six congress meant just that transactions during two thousand and five or two thousand and six congress did not mean to limit that relief to income received during two thousand and five or two thousand and six it into received in later years we filed our returns in a soon as we carefully study these provisions we promptly filed a refund requests in this tax payers make mistakes all the time there's there's or there's a period within which they can file a refund requ we did and we've been strongly advocating this position since and i think if you look to the types of the statute and the overall question here is did congress mean to you to grant this provisional relief to transactions during two thousand and five two were two thousand and six two matter when the income or was received or did congress mean only to limit this relief to income received in two thousand and five or two thousand and six and i think the statute answers that question by look for into transaction under the government's view the reference to transactions is essentially superfluous and i think that's why the government's brief it's notable that when it quotes the statute it doesn't put transactions in the quote and they basically ask this court to ignore that and you know the other thing that's notable about section when i want to deal is what's not there there's no reference to taxable year which is an income recognition concept you can see that from section four for a one of the code it self you can compare the statute to congress and acted which with the senate bill which was focused on income recognition which did take into account the difference between a fiscal year taxpayer and calendar year taxpayer and there may be i believe there's perhaps limited other litigation pending but that largely i think is a very small category of cases or taxpayers would be impacted by this we're talking about obviously transactions that took place more than a decade ago i mean the way that this provision works even under our patients that this is going to peter out and even for dream works it's no longer receiving income on the two thousand them ease their way through a gradual runway into this new regime in which all this was about on its actually that the the strongest argument on the other side is that we have to the can and that comes out that that if in fact we're interviewing a statute and there's an ambiguity that we are to interpret it in such a way as to assume that congress would have intended to comply with any international treaty obligations so is it your position that that can and doesn't come into play because the statutes on ambiguous are is it your position that even if it comes into play it can't override the other arguments that you make i mean the both of those and let me make it a few points on this because i think we're both interpretations would violate the international agreements that the government is relying on even its interpretation under its interpretation one on one deal would have been contrary to what the european trading partners were talking about at that time and  you know all of that or scores that were dealing with the statute were congress obviously knew it was in the thick of international relations was considering how to balance things protect u s companies bring us in line with international agreements and then add to these provisions and i think that would give the court all the more reasons to carefully follow a congress set and then finally where you say they're sort of a sliding scale in other words i think the government would say well yeah we weren't completely complying with  by but we ought to interpret it as that the more compliance right that we can have would be the veteran chip case we look for cases advocating couldn't find them and i think the reason why doesn't make sense is that are courts that are really sort of taking on the international relations role itself and saying well how do we know how do we want to balance international relations that is maybe one thing we can see that you know congress didn't want to in fear of that at all but once you're in the realm of congress you know directly in there in passing a law that impacting it newt consider that you would evolve a tax but that the final point is an important one which is the international backlash here was with respect to future transactions because that's where the competition was and that's why the focus was on the binding contract law because that had it not going going forward a fact with respect to new transactions section one on one t v just like section one one see didn't deal with new transactions it dealt with the us tax impact of all transactions two thousand and four two thousand and five and two thousand and six and that simply wasn't the concern of our european trading partners and that's why they didn't challenge the government's interpretation of want to see which is although it's not directly the provision of issue in this case i think is an important cornerstone understanding when the government's position has to be wrong one i want to see is a provision that says the repeal don't take effect with respect to transactions after a particular debt and up until the government's brief in this case the iraqis had interpret that provision to mean that for transactions before two thousand and five those transactions for income received in later years would get the full benefit of the e g i was gene going for and again that's not something that was challenge in the european trading european dispute because it dealt with prior transactions but if that's correct and it has together you can see that these are not only next to each other but they speak in the same durational transactional language and when one see you have transactions after december thirty one you thousand and four what does that mean obviously transactions entered into after december thirty one in two thousand and four and the government had interpreted the same exact language which appeared in the e t i act to mean transaction transactions entered into after the particular date that they did that accept that premise then one hundred one d it makes you know it becomes even more crystal clear that congress was referring to transactions entered into during two thousand and five and two thousand and six and for those transactions once they were entered into that period they would continue to enjoy the benefit of the transitional rule not the full e t i regime like pre two thousand and five transactions but the transitional rule and the percentages there are you say that you know there was more reading it wrong narrowly like the government that's your argument and the reason why the reason why the focus was on one of again because it dealt with future transactions it's if you had a binding contract in place then future transaction regime and that's one of the oddities under the government's interpretation is that if you accept that interpretation of one a one c then companies were even a worse position with risk and under the transitional law than they were under one c and that that doesn't make any sense i mean i think another problem of the government's interpretation on one a one c and generally is that even to this day the government has a form on its website its form eight eight seven three for the reporting of  income the government revised that form in september of two thousand and seventeen and i think that that shows that the ira's practice had been recognized that with respect to past transactions particular transactions before two thousand and five which  two thousand and six everything works together under that interpretation the court doesn't have to get into any of the sort of complicated somersaults that the government would have you do and reading things into the statute reading things out of it failing to take into account  congress is not the absence of any special rule for fiscal taxpayers and the like in two thousand and two the government is acting asking this court to read language into the statute in terms of income received from transactions that congress  jacob christiansen for the united states may please a court the government completely agrees that the statute here section i want to one of the american jobs creation act dealt and particular paragraph d dealt with transactions and that the transitional rule applied to