19Exemption: interposing new corporation between existing

19 Exemption: interposing new corporation between existing corporation and its shareholders (1) A conveyance of shares in a corporation (the target corporation) is not dutiable as the acquisition of a relevant interest in a land- holding corporation if: (a) the target corporation becomes, as a result of the conveyance, the subsidiary of another corporation (the interposed corporation); and (b) this section applies to the conveyance. (2) Subject to subsection (3), this section applies to a conveyance of shares if, and only if: (a) the interposed corporation is a corporation with limited liability; and (b) the interposed corporation was dormant from its registration until the resolution to acquire the shares in the target corporation; and

Stamp Duty Act 1978 25 (c) the interposed corporation acquires at least 90% of the issued shares in, and the voting control over, the target corporation as a result of the conveyance; and (d) at least 90% of the consideration for the conveyance of the shares in the target corporation consists of shares in the interposed corporation that are issued to the shareholders of the target corporation; and (e) the value of the consideration for the acquisition of the shares conveyed from each shareholder in the target corporation is equal to the value of the shares held by the shareholder immediately before the shares were conveyed; and (f) immediately after the conveyance of the shares in the target corporation at least 90% of the shares in the interposed corporation consisted of the shares issued to the shareholders of the target corporation as consideration for the acquisition of their shares; and (g) if, because of the conveyance of shares, the interposed corporation becomes the parent corporation of more than one subsidiary – the same shareholders owned at least 90% of the issued shares in, and had voting control over, each of the target corporations before the conveyance took effect. (3) However, this section does not apply to a conveyance of shares if: (a) the conveyance is a tax avoidance scheme, or part of a tax avoidance scheme; or (b) the Commissioner is of the opinion that the conveyance is a scheme, or part of a scheme, of which a purpose (collateral or otherwise) is to frustrate the recovery of duty, tax or royalty that is payable to the Territory.