March 06, 2015
In an effort to deter some types of tax inversion by U.S. corporations, the Obama administration issued a number of anti-inversion rules last fall. Law firms involved in such cross-border deals have expressed differing views on the impact of these measures. The Globe and Mail turned to Torys Tax partner Peter Keenan for his perspective on the new tax rules.
Below is an excerpt of the article.
To many, it appeared the flow of corporate headquarters out of the U.S. would be stopped cold by the new U.S. rules, issued by the U.S. Treasury in September 2014. And indeed, many lawyers with top Canadian firms who work on these deals say they have dried up. But some say U.S. companies may still seek to merge with Canadian partners for tax reasons, and the new rules are not necessarily big obstacles for all future deals. "What I have heard – I haven’t seen it yet – is smaller U.S. companies, mid-cap, particularly in pharma, might continue to look to do one of these deals," said Peter Keenan, a partner in the New York office of Torys LLP who works on cross-border mergers. "I think we’ll see some activity. It certainly won’t be as robust as last year."
For more on cross-border tax inversion, read our M&A Top Trends 2015 article “U.S. Clampdown on Inversions Closes Some Doors but Leaves Others Open.”
To read the full article, click here.