By: Howard Jiang
Under the current rules of the US Securities and Exchange Commission (SEC), foreign issuers are allowed to use International Financial Reporting Standards (IFRS) financial statements in their registration statements and periodic reports (17 CFR Parts 210, 230, 239 and 249). This substantially reduces the burden on foreign private issuers compared to complying with US Generally Accepted Accounting Principles (GAAP) auditing standards. Compliance with US GAAP requires engaging a US Public Company Accounting Oversight Board (PCAOB) qualified auditing team and applying US accounting standards, which in many respects are very different from those of the foreign private issuer’s home country or IFRS. This typically increases the complexity and costs associated with the auditing process. (more…)
By: Kevin Koscil and Carlos Piñeiro
A controlled foreign corporation (CFC) is a foreign corporation that is more than 50% owned by shareholders who: (a) are U.S. citizens or residents, domestic entities, or U.S. trusts and estates; and (b) own 10% or more of the foreign corporation’s voting power. Under current law, a pledge of a CFC’s assets in certain loan transactions triggers a deemed distribution to the U.S. shareholders of the CFC for U.S. income tax purposes. This rule applies whether the pledge of the CFC’s assets is direct or indirect, meaning that a pledge of CFC stock could implicate a deemed distribution. Under a safe harbor rule, however, a pledge of less than two-thirds of the CFC’s stock (measured by voting power) will not be considered an indirect pledge of the CFC’s assets.
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By: Gwenn Barney
The United Kingdom government proposed changes to its rules on mergers and acquisitions this week to give itself more oversight over deals that have national security implications.
The proposed rule will allow the government to intervene in a merger or acquisition involving a UK company with at least £1 million ($1.32 million) in revenue in the industries of military or dual use product design and manufacture, computer chip design, and quantum technology. Prior to this proposal, the turnover threshold for such an intervention was £70 million ($92.21 million) or where the effective market share of the combined business reached 25 percent or more.
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“Taking Care of Business” is a new blog from White and Williams’ Corporate and Securities Group. With the help of our friends in Cyber Law and Data Protection, Tax, Real Estate and Finance, Bankruptcy, Intellectual Property, Labor & Employment and Commercial Litigation, TCB will focus on emerging issues impacting the business community at every stage of the lifecycle from formation to growth and to exit. Whether it be important updates on day-to-day operational matters such as tax planning, employee benefits, commercial contracts, corporate finance, intellectual property, regulatory and data privacy and cybersecurity, or best practices and recent trends or legal developments of note applicable to transactional matters including acquisitions, strategic alliances, private equity and venture capital financings and debt financings, we’ve got you covered. And of course, we will keep you posted on any recent developments on the litigation and bankruptcy fronts too. In short, TCB will be a “one stop shop” for insights and commentary on everything relevant to owning and operating a business.
To give you a sense of the breadth of topics to be covered, today’s blog highlights five current legal issues that are on the minds of many of our clients. (more…)
