Document: 463 U.S. 159 103 S.Ct. 2933 77 L.Ed.2d 545 CONTAINER CORPORATION OF AMERICA, Appellantv.FRANCHISE TAX BOARD. No. 81-523. Argued Jan. 10, 1983. Decided June 27, Syllabus California imposes a corporate franchise tax geared to income. It employs the "unitary business" principle and formula apportionment in applying that corporations doing business both inside outside State. The used—commonly called "three-factor" formula—is based, equal parts, on proportion of unitary business' total payroll, property, sales are located Appellant paperboard packaging manufacturer is Delaware corporation headquartered Illinois elsewhere. also has number overseas subsidiaries incorporated countries which they operate. In calculating for years question this case share its net income was apportionable under three-factor formula, appellant omitted all subsidiaries' sales. Appellee Franchise Tax Board issued notices additional assessments, gravamen should have treated as part rather than passive investment. After paying assessments protest, brought an action refund Superior Court, upheld assessments. Court f Appeal affirmed. Held: 1. California's application foreign proper. Pp. 175-180. (a) taxpayer burden showing by "clear convincing evidence" state results extra-territorial values being taxed. This will, if reasonably possible, defer judgment courts deciding whether particular set activities constitutes business." Court's task determine court applied correct standards case, and, it did, within realm permissible judgment. 175-176. (b) Here, there no merit appellant's argument important analyzed incorrect legal standard. Rather, factors relied upon holding constituted business— included assistance obtaining equipment, filling personnel needs could not be met locally, substantial role played loaning funds guaranteeing loans provided others, considerable interplay between area expansion, technical subsidiaries, supervisory officers providing general guidance subsidiaries—taken combination clearly demonstrate reached conclusion "within judgment." 177-180. 2. use apportion consisting fair. had proving apportioned out appropriate proportions transacted offering various statistics appeared only wage rates generally lower operate but those offset levels productivity. may well addition payroll going into production any given corrugated container subsidiary, other factors, contributing same production. mere fact possibility reflected accounting does disturb underlying premises method. 180-184. 3. obligation Foreign Commerce Clause employ "arm's-length" analysis used Federal Government most nations evaluating consequences intercorporate relationships. Japan Line, Ltd. v. County Los Angeles, 441 434, 99 1813, 60 336, distinguished. 184-197. double taxation occasioned scheme impermissible. Due difference tangible would trouble avoiding subject even adopted arm's-length approach. Moreover, result "inevitable" taxation. perverse, simply sake taxation, require give up one allocation method sometimes favor another result. 189-193. violate "one voice" standard established supra, at variance with federal policy will struck down either implicates issues must left or violates clear directive. Three weigh strongly against might lead significant retaliation. create automatic "asymmetry" international imposed domestic entity, legitimate interest reducing corporations, amenable taxed way pays more function rate pre-empted law fatally inconsistent policy. There claim statutes themselves provide necessary pre-emptive force. requirement some treaties adopt form taxing multinational enterprises waived taxes each contracting own corporations. do cover States. And Congress never enacted legislation designed regulate 193-197. 117 Cal.App.3d 988, 173 Cal.Rptr. 121, Franklin C. Latcham, San Francisco, Cal., appellant. Neal J. Gobar, Diego, appellee. Justice BRENNAN delivered opinion Court. 1 appeal claiming State Process Clauses Constitution. common large States, authority charged administering state's tax. presents three questions review: (1) Was improper appellee find purposes tax? (2) Even finding proper, certain salient differences among national economies render so inaccurate enterprise constitutional "fair apportionment"? (3) event, did Clause, Const., Art. I, § 8, cl. 3, government inter-corporate relationships? 