WILLIAM DONALD SCHAEFER, Governor

Ch. 2

(2) ADD ANY LOSS COMPUTED UNDER SUBSECTION (C) OF
THIS SECTION TO ITS TAXABLE NET EARNINGS.

(C) SAME -- COMPUTATION.

(1)  TO COMPUTE THE QUALIFYING AMOUNT ALLOWED UNDER
THIS SECTION, AN INTERNATIONAL BANKING FACILITY SHALL DETERMINE
ITS GROSS EARNINGS DERIVED, DIRECTLY OR INDIRECTLY, FROM ANY
FOREIGN EXCHANGE TRADING OR HEDGING TRANSACTION THAT RELATES TO
MAKING, ARRANGING FOR, PLACING, OR SERVICING A LOAN TO A FOREIGN
PERSON IF:

(I)  SUBSTANTIALLY ALL OF THE PROCEEDS OF THAT
LOAN ARE USED OUTSIDE THE UNITED STATES; OR

(II)  ALL OF THE PROCEEDS ARE USED IN AN
APPROVED FOREIGN TRADE ZONE BY:

1.  A FOREIGN INDIVIDUAL;

2.  AN INDIVIDUAL RESIDING IN THE UNITED
STATES; OR

3.  A FOREIGN BRANCH OF A COMPANY THAT IS
ORGANIZED UNDER THE LAWS OF THE UNITED STATES OR OF A STATE, IS
NOT A BANK, AND HAS AT LEAST 80% OWNERSHIP OR CONTROL OF THE
FOREIGN BRANCH.

(2)  FROM THE GROSS EARNINGS COMPUTED UNDER PARAGRAPH
(1) OF THIS SUBSECTION, AN INTERNATIONAL BANKING FACILITY SHALL
SUBTRACT ALL DEDUCTIONS OR EXPENSES, DIRECTLY OR INDIRECTLY,
RELATED TO THOSE GROSS EARNINGS.

(3)  FROM THE ADJUSTED GROSS EARNINGS CALCULATED UNDER
PARAGRAPH (2) OF THIS SUBSECTION, AN INTERNATIONAL BANKING
FACILITY SHALL SUBTRACT THE PRODUCT OF MULTIPLYING THE ADJUSTED
GROSS EARNINGS BY A FRACTION:

(I)  THE NUMERATOR OF WHICH IS THE FISCAL YEAR
AVERAGE AMOUNT OF LIABILITY THAT WAS NEITHER OWED TO NOR RECEIVED
FROM A FOREIGN PERSON; AND

(II)  THE DENOMINATOR OF WHICH IS THE FISCAL
YEAR AVERAGE AMOUNT OF LIABILITY THAT WAS OWED TO OR RECEIVED
FROM ANY PERSON.

REVISOR'S NOTE: This section is new language derived
without substantive change from former Art. 81, §
128A(a)(3) and (5) and the first sentence of (a) and
(i).

In subsections (a)(2)(i)3. and (c)(l)(ii)3. of this
section, the words "organized under the laws of the
United States or of a state" are substituted for the
former word "domestic", for clarity.

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