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Towards the end of 1998, Congress approved Law 25.063 which included substantial modifications to the value-added tax (VAT) law, including within its scope "services provided abroad which are used or effectively exploited within Argentina". Until then only imported goods were subject to tax, and only services provided within Argentina were taxable.

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.

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.

Herbert Smith, Nicholson Graham & Jones and Nabarro Nathanson are advising the Birmingham Alliance on the redevelopment of Birmingham in the UK. The Birmingham Alliance is the title given to three limited partnerships who will invest £800 million (1.3 billion) redeveloping the Bullring and other buildings in the city. The companies involved; Hammerson PlC, Henderson Investors, and Land Securities, aim to pool their existing investments and coordinate redevelopment of the area.

Danish law firm O Bondo Svane is advising financial services group Unidanmark on its merger with insurance company Tryg-Baltica. The deal will create one of the largest asset management groups in the Nordic region. The new company will be known as Unidanmark A/S, managing Dkr250 billion ($36.8 billion) worth of assets. The transaction will integrate Tryg Baltica’s central insurance organization and Unibank’s (a subsidiary of Unidanmark) insurance companies.

On March 11 1999 the Supreme Court allowed a double deduction of expenses, once for Japanese and once for Dutch corporate income tax purposes. However, to put the case in context, it is first necessary to provide some background information on transfer pricing and explain the concept of an informal capital contribution in the Netherlands. Dutch tax law does not contain specific provisions regarding transfer pricing. Taxable profits are determined by applying the general rules detailed in Articles 7 and 9 of the Dutch Income Tax Act, and there is a wealth of case law in this respect.

As discussed in the previous update, the Australian government has set up a committee to report on the reform of Australia's business tax system. The reforms considered in relation to interest deductibility from an international perspective are summarized below.

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.

The European Court of Justice’s decision in ICI v Colmer has forced the UK Inland Revenue to alter the rules governing group relief. Yash Rupal and Neal Todd of Linklaters & Alliance explore the new opportunities available throughout the EU

Director of Tax and Corporate Strategy UK