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The Indian Authority for Advance Rulings (AAR) recently examined whether a US pension trust is entitled to claim benefits under the India-US tax treaty for income from the sale of portfolio investments in India.

TEP is the alignment of tax and procurement strategy. The benefits stem from the optimization of indirect and direct tax and the minimization of the risk of not complying with tax legislation, explain Philip Davies and Nick Mühlemann of Ernst & Young

The ECJ judgment in Marks & Spencer will have an impact on the decisions to be taken by multinational groups with subsidiaries in different EU countries. Lovells' international tax team analyzes how various member states might deal with the verdict

The Mexican Congress passed thin-capitalization rules in 2005 to stop taxpayers using excessive debt to avoid tax. Roberto del Toro, David Cuellar and Francisco José Zamora of PricewaterhouseCoopers explain how the rules were relaxed in 2006

The use of allowable losses and disclosure, but little on tax reform, featured in the UK government's pre-Budget statement. Gary Richards of Berwin Leighton Paisner warns that the system's complexity might mean that taxpayers will choose to leave the country

Type of deal Valuer Acquirer Target Adviser to acquirer (tax) Adviser to target (tax) M & A Undisclosed IBM, US Bowstreet, US Cravath, Swaine & Moore, Sharon Mendelson, Jeffrey Mande (US) Goodwin Proctor, US M & A $4.8 billion Lottomatica S p A GTECH Holdings Corporation Dewey Ballantine, Gordon Warnke and John Apadula (US) Cravath, Swaine & Moore, Michael Schler, Sean Thompson M & A €218 million ($267.7 million) Grosvenor Group 17% of Sonae Sierra, Portugal Slaughter and May, Graham Earles, Simon Letherman, KPMG (UK) In-house tax M & A Undisclosed Group AXA, France AXA Konzern AG (in connection with a voluntary public acquisition offer) Clifford Chance, Stefan Behrens, Germany M & A £37 million ($66 million) JS&P Holdings Towry Law from Henderson Group Slaughter and May, Paul Fahy (UK) Eversheds, Emma Channon (UK) M & A £143 million ($255 million) Unnamed Spanish investor Deka Immobilien's freehold interest in 100 Wood Street, London Clyde & Co PricewaterhouseCoopers M & A About €6.9 billion ($8.5 billion) Macquarie Infrastructure Group (MIG) and the Eiffage-Macquarie consortium Autoroutes Paris Rhin Rhône (APRR) Clifford Chance, Eric Davoudet, Anne de Dietrich (France) advised Macquarie Infrastructure Group (MIG) and the Eiffage/Macquarie consortium, Bredin Prat advised Eiffage and the Eiffage/Macquarie consortium Willkie Farr & Gallagher and Freshfields Bruckhaus Deringer (France) M & A Undisclosed Symantec Corporation (US) Imlogic (US) Fenwick & West, Ronald Schrotenboer and Adam Halpern In-house tax M & A $518 million Johnson & Johnson Animas Corporation Cravath, Swaine & Moore, William Brannan, Sharon Mendelson Pepper Hamilton Type of deal Value Issuer Lead managers Adviser to Issuer Adviser to lead managers Collateralized loan obligation (CLO) £5 billion ($8.9 billion) Barclays Bank Simmons & Simmons Clifford Chance (UK) Exchangeable bond Issue €572.8 million ($703.1 million) Parapública (Participações Públicas (SGPS)) Citigroup Global Markets and Caixa - Banco de Investimento Morais Leitão Uría Menéndez, Filipe Romão (Portugal) Initial public offering £150 million ($267.5 million) QinetiQ Group Credit Suisse, JPMorgan Cazenove and Merrill Lynch Herbert Smith Freshfields Bruckhaus Deringer, Jonathan Cooklin, Mark Boyle (UK), Claude Stansbury (US)

HMRC has closed down a tax avoidance scheme that had been disclosed to it (HMRC) under the disclosure regime brought in by Finance Act 2004. The scheme would have sought to generate losses artificially by buying and selling the right to dividends on shares.

The American Jobs Creation Act of 2004 added section 7874 to the Internal Revenue Code to combat the perceived abuse of inversions of US corporations into foreign corporations. The statute is overly broad and, as a result, ordinary restructuring transactions involving affiliated corporations may generate significant adverse federal income tax consequences. The temporary regulation just issued fixes much of the overreach problem.

Intra-group service fees are undoubtedly one of the most scrutinized items by the Swedish Tax Agency (STA) during tax audits. The continued scrutiny of intra-group service fees coupled with the STA's often controversial and sometimes erratic positions in its analyses has led to several court cases in this area. Arguably, a review of the aforementioned court cases could dishearten any fervent follower of the transfer pricing guidelines issued by the OECD (OECD Guidelines). Unfortunately for taxpayers and tax practitioners, the Swedish courts have tended to side with the STA. Nevertheless, there may be room for positive reform. A pending court case dealing with intra-group services may give the Swedish Supreme Administrative Court (SAC) an opportunity to set a positive precedent in one of the most recurring transfer pricing issues in Sweden.

The UK government published draft legislation relating to real estate investment trusts (Reits) on December 14. It is anticipated that this regime will be available from January 1 2007. The basic idea is that the Reit will not be subject to UK tax on its property income and gains, but tax on such income and gains will be paid only by the investors in the Reit.