99–010 

Calendar No. 465

107TH CONGRESS REPORT " SENATE ! 2d Session 107–188 

REVERSING THE EXPATRIATION OF PROFITS OFFSHORE 

ACT

JUNE 28, 2002.—Ordered to be printed 

Mr. BAUCUS, from the Committee on Finance, 

submitted the following 

R E P O R T 

[To accompany S. 2119] 

The Committee on Finance, to which was referred the bill (S. 

2119) to amend the Internal Revenue Code of 1986 to provide for 

the tax treatment of inverted corporate entities and of transactions 

with such entities, and for other purposes, reports favorably thereon with an amendment and recommends that the bill as amended 

do pass.

CONTENTS 

Page 

I. Legislative Background .................................................................................... 1 

II. Explanation of the Bill ..................................................................................... 2 

A. Tax Treatment of Inversion Transactions ................................................. 2 

B. Reinsurance Agreements ............................................................................. 7 

III. Budget Effects of the Bill ................................................................................. 9 

A. Committee Estimates .................................................................................. 9 

B. Budget Authority and Tax Expenditures .................................................. 11 

C. Consultation with Congressional Budget Office ....................................... 11 

IV. Votes of the Committee .................................................................................... 11 

V. Regulatory Impact and Other Matters ........................................................... 11 

A. Regulatory Impact ....................................................................................... 11 

B. Unfunded Mandates Statement .................................................................. 12 

C. Tax Complexity Analysis ............................................................................ 12 

VI. Changes in Existing Law Made by the Bill as Reported .............................. 12

I. LEGISLATIVE BACKGROUND 

At a hearing on March 21, 2002, notice was given that the Senate Committee on Finance intended to take action to curtail the 

benefits of inversion transactions. On June 13, 2002, the Committee began to mark up S. 2119 (the ‘‘Reversing the Expatriation 

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of Profits Offshore Act’’), with certain modifications. On June 18, 

2002, the Committee resumed the mark-up and approved the bill, 

as modified, by voice vote.

II. EXPLANATION OF THE BILL 

A. TAX TREATMENT OF INVERSION TRANSACTIONS

PRESENT LAW

Determination of corporate residence 

The U.S. tax treatment of a multinational corporate group depends significantly on whether the top-tier ‘‘parent’’ corporation of 

the group is domestic or foreign. For purposes of U.S. tax law, a 

corporation is treated as domestic if it is incorporated under the 

law of the United States or of any State. All other corporations 

(i.e., those incorporated under the laws of foreign countries) are 

treated as foreign. Thus, place of incorporation determines whether 

a corporation is treated as domestic or foreign for purposes of U.S. 

tax law, irrespective of other factors that might be thought to bear 

on a corporation’s ‘‘nationality,’’ such as the location of the corporation’s management activities, employees, business assets, operations, or revenue sources, the exchanges on which the corporation’s stock is traded, or the residence of the corporation’s managers and shareholders. 

U.S. taxation of domestic corporations 

The United States employs a ‘‘worldwide’’ tax system, under 

which domestic corporations generally are taxed on all income, 

whether derived in the United States or abroad. In order to mitigate the double taxation that may arise from taxing the foreignsource income of a domestic corporation, a foreign tax credit for income taxes paid to foreign countries is provided to reduce or eliminate the U.S. tax owed on such income, subject to certain limitations. 

Income earned by a domestic parent corporation from foreign operations conducted by foreign corporate subsidiaries generally is 

subject to U.S. tax when the income is distributed as a dividend 

to the domestic corporation. Until such repatriation, the U.S. tax 

on such income is generally deferred. However, certain anti-deferral regimes may cause the domestic parent corporation to be taxed 

on a current basis in the United States with respect to certain categories of passive or highly mobile income earned by its foreign 

subsidiaries, regardless of whether the income has been distributed 

as a dividend to the domestic parent corporation. The main antideferral regimes in this context are the controlled foreign corporation rules of subpart F (sections 951–964) and the passive foreign 

investment company rules (sections 1291–1298). A foreign tax credit is generally available to offset, in whole or in part, the U.S. tax 

owed on this foreign-source income, whether repatriated as an actual dividend or included under one of the anti-deferral regimes. 

