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  • Whether a duty imposed on the capitalisation of undistributed, but previously taxed, profits of a capital company constitutes a capital duty prohibited by Council Directive 69/335/EEC, as amended by Council Directive 85/303/EEC.
  • The recent controversy surrounding the taxation of relevant discount securities in the UK has produced a situation similar to that which applied in 1996. Sarah Squires of Cadwalader, Wickersham & Taft in London asks if the months of debate were really necessary
  • After a string of victories in the US tax courts, the IRS has lost a transfer pricing case. Not only did Compaq (the company concerned) avoid the excess tax that the IRS had charged, but they also received a positive adjustment of $21 million. This is the first time in a reported case that a company has received a positive adjustment.
  • When Japan lifted its restriction on holding companies last year, it opened up a range of possibilities. Dean Yoost of PricewaterhouseCoopers and Masaakira Kitazawa of Anderson Mori advise on how to avoid the pitfalls and make the most of the new opportunities
  • Punch Taverns is acquiring Allied Domecq Retailing in the UK for £2.75 billion ($4.4 billion). This will make Punch the second-largest public house operator in the UK after Nomura Securities. Rival leisure company Whitbread retired from the fight to gain control of Allied when the UK Department of Trade and Industry decided that The Competition Commission would have to examine the Whitbread bid.
  • The OECD has produced a report criticizing Switzerland for its bank secrecy rules. The annual report on the Swiss economy warned that the country would come under increasing foreign pressure to reveal banking information, because of the potential for tax evasion.
  • Canadian law firm Stikeman Elliott is advising British American Tobacco (BAT) on its offer to acquire Imasco, the Canadian consumer products group. BAT already owns 42% of Imasco, but is offering to buy the remaining equity for around C$ 10.3 billion ($6.9 billion). If the deal goes ahead BAT will keep Imperial Tobacco, Imasco’s tobacco business, but sell the group’s other subsidiaries.
  • KPMG and Linklaters & Alliance together are providing tax advice to Tarmac plc on the proposed demerger of their construction operations to Carillion plc, from their Heavy Building Materials division which is being retained by Tarmac.
  • The Chicago and Los Angeles offices of Mayer Brown & Platt are advising Abbott laboratories on the acquisition of ALZA corporation. The transaction values ALZA, a research-based pharmaceuticals company, at approximately $7.3 billion. The deal follows ALZA’s earlier acquisition of SEQUUS Pharmaceuticals earlier this year.
  • Baker & Botts is advising Schlumberger on the merger of Sedco Forex Offshore. Sedco will merge with Transocean in a merger valued at $3.2 billion. The merger will create the world’s largest offshore drilling company, which will be called Transocean Sedco Forex.