(1) Part 35A of the Principal Act is amended in section 835A -

(a) by the substitution, in subsection (1), of the following definition for the definition of "relevant person":

"'relevant person' in relation to an arrangement, means a person who is within the charge to tax in respect of profits or gains or losses, the computation of which profits or gains or losses takes account of the results of the arrangement, or would take account of the results of such an arrangement;",

and

(b) by the substitution of the following subsection for subsection (3):

"(3) For the purposes of this Part, references to losses that are chargeable to tax are references to losses arising from an arrangement or relevant activities, a profit or gain arising from which would be chargeable to tax.".

(2) Part 35A of the Principal Act is amended by the substitution of the following section for section 835E:

"835E. Modification of basic rules on transfer pricing for arrangements between qualifying persons

(1) For the purposes of this Part, a 'qualifying person', in relation to a chargeable period, means a person who -