U.S. taxation of foreign corporations 

The United States taxes foreign corporations only on income that 

has a sufficient nexus to the United States. Thus, a foreign corporation is generally subject to U.S. tax only on income that is ‘‘efVerDate May 23 2002 04:15 Jul 02, 2002 Jkt 099010 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\SR188.XXX pfrm12 PsN: SR188
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fectively connected’’ with the conduct of a trade or business in the 

United States. Such ‘‘effectively connected income’’ generally is 

taxed in the same manner and at the same rates as the income of 

a U.S. corporation. An applicable tax treaty may limit the imposition of U.S. tax on business operations of a foreign corporation to 

cases in which the business is conducted through a ‘‘permanent establishment’’ in the United States. 

In addition, foreign corporations generally are subject to a grossbasis U.S. tax at a flat 30-percent rate on the receipt of interest, 

dividends, rents, royalties, and certain similar types of income derived from U.S. sources, subject to certain exceptions. The tax generally is collected by means of withholding by the person making 

the payment. This tax may be reduced or eliminated under an applicable tax treaty. 

U.S. tax treatment of inversion transactions 

Under present law, U.S. corporations may reincorporate in foreign jurisdictions and thereby replace the U.S. parent corporation 

of a multinational corporate group with a foreign parent corporation. These transactions are commonly referred to as ‘‘inversion’’ transactions. Inversion transactions may take many different 

forms, including stock inversions, asset inversions, and various 

combinations of and variations on the two. Most of the known 

transactions to date have been stock inversions. In one example of 

a stock inversion, a U.S. corporation forms a foreign corporation, 

which in turn forms a domestic merger subsidiary. The domestic 

merger subsidiary then merges into the U.S. corporation, with the 

U.S. corporation surviving, now as a subsidiary of the new foreign 

corporation. The U.S. corporation’s shareholders receive shares of 

the foreign corporation and are treated as having exchanged their 

U.S. corporation shares for the foreign corporation shares. An asset 

inversion reaches a similar result, but through a direct merger of 

the top-tier U.S. corporation into a new foreign corporation, among 

other possible forms. An inversion transaction may be accompanied 

or followed by further restructuring of the corporate group. For example, in the case of a stock inversion, in order to remove income 

from foreign operations from the U.S. taxing jurisdiction, the U.S. 

corporation may transfer some or all of its foreign subsidiaries directly to the new foreign parent corporation or other related foreign 

corporations. 

In addition to removing foreign operations from the U.S. taxing 

jurisdiction, the corporate group may derive further advantage 

from the inverted structure by reducing U.S. tax on U.S.-source income through various ‘‘earnings stripping’’ or other transactions. 

This may include earnings stripping through payment by a U.S. 

corporation of deductible amounts such as interest, royalties, rents, 

or management service fees to the new foreign parent or other foreign affiliates. In this respect, the post-inversion structure enables 

the group to employ the same tax-reduction strategies that are 

available to other multinational corporate groups with foreign parents and U.S. subsidiaries, subject to the same limitations. These 

limitations under present law include section 163(j), which limits 

the deductibility of certain interest paid to related parties, if the 

payor’s debt-equity ratio exceeds 1.5 to 1 and the payor’s net interest expense exceeds 50 percent of its ‘‘adjusted taxable income.’’

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More generally, section 482 and the regulations thereunder require 

that all transactions between related parties be conducted on terms 

consistent with an ‘‘arm’s length’’ standard, and permit the Secretary of the Treasury to reallocate income and deductions among 

such parties if that standard is not met. 

Inversion transactions may give rise to immediate U.S. tax consequences at the shareholder and/or the corporate level, depending 

on the type of inversion. In stock inversions, the U.S. shareholders 

generally recognize gain (but not loss) under section 367(a), based 

on the difference between the fair market value of the foreign corporation shares received and the adjusted basis of the domestic corporation stock exchanged. To the extent that a corporation’s share 

value has declined, and/or it has many foreign or tax-exempt shareholders, the impact of this section 367(a) ‘‘toll charge’’ is reduced. 

The transfer of foreign subsidiaries or other assets to the foreign 

parent corporation also may give rise to U.S. tax consequences at 

the corporate level (e.g., gain recognition and earnings and profits 

inclusions under sections 1001, 311(b), 304, 367, 1248 or other provisions). The tax on any income recognized as a result of these 

restructurings may be reduced or eliminated through the use of net 

operating losses, foreign tax credits, and other tax attributes. 

