‘hybrid equity instrument’ means-
(a) any share, other than an equity share, if-
(i) the issuer of that share is obliged to redeem that share or to distribute an amount constituting a return of the issue price of that share (in whole or in part); or
[Subparagraph (i) substituted by section 8(1)(a) of Act 34 of 2019 deemed effective on 21 July, 2019 and applicable in respect of years of assessment ending on or after that date]
(ii) the holder of that share may exercise an option in terms of which the issuer must redeem that share or distribute an amount constituting a return of the issue price of that share (in whole or in part),
[Subparagraph (ii) substituted by section 8(1)(a) of Act 34 of 2019 deemed effective on 21 July, 2019 and applicable in respect of years of assessment ending on or after that date]
within a period of three years from the date of issue of that share;
(b) any share, other than a share contemplated in paragraph (a), if-
(i)
(aa) the issuer of that share is obliged to redeem that share or to distribute an amount constituting a return of the issue price of that share (in whole or in part) within a period of three years from the date of issue of that share;
[Item (aa) substituted by section 8(1)(b) of Act 34 of 2019 deemed effective on 21 July, 2019 and applicable in respect of years of assessment ending on or after that date]
(bb) the holder of that share may exercise an option in terms of which the issuer must redeem that share or distribute an amount constituting a return of the issue price of that share (in whole or in part) within a period of three years from the date of issue of that share; or
[Item (bb) substituted by section 8(1)(b) of Act 34 of 2019 deemed effective on 21 July, 2019 and applicable in respect of years of assessment ending on or after that date]
(cc) at any time on the date of issue of that share, the existence of the company issuing that share-
(A) is to be terminated within a period of three years; or
(B) is likely to be terminated within a period of three years upon a reasonable consideration of all the facts at that time; and
(ii)
(aa) that share does not rank pari passu as regards its participation in dividends or foreign dividends with all other equity shares in the capital of the relevant company or, where the equity shares in such company are divided into two or more classes, with the shares of at least one of such classes; or
[Item (aa) substituted by section 12 of Act 23 of 2018 effective on 17 January 2019]
(bb) any dividend or foreign dividend payable on such share is to be calculated directly or indirectly with reference to any specified rate of interest or the time value of money;
[Item (bb) amended by section 14 of Act 15 of 2016 effective on 1 January 2017, applies in respect of years of assessment ending on or after that date]
(c) any preference share if that share is-
(i) secured by a financial instrument; or
(ii) subject to an arrangement in terms of which a financial instrument may not be disposed of,
unless that share was issued for a qualifying purpose;
(d) any equity instrument the value of which is determined directly or indirectly with reference to-
(i) a share contemplated in paragraph (a) or (b) or a preference share contemplated in paragraph (c); or
(ii) an amount derived from a share or preference share contemplated in subparagraph (i); or
[Paragraph (d) added by section 14 of Act 15 of 2016 effective on 1 January 2017, applies in respect of years of assessment ending on or after that date]
(e) any equity instrument, other than an equity instrument contemplated in paragraph (d), if that equity instrument is subject to a right or arrangement that would have constituted a right or arrangement contemplated in paragraph (a), (b) or (c) had that right or arrangement applied in respect of the share with reference to which the value of that equity instrument is directly or indirectly determined;
[Paragraph (e) added by section 14(1)(d) of Act 15 of 2016 and substituted by section 8(1)(c) of Act 34 of 2019 and by section 7 of Act 20 of 2021]