transactions there's never been a dispute about that in this case what the parties dispute is the s the transitional relief that was actually provided so in this case the government agreed that d w a's two thousand and six film distribution agreement that transaction w like the distribution of a new film creating more licensing revenues do not constitute new transactions that's correct so as to that transaction the i r s agreed and allowed  going on here in the first clause of the statute which is a clause on which the xperia law is states in the case of transactions during two thousand and five or two thousand and six so even if you interpret the phrase during two thousand and five or two thousand and six to modify transactions all that was accomplishes is to identify which transactions are covered by the transitional row again the government does not dispute that transactions occurring during two get them a different i think that would be different your honor we do not think that the court should interpret paragraph d to to involve any shorthand at all it means what it says when congress your view would be to enough be a freestanding provision which i gather that is outside of it which i gather your new position applies even to two thousand and fourteen transactions excuse follow what is your current position about two thousand and fourteen transactions they would not be entitled to e t i benefits how congress purpose and then acting the amendments made by this sorry i'm sorry answer two thousand and four transactions those transactions would be entitled to one hundred percent of indefinitely no while until december thirty first of two thousand and four we read that effective date provided and what is suppose there is income received in two thousand and five for that two thousand and four transaction what's your view of the treatment of that income then under paragraph see the repeal would be effective to not a freestanding provision outside of d c because you now want to use d to to apply even to the transaction transaction not income well the would apply to any any transaction that is occurring or generating income after the effective date of the repeal or for the two thousand and five and two thousand and six energy to simply says that contain i agree with that and so if you plug in paragraph veto into the governing statutory language it would say that the amount included a bill in gross income by reason of the amendments made by the section shall not exceed apply the two to the first phrase we're just talking about when it talks about truth the only reference in the one to two thousand and five in two thousand and six is in connection with transactions occur in those you want to read the two thousand  clause of the of the one establishes which transactions are covered by the transitional role but the scope of the transitional relief that's actually provided is defined in the subsequent statutory language and it just it just to be clear your position is that the two actually applies to transactions that are outside the one that are in fact under sorry the chief counsel advice on which chief counsel relies came to the conclude from to that conclusion with respect to the earlier each errors and i want to be clear that those chief counsel advice do not set out or reflect the government's official it's clear that congress knew how to differentiate and to actually talk about it period of time that didn't have slaves income when it wanted to it could have done that the reason congress did not do that i believe is reflected in so congress was accommodating that considering it's a limited two years in in terms of what benefits you get it just said limited to two two years in terms of the transactions at issue i mean that there was that trade representative statement wouldn't faze it would allow for all kinds of new transactions to get the benefit yes but so i'm talking about during two thousand and four when the when this was and acted the european union's primary concern was that any was concerned and expressed its concern that congress knew full well when it passed these statutes that it wasn't completely comply and that's i disagree with that and that is the proper inquiry mean in two thousand and six there's no question that the believed that a two year phase out rule was consistent with the united states although they said they were trying to move toward what the w t don't want it without being unduly unit and to american corporations i mean it's clear th legislative history that there it was necessary and appropriate to have some period of transitional relief and congress believed in that if you read the senate report this is expressed there because a senate bill that that  was proposed at the same time actually clearly phased out transitional benefits within two years by the end of two thousand and six and the senate bill explained that congress believed that that was consistent in bringing the united states  with income that particular taxable year it had to do with income that a license out of a transaction and really thank you and that was the case when one regime after another replaced the former regime and gave incentives for our exports but when it came to finally repealing the the export regimes which is what congress did when it finally came to an end and that regime was not replaced it's reasonable for congress to have provided limited benefits to transactions without granting those transactions you know relief indefinitely for as does the word transactions actually do in one a one in one it describes the purpose of that is to describe to which transactions the transitional role applies it applies to transactions occurring during two thousand and five or two thousand and six well it's the subsequent language of the statute that defines the scope of that relief and that is what the parties dispute is about it's not about whether what is the best quote or statement from any of the w t o audience that said something specifically directed to income rather than transactions and how true your transition was supposed to be a transition as to in a transition as to time for entry into transactions even those transactions would have possibly long tails of their beneficial effect we cited the minutes of two thousand and six minutes and the end of our to your transition it seems to me that language by itself doesn't tell us whether the transition is as two transactions or as two income recognition know what it might be trying to focus my question and something that says and what we the europeans mean by two year transition is no more income benefits to these people even if they're old transactions you no doesn't necessarily mean that they thought that at the end of two thousand and six there would be no more benefits so i found the quote says that the european union warmly welcomed the repeal by congress of the grandfather provisions of the american jobs  a little additional time i think your honor so just a few points may number one the government's foremost singular reliance on d to i think is answered by the very first clause of that provision which it neglects to recognize which is understand my friend this morning it would say that a transaction entered into before two thousand and five and so not during two thousand and five would now benefit from the transitional rule in two thousand and subsection d one which which makes no sense in that that i think that's a product of its efforts its new interpretation of section one a one c in this case despite thirteen years or more of a different interpretation and now it's butchered reading of in the transactions could and really underscores the anomaly of the government's position which is why would have congress wanted to treat eight eight ten million dollar sale in two thousand and five differently than a ten million dollar lease which was simply paid over the course of ten certainly doesn't say that it refers to the transitional rule on there just begs the question of whether that rule was limited to transactions two thousand and five and two thousand and six in the ongoing facts or income recognized in later years and four and really when you think about it that provision one o one c meant that for transactions before two thousand and five those transactions would continue to receive the full benefit of the prior regime and the government had