18 CFR 367.29
§ 367.29 Compensation for use of capital.
United States · 18 CFR — Conservation of Power and Water Resources · Status: effective
Cite this
- Citation
- 18 CFR 367.29, § 367.29 Compensation for use of capital, United States, version 1 as recorded 2026-07-09, yourstate.us, https://yourstate.us/provision/71431
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Full text
A servicing transaction is deemed to be performed at no more than cost if the price of the service does not exceed a fair and equitable allocation of expenses plus reasonable compensation for necessary capital procured through the issuance of capital stock. Interest on borrowed capital and compensation for the use of capital must only represent a reasonable return on the amount of capital reasonably necessary for the performance of services or construction work for, or the sale of goods to, associate companies. The compensation may be estimated and must be computed monthly. The amount of compensation must be stated separately in each billing to the associate companies. An annual statement to support the amount of compensation for use of capital billed for the previous 12 months and how it was calculated must be supplied to each associate company at the end of the calendar year.
Legislative history
This is a federal regulation, adopted through agency rulemaking under the Administrative Procedure Act — not enacted by a recorded vote of Congress.