DCC And Statutory Fictions

This article appeared in the February 2011 issue of the 'Financial Instruments Tax and Accounting Review'

The saga that is the case of DCC Holdings (UK) Limited v HMRC Commissioners has finally reached its conclusion in the form of a single judgment delivered on 15 December by Lord Walker on behalf of all of the Supreme Court Judges. Given that the Supreme Court is likely to hear far fewer appeals of this nature than the House of Lords, the decision is interesting not just in its implications for the loan relationship regime but also as an indication of how the Supreme Court believes "statutory fictions" should be interpreted.

THE FACTS

In 2001 DCC, a UK resident company, entered into a number of net paying repos with a non-UK resident bank ("the Bank").