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UK corporate tax reform and the changes brought about by last month’s Budget will have a major impact on M&A transactions. Gary Richards of Weil, Gotshal & Manges, London, outlines some of the key issues

Nearly two years after the OECD first published its list of 35 uncooperative tax havens, the Paris-based organization has finally issued its revised blacklist and has, for the first time, made clear that any defensive measures could hit uncooperative OECD members and non-members alike. With only seven countries still on the list, the US is claiming credit for much of the project's success, stating that it was only due to their insistence on changing the direction of the project that most countries signed up.

London-based law firm Lovells has launched a Dutch practice in Amsterdam with the appointment of a team of three lawyers, led by Anton Louwinger, formerly of Andersen in Rotterdam. Louwinger will become a tax partner as soon as the necessary professional formalities are in place. Louwinger will be joined by Aart Nolten and Christiaan van Waalwijk van Doorn, both of whom also come from Andersen's Rotterdam office. Prior to working at Andersen, Louwinger worked with Loeff Claeys Verbeke and Van Mens & Wisselink, whose Rotterdam office he helped to set up.

In a departure from the trend for the big four professional services firms poaching lawyers for their tax groups, Baker & McKenzie has won a tax partner from KPMG in Los Angeles. Michael Lebovitz joined the Palo Alto office on May 1 but will work with his existing Southern California client base for three days a week. He will be instrumental in helping Baker & McKenzie increase its South California work. Lebovitz specializes in business and tax planning in connection with cross-border investment to and from the US and other countries. While at KPMG he spent some time as the national partner in charge of international tax services for its information, communication and entertainment practice and its healthcare and life sciences practice.

European Commission continues state aid probes

US firm Oppenheimer Wolff & Donnelly has hired a KPMG tax partner to lead its tax group in France. Kelly Williams joined the firm's Paris office in early April having been at KPMG since 1994. She previously worked at Andersen in Paris and is trained as both a lawyer and an accountant. Oppenheimer contacted Williams in October last year and has since hired a tax associate for the Paris group. The firm has six partners in Paris, as well as European offices in Brussels and Geneva, and, according to Williams, is planning further expansion across all practice areas throughout Europe. Williams decided to leave KPMG because she was unhappy with the type of work she was performing as a tax partner at a big five firm. She commented: ?Over the years the hierarchy in the big five firms has become oppressive. Once you become a partner there is a lot of administrative work, selling and delegating. I don't think that contributes to serving clients.?

In a recently published decision dated December 19 2001, the Cologne Tax Court interpreted language contained in article 23 (3) of the tax treaty between Germany and Canada as a subject-to-tax clause, and gave this clause precedence over provisions in the treaty by which items of income "shall be taxable only" in Canada. While the interpretation of treaty article 23 (3) as a subject-to-tax clause is not new, the relation of this clause to language in the treaty by which items of income are taxable "only" in a specified treaty state is highly controversial and of considerable practical significance.

HONG KONG SAR

Covering foreign employees in US retirement plans is a complex area and mistakes can be costly. Robert H Masnik and Karen Field of KPMG’s Washington National Tax Compensation and Benefits practice discuss the issues

Influenced significantly by methods based on the OECD transfer pricing guidelines, many countries are adopting and supplementing transfer pricing rules to compete and protect their tax base. This column highlights major transfer pricing developments around the world during the past few months. By Bill Dodge and Giovanni DiCenso, Deloitte & Touche, Washington, DC