91AAQDetermination on insurer as non-attributing active CFC

1. A person may apply to the Commissioner for a determination that, for the purposes of section EX 21B of the Income Tax Act 2007,—

2. a CFC is a non-attributing active CFC, if the CFC satisfies subsection (2); or
3. the members of a group of CFCs are non-attributing active CFCs, if the members satisfy subsection (3).

4. A CFC satisfies this subsection if—

5. the CFC is controlled by a company resident in New Zealand that—
   1. has a business of insurance to which section 60(1) of the Insurance (Prudential Supervision) Act 2010 applies:
   2. is in the same group of companies as a company resident in New Zealand that has a business of insurance to which section 60(1) of that Act applies; and
6. the CFC has, in a country or territory outside New Zealand, a business of insurance that is registered under the laws of the country or territory relating to the business of insurance; and

8. A group of CFCs satisfies this subsection if—

9. the group is a group of companies that—
   1. is controlled by a New Zealand resident; and
   2. has, in a country or territory outside New Zealand, a business of insurance that is registered under the laws of the country or territory relating to the business of insurance; and
10. each CFC—
    1. is controlled by a company resident in New Zealand that has a business of insurance to which section 60(1) of the Insurance (Prudential Supervision) Act 2010 applies or that is in the same group of companies as such a company; and
    2. is incorporated in the same country or territory as the other CFCs; and
    3. is subject to the laws of the country or territory; and
    4. is liable in the country or territory to income tax on its income; and
    5. derives its income mainly from the country or territory; and
    6. has a main business that is insurance or is related to insurance.

11. In deciding whether or not to grant an application, the Commissioner must consider whether the business of the CFC or group of CFCs—

12. is carried on with the main purpose of producing a commercial return on the capital of the CFC or group; and
13. produces income of the CFC or group, other than income from claims under reinsurance contracts, that is all or nearly all from—
    1. premiums from insurance contracts, other than reinsurance contracts, covering risks arising in the country or territory in which the business of the CFC or group is located:
    2. proceeds from investment assets having a total value commensurate with the value of those insurance contracts.

14. For the purposes of subsection (4), the Commissioner may take into account the following:

15. the nature and extent of the activities undertaken by the CFC or group in the business of insurance:
16. the nature and extent of the risks arising in the country or territory that are assumed by the CFC or group in the business:
17. the nature and value of the assets used by the CFC or group in the business compared with the nature and extent of the risks assumed by the CFC or group in the business:
18. the nature and amount of deductions that the company controlling the CFC or group has for expenditure or loss incurred in giving support in relation to the business compared with the nature and amount of the assessable income that the company has from the CFC or group in relation to the business.

19. In a determination, the Commissioner may stipulate conditions that must be satisfied,—

20. in addition to the requirements of subsection (2), for a CFC to be a non-attributing active CFC:
21. in addition to the requirements of subsection (3), for the members of a group of CFCs to be non-attributing active CFCs.

22. A determination may be made for income years specified in the determination.

23. A determination may provide for the extension, limitation, variation, cancellation, or revocation of an earlier determination.

24. A determination must be published in a publication chosen by the Commissioner within 30 days of the making of the determination.