Taxation (International and Other Provisions) Act 2010 section 149

"Actual provision" and "affected persons"

Section 149 defines the terms "the actual provision" and "the affected persons" as used throughout Part 4 of the Act, which deals with transfer pricing.

• In general, "the actual provision" and "the affected persons" take their meaning from the basic transfer pricing rule in section 147(1)
• Where the transfer pricing rules apply to oil-related ring-fence trades under section 205, the definitions change: "the actual provision" refers to the provision described in section 205(1)(b), and "the affected persons" means the two persons identified in section 205(2)
• Where the participation condition is only met because of the indirect participation rules for financing arrangements (sections 161 or 162), the meaning of "the actual provision" is narrowed to cover only the part of the actual provision that relates to those financing arrangements
• These definitions are essential for applying the arm's length principle correctly across the various transfer pricing scenarios covered by Part 4