There are radically divergent views emerging in relation to the interpretation of control and significant influence particularly in the context of minority shareholdings and shareholder arrangements. The flow-on impact upon provisions including Div 6C, debt/equity rules, interest deductibility, thin capitalisation and Div 250 is a contentious issue. This paper examines those issues and some other related recent developments in the context of project financing and consortium investment structures, in particular:
- control, negative control, sufficient influence and connected entities in the context of Div 6C, Div 974-80 and thin capitalisation
- thin capitalisation issues including related party debt rules and the ATO view of 820-39
- changes to the definition of “limited recourse debt”.