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Treaty Shopping Measures In Cross-Border Merger

Posted on:2014-05-16Degree:MasterType:Thesis
Country:ChinaCandidate:R ZouFull Text:PDF
GTID:2256330401478196Subject:International law
Abstract/Summary:PDF Full Text Request
The execution of Taxation Treaties is the outcome of the cooperation of certain’countires that may harmonize each countrys interests and provide their citizenspreferential taxation policies during economic activities. However, the utility of treatyshopping measures breaks the relativity of the treaties, and becomes an important toolfor international taxpayers to evade tax especially in cross-border merger andacquisitions involved loans and transfer of interests. As a legal tool to regulatetaxation problems between countires, taxation treaties, on one hand,birngsconsiderable economic interests, but on the other may induce certain unexpectedproblems. Thus, we need to justify the value of the taxation treaties cautiously, andtake active measures whether international or domestic to improve internationaltaxation system. Therefore, the author analyzes current anti-treaty-shopping measures,and raises certain proposals to enhance China’s anti-treaty-shopping system.This article concerns the two steps in cross-border merger and acquisition, whichmay involve treaty-shopping measures, one is the financing round before acquisitionand the other is the transfer of share interests after acquisition, and analyzes differentcountri’es anti-treaty-shopping measures in both steps and their pros and cons.Anti-treaty-shopping measures may strike international tax evasion, however, if notcorrectly designated or executed,they may conflict with taxation treaties or eveninternational legal pirnciples. Therefore, this article focuses on the US legislation andjustice history in relevant ifelds to help China build an effective and harmonious anti-treaty-shopping system.As an important participant in world economy, China may take advantage of’other countires experience and latest international rules. With the increasing ofcross-border merger and acquisitions, and the lack of expeirence duirng ifghtingagainst treaty shopping measures, China has to research ’others systems andpromulgate its own system according to its national conditions.This article utilizes the approach of history research, compairson and generalanalysis to study treaty-shopping measures. It concerns international basicanti-treaty-shopping system and focuses on the US approach, furthermore raisesproposals for China to improve its own system based on its national conditions andcurrent legislation.As to the rfamework of this article, it has three chapters:Chapter1is treaty shopping measures and anti-treaty-shopping measures. Thischapter introduces basic theory, approaches and harm of treaty shopping measures andgeneral international anti-treaty-shopping system.Chapter2is legal practice and comment of US anti-treaty-shopping system.This chapter analyzes US history of striking treaty shopping through time-lineincluding its judicial cases and its taxation treaties as well as comments its pros andcons.Chapter3is legal practice and proposals of Chi’nas anti-treaty-shopping system.This chapter concerns Chi’nas international domestic law to analyze its currentlegislation and raise proposals to improve its system.As the increase of cross-border investment, treaty shopping may become a vitalproblem, so China needs to pay cautious attention to it and this article may provide anapproach to improve China’s anti-treaty-shopping system.
Keywords/Search Tags:Treaty, shopping, Anti-treaty-shopping, measures, Cross-border Merger and Acquisition
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