13 January 2009
Calculation of the purchase NAV of the funds splitted on January 7, 2009
The split operations that have been implemented should benefit from tax deferral provided for in article 150-0 B of the French General Tax Code for the individuals having their tax residence in France*. As a consequence and under these conditions, from a tax perspective this operation should be fiscally considered as neutral (i.e. it should not trigger any capital profit or loss of exchange and it should not be taken into account to determine whether or not the sale threshold set at 25 730 euros- for the taxation of the capital gains made in 2009 – is reached). Consequently, the sum of the cost prices of the shares of the Funds received after the split will be equal to the cost price of the shares of the Fund that was split.
Under the rules applicable to the split operations benefiting from the tax deferral provided for in article 150-0 B of the French General Tax Code, the price or the purchase value of the shares of the company that was split should be multiplied by the ratio between the actual value of each of the companies created out of the split and the arithmetical sum of the actual values of the shares of these companies. The implementation of this rule would result in the calculation of the fiscal cost price of the Replica Fund and the fiscal cost price of the Side Pocket Fund in accordance with the following ratios :
At the time of the redemptions of the shares of the Funds received after the split, the capital profit or loss will be calculated using the cost prices established in this manner.
*The French Tax Administration should confirm in writing in the coming weeks through a ruling or an administrative circular, that the tax deferral provided for in article 150-0 B of the French General Tax Code is applicable to the split operations as implemented.
