(1) The value of any share in a dependant of an insurance company shall be no greater than that part of the net asset value of the dependant which would be payable in respect of the share if the dependant were in liquidation and the net asset value were the amount distributable to the shareholders in the winding up.
(2) In this Regulation “net asset value”, in relation to a dependant company, means the amount by which the value of its assets, as determined in accordance with these Regulations, exceeds the amount of its liabilities including contingent and prospective liabilities but not including liabilities in respect of share capital.
(3) The value of any debt due, or to become due, to an insurance company from a dependant shall be the amount which would reasonably be expected to be recovered in respect of that debt (due respect being taken of any security held in respect thereof) if the dependant were in liquidation.
(4) Any share in a dependant—
(a) in which there is no such excess of assets over liabilities as is specified in subregulation (2);
(b) in relation to which an insurance company cannot reasonably ascertain the amount of the liabilities of the dependant for the purposes of subregulation (2), shall be left out of account for the purposes for which these Regulations apply.
(5) Where an insurance company is unable to determine the value of any debt due or to become due to the company from a dependant because it cannot reasonably ascertain the amount of the liabilities of the dependant for the purpose of ascertaining what would reasonably be expected to be recovered in respect of that debt in accordance with subregulation (3), the debt shall be left out of account for the purposes for which these Regulations apply.
(6) In determining the net asset value of a dependant company which is an insurance company the value of its assets and the amount of its liabilities shall be determined in accordance with any valuation regulations applicable for the purpose of section 34 of the Act, in the case of general insurance business and for the purpose of any investigation to which section 95 of the Act applies in the case of long-term insurance business.
(7) In determining for the purpose of this Regulation the net asset value of a dependant company, which is not an insurance company, the value of the assets of the dependant company shall be determined in accordance with these Regulations as if they were assets of an insurance company.