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31 1999

STAMP DUTIES CONSOLIDATION ACT, 1999

PART 6

Special Provisions Relating to Uncertificated Securities

Interpretation (Part 6).

[FA1996 s101(1)]

68. —(1) In this Part—

“certificated securities” means securities other than uncertificated securities;

“market maker” means a person who—

(a) holds himself or herself out at all normal times in compliance with the rules of the Irish Stock Exchange Limited, or the London Stock Exchange Limited, as willing to buy and sell securities at a price specified by him or her, and

(b) is recognised as doing so by the Irish Stock Exchange Limited or the London Stock Exchange Limited;

“member firm” means a member firm of the Irish Stock Exchange Limited, or of the London Stock Exchange Limited, which is not acting in the ordinary course of business as a market maker in securities of the kind concerned;

“relevant period” means any period of 6 months ending on the 30th day of September or the 31st day of March;

“securities” means any stocks or marketable securities;

“uncertificated securities” means any securities, title to which is, by virtue of the Companies Act, 1990 (Uncertificated Securities) Regulations, 1996 (S.I. No. 68 of 1996), transferable by means of a relevant system.

(2) In this Part, “generate”, “instruction”, “operator”, “operator-instruction”, “relevant system” and “system-member” have the same meanings, respectively, as in the Companies Act, 1990 (Uncertificated Securities) Regulations, 1996.

(3) In this Part, references to title to securities include any legal or equitable interest in securities.

Operator-instruction deemed to be an instrument of conveyance or transfer.

[FA1996 s102]

69. —(1) Where a transfer of title to securities through a relevant system is effected by an operator-instruction, that operator-instruction shall, for all purposes of this Act, be deemed to be an executed instrument of conveyance or transfer of such securities and the date of execution shall be taken to be the date the operator-instruction is generated.

(2) Where an operator-instruction is generated in connection with the transfer through a relevant system of an equitable interest in securities, that transfer shall be deemed for the purposes of subsection (1) to have been effected by that operator-instruction.

(3) Where no operator-instruction is generated in connection with the transfer through a relevant system of an equitable interest in securities, that transfer shall, for the purposes of this Part, be deemed to have been effected by an operator-instruction generated on the date of the transfer.

Rate of duty.

[FA1996 s103]

70. —(1) Where an operator-instruction is, by virtue of section 69 , chargeable with stamp duty under or by reference to the heading “CONVEYANCE or TRANSFER on sale of any stocks or marketable securities” in Schedule 1, the rate at which the duty is charged under that heading shall be the rate of 1 per cent of the consideration for the sale to which that operator-instruction gives effect.

(2) Notwithstanding subsection (1)

(a) where the transfer operates as a voluntary disposition inter vivos, the reference in subsection (1) to the amount or value of the consideration for the sale shall, in relation to the duty so chargeable, be construed as a reference to the value of the securities transferred,

(b) where the calculation results in an amount which is not a multiple of one penny, the amount so calculated shall be rounded to the nearest penny, and any half of a penny shall be rounded up to the next whole penny.

Application and adaptation of other Parts of this Act.

[FA1996 s104]

71. — In relation to a charge for stamp duty arising by virtue of section 69

(a) the definition of “accountable person” in subsection (1) of section 1 shall be construed as if the reference, in the Table to that definition, to the purchaser or transferee were a reference to the transferee,

(b) notwithstanding section 2 (3), the operator-instruction which is charged to stamp duty by virtue of section 69 shall not be required to be stamped and, accordingly—

(i) any duty so charged shall be due and payable and shall be paid to the Commissioners on the date on which that operator-instruction is generated, and

(ii) that operator-instruction shall for the purposes of section 2 (4) and notwithstanding section 30 (3) be deemed to be duly stamped with the proper stamp duty when such duty and any penalty relating to such duty has been paid to the Commissioners,

(c) notwithstanding paragraph (b), where an agreement referred to in section 72 is in force between the Commissioners and an operator, any duty paid in respect of that operator-instruction in accordance with such agreement shall be deemed to have been paid to the Commissioners on the date on which it became due and payable,