2 * 3 Various aspects systems based provoked repeated litigation See, e.g., ASARCO, Inc. Idaho Comm'n, 458 ----, 102 3103, 73 787 (1982); F.W. Woolworth Co. Taxation Revenue Dept., 3128, 819 Exxon Corp. Wisconsin Dept. Revenue, 447 207, 100 2109, 65 66 (1980); Mobil Oil Commissioner Taxes, 445 425, 1223, 63 510 Moorman Mfg. Bair, 437 267, 98 2340, 57 197 (1978); General Motors Washington, 377 436, 84 1564, 12 430 (1964); Butler Bros. McColgan, 315 501, 62 701, 86 L.Ed. 991 (1942); Bass, Ratcliff & Gretton, 266 271, 45 82, 69 282 (1924); Underwood Typewriter Chamberlain, 254 113, 41 45, 165 (1920). 4 Under Constitution, not, when imposing income-based tax, "tax value earned borders." U.S., S.Ct., 3109. more-or-less integrated operating State, however, arriving precise territorial allocations "value" often elusive goal, theory practice. See 438, 1232; 507-509, 704-705; 47. For reason we long held Constitution single J.C. Penney Co., 311 435, 445, 61 246, 250, 85 267 (1940), "distinct 'clear cogent evidence' [the tax] extraterritorial . ." Corp., 221, 2119, quoting 507, 704, Norfolk Western R. North Carolina ex rel. Maxwell, 297 682, 688, 56 625, 628, 80 977 (1936). 5 One deriving locally taxable basis formal geographical transactional accounting. problem manipulation imprecision, ignores captures inadequately many subtle largely unquantifiable transfers take place components enterprise. 438-439, 1232, sources cited. business/formula very different approach businesses jurisdiction. rejects accounting, instead calculates local base first defining scope enterprise's jurisdiction part, then apportioning rest world taking account objective measures corporation's without ago constitutionality method, although constraints. Hans Rees' Sons, 283 123, 51 385, 75 879 (1931); now gained wide acceptance, forms Uniform Division Income Purposes Act (Uniform Act), last count been substantially 23 including California. B 6 Two traditionally attracted judicial attention. These are, easily guess, notions "formula apportionment," respectively. 7 8 allow arising interstate activities—even proportional basis—unless " 'minimal connection' 'nexus' 'a rational relationship attributed intrastate enterprise.' Corporation 219-220, 2118, C rp. 437, 1231. At least, principles obvious self-executing limitation purported unless least conducted 220, 2118; 444, 249, (1940). requires bond ownership control uniting 9 addition, quoted out-of-State related concrete in-State activities. functional meaning sharing exchange capable identification measurement—beyond flow investment distinct operation—which renders reasonable 3115; 438-442, 1232-1234. combined vertically whose (manufacturing, sales, etc.) operated across boundaries. recognized apply, enterprises, series similar separately jurisdictions linked managerial operational resources produced scale value. More recently, further refined concept (1980), where States' findings, (1982), found such findings improper. 10 statute issue from relevant provisions derived, tracks just discussed. particular, distinguishes "business income" multi-jurisdictional enterprise, Cal.Rev. Tax.Code Ann. §§ 25128-25136, "non-business" income, not.1 Although explicitly separately, antedated adoption Act,2 abandoned.3 11 A final point made about speak, unitary: variations theme, them logically consistent motivating example, decide respect lines treat subsidiary per se investment.4 440-441, 1233, that, matter, rule constitutionally required: "Superficially, division appear a[n] attractive limiting apportionability. But organization nothing unity diversity enterprise." Id., 440, 1233. 13 Thus, provides: 14 "In owning controlling, directly indirectly, corporation, owned controlled, consolidated report facts deems necessary." 25104 (West 1979).5 15 States approach, apply American countries.6 difficult address Part V whether, reasons implicated Mobil,7 variation theme barred. 16 17 Having determined constitute business," Such must, Clauses, 219, 227-228, 2122-2123; 272-273, 2343-2344; Inc., 134, 389. first, again obvious, component fairness what internal consistency—that every jurisdiction, business's second external consistency—the factor actually reflect sense how generated. "invalidat[e] whenever source 272, 2344 (emphasis added). 120-121, 46-47. Nevertheless, strike can prove "by 'out State,' [Hans Inc.,] 135, 389, 'led grossly distorted result,' [Norfolk 390 317, 326, 88 995, 1001, 19 1201 (1968) ]." 274, 2345. 18 formula—commonly formula—which Cal.Code 25128-25136 1979). We approved McCoglan, supra. Indeed, our approval, become, discuss detail infra, 183, something benchmark formulas judged. 282, 2349 (BLACKMUN, J., dissenting); cf. District Columbia, 380 553, 561, 1156, 1161, 68 (1965). Besides fair, discrimination commerce. 