In asset inversions, the U.S. corporation generally recognizes 

gain (but not loss) under section 367(a) as though it had sold all 

of its assets, but the shareholders generally do not recognize gain 

or loss, assuming the transaction meets the requirements of a reorganization under section 368. 

REASONS FOR CHANGE

The Committee believes that inversion transactions resulting in 

a minimal presence in a foreign country of incorporation are a 

means of avoiding U.S. tax and should be curtailed. In particular, 

these transactions permit corporations and other entities to continue to conduct business in the same manner as they did prior to 

the inversion, but with the result that the inverted entity avoids 

U.S. tax on foreign operations and may engage in earnings-stripping techniques to avoid U.S. tax on domestic operations. The Committee believes that certain inversion transactions (involving 80 

percent or more identity of stock ownership) have little or no nontax effect or purpose and should be disregarded for U.S. tax purposes. The Committee believes that other inversion transactions 

(involving more than 50 but less than 80 percent identity of stock 

ownership) may have sufficient non-tax effect and purpose to be respected, but warrant heightened scrutiny and other restrictions to 

ensure that the U.S. tax base is not eroded through related-party 

transactions. 

EXPLANATION OF PROVISION

In general 

The provision defines two different types of corporate inversion 

transactions and establishes a different set of consequences for 

each type. Certain partnership transactions also are covered. 

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1Since the top-tier foreign corporation would be treated for all purposes of the Code as domestic, the shareholder-level ‘‘toll charge’’ of sec. 367(a) would not apply to these inversion transactions. 

Transactions involving at least 80 percent identity of stock ownership 

The first type of inversion is a transaction in which, pursuant to 

a plan or a series of related transactions: (1) a U.S. corporation becomes a subsidiary of a foreign-incorporated entity or otherwise 

transfers substantially all of its properties to such an entity; (2) the 

former shareholders of the U.S. corporation hold (by reason of holding stock in the U.S. corporation) 80 percent or more (by vote or 

value) of the stock of the foreign-incorporated entity after the 

transaction; and (3) the foreign-incorporated entity, considered together with all companies connected to it by a chain of greater than 

50 percent ownership (i.e., the ‘‘expanded affiliated group’’), does 

not have substantial business activities in the entity’s country of 

incorporation, compared to the total worldwide business activities 

of the expanded affiliated group. The provision denies the intended 

tax benefits of this type of inversion by deeming the top-tier foreign 

corporation to be a domestic corporation for all purposes of the 

Code.1

In determining whether a transaction would meet the definition 

of an inversion under the provision, stock held by members of the 

expanded affiliated group that includes the foreign incorporated entity is disregarded. For example, if the former top-tier U.S. corporation receives stock of the foreign incorporated entity (e.g., so-called 

‘‘hook’’ stock), the stock would not be considered in determining 

whether the transaction meets the definition. Similarly, if a U.S. 

parent corporation converts an existing wholly owned U.S. subsidiary into a new wholly owned controlled foreign corporation, the 

stock of the new foreign corporation would be disregarded. Stock 

sold in a public offering related to the transaction also is disregarded for these purposes. 

Transfers of properties or liabilities as part of a plan a principal 

purpose of which is to avoid the purposes of the provision are disregarded. In addition, the Treasury Secretary is granted authority 

to prevent the avoidance of the purposes of the provision, including 

avoidance through the use of related persons, pass-through or other 

noncorporate entities, or other intermediaries, and through transactions designed to qualify or disqualify a person as a related person or a member of an expanded affiliated group. Similarly, the 

Treasury Secretary is granted authority to treat certain non-stock 

instruments as stock, and certain stock as not stock, where necessary to carry out the purposes of the provision. 

Transactions involving greater than 50 percent but less than 80 percent identity of stock ownership 

The second type of inversion is a transaction that would meet the 

definition of an inversion transaction described above, except that 

the 80-percent ownership threshold is not met. In such a case, if 

a greater-than-50-percent ownership threshold is met, then a second set of rules applies to the inversion. Under these rules, the inversion transaction is respected (i.e., the foreign corporation is 

treated as foreign), but: (1) any applicable corporate-level ‘‘toll 

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charges’’ for establishing the inverted structure may not be offset 

by tax attributes such as net operating losses or foreign tax credits; 

(2) the IRS is given expanded authority to monitor related-party 

transactions that may be used to reduce U.S. tax on U.S.-source income going forward; and (3) section 163(j), relating to ‘‘earnings 

stripping’’ through related-party debt, is strengthened. These measures generally apply for a 10-year period following the inversion 

transaction. In addition, inverting entities are required to provide 

information to shareholders or partners and the IRS with respect 

to the inversion transaction. 

