110 STAT. 1830
PUBLIC LAW 104-188—AUG. 20, 1996
shall be made with such annualizations as the Secretary shall
prescribe.
"(8) SPECIAL RULES FOR CERTAIN POSSESSIONS. —
"(A) IN GENERAL. —In the case of an existing credit
claimant with respect to an applicable possession, this section (other than the preceding paragraphs of this subsection) shall apply to such claimant with respect to such
applicable possession for taxable years beginning after
December 31, 1995, and before January 1, 2006.
"(B) APPLICABLE POSSESSION. —For purposes of this
paragraph, the term 'applicable possession' means Guam,
American Samoa, and the Commonwealth of the Northern
Mariana Islands.
"(9) EXISTING CREDIT CLAIMANT. —For purposes of this subsection—
"(A) IN GENERAL.— The term 'existing credit claimant'
means a corporation—
"(i)(I) which was actively conducting a trade or
business in a possession on October 13, 1995, and
"(II) with respect to which an election under this
section is in effect for the corporation's taxable year
which includes October 13, 1995, or
"(ii) which acquired all of the assets of a trade
or business of a corporation which—
"(I) satisfied the requirements of subclause (I)
of clause (i) with respect to such trade or business, and
"(II) satisfied the requirements of subclause
(II) of clause (i).
"(B) NEW LINES OF BUSINESS PROHIBITED. — I f, after
October 13, 1995, a corporation which would (but for this
subparagraph) be an existing credit claimant adds a
substantial new line of business (other than in an acquisition described in subparagraph (A)(ii)), such corporation
shall cease to be treated as an existing credit claimant
as of the close of the taxable year ending before the date
of such addition.
"(C) BINDING CONTRACT EXCEPTION. — If, on October 13,
1995, and at all times thereafter, there is in effect with
respect to a corporation a binding contract for the acquisition of assets to be used in, or for the sale of assets
to be produced from, a trade or business, the corporation
shall be treated for purposes of this paragraph as actively
conducting such trade or business on October 13, 1995.
The preceding sentence shall not apply if such trade or
business is not actively conducted before January 1, 1996.
" (10) SEPARATE APPLICATION TO EACH POSSESSION. —For
purposes of determining—
"(A) whether a taxpayer is an existing credit claimant, and
"(B) the amount of the credit allowed under this
section,
this subsection (and so much of this section as relates to this
subsection) shall be applied separately with respect to each
possession. ",
(b) ECONOMIC ACTIVITY CREDIT FOR PUERTO RICO. —
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