APPLICABILITY OF EXCLUSION FROM INTEREST EQUALIZATION TAX OF CERTAIN LOANS TO ASSURE RAW MATERIALS SOURCES.

SEC. 213. APPLICABILITY OF EXCLUSION FROM INTEREST EQUALIZATION TAX OF CERTAIN LOANS TO ASSURE RAW MATERIALS SOURCES. (a) Exception to Exclusion.— Section 4914(d) (relating to loans to assure raw materials sources) is amended by adding at the end thereof the following new paragraph: “(3) Exception.— The exclusion from tax provided by paragraph (1) shall not apply in any case where the acquisition of the debt obligation of the foreign corporation is made with an intent to sell, or to offer to sell, any part of such debt obligation to United States persons.” (b) Technical Amendments.— (1) Section 4914(j)(1) (relating to loss of entitlement to exclusion in case of certain subsequent transfers) is amended— (A) by striking out in subparagraph (A) “, or the exclusion provided by subsection (d),”, and (B) by striking out “subsection (d) or (f)” in subparagraph (I)) and inserting in lieu thereof “subsection (f)”. (2) Section 4918 (relating to exemption for prior American ownership) is amended by adding at the end thereof the following new subsection: “(g) Certain Debt Obligations Arising Out of Loans To Assure Raw Material Sources.— Under regulations prescribed by the Secretary or his delegate, subsection (a) shall not apply to the acquisition by a United States person of any debt obligation to which section 4914(d) applied where the acquisition of the debt obligation by such person is made with an intent to sell, or to offer to sell, any part of such debt obligation to United States persons. The preceding sentence shall not apply if the tax imposed by section 4911 has applied to any prior acquisition of such debt obligation.” (c) Effective Date.— The amendments made by subsections (a) and (b) shall apply with respect to acquisitions of debt obligations made after the date of the enactment of this Act.