With respect to ‘‘toll charges,’’ any applicable corporate-level income or gain required to be recognized under sections 304, 311(b), 

367, 1001, 1248, or any other provision with respect to the transfer 

of controlled foreign corporation stock or other assets by a U.S. corporation as part of the inversion transaction or after such transaction to a related foreign person is taxable, without offset by any 

tax attributes (e.g., net operating losses or foreign tax credits). To 

the extent provided in regulations, this rule will not apply to certain transfers of inventory and similar transactions conducted in 

the ordinary course of the taxpayer’s business. 

In order to enhance IRS monitoring of related-party transactions, 

the provision establishes a new pre-filing procedure. Under this 

procedure, the taxpayer will be required annually to submit an application to the IRS for an agreement that all return positions to 

be taken by the taxpayer with respect to related-party transactions 

comply with all relevant provisions of the Code, including sections 

163(j), 267(a)(3), 482, and 845. The Treasury Secretary is given the 

authority to specify the form, content, and supporting information 

required for this application, as well as the timing for its submission. 

The IRS will be required to take one of the following three actions within 90 days of receiving a complete application from a taxpayer: (1) conclude an agreement with the taxpayer that the return 

positions to be taken with respect to related-party transactions 

comply with all relevant provisions of the Code; (2) advise the taxpayer that the IRS is satisfied that the application was made in 

good faith and substantially complies with the requirements set 

forth by the Treasury Secretary for such an application, but that 

the IRS reserves substantive judgment as to the tax treatment of 

the relevant transactions pending the normal audit process; or (3) 

advise the taxpayer that the IRS has concluded that the application was not made in good faith or does not substantially comply 

with the requirements set forth by the Treasury Secretary. 

In the case of a compliance failure described in (3) above (and in 

cases in which the taxpayer fails to submit an application), the following sanctions will apply for the taxable year for which the application was required: (1) no deductions or additions to basis or cost 

of goods sold for payments to foreign related parties will be permitted; (2) any transfers or licenses of intangible property to related foreign parties will be disregarded; and (3) any cost-sharing 

arrangements will not be respected. 

If the IRS fails to act on the taxpayer’s application within 90 

days of receipt, then the taxpayer will be treated as having submitted in good faith an application that substantially complies with 

the above-referenced requirements. Thus, the deduction disallowVerDate May 23 2002 04:15 Jul 02, 2002 Jkt 099010 PO 00000 Frm 00006 Fmt 6659 Sfmt 6602 E:\HR\OC\SR188.XXX pfrm12 PsN: SR188
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ance and other sanctions described above will not apply, but the 

IRS will be able to examine the transactions at issue under the 

normal audit process. The IRS is authorized to request that the 

taxpayer extend this 90-day deadline in cases in which the IRS believes that such an extension might help the parties to reach an 

agreement. 

The ‘‘earnings stripping’’ rules of section 163(j), which deny or 

defer deductions for certain interest paid to foreign related parties, 

are strengthened for inverted corporations. With respect to such 

corporations, the provision eliminates the debt-equity threshold 

generally applicable under section 163(j) and reduces the 50-percent thresholds for ‘‘excess interest expense’’ and ‘‘excess limitation’’ to 25 percent. 

In cases in which a U.S. corporate group acquires subsidiaries or 

other assets from an unrelated inverted corporate group, the provisions described above generally do not apply to the acquiring U.S. 

corporate group or its related parties (including the newly acquired 

subsidiaries or assets) by reason of acquiring the subsidiaries or assets that were connected with the inversion transaction. The Treasury Secretary is given authority to issue regulations appropriate to 

carry out the purposes of this provision and to prevent its abuse. 

Partnership transactions 

Under the provision, both types of inversion transactions include 

certain partnership transactions. Specifically, both parts of the provision apply to transactions in which a foreign-incorporated entity 

acquires substantially all of the properties constituting a trade or 

business of a domestic partnership, if after the acquisition at least 

80 percent (or more than 50 percent but less than 80 percent, as 

the case may be) of the stock of the entity is held by former partners of the partnership (by reason of holding their partnership interests), and the ‘‘substantial business activities’’ test is not met. 

