 2014 ; | ||
‘shares’ includes stock; | ||
‘successor company’ and ‘transferor company’ have the meanings given to them by section 461 of the Companies Act 2014 ; | ||
‘undertaking’ includes part of an undertaking. | ||
(b) References in this section to a company shall be construed as including references to a society registered under the Industrial and Provident Societies Act 1893 . | ||
(2) (a) This subsection applies where there is a scheme for the bona fide reconstruction of any company or the amalgamation of any companies and where, in connection with the scheme, the following conditions apply: | ||
(i) a company with limited liability is to be registered, or a company has been established by Act of the Oireachtas, or the nominal share capital of a company has been increased, | ||
(ii) the company (in this section referred to as the ‘acquiring company’) is to be registered or has been established or has increased its capital with a view to the acquisition of either— | ||
(I) the undertaking of a particular existing company (in this section referred to as the ‘target company’), or | ||
(II) not less than 90 per cent of the issued share capital of a target company, | ||
and | ||
(iii) the consideration for the acquisition (except such part of that consideration as consists in the transfer to or discharge by the acquiring company of liabilities of the target company) consists as to not less than 90 per cent of that consideration— | ||
(I) where an undertaking is to be acquired, in the issue of shares in the acquiring company to the target company or to holders of shares in the target company, or | ||
(II) where shares are to be acquired, in the issue of shares in the acquiring company to the holders of shares in the target company in exchange for the shares held by them in the target company. | ||
(b) For the purposes of paragraph (a)(i) in so far as it relates to a company with limited liability that is to be registered, a company with limited liability does not include a private company limited by shares to which Part 2 of the Companies Act 2014 applies. | ||
(c) For the purposes of paragraph (a)(i), a company that has issued any share capital shall be treated as if it had increased its nominal share capital. | ||
(3) Subsection (2) shall not apply unless— | ||
(a) it is provided by the memorandum of association of the acquiring company or the Act establishing the acquiring company that one of the objects for which the company is formed is the acquisition of the undertaking of, or shares in, the target company, or | ||
(b) it appears from the resolution, Act or other authority for the increase of the capital of the acquiring company that the increase is authorised for the purpose of acquiring the undertaking of, or shares in, the target company. | ||
(4) This subsection applies where— | ||
(a) a merger is undertaken, and | ||
(b) the successor company is a private company limited by shares, a designated activity company or a public limited company that is not an investment company within the meaning of section 2, 963 or 1001, respectively, of the Companies Act 2014 . | ||
(5) Where subsection (2) or (4) applies, and subject to this section, stamp duty under the following headings in Schedule 1— | ||
(a) ‘CONVEYANCE or TRANSFER on sale of any stocks or marketable securities.’, | ||
(b) ‘CONVEYANCE or TRANSFER on sale of a policy of insurance or a policy of life insurance where the risk to which the policy relates is located in the State.’, or | ||
(c) ‘CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance.’, | ||
shall not be chargeable on any instrument made for the purposes of or in connection with— | ||
(i) the transfer of the undertaking or shares, or | ||
(ii) the assignment of any debts, whether such debts are debts of the target company assigned to the acquiring company or, as the case may be, debts of the transferor company assigned to the successor company as a result of the merger. | ||
(6) In the case of an instrument made for the purposes of or in connection with a transfer to a company (within the meaning of the Companies Act 2014 ), subsection (5) shall not apply unless the instrument is executed within the period of 12 months from the date of the registration of the acquiring company or the date of the resolution to increase the nominal share capital of the acquiring company. | ||
(7) (a) This subsection applies to any property, an instrument for the conveyance of which is chargeable to stamp duty under or by reference to the following heading in Schedule 1, namely: ‘CONVEYANCE or TRANSFER on sale of any property other than stocks or marketable securities or a policy of insurance or a policy of life insurance.’. | ||
(b) Subsection (5) shall not apply to an instrument made for the purposes of or in connection with the transfer of an undertaking that includes any property to which this subsection applies, where a conveyance of that property has not been obtained by, as the case may be, the target company or the transferor company prior to the date of the execution of the instrument.”, | ||
(b) in subsection (8)— | ||
(i) in paragraphs (b) and (c) by substituting “, liquidation or merger” for “or liquidation”, and | ||
(ii) by substituting “subsection (5)” for “subsection (2)”, | ||
and | ||
(c) by inserting the following after subsection (10): | ||
“(11) In the case of— | ||
(a) a merger undertaken in accordance with Chapter 3 of Part 9 of the Companies Act 2014 — | ||
(i) the resolution referred to in paragraph (a)(ii) of section 202(1) of that Act, in the case of a merger effected by way of the summary approval procedure (within the meaning of section 202 of that Act), or | ||
(ii) the order made under section 480(2) of that Act, in the case of a merger effected otherwise than by way of the summary approval procedure (within the foregoing meaning), | ||
shall be regarded as a conveyance on sale, or | ||
(b) a merger undertaken in accordance with Chapter 16 of Part 17 of the Companies Act 2014 , the order made under section 1144 of that Act shall be regarded as a conveyance on sale. | ||
(12) This section shall not apply unless the scheme of reconstruction or amalgamation or the merger is effected for bona fide commercial reasons and does not form part of a scheme or arrangement of which the main purpose, or one of the main purposes, is avoidance of liability to any tax or duty.”. |