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Renaud Jouffroy Fabien Cotte It is still uncertain whether a cross border transfer of a cash pooling activity within a group may constitute an indirect transfer of profit. In 2011, the Paris Administrative Court ruled that the transfer of a cash pooling activity without compensation from a French company to another member of the group located in a foreign jurisdiction (Switzerland) qualifies as an indirect transfer of profits. Therefore, the tax authorities have been entitled to reassess Nestlé up to the value of the activity transferred, retaining a profit margin of 0.5%, which according to the tax authorities corresponded to the usual profit margin applied by various multinational companies for such an activity.

The OECD has given its backing to the introduction of a Chinese carbon tax in its Economic Survey of China 2013. However the government may already be pushing forward with environmental tax reform.

Daniel Harrison As part of the recent amendment to the tax regulations (the Amended Tax Law No. 05/NA, dated December 20 2011), the Lao legislators have introduced a new depreciation method: Activity depreciation. The less commonly used (for tax purposes) method brings the total number of statutory depreciation options to three; the other two being the pre-existing straight-line and declining-balance methods (although the declining-balance method described in the regulations more closely resembles the sum-of-years-digits method).

Canada’s 2013 federal budget (Budget 2013) was released on March 21 2013 and focused on spending in support of job creation and on tightening a number of tax measures. It also included a number of significant developments from a cross-border perspective that are highlighted here.

Ayesha Lau Darren Bowdern On February 27 2013 the financial secretary presented the 2013-14 budget in which he forecast a consolidated budget surplus of $64.9 billion for 2012-13, well ahead of the forecast deficit of $3.4 billion. The surplus has been largely driven by increased revenues from land sales, tax collections, stamp duties and a greater than anticipated dividend from West Rail Property Development. A modest improvement in the economy is forecast with GDP growth of 1.5% to 3.5% for 2013 and a headline inflation rate for 2013 estimated at 4.5 %. Budget proposals include one-off measures worth $33 billion to ease pressure on the middle class, grass roots and small and medium enterprises and capital expenditure of $88 billion, including $70.1 billion on capital works.

Elena Kostovska On December 4 2012, the FYR Macedonian Parliament ratified the income tax treaty signed with Kazakhstan. The ratification was published in the Official Gazette 154 on December 7 2012. The treaty, initially signed between the two countries on July 2 2012, covers the personal income tax and profit tax in FYR Macedonia and the corporate income tax and the individual income tax in Kazakhstan. As is usually the case, the treaty is mostly harmonised with the OECD model; however, certain specifics can be noted.

On March 19 2013, the Italian Revenue Office published the second edition of the International Tax Ruling Bulletin (bulletin), about three years after its first edition (April 14 2010). Piergiorgio Valente and Caterina Alagna of Valente Associati GEB Partners explain the bulletin’s impact on the tax market.

Type of Agreement Country Country Date Signed Double Taxation Avoidance Agreement Argentina Spain March 11 2013 Double Taxation Avoidance Agreement Norway UK March 14 2013 Double Taxation Avoidance Agreement Spain UK March 14 2013 Tax Information Exchange Agreement Canada Panama March 17 2013 Double Taxation Avoidance Agreement Belarus Indonesia March 19 2013

TYPE OF DEAL VALUE ACQUIRER TARGET ADVISER TO ACQUIRER (TAX) ADVISER TO TARGET (TAX) Acquisition $55 billion Rosneft TNK-BP Cleary Gottlieb Steen & Hamilton Skadden Arps Slate Meagher & Flom / Akin Gump Strauss Hauer & Feld / Weil, Gotshal & Manges Acquisition $2.62 billion Liberty Media Corporation Charter Communications Baker Botts Kirkland & Ellis Acquisition $900 million Dynegy Ameren Energy Resources Wachtell, Lipton, Rosen & Katz - Jodi Schwartz, Joshua Holmes Acquisition $528 million GRIP Unit Trust G:Res1 Simmons & Simmons - Nick Cronkshaw, Chris Agnoli Pinsent Masons Acquisition $418.7 million GE Capital Australia Allianz Finance King & Wood Mallesons Allens Acquisition $360 million Valeant Pharmaceuticals International Obagi Medical Products Jenner & Block Acquisition $294 million Cynosure Palomar Medical Technologies Hinckley, Allen & Snyder WilmerHale Acquisition $209 million Glatfelter Gernsbach Dresden Papier Jones Day Luther Rechtsanwaltsgesellschaft / Sangra Moller Acquisition Undisclosed Dropbox Orchestra Fenwick & West - Adam Halpern, Larissa Neumann TYPE OF DEAL VALUE ISSUER / BORROWER LEAD MANAGERS / ARRANGERS ADVISER TO ISSUER / BORROWER ADVISER TO LEAD MANAGERS Senior Notes Offering $1.5 billion Goldcorp HSBC / Merrill Lynch Shearman and Sterling / Cassels Brock & Blackwell Davis Polk & Wardwell - Michael Mollerus Senior Notes Offering $1.2 billion Discovery Communications J.P. Morgan / Merrill Lynch / Credit Suisse Wilmer Cutler Pickering Hale / Dorr Davis Polk & Wardwell - Samuel Dimon Secondary Offering $600 million Yandex Morgan Stanley / Deutsche Bank / Goldman Sachs Davis Polk & Wardwell - John Paton Wilmer Cutler Pickering Hale / Dorr Senior Notes Offering $500 million Maxim Integrated Products J.P. Morgan / Goldman Sachs Weil, Gotshal & Manges Davis Polk & Wardwell - Rachel Kleinberg Junior Subordinated Notes Offering $450 million PPL Capital Funding Citigroup / Merrill Lynch / Morgan Stanley / UBS / Wells Fargo Davis Polk & Wardwell - Samuel Dimon Sullivan & Cromwell Debut Offering $275 million NANA Development Corporation Goldman Sachs Stoel Rives Davis Polk & Wardwell - Samuel Dimon

UK compliance; OECD after-tax hedging problems; BEPS; Cyprus 10%; Bundled supplies; British Colombia’s carbon tax; Fortescue Metals; Master Currency