[Code of Federal Regulations]
[Title 26, Volume 10]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR1.955-4]

[Page 325-326]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
PART 1_INCOME TAXES--Table of Contents
 
Sec. 1.955-4  Definition of less developed country.

    (a) Designation by Executive order. For purposes of sections 951 
through 964, the term ``less developed country'' means any foreign 
country (other than an area within the Sino-Soviet bloc) or any 
possession of the United States with respect to which, on the first day 
of the foreign corporation's taxable year, there is in effect an 
Executive order by the President of the United States designating such 
country or possession as an economically less developed country for 
purposes of such sections. Each territory, department, province, or 
possession of any foreign country other than a country within the Sino-
Soviet bloc may be treated as a separate foreign country for purposes of 
such designation if the territory, department, province, or possession 
is overseas from the country of which it is a territory, department, 
province, or possession. Thus, for example, an overseas possession of a 
foreign country may be designated by Executive order as an economically 
less developed country even though the foreign country itself has not 
been designated as an economically less developed country; or the 
foreign country may be so designated even though the overseas 
possessions of such country have not been designated as economically 
less developed countries. The term ``possession of the United States'', 
for purposes of section 955(c)(3) and this section, shall be construed 
to have the same meaning as that contained in paragraph (b)(2) of Sec. 
1.957-3.
    (b) Countries not eligible for designation. Section 955(c)(3) 
provides that no designation by Executive order may be

[[Page 326]]

made under section 955(c)(3) and paragraph (a) of this section with 
respect to--

Australia
Austria
Belgium
CanadaDenmark
France
Germany(Federal Republic)
Hong Kong
Italy
Japan
Liechtenstein
Luxembourg
Monaco
Netherlands
New Zealand
Norway
Union of South Africa
San Marino
Sweden
Switzerland
United Kingdom.

    (c) Termination of designation. Section 955(c)(3) provides that, 
after the President has designated any foreign country or possession of 
the United States as an economically less developed country for purposes 
of sections 951 through 964, he may not terminate such designation 
(either by issuing an Executive order for the purpose of terminating 
such designation or by issuing an Executive order which has the effect 
of terminating such designation) unless, at least 30 days prior to such 
termination, he has notified the Senate and the House of Representatives 
of his intention to terminate such designation. If such 30-day notice is 
given, no action by the Congress of the United States is necessary to 
effectuate the termination. The requirement for giving 30-day notice to 
the Senate and House of Representatives applies also to the termination 
of a designation with respect to an overseas territory, department, 
province, or possession of a foreign country. See paragraph (c) of Sec. 
1.955-2 for the effect of a termination of a Presidential designation 
upon property which would be a qualified investment in a less developed 
country but for the fact of such termination.

[T.D. 6683, 28 FR 11182, Oct. 18, 1963]