5Related companies

#### 5 Related companies (1) For the purposes of this Act: (a) where a company is a subsidiary of another company, the first‑mentioned company and that other company shall be deemed to be related to each other; and (b) where 2 or more companies are each subsidiaries of another company, those companies and that other company shall be deemed to be related to each other. (2) For the purposes of subsection (1), where a company has shareholding interests in the shares in another company exceeding in amount one‑half of the total of the amounts paid on all shares in the other company, that other company shall be deemed to be the subsidiary of the first‑mentioned company. (3) For the purposes of this section: (a) a company has a shareholding interest in the shares in another company if the first‑mentioned company is beneficially entitled to, or is beneficially entitled to an interest in, any shares in the other company, whether or not the whole or any part of the legal ownership of the shares is vested in the first‑mentioned company; and (b) the amount of the shareholding interest is an amount equal to the value of the shares, or of the first‑mentioned company’s interest in the shares, as the case requires, on the basis that the value of the shares is equal to the amount paid on the shares. (4) For the purposes of this section, where a company (in this subsection referred to as the first company) has shareholding interests in the shares in a company (in this subsection referred to as the second company) that has shareholding interests in the shares in another company (in this subsection referred to as the third company), the first company shall be deemed to have shareholding interests in the shares in the third company (in addition to any other shareholding interests) of an amount that bears to the amount of the shareholding interests of the second company in the shares in the third company the same proportion as the amount of the shareholding interests of the first company in the shares in the second company bears to the total of the amounts paid on all shares in the second company. (5) In ascertaining for the purposes of the application of subsection (4) the extent and amount of the shareholding interests of a company in the shares in another company, there shall be taken into account any shareholding interest which that first‑mentioned company is to be deemed to have in the shares in that other company by any other application or applications of that subsection or this subsection. (6) A reference in this section to shares in a company shall be read as a reference to shares in, or stock forming part of, the capital of a company and a reference in this section to an amount paid on shares in a company shall be read as including a reference to an amount treated by the company as having been so paid. (7) In this section: > company does not include an unincorporated body or association of persons. > share, in relation to a company, means a share of a kind carrying voting rights on all questions at general meetings of the company.