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131 STAT. 2220 PUBLIC LAW 115–97—DEC. 22, 2017 ‘‘(1) treated as fiscally transparent for purposes of this chapter but not so treated for purposes of the tax law of the foreign country of which the entity is resident for tax purposes or is subject to tax, or ‘‘(2) treated as fiscally transparent for purposes of such tax law but not so treated for purposes of this chapter. ‘‘(e) REGULATIONS.—The Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including regulations or other guidance providing for— ‘‘(1) rules for treating certain conduit arrangements which involve a hybrid transaction or a hybrid entity as subject to subsection (a), ‘‘(2) rules for the application of this section to branches or domestic entities, ‘‘(3) rules for treating certain structured transactions as subject to subsection (a), ‘‘(4) rules for treating a tax preference as an exclusion from income for purposes of applying subsection (b)(1) if such tax preference has the effect of reducing the generally applicable statutory rate by 25 percent or more, ‘‘(5) rules for treating the entire amount of interest or royalty paid or accrued to a related party as a disqualified related party amount if such amount is subject to a participa- tion exemption system or other system which provides for the exclusion or deduction of a substantial portion of such amount, ‘‘(6) rules for determining the tax residence of a foreign entity if the entity is otherwise considered a resident of more than one country or of no country, ‘‘(7) exceptions from subsection (a) with respect to— ‘‘(A) cases in which the disqualified related party amount is taxed under the laws of a foreign country other than the country of which the related party is a resident for tax purposes, and ‘‘(B) other cases which the Secretary determines do not present a risk of eroding the Federal tax base, ‘‘(8) requirements for record keeping and information reporting in addition to any requirements imposed by section 6038A.’’. (b) CONFORMING AMENDMENT.—The table of sections for part IX of subchapter B of chapter 1 is amended by inserting after the item relating to section 267 the following new item: ‘‘Sec. 267A. Certain related party amounts paid or accrued in hybrid transactions or with hybrid entities.’’. (c) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable years beginning after December 31, 2017. SEC. 14223. SHAREHOLDERS OF SURROGATE FOREIGN CORPORATIONS NOT ELIGIBLE FOR REDUCED RATE ON DIVIDENDS. (a) IN GENERAL.—Section 1(h)(11)(C)(iii) is amended— (1) by striking ‘‘shall not include any foreign corporation’’ and inserting ‘‘shall not include— ‘‘(I) any foreign corporation’’, (2) by striking the period at the end and inserting ‘‘, and’’, and (3) by adding at the end the following new subclause: 26 USC 1. 26 USC 267A note. 26 USC 261 prec. VerDate Sep 11 2014 10:09 Oct 18, 2018 Jkt 079139 PO 00097 Frm 00168 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL097.115 PUBL097 dkrause on DSKBC28HB2PROD with PUBLAWS