[Code of Federal Regulations]

[Title 48, Volume 7]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR3009.104-73]



[Page 73]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

     CHAPTER 30--DEPARTMENT OF HOMELAND SECURITY, HOMELAND SECURITY 

                      ACQUISITION REGULATION (HSAR)

 

PART 3009_CONTRACTOR QUALIFICATIONS--Table of Contents

 

           Subpart 3009.1_Responsible Prospective Contractors

 

Sec. 3009.104-73  Special rules.



    The following special rules shall apply when determining whether a 

foreign incorporated entity should be treated as an inverted domestic 

corporation.

    (a) Certain stock disregarded. For the purpose of treating a foreign 

incorporated entity as an inverted domestic corporation these shall not 

be taken into account in determining ownership:

    (1) Stock held by members of the expanded affiliated group which 

includes the foreign incorporated entity; or

    (2) Stock of such entity which is sold in a public offering related 

to the acquisition described in subsection (b)(1) of section 835 of the 

Homeland Security Act (the Act), Pub. L. 107-296.

    (b) Plan deemed in certain cases. If a foreign incorporated entity 

acquires directly or indirectly substantially all of the properties of a 

domestic corporation or partnership during the 4-year period beginning 

on the date which is after the date of enactment of this Act and which 

is 2 years before the ownership requirements of subsection (b)(2) of the 

Act are met, such actions shall be treated as pursuant to a plan.

    (c) Certain transfers disregarded. The transfer of properties or 

liabilities (including by contribution or distribution) shall be 

disregarded if such transfers are part of a plan a principal purpose of 

which is to avoid the purposes of this section.

    (d) Special rule for related partnerships. For purposes of applying 

subsection (b) to the acquisition of a domestic partnership, except as 

provided in regulations, all domestic partnerships which are under 

common control (within the meaning of section 482 of the Internal 

Revenue Code of 1986) shall be treated as a partnership.

    (e) Treatment of certain rights. (1) Certain rights shall be treated 

as stocks to the extent necessary to reflect the present value of all 

equitable interests incident to the transaction, as follows:

    (i) Warrants;

    (ii) Options;

    (iii) Contracts to acquire stock;

    (iv) Convertible debt instruments;

    (v) Others similar interests.

    (2) Rights labeled as stocks shall not be treated as stocks whenever 

it is deemed appropriate to do so to reflect the present value of the 

transaction or to disregard transactions whose recognition would defeat 

the purpose of section 835 of the Act.