Page:United States Statutes at Large Volume 83.djvu/693

 83 STAT. ]

PUBLIC LAW 91-172-DEC. 30, 1969

665

" (B) such corporation shall be treated as having entered into a binding contract for the construction, reconstruction, erection, or acquisition of such property on the date on which such other member entered into a contract for the construction, reconstruction, erection, or acquisition of such property, and " (C) such corporation shall be treated as having commenced the construction, reconstruction, or erection of such property on the date on which such other member commenced such construction, reconstruction, or erection. For purposes of this subsection and subsection (c), a contractbetween two corporations which are members of the same affiliated group shall not be treated as a binding contract as between such corporations, unless, at all times after June 30, 1969, and prior to the completion of performance of such contract, such corporations are not members of the same affiliated group. For purposes of the preceding sentences, the term 'affiliated group' has the meaning assigned to it by section 1504(a), except that all corporations shall ^^A Stat. 369. be treated as includible corporations (without any exclusion under section 150J:(b)), "(9) BARGES FOR OCEAN-GOING VESSELS.—Barges specifically designed and constructed, reconstructed, erected, or acquired for use with ocean-going vessels which are designed to carry barges and which are pre-termination property, but not in excess of— " (A) the number to be used with such vessels specified in applications for mortgage or construction loan insurance fi^ed with the Secretary of Commerce on or before April 18, 1969, under title X I of the Merchant Marine Act, 1936, or 73^ltar*i69^^2^72 " (B) if subparagraph (A) does not apply and if more than 46 USC 127150 percent of the barges which the taxpayer establishes as 1279b. necessary to the initial planned use of such vessels are pretermination property (determined without regard to this paragraph), the number which the taxpayer establishes as so necessary, together with the machinery and equipment to be installed on such barges and necessary for their planned use, shall be treated as pretermination property. "(10) CERTAIN NEW-DESIGN PRODUCTS.—Where—

" (A) on April 18, 1969, the taxpayer had undertaken a project to produce a product of a new design pursuant to binding contracts in effect on such date which—• "(i) were fixed-price contracts (except for provisions requiring or permitting price changes resulting from changes in rates of pay or costs of materials), and "(ii) covered more than 50 percent of the entire production of such design to be delivered by the taxpayer before January 1, 1973, and " (B) on or before April 18, 1969, more than 50 percent of the aggregate adjusted basis of all property of a character subject to the allowance for depreciation required to carry out such binding contracts was property the construction, reconstruction, or erection of which had been begun by the taxpayer, or had been acquired by the taxpayer (or was under a binding contract for such construction, reconstruction, erection, or acquisition), then all tangible personal property placed in service by the taxpayer before January 1, 1972, which is required to carry out such binding contracts shall be deemed to be pre-termination property. For purposes of subparagraph (B) of the preceding sentence, jigs, dies, templates, and similar items which can be used only for the

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