1235; 444-448, 1819-1821, 336 (1979) (property tax). Aside forbidding types commerce, construed differ methods produce resultant higher incur were limited commerce context, anti-discrimination practice required much fair apportionment. explained eliminating overlapping establish mandated rules regarding cases. 278-280, 2347-2348. Because thought essentially legislative, declined undertake it, fairly invalid because differed prevailing As 185-187, searching inquiry confronted II 20 manufacturing custom-ordered packaging. Its operation integrated, includes raw timber wastepaper composition finished products ordered customers. domestic. During case—1963, 1964, 1965 controlled four Latin European countries. percentage (either through subsidiaries) ranged 66.7% 100%. instances (about half) 100% remainder nationals. company book Another inactive. engaged—in their respective markets—in 21 Most were, like itself, fully few bought intermediate Sales materials accounted 1% purchases. relatively autonomous matters day-to-day management. rare, occurred fill position locally. United training program employees, groups employees occasionally visited 2-6 week periods familiarize operation. senior vice-president overseeing operations subsidiaries. professionalism, profitability, ethical practices dealt major problems long-term decisions; management hands executives who always citizens host country. decisions capital expenditures review appellant, worked consensus outright domination. directors boards play active decisions.8 22 respects, decidedly close. approximately half debt directly, guaranteed, advice consultation techniques, engineering, design, architecture, insurance, cost entering service agreements informal arrangement. Finally, assisted procurement selling equipment employing purchasing department act agent subsidiaries.9 filed returns. 1969, after conducting audit returns question, years. approaches initial appellee's capture case.10 24 unapportioned business, earnings derived (subject adjustments here), include deducted—as authorized law, see 167, n. 1—all dividend non-business gains assets business. these calculations summarized margin.11 25 1969 investments. Including two primary effects: increased amount (less inter-subsidiary dividends, 5, supra ), decreased effect, increase liability years.12 26 paid amounts sued refund, raising before tried stipulated facts, On appeal, affirmed, 121 (1981), Supreme refused exercise discretionary review. noted probable 456 960, 2034, 72 483 (1982). III A. 27 first. previously noted, taxed." Supra, 164. corollary said closely context Norton 340 534, 71 377, 95 517 (1951): 28 "The rule, applicable here, immunity establishing his exemption. "This merely 29 original matter decided differently. Of course, cases, power examine whole record arrive independent rights invaded, mean re-examine, instance, supported evidence." 537-538, (footnotes omitted; emphasis added).13 30 id., 538, (concluding "in light evidence, [state] [on State] judgment."). limits established. factual records parties enter stipulation, tend complex, line "historical fact" "constitutional fuzzy best. Cf. nn. 22, 23, 3114-3115, 23. cause certainty little good turns colorable erred de novo adjudication, unintended nuances spawn avalanche critical comment.14 case; "was judgment."15 31 singularly unconvinced standard," Woolworth, 3134, articulated argues improperly potential dispositive reaching finding. fact, mentioned "major appellant," Cal.App.3d, 998, Cal.Rptr., 127, principally, discussing observation "[h]igh officials gave directions compliance parent's practices." 127-128.16 endorsing administrative presumption engaged unitary. court's reasoning, element many. considering put, "presumption" criticized reasonable. Investment truly "distinct" main serves diversifying portfolio risks inherent tied industry's cycle. When invests engages work becomes likely make better use—either integration expertise—of existing resources. 32 urges us bright-line requiring prerequisite mercantile characterized "a goods." Brief decline invitation. acceptable value, goods.17 reiterated "contributions [of subsidiaries] result[ed] integration, centralization management, scale." 