Page:United States Statutes at Large Volume 79.djvu/1000

 960 78 Stat. 813. 26 USC 4914

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PUBLIC LAW 89-243-OCT. 9, 1965

[79 STAT.

(h) ACQUISITIONS BY CERTAIN TAX-EXEMPT ORGANIZATIONS.—

(1) Section 4914(f) is amended by adding at the end thereof (after and below paragraph (2)) the following new sentence: " For purposes of this subsection, stock or debt obligations acquired as a result of the investment or reinvestment of such contributions or fees which consist of insurance premiums (other than premiums paid to a mutual insurance company or association described in section 501(c) (15)) paid by the members of such local organizations shall be treated as held exclusively for the benefit of such members if primarily so held, notwithstanding that such stock or debt obligations may, under certain contingencies, be used for the benefit of other members of such United States person." (2) The amendment made by paragraph (1) shall apply with respect to acquisitions of stock and debt obligations made after July 18, 1963: (i) EXCLUSION FOR INVESTMENTS I N LESS DEVELOPED COUNTRY

26 USC 4916. 26^sc^*77^V'

PARTNERSHIPS.—Section 4916(c)(1) is amended by adding at the end i hereof the following new sentence: "A foreign partnership, as defined in section 7701(a)(2) and (5), the assets and gross income of which, for the applicable periods set forth in paragraph (3), satisfy the requirements of subparagraph (A) or (B) of the first sentence of this paragraph, shall be treated as a less developed country corporation for purposes of this section." (]) NOTICE or ACQUISITION FOR EXCLUSION OF ORIGINAL OR N E W

26 USC 4917.

ISSUES.—Section 4917 is amended— (1) by adding at the end of subsection (a) the following new sentence: " I n the case of acquisitions of debt obligations having a period remaining to maturity of 1 year or more but less than 3 years made during the period beginning February 11, 1965, and ending with the date of the enactment of the Interest Equalization Tax Extension Act of 1965, the notice of acquisition may be filed within such period following the date of such enactment as the Secretary or his delegate may prescribe by regulations."; and (2) by adding at the end of such section the following new subsection: " (d) REDUCTION OF EXCLUSION I N CASE OF LATE F I L I N G OF CERTAIN NOTICES OF ACQUISITION.—If, with respect to an acquisition after the

date of the enactment of the Interest Equalization Tax Extension Act of 1965 of stock or a debt obligation which is all or part of an original or new issue to which an Executive order issued under subsection (a) is applicable (other than an Executive order which is applicable to a limited aggregate amount of such issues), the notice of acquisition required by subsection (a) is not filed on or before the last day (including extensions of time) specified in the regulations prescribed by the Secretary or his delegate under such subsection, the exclusion provided by such Executive order shall not apply to 5 percent of such acquisition for each 30-day period or fraction thereof after such last day during which such failure continues, except that in no event shall such exclusion be reduced under this subsection by more than 25 percent of such acquisition." (k) CONSIDERATION OF TREATY VIOLATIONS I N CONNECTION W I T H EXCLUSION FOR ORIGINAL OR N E W ISSUES.—Section 4917 is amended

by adding after subsection (d) (as added by subsection (j) of this section) the following new subsection: "(e) FULFILLMENT OF TREATY OBLIGATIONS.—In determining whether to issue an Executive order under subsection (a) with respect to a foreign country, and in determining whether to revoke or modify an Executive order issued under subsection (a) with respect to a foreign country (whether issued before or after the enactment of this

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