Taxation (International and Other Provisions) Act 2010 section 371RG

Companies in which a UK resident company has more than a 50% investment

Section 371RG determines when a non-UK resident company is treated as a controlled foreign company (CFC) because a UK resident company, possibly together with associated enterprises, holds more than a 50% investment in it.

• A non-UK resident company is treated as a CFC if a UK resident company, alone or with its associated enterprises, directly or indirectly holds more than a 50% investment in it.
• An "associated enterprise" is a person who has a 25% investment in the UK resident company (or vice versa), or where a third party has a 25% investment in both the person and the UK resident company.
• The investment thresholds (more than 50% and 25%) are determined by reference to section 259ND of the same Act, which sets out how percentage investments are measured.
• When applying section 259ND for this purpose, its general references to percentage thresholds are read as referring specifically to "more than 50%" or "25%" (or "25% or more") as appropriate.