Section 195A | Oil licence swaps ^F1

(1)Sections 195B to 195F apply for the purposes of corporation tax on chargeable gains.^F1F2

(2)In those sections—^F1

“licence-consideration swap” means a case where conditions A, B, C and D are met;

“mixed-consideration swap” means a case where conditions A, B, C and E are met.

(3)Condition A is that a company (“company A”) disposes of one or more UK licences to another company (“company B”), by way of a bargain at arm's length (“disposal A”).^F1

(4)Condition B is that company B disposes of one or more UK licences to company A, by way of a bargain at arm's length (“disposal B”).^F1

(5)Condition C is that either or both of the following paragraphs applies—^F1

(a)the licence, or at least one of the licences, comprised in disposal A relates to a developed area;^F1

(b)the licence, or at least one of the licences, comprised in disposal B relates to a developed area.^F1

(6)Condition D is that both—^F1

(a)disposal A is the only consideration given for disposal B, and^F1

(b)disposal B is the only consideration given for disposal A.^F1

(7)Condition E is that either—^F1

(a)disposal A is the only consideration given for disposal B, or^F1

(b)disposal B is the only consideration given for disposal A,^F1

(and accordingly one of the disposals is part of the consideration given for the other disposal).

(8)In this section and sections 195B to 196 a reference to disposal of a UK licence includes—^F1

(a)a disposal of an interest in a UK licence, and^F1

(b)a disposal of a UK licence, or an interest in a UK licence, only so far as the licence relates to part of the licensed area.^F1