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The Spanish general tax law (Ley General Tributaria) regulates the main principles and the basic framework of the Spanish taxation system. It was issued in 1963 and underwent substantial modifications in 1985, 1995 and 1998. The government intends to replace it with a new law to update it into a single text and to modernize it. The first step has been to appoint a Reform Commission. The aim of this commission is to provide the government with ideas and proposals from various sources (tax professionals, employers' associations, etc).

DATE TYPE OF DEAL VALUE ACQUIRER TARGET HOLDER ADVISERS TO TARGET ADVISERS TO ACQUIRER ADVISERS TO HOLDER 23/3/01 acquisition $130 million Micron Electronics (US) Interland (US) N/A Kilpatrick Stockton, Atlanta, Lynn Fowler Fenwick & West, Palo Alto, Jim Garahan, Adam Halpern N/A 27/3/01 acquisition $10.5 billion Johnson & Johnson (US) ALZA Corporation (US) N/A Heller Ehrman White & McAuliffe, San Francisco, Robert Alexander, Keith Betzina,Teresa Maloney; ALZA, Peter Staple, Susan Fairbrook Cravath Swaine & Moore, New York, Lewis Steinberg, Gregory Schmolka N/A 27/3/01 acquisition $500 million Marathon Oil Company (US) Pennaco Energy Inc (US) N/A Vinson & Elkins, Texas, Barry Miller, Judy Blissard, John Jeffers Baker Botts, Texas, Benjamin Wells, Michael Bresson, Chuck Campbell; Marathon, Rich Molina N/A 22/3/01 acquisition $550 million Avnet Inc (US) Kent Electronics Corporation (US) N/A Locke, Liddell & Sapp, Texas, Gene Lewis Carter Ledyard & Milburn, New York, Jerome Cohen, Howard Barnet N/A

In a recent memorandum to the Ministry of Finance, a Swedish tax committee has proposed changes to the regulations governing the Swedish tax surcharge. The reason behind the proposal is that the regulations will lead to improved compliance – in comparison with the existing rules – with the European Declaration of Human Rights and the principles in respect of penalties.

In April 2001, Mexico's President Fox sent to Congress the proposed tax reform deferred from December 2000. The proposed changes were deferred to allow them to better conform with the so-called integral tax reform and prepare them for discussion and approval. The tax reform programme is expected to take a long time passing through Congress, and approval cannot be expected before the end of May/beginning of June 2001.

A ruling by the European Court of Justice (ECJ) last year has put additional pressure on the Finnish government to amend the Finnish avoir fiscal system for dividend taxation. In the ruling, the ECJ found that the Dutch dividend tax system was incompatible with the EC Treaty. Although under the Finnish avoir fiscal system foreign dividends are treated differently than Finnish dividends, it has been argued that the Finnish system has a discriminatory effect.

The decision recently handed down by the European Court of Justice (ECJ) in the matter of AMID NV suggests that central aspects of German tax law on cross-border loss utilization are in violation of the freedom of establishment clause of the EC Treaty (article 43; formerly, article 52). As pointed out by Gert Saß (Der Betrieb 2001, 508), the judgment raises two questions:

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An increasing number of multinationals are implementing their stock option plans in Germany. There are both benefits for employees and tax consequences for the local German subsidiary. By Hans-Jörg Fischer, Deloitte & Touche, Frankfurt

New transfer pricing provisions were introduced in India as part of the Union Budget 2001. And not before time, in a country that is at the forefront of those reaping the benefits of globalization. By Mukesh Butani of Andersen, Mumbai

When changes to the ‘mixer’ regime were set in progress, UK corporations were left with a narrowing range of planning options. Some possibilities for a Dutch resident mixer are considered here. By Gay Deuchar and Frank van Hulsen, Ernst & Young’s International Tax Services department