Section 97ZA | Clearance services: exception for replacement securities. ^F1F2

(1)There shall be no charge to tax under section 96 above in respect of the transfer ... of chargeable securities (“the new securities”) issued by a company in place of existing securities of the same company (“the old securities”) if the following conditions are met.^F1F3

(2)The first condition is that the old securities are held under a clearance services scheme.^F1

(3)The second condition is that—^F1

(a)there was a charge to tax under section 96 above in respect of the transfer ...—^F1F4

(i)of the old securities, or^F1

(ii)of earlier securities in relation to which on a previous application of this section those securities were the new securities,^F1

or there would have been such a charge if that section had been in force; or

(b)there would have been such a charge but for section 97(3) ... above.^F1F5

(4)The third condition is that there is an arrangement under which—^F1

(a)the new securities are transferred ... as mentioned in section 96(1)(b), and^F1F6

(b)the old securities are cancelled.^F1

(5)For the purposes of subsection (2) above the cases in which securities are held under a clearance services scheme are those specified (in relation to shares) in section 97(6) above.^F1

(6)The exception provided by this section applies only to the extent that the value of the new securities immediately after their issue does not exceed the value of the old securities immediately before the issue of the new securities.^F1