A CFC is a foreign resident company where a control test is satisfied (see below). 
First criteria: whether the CFC is a resident of a listed (Canada, France, Germany, Japan, NZ, UK, US) or unlisted country (all other countries). 
Second criteria: one of the three control tests must be satisfied. In particular: 
- Strict control: a group of five or fewer Australian 1 per cent entities and their associates hold at least 50 per cent (direct and indirect interests) of the foreign company. 
- Assumed control: a foreign company owns or is entitled to acquire an associate-inclusive control interest of at least 40 per cent in the foreign company. 
- De facto control: a group of five or fewer Australian entities, either alone or with associates, effectively controls the foreign company.  