Page:United States Statutes at Large Volume 68A.djvu/357

 CH. 1—NORMAL TAXES AND SURTAXES

317

(c) DISTRIBUTIONS OF STOCK OR SECURITIES.—If the stock or securities were received in a distribution subject to the provisions of section 1081(c) or the corresponding provisions of prior internal revenue laws, then the basis in the case of the stock in respect of which the distribution was made shall be apportioned, under regulations prescribed by the Secretary or his delegate, between such stock and the stock or securities distributed. (d) TRANSFERS W I T H I N SYSTEM GROUP.—If the property was acquired by a corporation which is a member of a system group on a transfer or distribution described in section 1081(d)(1), then the basis shall be the same as it would be in the hands of the transferor; except that if such property is stock or securities issued by the corporation from which such stock or securities were received and they were issued— (1) as the sole consideration for the property transferred to such corporation, then the basis of such stock or securities shall be either— (A) the same as in the case of the property transferred therefor, or J (B) the fair market value of such stock or securities at the time of their receipt, whichever is the lower; or (2) as part consideration for the property transferred to such corj- poration, then the basis of such stock or securities shall be either— I (A) an amount which bears the same ratio to the basis of the property transferred as the fair market value of such stock or securities at the time of their receipt bears to the total fair market s value of the entire consideration received, or (B) the fair market value of such stock or securities a t the time of their receipt, whichever is the lower. SEC. 1083. DEFINITIONS

(a) ORDER OF SECURITIES AND EXCHANGE COMMISSION.—For purposes of this part, the term "order of the Securities and Exchange Commission" means an order issued after May 28, 1938, by the Securities and Exchange Commission which requires, authorizes, permits, or approves transactions described in such order to effectuate section II (b) of the Public Utility Holding Company Act of 1935 (49 Stat. 820; 15 U.S.C. 79k (b)), which has become or becomes final in accordance with law. (b) REGISTERED HOLDING COMPANY; HOLDING COMPANY SYSTEM; ASSOCIATE COMPANY.—For purposes of this part, the terms "registered

holding company", "holding company system", and "associate company shall have the meanings assigned to them by section 2 of the Public UtiHty Holding Company Act of 1935 (49 Stat. 804; 15 U.S.C. 79b (a)). (c) MAJORITY-OWNED SUBSIDIARY COMPANY.—For purposes of this part, the term "majority-owned subsidiary company" of a registered holding company means a corporation, stock of which, representing in the aggregate more than 50 percent of the total combined voting power of all classes of stock of such corporation entitled to vote (not including stock which is entitled to vote only on default or nonpayment of dividends or other special circumstances) is owned wholly by such registered holding company, or partly by such registered holding company and partly by one or more majority-owned subsidiary § 1083(c)

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