(d) subject to paragraph (e), section 14 shall apply with the modification that the penalties imposed for not duly stamping the operator-instruction, which is charged to stamp duty by virtue of section 69 within a particular period of the date of first execution, shall be imposed for non-payment of the stamp duty within that period, and with any other necessary modifications,

(e) sections 4, 6, 8, 11, 14(4), 20, 127 and 129(1) shall not apply,

(f) (i) if at any time it appears that for any reason no duty, or insufficient duty, has been paid to the Commissioners, they shall make an assessment of such amount of duty or additional duty as, to the best of their knowledge, information and belief, ought to be charged, levied and paid and the accountable person shall be liable for the payment of the duty so assessed,

(ii) if at any time it appears that for any reason an assessment is incorrect, the Commissioners shall make such other assessment as they consider appropriate, which assessment shall be substituted for the first-mentioned assessment,

(iii) section 21 shall apply to an assessment under this paragraph as if it were an assessment mentioned in that section,

(g) any reliefs or exemptions from stamp duty which are conditional on an instrument being stamped in accordance with section 20 with a particular stamp denoting either that it is not chargeable with any duty or that it is duly stamped shall apply notwithstanding such condition not having been complied with.

Collection and payment of duty.

[FA1996 s105]

72. — The Commissioners may enter into an agreement with an operator, in such form and on such terms and conditions as they think fit, in relation to the collection of stamp duty and the payment of such duty to the Commissioners.

Exemptions.

[FA1996 s106](1) and (2)]

73. —(1) Section 69 shall not apply—

(a) to the extent that it would give rise to a charge to stamp duty under the heading “CONVEYANCE or TRANSFER of any kind not already described in this Schedule” in Schedule 1,

(b) in respect of a transfer of title to securities to a purchaser in completion of a contract for sale to the extent to which the interest transferred has, following that transfer, been retransferred in completion of a separate contract for sale made by that purchaser prior to that transfer to that purchaser provided that both contracts were due for completion on the same day and are in fact completed within 25 days after the making of whichever of those contracts was earlier in priority.

(2) Stamp duty shall not be chargeable under or by reference to any heading in Schedule 1 other than the heading “CONVEYANCE or TRANSFER on sale of any stocks or marketable securities” on an instrument effecting a transfer of securities if the transferee is a system-member and the instrument is in a form which will, in accordance with the rules of the system, enable certificated securities to be converted into uncertificated securities so that title to them may become transferable by means of the relevant system.

Exemption for market makers.

[FA1996 s106(3)]

74. — Stamp duty shall not be chargeable on any instrument of transfer whereby any securities are on the sale of such securities transferred to a market maker acting in the ordinary course of business as a market maker in securities of the kind concerned or to a person acting as nominee of such market maker.

Relief for member firms.

[FA1996 s107(1) to (4)]

75. —(1) Stamp duty shall not be chargeable on any instrument of transfer whereby any securities are on the sale of such securities transferred to a member firm acting on its own behalf in the ordinary course of that member firm's business or to a nominee of such member firm.

(2) Notwithstanding subsection (1)

(a) if and to the extent that the member firm does not transfer the securities referred to in subsection (1) to a bona fide purchaser before the expiration of the period of one month from the date of transfer, in this section referred to as “the specified period”, the member firm shall pay to the Commissioners within 14 days after the expiration of the specified period the amount of ad valorem duty which would have been chargeable on the transfer if this section had not been enacted;

(b) the member firm may, in relation to any such sale with a completion date not later than 30 days from the date of the contract for sale and prior to the date of the contract, elect to have such completion date treated as the date of the second-mentioned transfer referred to in paragraph (a) and, in that event, that completion date shall be deemed, for the purposes of paragraph (a), to be the date of that second-mentioned transfer.

(3) If any member firm fails to pay any sum due to the Commissioners under subsection (2), that sum, together with interest on that sum at the rate of 1 per cent per month or part of a month from the first day after the expiration of the specified period to the date of payment of that sum and, by means of further penalty, a sum equal to 1 per cent of the duty for each day the duty remains unpaid, shall be recoverable from the member firm as a debt due to the Minister for the benefit of the Central Fund.

