Corporation Tax Act 2009 section 578

Relevant contracts of a company and being party to such contracts

Section 578 defines what it means for a derivative contract to be a company's "relevant contract" and what it means for a company to be "a party to" such a contract.

• A relevant contract belongs to a company if the company originally entered into it or subsequently acquired it.
• A company "acquires" a relevant contract when it becomes entitled to the rights and subject to the liabilities under that contract.
• In certain cases involving embedded derivatives — within hybrid derivatives, loan relationships, or other host contracts — companies may be treated as parties to relevant contracts under separate rules (sections 584 to 586).
• All references throughout Part 7 to a company being "a party to" a relevant contract must be read in line with these definitions.