Page:United States Statutes at Large Volume 101 Part 2.djvu/1215

 PUBLIC LAW 100-203—DEC. 22, 1987 "(b) MINIMUM INCOME.—

EFFECTIVELY

CONNECTED

NET

101 STAT. 1330-421 INVESTMENT

"(1) IN GENERAL.—In the case of a foreign company taxable under part I or II of this subchapter for the taxable year, its net investment income for such year which is effectively connected with the conduct of an insurance business within the United States shall be not less than the product of— "(A) the required United States *** assets of such company, and "(B) the domestic investment yield applicable to such company for such year. ..

"(2) REQUIRED U.S. ASSETS.—

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"(A) IN GENERAL.—For purposes of paragraph (1), the required United States"^ assets of any foreign company for any taxable year is an amount equal to the product of— "(i) the mean of such foreign company's total insurance liabilities on United States business, and "(ii) the domestic asset/liability percentage ap>:i --i & plicable to such foreign company for such year. "(B) TOTAL INSURANCE LIABIUTIES.—For purposes of this ^) i' paragraph— "(i) COMPANIES TAXABLE UNDER PART I •'*.—In the case of a company taxable under part I, the term 'total insurance liabilities' means the sum of the total reserves (as defined in section 816(c)) plus (to the extent • * •' *not included in total reserves) the items referred to in ^•'ii paragraphs (3), (4), (5), and (6) of section 807(c). "(ii) COMPANIES TAXABLE UNDER PART **' ii.—In the case of a company taxable under part II, the term 'total ^' insurance liabilities' means the sum of unearned premiums and unpaid losses. '^ ^ "(C) DOMESTIC ASSET/LIABILITY PERCENTAGE.—The domestic asset/liability percentage applicable for purposes of v^xj'j subparagraph (A)(ii) to any foreign company for any taxable '""^^ year is a percentage determined by the Secretary on the basis of a ratio— '^'^ "(i) the numerator of which is the mean of the assets of domestic insurance companies taxable under the same part of this subchapter as such foreign company, and "(ii) the denominator of which is the mean of the total insurance liabilities of the same companies. "(3) DOMESTIC INVESTMENT YIELD.—The domestic investment yield applicable for purposes of paragraph (I)(B) to any foreign company for any taxable year is the percentage determined by the Secretary on the basis of a ratio— "(A) the numerator of which is the net investment income of domestic insurance companies taxable under the ' same part of this subchapter as such foreign company, and ,, "(B) the denominator of which is the mean of the assets of the same companies held for the production of such income. "(4) ELECTION TO USE WORLDWIDE YIELD.— "*Copy read "U.S.". ' '• Copy read "PART I.—". " ' Copy read "PART II.—".

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