(4) Where subsection (1) applies in relation to a transfer of securities to a member firm, the member firm shall within 30 days of the end of the relevant period within which the transfer is made deliver to the Commissioners a statement in writing or in such other manner as the Commissioners may agree to in writing—

(a) showing in respect of each such transfer—

(i) full details in relation to the type, nominal value, description and amount of the securities comprised in the transfer;

(ii) what part (if any) of the securities comprised in the transfer has been transferred by the member firm to a bona fide purchaser within the specified period and what part of the securities has not been so transferred;

(iii) the date of the transfer and, if any part of the securities has been transferred to a bona fide purchaser within the specified period, the date on which that part was so transferred;

(iv) the amount of stamp duty (if any) payable by virtue of subsection (2) and the date of payment;

(b) certifying in respect of each such transfer that—

(i) the member firm was acting on its own behalf in the ordinary course of its business, and

(ii) any securities transferred in respect of which the stamp duty has not been paid were transferred on sale to a bona fide purchaser within the period of one month after the date of the transfer,

and shall produce such further evidence by means of statutory declaration or otherwise in relation to the matters set out in paragraphs (a) and (b) as the Commissioners require.

(5) A member firm which fails to deliver a statement within the period specified in subsection (4) shall be liable to a penalty of £1,000.

Obligations of system-members.

[FA1996 s108]

76. —(1) Where an instruction is entered or is caused to be entered in a relevant system by a system-member, and the effect of that instruction is that no stamp duty is calculated by the relevant system, that system-member shall retain evidence in legible written form, or readily convertible into such a form, for a period of 3 years from the date of such instruction, in sufficient detail to establish that the related operator-instruction is not chargeable with stamp duty, and the system-member shall make any such evidence available to the Commissioners on request.

(2) A system-member who fails to comply with subsection (1) shall be liable to a penalty of £1,000.

(3) Where a system-member fraudulently or negligently enters or causes to be entered an incorrect instruction in a relevant system and such incorrect instruction gives rise to an underpayment of stamp duty, or results in a claim for exemption from duty to which there is no entitlement, that system-member shall incur a penalty of £1,000 together with the amount, or twice the amount in the case of fraud, of the difference between the duty so paid (if any) and the duty which would have been payable if the instruction had been entered correctly.

(4) A system-member shall be deemed to have acted negligently for the purposes of subsection (3) if it comes to the system-member's notice, or it would have come to the system-member's notice if the system-member had taken reasonable care, that an incorrect instruction has resulted in an underpayment of stamp duty, unless the system-member notifies the Commissioners accordingly, in writing, without unreasonable delay.

(5) An incorrect instruction to which subsection (3) applies shall be deemed to be the production of an incorrect document for the purposes of section 1078(2)(d) of the Taxes Consolidation Act, 1997 .

Overpayment of duty.

[FA1996 s109]

77. —(1) Where on a claim it is proved to the satisfaction of the Commissioners that there has been an overpayment of duty in relation to a charge to duty by virtue of section 69 , the overpayment shall be repaid.

(2) A claim under this section shall—

(a) be made within a period of 6 years beginning on the date on which the payment was made,

(b) set out the grounds on which the repayment is claimed,

(c) contain a computation of the amount of the repayment claimed,

(d) if so required by the Commissioners, be supported by such documentation as may be necessary to prove the entitlement to a repayment of the amount claimed, and

(e) if the claim arises by virtue of the operation of section 73 (1)(b)

(i) it shall be made on a form prescribed by the Commissioners, and

(ii) it shall not be made to the Commissioners before the 21st day of the month following the month in which the overpayment of duty arose.

(3) Where the claimant is not resident in the State and has no branch or agency in the State the Commissioners may require the claimant, as a condition for obtaining a repayment, to appoint and maintain a tax representative in the State who shall be personally liable to the Commissioners for any loss of duty arising out of an incorrect claim.

(4) A person shall not be a tax representative under this section unless that person—

(a) has a business establishment in the State, and

(b) is approved by the Commissioners.

Regulations.

[FA1996 s110]

78. —(1) The Commissioners may make such regulations as seem to them to be necessary for the purpose of giving effect to this Part and of enabling them to discharge their functions in relation to administration, assessment, collection, recovery and repayment under this Part.

(2) Every regulation made under this section shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the regulation is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done under the regulation.