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  • Revenue Canada has just issued a release detailing its views on how it will apply transfer pricing legislation and penalties. Canada's penalties apply to post-1998 taxation year adjustments, and are calculated as 10% of the adjustment to income or loss. Taxpayers can avoid a transfer pricing penalty by preparing 'reasonable effort' contemporaneous documentation that demonstrates adherence to arm's-length principles. The Canadian authorities' view as to the meaning of reasonable effort is extensive.
  • Australian business income taxation was recently reviewed in a report which detailed the findings of a discussion paper, A Platform for Consultation, issued earlier this year. The report's objective was to review Australia's current business income tax system and provide recommendations.
  • Neutrality limits review options
  • The UK chemicals company ICI has sold its acrylics business in Belgium to Ineos Acrylics for $847 million.
  • The international telecommunications network Global Crossing has bought the UK company Racal Telecom for $1.7 billion. Global Crossing, a US company based in Bermuda, outbid the US company Energis for Racal, and will use the deal to strengthen its presence in the UK.
  • The $11.6 billion deal between US companies Union Carbide and Dow Chemicals is near completion, with Union Carbide shareholders voting on the merger on December 1.
  • The Bank of Scotland has launched a £20.85 billion ($34.7 billion) hostile bid for the UK's National Westminster Bank (NatWest). The surprise offer comes one month after NatWest agreed to pay £10.8 billion ($17.4 billion) for the life assurer Legal & General.
  • Vulcan Ventures has invested $1.65 billion in RCN, the New Jersey-based telecommunications company. The investment group, which was established in 1986 by Microsoft co-founder Paul Allen, is helping RCN extend its residential network across the US.
  • Davis Polk conducts Merrill Lynch deal
  • Nestlé has agreed to sell its European frozen food business to a Swedish-US investment group.