Subject to subsection (2) below, and section 138, section 103G, 103H or 103I shall not apply to any issue of units in a collective investment scheme in exchange for or in respect of units in another scheme unless the exchange or scheme of reconstruction in question is effected for bona fide commercial reasons and does not form part of a scheme or arrangements of which the main purpose, or one of the main purposes, is avoidance of liability to capital gains tax, corporation tax or income tax.
Subsection (1) above shall not affect the operation of section 103G, 103H or 103I in any case where the participant to whom the units are issued does not hold more than 5 per cent of, or of any class of, the units in the second scheme mentioned in subsection (1) above.
For the purposes of subsection (2) above units held by participants connected with the participant there mentioned shall be treated as held by that participant.
If any tax assessed on a participant ("the chargeable participant") by virtue of subsection (1) above is not paid within 6 months from the date determined under subsection (5) below, any other participant who—
may, at any time within 2 years from that date, be assessed and charged (in the name of the chargeable participant) to all or, as the case may be, a corresponding part of the unpaid tax; and a participant paying any amount of tax under this subsection shall be entitled to recover from the chargeable participant a sum equal to that amount together with any interest paid by him under section 87A of the Management Act on that amount.
The date referred to in subsection (4) above is whichever is the later of—
Section 138 (procedure for clearance in advance) applies to this section as it applies to section 137 (with any necessary modifications).