(1)Subject to subsection (5) below, where immediately before the date of transfer an acquired company was the wholly owned subsidiary of the person from whom it was acquired, any property, rights or liabilities to which this subsection applies shall vest in the acquired company on the date of transfer of the company.
(2)The property, rights and liabilities to which subsection (1) above applies are any property, rights and liabilities of an associated privately owned company which—
(a)satisfy a vesting condition for the purposes of this section, and
(b)would remain vested in the associated privately owned company but for this section.
(3)Property, rights and liabilities satisfy a vesting condition for the purposes of this section if—
(a)they are wholly appurtenant to the undertaking carried on by the acquired company, or
(b)they are mainly appurtenant to property, rights or liabilities which are wholly appurtenant to that undertaking, or
(c)they cannot reasonably be severed from property, rights or liabilities of the acquired company or property, rights or liabilities such as are mentioned in paragraph (a) or (b) above.
(4)In the application of subsections (1) to (3) above in a case where the acquired company fulfils the criteria in paragraph 2 of Part II of Schedule 2 to this Act, the references in subsection (3) above to the undertaking carried on by the acquired company shall be construed as references to the shipbuilding undertaking carried on at a shipyard or other works in which the acquired company had an interest in possession on 31st July 1974.
(5)The rights and liabilities under any agreement for the rendering of personal services by any person shall be vested in the acquired company by virtue of this section if, and only if, immediately before the date of transfer, his employment under the agreement was wholly or mainly for the purposes of the undertaking carried on as mentioned in subsection (3) or, as the case may require, subsection (4) above.
(6)The provisions of Schedule 3 to this Act shall have effect for supplementing the preceding provisions of this section.
(7)In this section and Schedule 3 to this Act—
“associated privately owned company ” means any privately owned company which immediately before the date of transfer was the holding company of an acquired company or the wholly owned subsidiary of a company whose securities do not vest but which was the holding company of an acquired company; and
“privately owned company ” means a company whose securities do not vest, and which is not a subsidiary of a company whose securities vest, in either of the Corporations by virtue of this Part of this Act.