Chapter:	112	Title:	Inland Revenue Ordinance	Gazette Number:	E.R. 1 of 2012
Section:	14A	Heading:	Qualifying debt instruments	Version Date:	09/02/2012

(1) For the purposes of this Part the assessable profits of a person for sums received by or accrued to the person as-

(a) interest paid or payable on a medium term debt instrument or short term debt instrument; or
(b) any gain or profit on the sale or other disposal or on the redemption on maturity or presentment of the medium term debt instrument or short term debt instrument,

(a) a medium term debt instrument issued on or after the date of commencement* of the Inland Revenue (Amendment) Ordinance 2011 (4 of 2011); or
(b) a short term debt instrument,

(a) if the issuer is a natural person-
(i) any relative of the issuer;
(ii) any partner of the issuer;
(iii) if a partner of the issuer is a natural person, any relative of that partner;
(iv) any partnership of which the issuer is a partner;
(v) any corporation controlled by-
(A) the issuer;
(B) a partner of the issuer;
(C) if a partner of the issuer is a natural person, any relative of that partner; or
(D) a partnership of which the issuer is a partner; or
(vi) any director or principal officer of a corporation referred to in subparagraph (v);
(b) if the issuer is a corporation-
(i) any associated corporation;
(ii) any person who controls the issuer;
(iii) any partner of a person who controls the issuer;
(iv) if a person who controls the issuer is a natural person, any relative of that person;
(v) if a partner referred to in subparagraph (iii) is a natural person, any relative of that partner;
(vi) any director or principal officer of the issuer or of any associated corporation;
(vii) any relative of a director or principal officer referred to in subparagraph (vi);
(viii) any partner of the issuer; or
(ix) if a partner of the issuer is a natural person, any relative of that partner; or
(c) if the issuer is a partnership-
(i) any partner of the issuer;
(ii) if a partner of the issuer is a partnership, any partner (Partner A) of that partnership or any partner (Partner B) with that partnership in any other partnership;
(iii) if Partner A is a partnership, any partner of Partner A;
(iv) if Partner B is a partnership, any partner of Partner B;
(v) if a partner of, or with, or in any of the partnerships referred to in subparagraph (ii), (iii) or (iv) is a natural person, any relative of that partner;
(vi) any corporation controlled by-
(A) the issuer;
(B) a partner of the issuer;
(C) if a partner of the issuer is a natural person, any relative of that partner; or
(D) a partnership of which the issuer is a partner;
(vii) any director or principal officer of a corporation referred to in subparagraph (vi); or
(viii) any corporation of which any partner of the issuer is a director or principal officer; (Added 4 of 2011 s. 3)

(a) a corporation over which the issuer has control;
(b) a corporation which has control over the issuer; or
(c) a corporation which is under the control of the same person as is the issuer; (Added 4 of 2011 s. 3)

(a) by means of the holding of shares or the possession of voting power in or in relation to that or any other corporation; or
(b) by virtue of any power conferred by the articles of association or other document regulating that or any other corporation,

(a) is in respect of a debt issue which in its entirety has been lodged with and cleared by the Central Moneymarket Unit operated by the Monetary Authority;
(b) subject to subsection (5), is issued by a person and has at all relevant times a credit rating acceptable to the Monetary Authority from a credit rating agency recognized by the Monetary Authority;
(c) (Repealed 34 of 2003 s. 3)
(d) subject to subsection (5), has-
(i) where it is issued before 1 April 1999, a minimum denomination of $500000 or its equivalent in a foreign currency; or
(ii) where it is issued on or after 1 April 1999, a minimum denomination of $50000 or its equivalent in a foreign currency; (Replaced L.N. 90 of 1999 and 44 of 1999 s. 11)
(e) is, at issuance, issued in Hong Kong to-
(i) 10 or more persons; or
(ii) less than 10 persons none of whom is an associate of the issuer of the instrument; (Replaced 4 of 2011 s. 3)
(f) if it is a scripless instrument, it is one that would qualify in the terms of this definition if it were in a physical form; (Amended 34 of 2003 s. 3)
(g) is issued on or after 14 November 2003; (Amended 34 of 2003 s. 3; 4 of 2011 s. 3)

(a) a debt instrument that-
(i) is issued before 5 March 2003;
(ii) has an original maturity of not less than 5 years or is undated; and
(iii) cannot be redeemed within 5 years from the date of its issue; or
(b) a debt instrument that-
(i) is issued on or after 5 March 2003;
(ii) has an original maturity of less than 7 years but not less than 3 years or is undated; and
(iii) can be redeemed within 7 years from the date of its issue but not within the first 3 years; (Added 34 of 2003 s. 3. Amended 4 of 2011 s. 3)

(a) a person employed by the corporation who, either alone or jointly with one or more other persons, is responsible under the immediate authority of the directors of the corporation for the conduct of the business of the corporation; or
(b) a person employed by the corporation who, under the immediate authority of a director of the corporation or a person to whom paragraph (a) applies, exercises managerial functions in respect of the corporation; (Added 4 of 2011 s. 3)

(a) an adopted child is regarded as a child of both the natural parents and the adopting parents; and
(b) a step child is regarded as a child of both the natural parents and the step parents; (Added 4 of 2011 s. 3)

(a) is issued on or after the date of commencement of the Inland Revenue (Amendment) Ordinance 2011 (4 of 2011);
(b) has an original maturity of less than 3 years or is undated; and
(c) can be redeemed within 3 years from the date of its issue; (Added 4 of 2011 s. 3)

(a) both the corporation and the issuer are wholly owned by-
(i) the Government of Hong Kong; or
(ii) the central government of the same country;
(b) more than 50% of the voting power in the corporation and more than 50% of the voting power in the issuer are held or controlled by-
(i) one or more than one corporation which is established and wholly owned by the Government of Hong Kong or the central government of the same country for the purpose of carrying on the business of investment (government investment vehicle); or
(ii) a wholly owned subsidiary of a government investment vehicle; or
(c) more than 50% of the voting power in the corporation is held or controlled by a corporation wholly owned by the Government of Hong Kong or the central government of the same country (government enterprise) and more than 50% of the voting power in the issuer is held or controlled by another government enterprise. (Added 4 of 2011 s. 3)

(a) declare that the provisions relating to a credit rating mentioned in paragraph (b) of that definition do not apply;
(b) fix an amount of minimum denomination different from the amount mentioned in paragraph (d)(i) or (ii), as the case may be, of that definition, (Amended L.N. 90 of 1999 and 44 of 1999 s. 11)