Page:United States Statutes at Large Volume 98 Part 1.djvu/689

 PUBLIC LAW 98-369—JULY 18, 1984 United States affiliate obligations held by such applicable CFC, multiplied by, (ii) a fraction (not in excess of 1)— (I) the numerator of which is the sum of the aggregate principal amount of United States affiliate obligations held by the applicable CFC on March 31, 1984, but not in excess of the applicable limit, and (II) the denominator of which is the average daily principal amount of United States affiliate obligations held by such applicable CFC during the taxable year. Proper adjustments shall be made to the numerator described in clause (ii)(I) for original issue discount accruing after March 31, 1984, on CFC obligations and United States affiliate obligations. i

98 STAT. 641

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(C) ADJUSTMENT FOR RETIREMENT OF CFC OBLIGATIONS.—

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The amount described in subparagraph (B)(ii)(I) for any taxable year shall be reduced by the sum of— (i) the excess of (I) the aggregate principal amount of CFC obligations which are outstanding on March 31, 1984, but only with respect to obligations issued before March 8, 1984, or issued after March 7, 1984, by the applicable CFC pursuant to a binding commitment in effect on March 7, 1984, over (II) the average daily outstanding principal amount during the teixable year of the CFC obligations described in subclause (I), and (ii) the portion of the equity of such applicable CFC allocable to the excess described in clause (i) (determined on the basis of the debt-equity ratio of such applicable CFC on March 31, 1984). (D) APPLICABLE CFC.—For purposes of this paragraph, the term "applicable CFC" means any controlled foreign corporation (within the meaning of section 957)— (i) which was in existence on March 31, 1984, and (ii) the principal purpose of which on such date consisted of the issuing of CFC obligations or the holding of short-term obligations and lending the proceeds of such obligations to affiliates. (E) AFFIUATES; UNITED STATES AFFILIATES.—For purposes

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of this paragraph— (i) AFFIUATE.—The term "affiliate" means any person who is a related person (within the meaning of section 482 of the Internal Revenue Code of 1954) to the applicable CFC. y.n •• (ii) UNITED STATES AFFILIATE.—The term "United States affiliate" means any United States person which , f:." ' is an affiliate of the applicable CFC. (F) UNITED STATES AFFILIATE OBLIGATIONS.—For purposes of this paragraph, the term "United States affiliate obligations" means any obligation of (and payable by) a United States affiliate. (G) CFC OBLIGATiON.—For purposes of this paragraph, the term "CFC obligation" means any obligation of (and issued by) a CFC if—

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