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Terumo wins Vascutek for $170 million Sunday, 6-Oct-02 00:00:00 GMT NewsInBrief 11212 Japanese medical device company is acquiring Vascutek vascular grafts business from Centerpulse for $170 million. The deal was announced on October 4 and is due to close in November. Terumo is expanding its cardio vascular departments including catheter systems for vascular diagnosis and treatment and artificial pulmonary systems. Its acquisition of Vascutek will been used to develop treatments for conditions including aneurysms.

PricewaterhouseCoopers has closed the sale of its consulting business to IBM. The sale was completed on October 2 after being approved by the PricewaterhouseCoopers member firms and partners globally and receiving all regulatory clearances. IBM paid approximately $3.5 billion for the business, which had previously been considered for an IPO under the name "Monday".

Italian Prime Minister Silvio Berlusconi tried to please everyone with his draft budget announced last week. But despite its intention to trim the state deficit and promise of more than €7 billion in tax cuts, tax advisers claim it will do little for big business.

Carlyle Group sets up $600 million VC fund Sunday, 6-Oct-02 00:00:00 GMT NewsInBrief 11213 The Carlyle Group has established the venture capital fund, Carlyle Venture Partners, which raised over $600 million of capital commitments from institutional investors and high-net-worth individuals worldwide. Simpson Thacher & Bartlett advised the Carlyle Group with Adam Rosenzweig working on tax issues.

Sixth VAT Directive – Article 13A(1)(f) and Article 13B(a) – Exemption for services performed by independent groups not likely to give rise to distortions of competition – Exemption for insurance transactions and related services performed by insurance brokers and insurance agents – Assessments of damage caused to motor vehicles carried out by an association on behalf of insurance companies which are members of that association.

The US Internal Reveunue Service (IRS) is strengthening its anti-tax shelter stance and has set new audit priorities. The strategy is designed to focus on key areas of non-compliance and will hit promoters of the schemes first before aiming to identify participants in the tax evasion efforts.

Following the publication of the revised Catalogue of Foreign Investment in Industries, effective April 1 2002, the State Administration of Customs issued a circular clarifying the import value-added tax and customs tax exemption for equipment imported by a foreign invested enterprise for its own use within the enterprise's total investment amount. The circular states that "encouraged" projects approved after April 1 2002, and "encouraged" projects that were once categorized as "restricted B" projects in the old guidance catalogue, which involve technology transfers, are now both entitled to the tax exemptions.

Multinational groups that operate in a large number of taxing jurisdictions face challenges in demonstrating compliance with the arm's-length standard. Among the growing number of countries that demand contemporaneous documentation, there is very little commonality in requirements. This makes it difficult to achieve economies of scale in the preparation of documentation.

TransCanada

Under draft legislation published recently, the UK intends to restrict the interest deduction that can be claimed by a UK branch through the imposition of an arm's-length debt-to-equity ratio on the branch. At present there is often little restriction in practice on the deduction that UK branches of overseas companies, particularly banks, can claim in the UK in respect of borrowing costs. In comparison, the interest deductions of a UK subsidiary of a foreign parent are effectively limited by the existence of its equity capital (restricting its level of debt). This has resulted in a disparity between the tax treatment of UK branches and UK subsidiaries, which favours (in this respect) branches. The government has decided to take action, because the current position is out of line with other major industrialized countries (in particular, France, Germany and the US).