Section 357BP | Meaning of “new qualifying IP right” and “old qualifying IP right” ^F1F2

(1)This section applies for the purposes of this Part.

(2)“New qualifying IP right”, in relation to a company, means a qualifying IP right which meets condition A, B or C.

(3)“Old qualifying IP right”, in relation to a company, means a qualifying IP right which does not meet any of those conditions.

(4)Condition A is that the right was granted or issued to the company in response to an application filed on or after the relevant date.

(5)Condition B is that the right was assigned to the company on or after the relevant date.

(6)Condition C is that an exclusive licence in respect of the right was granted to the company on or after the relevant date.

(7)The “relevant date” for the purposes of subsections (4), (5) and (6) is 1 July 2016; but this is subject to subsection (8).

(8)The “relevant date” for the purposes of subsections (5) and (6) is 2 January 2016 if—

(a)the company and the person who assigned the right or granted the licence were connected at the time of the assignment or grant,

(b)the main purpose, or one of the main purposes, of the assignment of the right or the grant of the licence was the avoidance of a foreign tax,

(c)the person who assigned the right or granted the licence was not within the charge to corporation tax at the time of the assignment or grant, and

(d)the person who assigned the right or granted the licence was not liable at the time of the assignment or grant to a foreign tax which is designated for the purposes of this section by regulations made by the Treasury.

(9)Regulations may be made under subsection (8)(d) which designate a foreign tax only if it appears to the Treasury that the tax may be charged at a reduced rate under provisions of the law of the country or territory concerned which correspond to the provisions of this Part.

(10)Regulations may not be made under subsection (8)(d) after 31 December 2016.

(11)In this section “foreign tax” means a tax under the law of a country or territory outside the United Kingdom.

(12)Section 1122 (meaning of “connected” persons) applies for the purposes of this section.

(13)This section has effect subject to section 357GCZA (qualifying IP right held by another party to a cost-sharing arrangement) and section 357GCZB (exclusive licence held by another party to a cost-sharing arrangement).^F3