For purposes of determining whether these tests are met, all partnerships that are under common control within the meaning of section 482 are treated as one partnership, except as provided otherwise in regulations. In addition, the modified ‘‘toll charge’’ provisions apply at the partner level. 

EFFECTIVE DATE

The regime applicable to transactions involving at least 80 percent identity of ownership applies to inversion transactions completed after March 20, 2002. The rules for inversion transactions 

involving greater-than-50-percent identity of ownership apply to inversion transactions completed after 1996 that meet the 50-percent 

test and to inversion transactions completed after 1996 that would 

have met the 80-percent test but for the March 20, 2002 date.

B. REINSURANCE AGREEMENTS

PRESENT LAW

In the case of a reinsurance agreement between two or more related persons, present law provides the Treasury Secretary with 

authority to allocate among the parties or recharacterize income 

(whether investment income, premium or otherwise), deductions, 

assets, reserves, credits and any other items related to the reinsurVerDate May 23 2002 04:15 Jul 02, 2002 Jkt 099010 PO 00000 Frm 00007 Fmt 6659 Sfmt 6602 E:\HR\OC\SR188.XXX pfrm12 PsN: SR188
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2Sec. 845(a). 

3See S. Rep. No. 97–494, ‘‘Tax Equity and Fiscal Responsibility Act of 1982,’’ July 12, 1982, 

337 (describing provisions relating to the repeal of modified coinsurance provisions). 4The authority to allocate, recharacterize or make other adjustments was granted in connection with the repeal of provisions relating to modified coinsurance transactions. 

ance agreement, or make any other adjustment, in order to reflect 

the proper source and character of the items for each party.2 For 

this purpose, related persons are defined as in section 482. Thus, 

persons are related if they are organizations, trades or businesses 

(whether or not incorporated, whether or not organized in the 

United States, and whether or not affiliated) that are owned or 

controlled directly or indirectly by the same interests. The provision may apply to a contract even if one of the related parties is 

not a domestic company.3 In addition, the provision also permits 

such allocation, recharacterization, or other adjustments in a case 

in which one of the parties to a reinsurance agreement is, with respect to any contract covered by the agreement, in effect an agent 

of another party to the agreement, or a conduit between related 

persons. 

REASONS FOR CHANGE

The Committee is concerned that reinsurance transactions are 

being used to allocate income, deductions, or other items inappropriately among U.S. and foreign related persons. The Committee is 

concerned that foreign related party reinsurance arrangements 

may be a technique for erosion of the U.S. tax base. The Committee 

believes that the provision of present law permitting the Treasury 

Secretary to allocate or recharacterize items related to a reinsurance agreement should be applied to prevent misallocation, improper characterization, or to make any other adjustment in the 

case of such reinsurance transactions between U.S. and foreign related persons (or agents or conduits). The Committee also wishes 

to clarify that, in applying the authority with respect to reinsurance agreements, the amount, source or character of the items may 

be allocated, recharacterized or adjusted. 

EXPLANATION OF PROVISION

The provision clarifies the rules of section 845, relating to authority for the Treasury Secretary to allocate items among the parties to a reinsurance agreement, recharacterize items, or make any 

other adjustment, in order to reflect the proper source and character of the items for each party. The provision authorizes such allocation, recharacterization, or other adjustment, in order to reflect 

the proper source, character or amount of the item. It is intended 

that this authority 4 be exercised in a manner similar to the authority under section 482 for the Treasury Secretary to make adjustments between related parties. It is intended that this authority be applied in situations in which the related persons (or agents 

or conduits) are engaged in cross-border transactions that require 

allocation, recharacterization, or other adjustments in order to reflect the proper source, character or amount of the item or items. 

No inference is intended that present law does not provide this authority with respect to reinsurance agreements. 

The Committee notes that no regulations have been issued under 

section 845(a). The Committee expects that the Treasury DepartVerDate May 23 2002 04:15 Jul 02, 2002 Jkt 099010 PO 00000 Frm 00008 Fmt 6659 Sfmt 6602 E:\HR\OC\SR188.XXX pfrm12 PsN: SR188
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ment shall issue regulations under section 845(a) to address effectively the allocation of income (whether investment income, premium or otherwise) and other items, the recharacterization of such 

items, or any other adjustment necessary to reflect the proper 

amount, source or character of the item. 

