Article 3 Amendments to Schedule 19AA

Amend paragraph 4^f1 of Schedule 19AA as follows.

In sub-paragraph (1) for the definition of “B” substitute—

• “B is the aggregate of—

  1. (a)

     the appropriate part of the investment reserve at that time, and

  2. (b)

     the appropriate part of any liabilities of the company’s long term business fund at that time which represent a money debt,”.

For sub-paragraph (2) substitute—

“(2)

In sub-paragraph (1) above, in B, the “appropriate part” of the company’s investment reserve at the end of the period of account, or of any liabilities of its long term business fund at that time which represent a money debt, is—

(a)

where none (or none but an insignificant proportion) of the liabilities of the company’s long term business at that time are with-profits liabilities, the part which bears to the whole the proportion A/B; and

(b)

in any other case, the part which bears to the whole the proportion C/D.

• For this purpose—

• A is the amount of the liabilities of the company’s overseas life assurance business at the end of the period of account,

• B is the whole amount of the liabilities of the company’s long term business at that time,

• C is the amount of the with-profits liabilities of the company’s overseas life assurance business at that time, and

• D is the whole amount of the with-profits liabilities of the company’s long-term business at that time.”

After sub-paragraph (4) insert—

“(5)

In this paragraph—

• “investment reserve”, in relation to an insurance company, means the excess of the value of the assets of the company’s long term business over the aggregate of—

  1. (a)

     the liabilities of that business, and

  2. (b)

     any liabilities of the long term business fund which represent a money debt;

• “money debt” has the same meaning as in Chapter II of Part IV of the Finance Act 1996^f2.”