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Swedish Cross-border Reorganisations

Ljungdahl, Carl (2003)
Department of Law
Abstract
Company reorganisations are becoming more and more frequent in order to stay competitive in an international market place and to adapt to the changing economic environment. In this matter, taxation is one of the most important issues and is often a barrier to restructuring operations which is the consequence of the large variation in the effective tax rates in the Community. Therefore, the creation of a level playing field is seen as important. In the European Single Market, it should not make a difference if companies from one Member State, or more than one Member State are involved in a reorganisation. The main problem with reorganisations is the potential loss of taxing jurisdiction by the ''home'' State of the company's capital.... (More)
Company reorganisations are becoming more and more frequent in order to stay competitive in an international market place and to adapt to the changing economic environment. In this matter, taxation is one of the most important issues and is often a barrier to restructuring operations which is the consequence of the large variation in the effective tax rates in the Community. Therefore, the creation of a level playing field is seen as important. In the European Single Market, it should not make a difference if companies from one Member State, or more than one Member State are involved in a reorganisation. The main problem with reorganisations is the potential loss of taxing jurisdiction by the ''home'' State of the company's capital. Without having special rules reserves hidden in the assets would crystallise thus preventing the reorganisation taking place. Moreover, the Community had to balance the competing financial interests of the Member States and of the companies conducting cross-border operations keeping in mind the aim of reaching tax neutrality. The solution adopted by the Community was the Merger Directive of 23 July 1990. It postpones the tax charge to a later disposal. This was a historical breakthrough in the history of the Community because it was the first time that the Member States agreed a significant piece of direct tax legislation in the Community. The scheme of the Merger Directive is to provide a deferral of taxation in certain situations involving (i) mergers, (ii) divisions, (iii) transfers of assets and (iv) exchange of shares. The Merger Directive was incorporated into Swedish law and came into force on 1 January 1995 as Sweden joined the European Community. (Less)
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author
Ljungdahl, Carl
supervisor
organization
year
type
H3 - Professional qualifications (4 Years - )
subject
keywords
EG-rätt
language
English
id
1559787
date added to LUP
2010-03-08 15:55:24
date last changed
2010-03-08 15:55:24
@misc{1559787,
  abstract     = {Company reorganisations are becoming more and more frequent in order to stay competitive in an international market place and to adapt to the changing economic environment. In this matter, taxation is one of the most important issues and is often a barrier to restructuring operations which is the consequence of the large variation in the effective tax rates in the Community. Therefore, the creation of a level playing field is seen as important. In the European Single Market, it should not make a difference if companies from one Member State, or more than one Member State are involved in a reorganisation. The main problem with reorganisations is the potential loss of taxing jurisdiction by the ''home'' State of the company's capital. Without having special rules reserves hidden in the assets would crystallise thus preventing the reorganisation taking place. Moreover, the Community had to balance the competing financial interests of the Member States and of the companies conducting cross-border operations keeping in mind the aim of reaching tax neutrality. The solution adopted by the Community was the Merger Directive of 23 July 1990. It postpones the tax charge to a later disposal. This was a historical breakthrough in the history of the Community because it was the first time that the Member States agreed a significant piece of direct tax legislation in the Community. The scheme of the Merger Directive is to provide a deferral of taxation in certain situations involving (i) mergers, (ii) divisions, (iii) transfers of assets and (iv) exchange of shares. The Merger Directive was incorporated into Swedish law and came into force on 1 January 1995 as Sweden joined the European Community.},
  author       = {Ljungdahl, Carl},
  keyword      = {EG-rätt},
  language     = {eng},
  note         = {Student Paper},
  title        = {Swedish Cross-border Reorganisations},
  year         = {2003},
}