Par. 2. In Sec. 1.985-1, paragraph (b)(2)(ii)(E) is added to read as follows:
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(b) * * *
(2) * * *
(ii) * * *
(E) Change in functional currency when currency ceases to be hyperinflationary--(1) In general. A QBU that has been required to use the dollar as its functional currency under paragraph (b)(2) of this section, or has elected to use the dollar as its functional currency under paragraph (b)(2)(ii)(B)(2) of this section or Sec. 1.985-2, must change its functional currency as of the first day of the first taxable year that follows three consecutive taxable years in which the currency of its economic environment, determined under paragraph (c)(2) of this section, is not a hyperinflationary currency. The functional currency of the QBU for such year shall be determined in accordance with paragraph (c) of this section. For purposes of Sec. 1.985-4, the change is considered to be made with the consent of the Commissioner. See Sec. 1.985-5 for adjustments that are required upon a change in functional currency.
(2) Effective date. Section 1.985-1(b)(2)(ii)(E) is effective for taxable years beginning after the date which is 30 days after the publication of final regulations in the Federal Register.