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  • Burdens imposed on non-US financial institutions by new US withholding rules can be alleviated by a qualified intermediary agreement with the IRS. By Barbara Hanrehan and Alan Shapiro of Deloitte & Touche, LLP New York and Washington, DC
  • Tax treaty negotiations in Latin America are proceeding at a rapid pace. Jorge Gross and John Salerno of Price Waterhouse LLP, Miami and Boston alert readers to the changes, and to the tax planning opportunities for multinationals
  • The OECD Council has adopted the recommendations of a study by the organization's committee on fiscal affairs on tax sparing. The study looked at the consequences of tax sparing provisions inserted into tax treaties. It showed that such provisions can give significant scope for tax planning and tax avoidance in both the country of the investor and the country of the investment.
  • Telewest Communications, the UK's second-largest cable company, has agreed a £649 million ($1 billion) bid for General Cable, the UK's sixth-largest cable company.
  • US investment groups Blackstone and Colony Capital are to acquire the British Savoy Hotel group for £520 million ($840 million). Deloitte & Touche in New York and London is advising Blackstone. Partners Paul Herrera and Ken MacFarlane are handling tax questions. The Savoy Hotel group is advised by accountants Coopers & Lybrand and by law firm Slaughter & May.
  • Schroder Ventures, a private equity provider, is to buy Leica Microsystems, part of the Leica Holdings group, in a deal valued at $500 million. Leica Microsystems is a world leader in the manufacture of microscopes and other related equipment for the healthcare, research and semi-conductor industries.
  • Carnival Corporation of Miami, together with a group of Norwegian investors led by Christiania Markets, is to buy the Cunard cruise ship line from the Norwegian Kvaerner Group for $500 million. The Cunard line operates five cruise ships. Carnival has also reached an agreement with Kvaerner-Masa Yards to develop and design a new class of ships for Cunard.
  • Bacardi-Martini has bought the Dewars Scotch Whisky and Bombay Gin brands from Diageo in a £1.1 billion ($1.8 billion) deal. Diageo's sale of the brands was required by the US and EU regulatory authorities, when the company was created by the merger of Guinness and Grand Metropolitan in December 1997.
  • The Second Chamber of the Netherlands parliament recently adopted a legislative proposal which, if enacted into law, will radically change the existing rules for taxation of employee stock option plans. The new rules will enter into force on the first day after the official publication of the new rules as approved by the First Chamber of Netherlands parliament in the Official Gazette of the Netherlands. The effective date will probably be somewhere in May or June 1998.
  • The 1998 Japan Tax Reform has now been passed by the Japanese parliament (see International Tax Review February 1998) and became law effective April 1 1998.