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  • The US Congress has found that foreign multinationals may have an unfair advantage in the international tax market. Hal Hicks, David Benson and Marjorie Rollinson of Ernst & Young, Washington examine the prospects for change and possible amendments to tax shelter rules
  • Germany’s 1999 tax reform act, enacted by the legislature on March 19 1999, contains numerous changes to the taxation of domestic and registered foreign mutual funds. These amendments affect both investors and the mutual funds themselves. This article highlights the tax implications of the new law for foreign investment funds held by German investors.
  • The announcement that Tony Rumble, a Finance and Treasury taxation specialist, has joined PricewaterhouseCoopers as a partner, has provoked strong reactions from Arthur Andersen, where Rumble had been working on a six month contract.
  • New York firm Skadden Arps Slate Meagher & Flom is advising Chicago-based telecoms group Ameritech, on the disposal of its cellular business to GTE. The deal is worth $3.2 billion and is a direct result of Ameritech’s planned merger with SBC communications. The deal is contingent on that merger (worth $56 billion) being completed. The merger has yet to be approved by the Federal Communications Commission, but will not be affected by GTE’s merger with Bell Atlantic.
  • Clifford Chance is advising the Bank of New York on its acquisition of Royal Bank of Scotland Trust Bank, which is the largest provider of pension fund services in the UK.
  • The German Finance Minister, Hans Eichel, has indicated that he will appoint Heribert Zitzelsberger, Head of Tax at Bayer Chemicals, as his deputy on tax policy. The move may promote better relations between industry and government on tax policy, following the unpopular policies of former finance minister Oskar Lafontaine.
  • US law firm Wachtell, Lipton, Rosen & Katz is advising Fleet Financial on its takeover of BankBoston. The acquisition, which is valued at $16 billion will end BankBoston’s four year aggressive expansion policy.
  • From April 1 1999 foreign banks and securities dealers with no presence in Switzerland will be able to trade on the Swiss stock exchange. This change has triggered amendments to Swiss stamp tax legislation. Charles Hermann of KPMG, Banking Tax Group, Zurich reports
  • A recent advance ruling discussed the ambit of the non-discrimination clause in Article 26 of the Double Taxation Avoidance Agreement between India and France (DTAA). The issue was whether the applicant (a non-resident French Banking Company, operating through a branch office in India) could use lower tax rates as applicable to a domestic company (as against the higher rates applicable to a non-domestic foreign company).
  • The convention on the elimination of double taxation in connection with the adjustment of profits of associated enterprises (the Arbitration Convention) comes into force in Finland on May 1 1999. This relates to Denmark, Italy, Luxembourg, the Netherlands, Portugal and the UK.