Court of Appeal.

Sir Nicolas Browne-Wilkinson V.-C., Parker and Russell L.JJ.

Judgment delivered 16 March 1989.

Corporation tax – Loss relief – Exchange loss on repayment of foreign loans – Deutschmarks borrowed at a low rate of interest and lent on to parent company at higher rate – Risk of group losses assumed by finance company – Whether loans were trading transactions.

  This was an appeal from a judgment of Vinelott J. ([1987] BTC 415) dismissing an appeal from the determination of a Special Commissioner that the taxpayer company (‘OCFL’) was not a trading company whose losses might be set off against the profits of its parent company.

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