(1) In this section ' relevant territory ' has the meaning assigned to it in section 172A.
(2) This section applies to a payment of royalties -
(a) made by a company in the course of a trade or business carried on by the company,
(b) to a company (in this subsection referred to as the 'receiving company') which -
(i) is not resident in the State, and
(ii) is, by virtue of the law of a relevant territory, resident for the purposes of tax in a relevant territory which imposes a tax that generally applies to royalties receivable in that territory by companies from sources outside that territory,
and
(c) which is made for bona fide commercial reasons and does not form part of any arrangement or scheme of which the main purpose or one of the main purposes is avoidance of liability to income tax, corporation tax or capital gains tax,
except where the royalties are paid to the receiving company in connection with a trade or business carried on in the State by the company through a branch or a
…