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Pedro Fernández It may be a classic in other jurisdictions, but only recently has it gained momentum in the Spanish landscape, and it may well move to the top of the agenda of the Spanish tax auditors. Unlike the primary transfer pricing adjustment, for which there are more or less effective means to mitigate the potential double taxation, the secondary adjustment can easily lead to a final tax cost.

Jul Seventa Tarigan To avoid higher taxes on income, individuals that are subject to progressive tax rates usually split their taxable income by transferring their income to other people. Through this, it is possible to lower the effective tax rate since the lower income in the hands of the transferee will be subject to lower tax rate. In a cross-border investment, workers who are dispatched by the investor/parent company to its subsidiary may be subject to very high taxes on individual income in the country where the investment was made. To avoid this situation, the parent company would usually absorb the employee's income generated in the other country by classifying the worker's income as a management fee, technical fee, or other kind of fee that is being paid by the subsidiary to the parent company.

Rajendra Nayak Ganesh Pai The Mumbai Tribunal in the case of Standard Chartered Bank (taxpayer) [2011-TII-80-ITAT-MUM-INTL] recently adjudicated on the taxability of data processing charges under the Indian tax law (ITL) and the India-Singapore tax treaty (treaty). The taxpayer is a non-resident, engaged in the business of banking through various branches in India. It entered into an agreement with a Singapore company (S Co) for receiving data processing support for its India operations. To provide the required support, S Co maintained a data centre at Singapore and made available a portion of its disc storage capacity exclusively for the taxpayer. S Co processed the raw data received from the taxpayer using certain licensed software on its mainframe computer and electronically transmitted the output data back to India in the form of reports as per the taxpayer's specifications. The taxability of the payments was to be adjudicated having regard to the definition of royalty under the ITL and the treaty, which includes within its ambit the consideration for the use of a process and payments for the use or the right to use industrial, commercial or scientific equipment (equipment royalty clause).

Sandra Benedetto B Cristián Bay-Schmith C Chile, Colombia and Peru have formally combined the operations of their stock markets to create the Latin American Integrated Market (Mercado Integrado Latinoamericano, or MILA) which has recently started operations.

Nélio Weiss Philippe Jeffrey On May 13 2011, the Brazilian Revenue Service issued Normative Instruction (NI) 1,154, with the aim of regulating the deductibility of interest and other general expenses paid or credited by a Brazilian source to individuals or legal entities considered related or resident or domiciled in a tax haven or in a jurisdiction under a privileged tax regime.

The European Free Trade Association Surveillance Authority (ESA) has issued a reasoned opinion concluding that the Norwegian rules on exit tax for companies and cross-border restructurings are incompatible with the EEA agreement. Camilla Jøtun Borge-Andersen and Joachim Bjerke of BA-HR analyse the decision and discuss whether Norway’s response has resolved the issue.

After a decade of political discussion, negotiation and consultation, the European Commission has finally released its proposals for a common consolidated corporate tax base (CCCTB). Salman Shaheen finds out what the plans could mean for taxpayers and why they took so long to get to this stage.

KPMG has formed a new transfer pricing and indirect tax team in the UK.

Herbert Smith alliance firm, Stibbe, has added Linklaters' local tax head to its new office in Luxembourg.

Melbourne hopes to attract investment from Asia and the Middle East