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markets and substituting more relevant and up-to-date examples.

(2) This determination applies where, for the purpose of calculating the income or expenditure of a person in respect of a Futures Contract or Option Contract, it is necessary to determine the price of that contract.

(3) This determination sets out the approved markets, sources of information, and method, used for determining the prices for Futures Contracts and Option Contracts that are either traded on the New Zealand Futures Exchange or denominated in a foreign currency. It does not apply in relation to Option Contracts in respect of shares, as such contracts are “excepted financial arrangements” (as defined in subsection 64B(1) of the Act) and are not subject to the accrual provisions.

2. Reference—(1) This determination is made pursuant to subsections 64E (1) and (6) of the Income Tax Act 1976.

(2) This determination rescinds and replaces Determination G7B: New Zealand Futures and Options Markets and Determination G18: International Futures and Option Markets, both of which were made on 4 December 1989.

3. Scope of Determination—This determination applies where, for the purpose of calculating the income or expenditure of a person in respect of a Futures Contract or Option Contract, it is necessary to determine the price of that contract. It does not apply in relation to Option Contracts in respect of shares, as such contracts are “excepted financial arrangements” (as defined in subsection 64B (1) of the Act) and are not subject to the accrual provisions. It does, however, apply to options relating to share price indices (such as the NZSE.40 Capital Share Price Index Option Contract).

4. Principle—(1) Markets are approved having regard to the following criteria—

(a) The number of participants in the market or having access to the market;

(b) Frequency of trading in the market;

(c) The nature of trading in the market—how the price or rate is determined and how the financial assets are traded on the market;

(d) The existence, in relation to the market, of an appropriate regulatory body established by law;

(e) The potential or demonstrated capacity of a person or group of persons to significantly influence the market;

(f) Significant barriers to entry; and

(g) Discrimination on the basis of quantity bought and sold unless based on the risks involved or the transaction costs or economies of scale.

(2) Sources of information are approved having regard to the following criteria—

(a) Reliance on the sources of information by the market; and

(b) The accessibility of the sources of information by participants in the market.

(3) A method of obtaining a price for Futures Contract or Option Contract is approved if it is determined by an independent source and is adopted by participants in the market.

5. Interpretation—(1) In this determination, unless the context otherwise requires—

Expressions used, except the expression “Income Year”, have the same meanings as in the Act, and where a word or expression is given a particular meaning for the purposes of sections 64B to 64M of the Act, it shall have the same meaning in this determination.

“The Act” means the Income Tax Act 1976.

“Approved Exchange” means the New Zealand Futures & Options Exchange and any exchange listed in subclause 6(3) of this determination.

“Futures Contract” means a futures contract traded on the New Zealand futures and options market or on a futures market outside New Zealand.

“Income Year” means—

(a) Where a taxpayer furnishes a return of income under Section 15 of the Income Tax Act 1976 for an accounting year ending with an annual balance date other than the 31st day of March, the period commencing in the day after the end of the immediately preceding accounting year and ending on that balance date;

(b) In respect of the income of any person, the year in which that income has been derived by that person.

“New Zealand Dealer” means a public broker or principal trader on the New Zealand Futures & Options Exchange.

“New Zealand Futures and Options Market” means the market in futures and option contracts administered by the New Zealand Futures & Options Exchange Limited.

“Option Contract” means an option contract traded on the New Zealand futures and options market or on an organised and regulated option market outside New Zealand.

“Subscriber Screen Broadcast” means a screen broadcast by any subscriber to the ticker price feed of the relevant approved exchange.

(2) Any reference in this determination to another determination made by the Commissioner shall be construed as including a reference to any fresh determination made by the Commissioner to vary, rescind, restrict, or extend that determination.

(3) For convenience, words and phrases defined in this determination are indicated by initial capital letters, but the absence of a capital letter shall not alone imply that the word or phrase is used with a meaning different from that given by its definition.

6. Method—(1) Determination G7B: New Zealand Futures and Options Markets and Determination G18: International Futures and Option Markets are hereby rescinded with effect from the day on which this determination is signed.

(2) The New Zealand futures and options markets in the following contracts are approved:

Any contracts (other than Option Contracts in respect of shares) listed for trading on the New Zealand Futures & Options Exchange.

(3) In relation to Futures Contracts or Option Contracts traded in foreign markets, the following futures and options markets are approved:

Any contracts (other than Option Contracts in respect of shares) listed for trading on any of the following Approved Exchanges:

American Stock Exchange (AMEX)

Australian Options Market (AOM)

Belgian Futures & Options Exchange (Belfox)

Bolsa de Mercadorias & Futuros (BM&F)

Budapest Commodity Exchange (BCE)

Chicago Board of Trade (CBOT)

Chicago Board Options Exchange (CBOE)

Chicago Mercantile Exchange (CME)

Chicago Rice & Cotton Exchange (an affiliate to MidAm)

Citrus Associates of the New York Cotton Exchange Inc

Commodity Exchange, Inc (COMEX)

Copenhagen Stock Exchange

Deutsche Terminbörse (DTB)

European Options Exchange (EOE)

Financial Futures Market Amsterdam (FTA)

Financial Instruments Exchange (FINEX)—a division of

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