Magazine
September 1999

Magazine Archive

Boom time for Europe’s tax advisers

International Tax Review’s annual survey finds the big five continuing to dominate. But our results also find that corporate tax work is growing rapidly, and that there is plenty of room for all to prosper. Rosie Murray-West and Oliver Ralph ask why demand is expanding so quickly

US court upholds National Westminster’s claim against IRS

National Westminster Bank and the UK government are celebrating a victory over the US Internal Revenue Service (IRS) , following a US ruling on National Westminster’s tax payments.
Mayer Brown advises Abbott

The Chicago and Los Angeles offices of Mayer Brown & Platt are advising Abbott laboratories on the acquisition of ALZA corporation. The transaction values ALZA, a research-based pharmaceuticals company, at approximately $7.3 billion. The deal follows ALZA’s earlier acquisition of SEQUUS Pharmaceuticals earlier this year.
Baker & Botts in drilling merger

Baker & Botts is advising Schlumberger on the merger of Sedco Forex Offshore. Sedco will merge with Transocean in a merger valued at $3.2 billion. The merger will create the world’s largest offshore drilling company, which will be called Transocean Sedco Forex.
AA turns to Linklaters

Linklaters & Alliance advised Centrica plc on its acquisition of the Automobile Association. The value of the transaction was £1.1 billion ($18 billion).
UK big three in pub deal

Punch Taverns is acquiring Allied Domecq Retailing in the UK for £2.75 billion ($4.4 billion). This will make Punch the second-largest public house operator in the UK after Nomura Securities. Rival leisure company Whitbread retired from the fight to gain control of Allied when the UK Department of Trade and Industry decided that The Competition Commission would have to examine the Whitbread bid.
Ashurst advises Deutsche

UK firm Ashurst Morris Crisp is advising Deutsche Telecom on its purchase of UK mobile phone operator One2One. Deutsche will pay Cable & Wireless and MediaOne (who each have a 50% stake in the operator) £8.4 billion ($13.5 billion) including debt, for the purchase.
Freshfields advises Gannett on Newsquest bid

Freshfields in the UK is advising US publishing group Gannett, on its intended acquisition of Newsquest in the UK for £922 million ($1.5 billion).
Fried Frank in petfood deal

Fried Frank Harris Shriver & Jacobson is advising Procter & Gamble (P&G) on the acquisition of Iams, a petfood company for about $2.3 billion. The deal is subject to regulatory approval but should be complete within a month.
Slaughter and May works on cleaning merger

Slaughter and May is advising UK household products company Reckitt & Coleman on its merger with Benckiser in the Netherlands. The move will create the world’s largest household cleaning products company, valued at £4.86 billion ($7.84 billion).
KPMG and Linklaters & Alliance advise on Tarmac demerger

KPMG and Linklaters & Alliance together are providing tax advice to Tarmac plc on the proposed demerger of their construction operations to Carillion plc, from their Heavy Building Materials division which is being retained by Tarmac.
Stikeman Elliot advises BAT

Canadian law firm Stikeman Elliott is advising British American Tobacco (BAT) on its offer to acquire Imasco, the Canadian consumer products group. BAT already owns 42% of Imasco, but is offering to buy the remaining equity for around C$ 10.3 billion ($6.9 billion). If the deal goes ahead BAT will keep Imperial Tobacco, Imasco’s tobacco business, but sell the group’s other subsidiaries.
Ernst & Young offers net advice

The world of faceless tax advice moved one step closer when Ernst & Young announced the launch of the first on-line tax adviser. Endearingly named Ernie, the adviser will allow clients to ask tax questions and receive written answers on-line.
ABA rejects MDP plans

The American Bar Association has rejected plans to allow lawyers to practise in multidisciplinary partnerships. A meeting of the policymaking body, the House of Delegates, voted by 304-98 to replace a report that would have eased restrictions on MDPs.
Loyens & Volkmaars abandons tax-only principles

After years of exclusively providing tax advice, Netherlands firm Loyens & Volkmaars has decided to expand its practice. Taking advantage of the closure of general practice firm Loeff Claeys Verbeke, Loyens has recruited 26 partners in Rotterdam and the Hague. Their areas of speciality include corporate, labour, banking and real estate.
OECD moves quickly to avert business controversy

The Committee of Fiscal Affairs of the OECD has acted quickly to diffuse a potential row between itself and the BIAC (Business and Industry Advisory Committee) over last year’s report on harmful tax competition.
UK Revenue climbs down on Herbert Smith case

UK companies will be able to take account of certain future losses when calculating taxable profits, following an unexpected climbdown by the Inland Revenue on two landmark cases.
KPMG links tax practice to Morrison & Foerster

Big five firm KPMG has formed a strategic tax alliance with Morrison & Foerster, a US West Coast law firm. This is the first time that a big law firm has formed a relationship with a big five accounting firm in the US
IRS loses key transfer pricing case

After a string of victories in the US tax courts, the IRS has lost a transfer pricing case. Not only did Compaq (the company concerned) avoid the excess tax that the IRS had charged, but they also received a positive adjustment of $21 million. This is the first time in a reported case that a company has received a positive adjustment.
OECD slams Swiss tax practices

The OECD has produced a report criticizing Switzerland for its bank secrecy rules. The annual report on the Swiss economy warned that the country would come under increasing foreign pressure to reveal banking information, because of the potential for tax evasion.
News in Brief

Russia considers tax on money transfers, United Parcel Service may appeal on tax judgement, Brazil scraps banking tax
TaxFax

Pity Hungarian tax debtors this summer. Whatever summer holidays they might have planned, they may find themselves unable to leave the country.
New dawn for Japanese holdings

When Japan lifted its restriction on holding companies last year, it opened up a range of possibilities. Dean Yoost of PricewaterhouseCoopers and Masaakira Kitazawa of Anderson Mori advise on how to avoid the pitfalls and make the most of the new opportunities
Chinese temptation for R&D plans

China’s efforts to boost new technology could have welcome consequences for foreign investors. Elizabeth Thong of Simmons & Simmons in Shanghai explains how multinationals can benefit from the latest incentives
Germany limits haven opportunities

Germany’s high tax rates have forced both companies and individuals to seek refuge in tax havens. But years of legislation have restricted the opportunities. Hans-Jorg Fischer of Clifford Chance in Frankfurt presents an overall view of Germany’s tax haven regulations
German rules pierce corporate veil

The German CFC regime was, like many others, founded on the principles of the US’ Subpart F. Since its inception in 1972, the rules have been adapted to focus on capital investments. Mark Smith and Diether Laudan of Ernst & Young in Stuttgart explain the rules
UK security rules come full circle

The recent controversy surrounding the taxation of relevant discount securities in the UK has produced a situation similar to that which applied in 1996. Sarah Squires of Cadwalader, Wickersham & Taft in London asks if the months of debate were really necessary
VAT treatment of import and export of services in Argentina
Recent trends in Australia's Double Tax Agreements
Austrian tax reform 2000: news for new business
Withdrawal of Foreign Contractor Withholding Directive?
Tax benefits to computer software and knowledge based industries – through the Indian prism
Stock lending and re-purchase transactions - revised tax treatment
Report on Business Taxation in the Netherlands
Potentially illegal regulations on tax refunds to nonresidents
Treasury Withdraws Hybrid Branch and Brown Group Regulations