Schedule 1 · Transactions where goods are deemed to be or not to be pawned

FIRST SCHEDULESections 3(4) and 82(1)Transactions where goods are deemed to be or not to be pawnedSale and repurchase agreement1.—

This paragraph applies to an agreement between 2 persons, X and Y, where —

X sells goods to Y for a price; and

X is required to re-purchase the goods from Y at a higher price.

In such an agreement —

the goods are deemed to be pawned;

X is deemed to be the pawner;

the sale price is deemed to be the sum loaned; and

the difference between the sale price and the repurchase price is deemed to be the profit taken for the loan.