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TITLE 26-INTERNAL REVENUE CODE does not meet such requirements at the close of any quarter by reason of a discrepancy existing immediately after the acquisition of any securi- ty or other property which is wholly or partly the result of such acquisition during such quar- ter shall not lose its status for such quarter as a regulated investment company if such discrep- ancy is eliminated within 30 days after the close of such quarter and in such cases it shall be considered to have met such requirements at the close of such quarter for purposes of apply- ing the preceding sentence. (e) Investment companies furnishing capital to devel- opment corporations. (1) General rule If the Securities and Exchange Commission determines, in accordance with regulations issued by it, and certifies to the Secretary not earlier than 60 days prior to the close of the taxable year of a registered management company, that such investment company is principally engaged in the furnishing of cap- ital to other corporations which are principal- ly engaged in the development or exploitation of inventions, technological improvements, new processes, or products not previously gen- erally available, such investment company may, in the computation of 50 percent of the value of its assets under subparagraph (A) of subsection (b)(4) for any quarter of such tax- able year, include the value of any securities of an issuer, whether or not the investment company owns more than 10 percent of the outstanding voting securities of such issuer, the basis of which, when added to the basis of the investment company for securities of such issuer previously acquired, did not exceed 5 percent of the value of the total assets of the investment company at the time of the subse- quent acquisition of securities. The preceding sentence shall not apply to the securities of an issuer if the investment company has con- tinuously held any security of such issuer (or of any predecessor company of such issuer as determined under regulations prescribed by the Secretary) for 10 or more years preceding such quarter of such taxable year. (2) Limitation The provisions of this subsection shall not apply at the close of any quarter of a taxable year to an investment company if at the close of such quarter more than 25 percent of the value of its total assets is represented by secu- rities of issuers with respect to each of which the investment company holds more than 10 percent of the outstanding voting securities of such issuer and in respect of each of which or any predecessor thereof the investment company has continuously held any security for 10 or more years preceding such quarter unless the value of its total assets so repre- sented is reduced to 25 percent or less within 30 days after the close of such quarter. (3) Determination of status For purposes of this subsection, unless the Securities and Exchange Commission deter- mines otherwise, a corporation shall be con- sidered to be principally engaged in the devel- opment or exploitation of inventions, techno- logicai improvements, new processes, or prod- ucts not previously generally available, for at least 10 years after the date of the first acqui- sition of any security in such corporation or any predecessor thereof by such investment company if at the date of such acquisition the corporation or its predecessor was principally so engaged, and an investment company shall be considered at any date to be furnishing capital to any company whose securities it holds if within 10 years prior to such date it has acquired any of such securities, or any se. curities surrendered in exchange therefor, from such other company or predecessor thereof. For purposes of the certification under this subsection, the Securities and Ex- change Commissioa hall have authority to issue such rules, regulations and orders, and to conduct such investigations and hearings, either public or private, as it may deem ap- propriate. (4) Definitions The terms used in this subsection shall have the same meaning as in subsections (b)(4) and (c) of this section. (f) Certain unit investment trusts For purposes of this title- (1) A unit investment trust (as defined in the Investment Company Act of 1940)- (A) which is registered under such Act and issues periodic payment plan certifi- cates (as defined in such Act) in one or more series, (B) substantially all of the assets of which, as to all such series, consist of (i) se- curities issued by a single management com- pany (as defined in such Act) and securities acquired pursuant to subparagraph (C), or (ii) securities issued by a single other corpo- ration, and (C) which has no power to invest in any other securities except securities issued by a single other management company, when permitted by such Act or the rules and reg- ulations of the Securities and Exchange Commission, shall not be treated as a person. (2) In the case of a unit investment trust de- scribed in paragraph (1)- (A) each holder of an interest in such trust shall, to the extent of such interest, be treated as owning a proportionate share of the assets of such trust; (B) the basis of the assets of such trust which are treated under subparagraph (A) as being owned by a holder of an interest in such trust shall be the same as the basis of his interest in such trust; and (C) in determining the period for which the holder of an interest in such trust has held the assets of the trust which are treat- ed under subparagraph (A) as being owned by him, there shall be included the period for which such holder has held his interest in such trust. This subsection shall not apply in the case of a unit investment trust which is a segregated asset account under the insurance laws or regu- lations of a State. (Aug. 16, 1954, ch. 736, 68A Stat. 268; Sept. 3, 1958, Pub. L. 85-886, title I, § 38, 72 Stat. 1638; Dec. 30, 1969, Pub. L. 91-172, title IX, § 908(a), Page 537 § 851