§ 14 — What holding an equity interest means

14.—(1) A person holds an equity interest under this Part if the person —(a)

has or is deemed to have an equity interest in accordance with subsections (2) to (8); or

(b)

otherwise has a legal or equitable interest in that equity interest,

except for any interest prescribed by regulations made under section 57 as an interest that is to be disregarded.

(2) Subject to subsection (3), a person has an equity interest if the person has authority (whether formal or informal, or express or implied) to dispose of, or to exercise control over the disposal of, that equity interest.

(3) It is immaterial that the authority of a person to dispose of, or to exercise control over the disposal of, the equity interest is, or is capable of being made, subject to restraint or restriction.

(4) It is immaterial, for the purposes of determining whether a person has an equity interest, that the interest cannot be related to a particular share, an interest or a right that gives its holder voting power, or a unit of a business trust, as the case may be.

(5) A person is deemed to have an equity interest if —(a)

any property held in trust consists of or includes the equity interest; and

(b)

the person knows, or has reasonable grounds for believing, that the person has an interest under that trust.

(6) A person is also deemed to have an equity interest in an entity if that person —(a)

has entered into a contract to purchase the equity interest;

(b)

has a right, otherwise than by reason of having an interest under a trust, to have the equity interest transferred to (or to the order of) that person, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not;

(c)

has the right to acquire the equity interest under an option, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not; or

(d)

is entitled (otherwise than by reason of having been appointed as proxy or representative) to vote at —(i)

a general meeting of the entity;

(ii)

in the case of an entity that is a business trust — a general meeting of the unitholders of the business trust; or

(iii)

in the case of an entity that is a trust other than a business trust — a general meeting of the beneficiaries of the trust in question,

to exercise or control the exercise of a right attached to the equity interest, not being an equity interest in which that person has a legal or equitable interest.

(7) A person is not to be deemed as not having an equity interest by reason only that the person has the equity interest jointly with another person.

(8) An equity interest is not to be disregarded by reason only of —(a)

its remoteness;

(b)

the manner in which it arose; or

(c)

the fact that the exercise of a right conferred by the equity interest is, or is capable of being made, subject to restraint or restriction.

(9) Regulations made under section 57 may provide that any equity interest is to be disregarded for the purposes of this section or any subsection of this section.

—(1) A person holds an equity interest under this Part if the person —(a)

has or is deemed to have an equity interest in accordance with subsections (2) to (8); or

(b)

otherwise has a legal or equitable interest in that equity interest,

except for any interest prescribed by regulations made under section 57 as an interest that is to be disregarded.

(2) Subject to subsection (3), a person has an equity interest if the person has authority (whether formal or informal, or express or implied) to dispose of, or to exercise control over the disposal of, that equity interest.

(3) It is immaterial that the authority of a person to dispose of, or to exercise control over the disposal of, the equity interest is, or is capable of being made, subject to restraint or restriction.

(4) It is immaterial, for the purposes of determining whether a person has an equity interest, that the interest cannot be related to a particular share, an interest or a right that gives its holder voting power, or a unit of a business trust, as the case may be.

(5) A person is deemed to have an equity interest if —(a)

any property held in trust consists of or includes the equity interest; and

(b)

the person knows, or has reasonable grounds for believing, that the person has an interest under that trust.

(6) A person is also deemed to have an equity interest in an entity if that person —(a)

has entered into a contract to purchase the equity interest;

(b)

has a right, otherwise than by reason of having an interest under a trust, to have the equity interest transferred to (or to the order of) that person, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not;

(c)

has the right to acquire the equity interest under an option, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not; or

(d)

is entitled (otherwise than by reason of having been appointed as proxy or representative) to vote at —(i)

a general meeting of the entity;

(ii)

in the case of an entity that is a business trust — a general meeting of the unitholders of the business trust; or

(iii)

in the case of an entity that is a trust other than a business trust — a general meeting of the beneficiaries of the trust in question,

to exercise or control the exercise of a right attached to the equity interest, not being an equity interest in which that person has a legal or equitable interest.

(7) A person is not to be deemed as not having an equity interest by reason only that the person has the equity interest jointly with another person.

(8) An equity interest is not to be disregarded by reason only of —(a)

its remoteness;

(b)

the manner in which it arose; or

(c)

the fact that the exercise of a right conferred by the equity interest is, or is capable of being made, subject to restraint or restriction.

(9) Regulations made under section 57 may provide that any equity interest is to be disregarded for the purposes of this section or any subsection of this section.