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In HMRC v FCE Bank PLC (CA – 17 October) two companies (FC and FL) were resident in the UK. Their parent company (FM) was resident in the USA. FL incurred trading losses which it claimed to surrender to FC. FC claimed group relief in respect of these losses. HMRC rejected the claim on the grounds that FM was resident in the USA. FC appealed contending that the effect of the ‘non-discrimination article’ in the 1975 UK/USA double taxation agreement was that group relief was available between two UK resident directly-held 75% subsidiaries of a US parent company in circumstances where it would be available if the parent company were UK resident. The First-tier Tribunal accepted this contention and allowed the appeal holding that ‘on the facts of this appeal the difference in treatment is because the direct holding...

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