EFFECTIVE DATE

The provision is effective for any risk reinsured after April 11, 

2002.

III. BUDGET EFFECTS OF THE BILL 

A. COMMITTEE ESTIMATES

In compliance with paragraph 11(a) of rule XXVI of the Standing 

Rules of the Senate, the following statement is made concerning 

the estimated budget effects of the committee amendment to the 

bill as reported.

10


Insert offset folio 13 here SR188.001
11

B. BUDGET AUTHORITY AND TAX EXPENDITURES

Budget authority 

In compliance with section 308(a)(1) of the Budget Act, the Committee states that the revenue provisions of the committee amendment to the bill as reported involve no new or increased budget authority. 

Tax expenditures 

In compliance with section 308(a)(2) of the Budget Act, the Committee states that the revenue provisions of the committee amendment to the bill as reported involve no new tax expenditures. 

C. CONSULTATION WITH CONGRESSIONAL BUDGET OFFICE

In accordance with section 403 of the Budget Act, the Committee 

advises that the Congressional Budget Office (‘‘CBO’’) has not submitted a statement on the bill. The letter from CBO was not received in a timely manner, and therefore will be provided separately. 

IV. VOTES OF THE COMMITTEE 

In compliance with paragraph 7(b) of rule XXVI of the Standing 

Rules of the Senate, the following statements are made concerning 

the votes taken on the Committee’s consideration of the bill. 

Motion to report the committee amendment 

The bill was ordered favorably reported by a voice vote, a 

quorum being present, on June 18, 2002. 

Votes on other amendments 

None.

V. REGULATORY IMPACT AND OTHER MATTERS 

A. REGULATORY IMPACT

Pursuant to paragraph 11(b) of rule XXVI of the Standing Rules 

of the Senate, the Committee makes the following statement concerning the regulatory impact that might be incurred in carrying 

out the provisions of the bill as amended. 

Impact on individuals and businesses 

The provisions do not impose increased regulatory burdens on individuals. 

The provisions affect certain businesses that have undertaken, or 

that plan to undertake, inversion transactions and partnership 

transactions covered by the bill. Businesses that have not undertaken or planned to undertake such transactions generally are not 

affected by the provisions of the bill. Thus, the bill generally does 

not impose increased regulatory burdens on businesses. 

Impact on personal privacy and paperwork 

The provisions of the bill do not impact personal privacy. 

12

B. UNFUNDED MANDATES STATEMENT

The Committee on Finance has reviewed the provisions of the 

bill as approved by the Committee on June 18, 2002. In accordance 

with the requirements of Public Law 104–4, the Unfunded Mandates Reform Act of 1995, the Committee has determined that the 

provisions of the bill contain Federal private sector mandates. The 

Committee has concluded that the provisions of the bill contain no 

intergovernmental mandates within the meaning of Public Law 

104–4. 

C. TAX COMPLEXITY ANALYSIS

Section 4022(b) of the Internal Revenue Service Reform and Restructuring Act of 1998 (the ‘‘IRS Reform Act’’) requires the Joint 

Committee on Taxation (in consultation with the Internal Revenue 

Service and the Department of the Treasury) to provide a tax complexity analysis. The complexity analysis is required for all legislation reported by the Senate Committee on Finance, the House 

Committee on Ways and Means, or any committee of conference if 

the legislation includes a provision that directly or indirectly 

amends the Internal Revenue Code (the ‘‘Code’’) and has widespread applicability to individuals or small businesses. 

The staff of the Joint Committee on Taxation has determined 

that a complexity analysis is not required under section 4022(b) of 

the IRS Reform Act because the bill contains no provisions that 

amend the Internal Revenue Code and that have ‘‘widespread applicability’’ to individuals or small businesses. 

VI. CHANGES IN EXISTING LAW MADE BY THE BILL AS 

REPORTED 

In the opinion of the Committee, it is necessary in order to expedite the business of the Senate, to dispense with the requirements 

of paragraph 12 of rule XXVI of the Standing Rules of the Senate 

(relating to the showing of changes in existing law made by the bill 

as reported by the Committee).

Æ