118 STAT. 1658 PUBLIC LAW 108–357—OCT. 22, 2004 transmission transaction’ means any sale or other disposition before January 1, 2007, of— ‘‘(A) property used in the trade or business of providing electric transmission services, or ‘‘(B) any stock or partnership interest in a corporation or partnership, as the case may be, whose principal trade or business consists of providing electric transmission serv ices, but only if such sale or disposition is to an independent trans mission company. ‘‘(4) INDEPENDENT TRANSMISSION COMPANY.—For purposes of this subsection, the term ‘independent transmission company’ means— ‘‘(A) an independent transmission provider approved by the Federal Energy Regulatory Commission, ‘‘(B) a person— ‘‘(i) who the Federal Energy Regulatory Commis sion determines in its authorization of the transaction under section 203 of the Federal Power Act (16 U.S.C. 824b) or by declaratory order is not a market partici pant within the meaning of such Commission’s rules applicable to independent transmission providers, and ‘‘(ii) whose transmission facilities to which the elec tion under this subsection applies are under the oper ational control of a Federal Energy Regulatory Commission approved independent transmission pro vider before the close of the period specified in such authorization, but not later than the close of the period applicable under subsection (a)(2)(B) as extended under paragraph (2), or ‘‘(C) in the case of facilities subject to the jurisdiction of the Public Utility Commission of Texas— ‘‘(i) a person which is approved by that Commission as consistent with Texas State law regarding an inde pendent transmission provider, or ‘‘(ii) a political subdivision or affiliate thereof whose transmission facilities are under the operational control of a person described in clause (i). ‘‘(5) EXEMPT UTILITY PROPERTY.—For purposes of this sub section: ‘‘(A) IN GENERAL.—The term ‘exempt utility property’ means property used in the trade or business of— ‘‘(i) generating, transmitting, distributing, or selling electricity, or ‘‘(ii) producing, transmitting, distributing, or selling natural gas. ‘‘(B) NONRECOGNITION OF GAIN BY REASON OF ACQUISI TION OF STOCK.—Acquisition of control of a corporation shall be taken into account under this subsection with respect to a qualifying electric transmission transaction only if the principal trade or business of such corporation is a trade or business referred to in subparagraph (A). ‘‘(6) SPECIAL RULE FOR CONSOLIDATED GROUPS.—In the case of a corporation which is a member of an affiliated group filing a consolidated return, any exempt utility property pur chased by another member of such group shall be treated
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