36.  Excluded arrangements

(1)     An ‘arrangement’ is an excluded ‘arrangement’ if it is-

(a)     a debt in terms of which-

(i)      the borrower receives or will receive an amount of cash and agrees to repay at least the same amount of cash to the lender at a determinable future date; or

(ii)     the borrower receives or will receive a fungible asset and agrees to return an asset of the same kind and of the same or equivalent quantity and quality to the lender at a determinable future date;

(b)     a lease;

(c)     a transaction undertaken through an exchange regulated in terms of the Financial Markets Act, 2012 (Act 19 of 2012); or

[Paragraph (c) substituted by section 40 of Act 23 of 2015]

(d)     a transaction in participatory interests in a scheme regulated in terms of the Collective Investment Schemes Control Act, 2002 (Act No. 45 of 2002).

(2)     Subsection (1) applies only to an ‘arrangement’ that-

(a)     is undertaken on a stand-alone basis and is not directly or indirectly connected to any other ‘arrangement’ (whether entered into between the same or different parties); or

(b)     would have qualified as having been undertaken on a stand-alone basis as required by paragraph (a), were it not for a connected ‘arrangement’ that is entered into for the sole purpose of providing security and if no ‘tax benefit’ is obtained or enhanced by virtue of the security ‘arrangement’.

(3)     Subsection (1) does not apply to an ‘arrangement’ that is entered into-

(a)     with the main purpose or one of its main purposes of obtaining or enhancing a ‘tax benefit’; or

(b)     in a specific manner or form that enhances or will enhance a ‘tax benefit’.

(4)     The Commissioner may determine an “arrangement” to be an excluded “arrangement” by public notice.