Page:United States Statutes at Large Volume 82.djvu/1353

 82 STAT. ]

PUBLIC LAW 90-622-OCT. 22, 1968

1311

qualified under paragraph (1)(A) if the merger had been into the controlling corporation, and (ii) no stock of the acquiring corporation is used in the transaction." (b) Section 368(b) of such Code (relating to definition of a party to 68A Stat. 120; Stat. a reorganization) is amended by adding at the end thereof the follow- 7826 u s e57. 368. ing new sentence: "In the case of a reorganization qualifying under paragraph (1)(A) of subsection (a) by reason of paragraph (2)(D) of that subsection, the term 'a party to a reorganization' includes the controlling corporation referred to in such paragraph (2)(D). " (c) The amendments made by subsections (a) and (b) shall apply to statutory mergers occurring after the date of the enactment of this Act. SEC. 2, (a) Section 358(e) of the Liternal Revenue Code of 1954 68A Stat. 118. (relating to the exception to the rule for determining basis to distributees in corporate reorganizations) is amended to read as follows: "(e) EXCEPTION.—This section shall not apply to property acquired by a corporation by the exchange of its stock or securities (or the stock or securities of a corporation which is in control of the acquiring corporation) as consideration in whole or in part for the transfer of the property to it." Property t r a n (b) The last sentence of section 362(b) of such Code (relating to fers to corpora-s basis of property transferred to corporations in corporate reorgani- tions, nonzations) is amended to read as follows: "This subsection shall not applicability. apply if the property acquired consists of stock or securities in a cor- ^^^ ^*^' ^^^ poration a party to the reorganization, unless acquired by the exchange of stock or securities of the transferee (or of a corporation which is in control of the transferee) as the consideration in whole or in part for the transfer." (c) The amendments made by subsections (a) and (b) shall apply Applicability. only in respect of plans of reorganization adopted after the date of the enactment of this Act. Approved October 22, 1968.

Public Law 90-622 AN ACT

To amend the I n t e r n a l Revenue Code of 19.54 with respect to the t r e a t m e n t of income from the operation of a c<minuinications satellite.system.

Be U endcted by the Senate and House of ReirreaentatlceH of the Ignited States of America In Congress assembled, That (a) section 883 of the Internal Revenue Code of 1954 (relating to exclusions from gross income) is amended by inserting " (a) INCOME or FOREIGN CORPORATIONS FROM S H I P S AND AIRCRAFT.—" before "The", and by adding at the end thereof the following new subsection: "(b)

October 22, 1968

[H. R. 18486]

Taxes. Global communications satellite system, tax exemption. 68A Stat. 28326 USC 88 3.

EARNINGS DERIVED FROM COMMUNICATIONS SATELLITE SYS-

TEM.—The earnings derived from the ownership or operation of a communications satellite system by a foreign entity designated by a foreign government to participate in such ownership or operation shall be exempt from taxation under this subtitle, if the United States, through its designated entity, participates in such system pursuant to the Communications Satellite Act of 1962 (47^ U.S.C. 701 and following)." (b) The amendment made by subsection (a) shall apply with resj^ect to taxaole years beginning after December 31, 1966. Approved October 22, 1968.

76 Stat. 419Effective date.

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