Plain language law

New Zealand law explained for everyone

 Plain Language Law homepage
Back to
YC 13: Corporate spin-outs
or “Rules for splitting a company into two separate entities”
You could also call this:

“When special rules help a company meet continuity requirements”

When you’re looking at the rules for a company’s continuity, there are some special rules that can help the company. These rules are meant to be helpful and make things easier. If a company doesn’t meet the normal requirements for continuity, but would have met them if these special rules were used, then the company is treated as if it did meet the requirements.

These special rules are found in [sections YC 10 to YC 13]. If using these rules would have made the difference between meeting the continuity requirements or not, then the company is considered to have met the requirements.

This means that even if a company doesn’t quite fit the usual rules, it might still be okay if these special helping rules apply. It’s like getting a bit of extra help to pass a test.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

Next up: YC 15: Directors’ knowledge of failure to meet requirements of continuity provision

or “Directors' responsibility when company ownership changes affect rule compliance”
Next

Part Y Definitions and related matters
Measurement of company ownership

YC 14Disregarding concessionary rules

  1. As the provisions of sections YC 10 to YC 13 are intended to have concessionary effect, subsection (2) applies if—

  2. at a time, for a company and a continuity provision, the requirements of the provision are not met; but
    1. the requirements would have been met but for the application to a particular extent of sections YC 10 to YC 13.

      1. The requirements of the continuity provision are treated as met at the time.

      Compare