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Avnet, a US-based distributor of semiconductors, components and computer products is to acquire the European distribution division of VEBA Electronics from E.ON AG, as part of a £2.35 billion ($3.5 billion) consortium bid for VEBA electronics distribution group by Avnet, Arrow Electronics and Schroder Ventures.

The primary motivation behind the recent changes to the Irish corporate tax regime, whereby the standard corporate tax rate is to be reduced to 12.5% by the year 2003, was to preserve the attraction of Ireland as a low-tax platform for the many multinational companies which have invested substantially in Irish operations. However, the new regime also presents significantly more opportunities for the international business community to do business in and/or through Ireland.

Lovells

International telecommunications company Cable & Wireless Communications plc and Cable & Wireless independent directors have restructured in a transaction worth £17.1 billion ($25.4 billion).

Managing the group treasury and tax for a plc is no mean task, but Darren Mee of David S Smith (Holdings) explains to Sharon Cunningham how he has achieved this while still maintaining a balance with his private life

Pursuant to the Finance Bill 2000, the French tax authorities issued new guidelines (Inst. Adm. n°13 D 1 00, June 27 2000) commenting on the rules regarding the granting of rulings for tax-free spin-offs and split-offs (Apports partiels d'actifs and Scissions), as from January 1 2000. Under French tax law, it is possible to benefit from a tax deferral mechanism in the case of a demerger if certain conditions are met (among other things, the assets and liabilities contributed constitute a full and autonomous line of business; the company contributing the full and autonomous line of business undertakes to keep the shares received for three years; and commitments regarding the computation of future capital gains). When those conditions are not met, a ruling must be applied for to benefit from the regime. This is the case, for instance, when a foreign company contemplates contributing its French permanent establishment to a new French company.

Tax Reform 2000 – officially the Act for the Reduction of Tax Rates and Reform of Business Taxation, or the Tax Reduction Act (Steuersenkungsgesetz) – was enacted into law on July 14 2000, after the government outmanoeuvred the staunch CDU/CSU opposition in an interesting display of legislative finesse.

The Singapore government aims to encourage hi-tech start-ups through its new Entrepreneurial Employee Stock Option Scheme. On offer is a 50% tax exemption, in addition to the already low corporate and personal income tax rates. By Linda Ng of White & Case LLP, Tokyo

Plesner & Grønborg

Freshfields Bruckhaus Deringer