Search results for

Vladimir Kotenko Iryna Kalyta The Ukrainian government is rumored to be on the verge of submitting a long-awaited draft transfer pricing law to the Parliament. Transfer pricing documentation requirement is supposed to be imposed, possibly covering 2013. In addition, the existing transfer pricing regulations are expected to undergo a major overhaul. Ukrainian tax authorities started to actively question the beneficial ownership status of non-resident royalty recipients. IP sublicensing structures are under the biggest scrutiny. Several treaty shopping allegations have been known to be raised. No conclusive court practice has formed as yet.

Lewis Greenwald, the former head of Sullivan & Worcester's international tax practice group has joined Mayer Brown's New York office as a partner in the tax transactions & consulting practice.

Yu Tao Jobst Wilmanns Captive financing entities and other vehicles for centralising a group's funding arrangements have long been objects of suspicion for the tax auditors. However the scope for negative findings is being progressively curtailed. The 2008 Annual Tax Act effectively disallowed loan losses on intra-group finance and the interest limitation (basically to 30% of EBITDA) of 2009 significantly reduced the scope for withdrawing profits through financing charges. On the other hand, Cadbury Schweppes (ECJ case C-196/04 of September 12, 2006) now prevents a tax auditor from declaring an EU group financing centre abusive, merely because it enjoys a favourable tax regime. The tax authority's attention is now increasingly directed at the interest rate, an area unbounded by hard and fast rules. The interest rate must be at arm's length. Arm's length is undefined, but should lie somewhere between the borrowing and lending rate typically on offer from banks. Third-party comparisons often assume there to be little or no loan risk, not least in reflection of the free-of-charge "group backing" featuring in the transfer pricing rules. This, though, has prompted an intention of changing towards rating a borrower within a group at the group rating rather than on its own financial standing. Unfortunately, attempts to reach a consensus on a rating formula have all foundered on the unanswered question of a parent's ability to strip a subsidiary of assets, and thus to shift the credit risk, at will. The same problem is also felt by members of international cash pools. Frequently, many still take a broad approach of basing the pool interest rates on EONIA or EURIBOR with a discount or premium of, say 20 or 30 basis points to cover the cost of running the pool. However, tax auditors are ever more searching in their demand to know which entity takes the risk and to impute income or disallow expense accordingly.

Gordana Vucenovic While the end of 2012 in Serbia will be remembered for significant changes in Serbian legislation, the beginning of 2013 is reserved for signing and ratifying already signed double tax treaties. In January and February 2013, four new double tax treaties with Canada, Palestine, Tunisia and Georgia, that were signed in April 2012, have been ratified, and it is expected that they will become applicable as of 2014.

Shanwu Yuan, a former senior official in China's State Administration of Taxation (SAT), has joined Baker & McKenzie's global tax practice as a director in the New York office.

One week after George Osborne, UK Chancellor of the Exchequer, delivered his Budget 2013, Stephen Herring, senior tax partner at BDO in London, looks at the impact on businesses.

KPMG has hired two experienced managing directors for its alternative investment funds tax practice in the US.

Michael Faber has joined Cooley in New York as a partner in its tax practice.

Peter Tan, a senior tax adviser in the Singapore market for more than 30 years, joined Baker & McKenzie.Wong & Leow this month from PwC, where he was a partner.

Andrew Hitchmough and Patrick Way have joined the senior rank of barristers in the UK, after being appointed Queen's Counsel (QC) yesterday.