The eurozone crisis — what are the tax and transfer pricing risks?
Europe’s leaders are striving to demonstrate their commitment to defend the euro on the markets, but the eurozone’s outlook for 2013 is still grim. Most countries are heading into recession and unemployment rates continue to rise. Also, there is speculation that the eurozone will disintegrate or that a eurozone country may unilaterally withdraw from the European Monetary Union (EMU).
Many companies are struggling to understand the effect such events may have on contracts whose payments are euro-denominated. Early identification of the most likely tax and transfer pricing risks will help companies understand which practical tax and transfer pricing aspects they could confront upon a Eurozone breakup.
When euro-denominated contracts are between parties from the same Eurozone country, then a departure from the Eurozone by that country should not in principle affect either party. In such circumstances, it is likely that the contract would, by virtue of the implementing legislation, simply be redenominated in the new currency of the relevant country at the rate that country has specified, and the parties will simply continue to perform their contractual obligations as usual. Tax and transfer pricing issues only arise when the contract involves multi-jurisdictional or cross-border transactions that are either euro-denominated or have some euro payment requirements…
If you are registered and logged in to the site, click on the link below to read the rest of the DLA Piper briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from DLA Piper
News from The Lawyer
Briefings from DLA Piper
Health Alert — Julia Clare v Australian Community Pharmacy Authority; Dr Reid v Medical Council of NSW; and more
DLA Piper has released the 22 December 2014 issue of its Health Alert, which focuses on judgments, legislation and reports in the health sector.
The European Court of Justice (CJEU) has handed down a landmark judgment concerning the patentability of stem cells in Europe.
Analysis from The Lawyer
Regulators are ramping up the pressure in the aftermath of recession, leaving firms to compete for compliance and restructuring work
Shearman & Sterling is making its presence felt in the City, squaring up to magic circle firms and looking to muscle in on key relationships. Private equity house Bridgepoint is one outfit that has had its head turned by the US firm.