3135, Mobil, 1232. "[S]ubstantial mutual interdependence," 3139, arise ways; goods one. 33 new "considerable expansion," 997, "substantial" 998-999, 127-128, differs ASARCO Woolworth,18 comes closer cases presenting "functionally enterprise," entitled entity. need sufficient existence Taken combination, judgment."19 IV 34 turn Once again, proof; "there 1231, "out State," 35 challenges grounds, practical (although theoretical) character First, significantly profitable is, ignoring relying indirect systematically distorts true obvious: profit figures precisely sort basic theoretical weaknesses justify resort place. considered rejected pointing exists, 36 "separate [geographical] while purports isolate portions received fail contributions resulting ale. profitability whole, misleading characterize having identifiable 'source.' separate useful auditing, required." 1232 (citation omitted). 37 Appellant's related, answered way. contends that: 38 costs primarily workers wages formulary apportionment, unfairly inflates operations, higher." 12. 39 supports demonstrate, operate, able show plant labor thousand square feet 40% plants. 40 itself come close impeaching rationale behind formula. therefore contributing—albeit indirectly—to Both imperfect proxies ideal achieve practice, describe theory. Some particularly problematic focus small spectrum formulas, see, supra; occasion distortive effect focusing outrageous reversal. rel (1931), entirely property resulted attribution 85% taxpayer's over course years, purposely skewed resolve doubts 21.7%. one-factor "albeit face, operates reach profits attributable transactions jurisdiction." 42 approval avoid sorts distortions present 43 necessarily imperfect.20 seen evidence demonstrating margin error (systematic not) greater urged case: allegedly enormous caused tables 11-12, reveal methodology employed 14%, far cry 250% led figure certainly attributing Ford Motor Beauchamp, 308 331, 273, 304 (1939); 44 outlined, conclude proper happens, quite Each qualified approach—often referred approach—to corporations.21 most—but all—purposes entity dealing arm's length affiliated realizes books. If domestic, probably difference, 170-171. Given international, scrutiny Clause. 446, 1236; Ltd., 1820; Bowman Chicago N.W.R. 125 465, 482, 689, 696, 700 (1888). Line. 46 Line involved attempt impose apparently apportioned, nondiscriminatory, ad valorem cargo containers instrumentalities temporarily ports. containers, home port Japan. convention signed clear, neither imported nation. "[w]hen seeks considerations, beyond doctrine governing Interstate Clause], play." 1820. enhanced risk multiple mitigate, eliminate, "neither nor Nation ensure full entities sovereign. instrumentality domiciled abroad, country domicile right, consistently custom nations, seek basis, inevitably results. absence authoritative tribunal ensuring aggregation computed though 'fairly apportioned' instrumentality's presence ' "to [domestic] exposed, clause forbids." 447-448, 1821, Evco Jones, 409 91, 94, 93 349, 351, 325 (1972), J.D. Adams Storen, 307, 311, 58 913, 916, 82 1365 (1938) (footnote 47 consideration arises "impair uniformity essential." 448, 1821. 48 "A frustrate achievement several ways. disputes reconciling formulae arise. novel creates asymmetry structure, disadvantaged levy retaliate American-owned jurisdictions. followed State's subjected varying degrees plainly prevent 'speaking voice' regulating commerce." 450-451, 1822-1823 49 concluded failed meet tests 451-454, 1823-1824. 50 respects. actual appe lant's part.22 Second, stems serious divergence schemes authorities. Third, authorities accepted Government, degree spoken, seems prefer community California.23 ways distinguishable Line.24 involves property. distinguished 444-446, 1235-1236, 228-229, 2122-2123, suggesting "[t]he situs carry force" 1235. real, "inevitabl[e]" scheme. 447, claimed right full, part—a 452, 455, 1820, 1823, 1825. contrast, faced allocating multi-national divides pie principles. mathematical generalization. Whether twice portion dependent solely individual case.25 third here falls, owners specifically open "domestically commerce," 7, 1819, and—to extent analogized place—this falls reservation.26 52 distinctions add difference. explain, do. 53 "[e]ven slight tax—a deemed minimis context—assumes importance sensitive relations sovereignty concerned." 456, 1825 statement absolute prohibition state-induced end. But, issue. deserves receive scrutiny, takes alternatives available 54 eliminate adhering rule: whatsoever, "that owned, registered abroad exclusively 1819. To adhere means unfair, express try all, deal party suggested unfairness elaboration. Or adopting version That guarantee end 55 already multi-corporate despite reliance, recognizes, engage transfer ledgers. U.S.C. 482 (whether incorporated, organized affiliated) indirectly interests, Secretary Treasury] distribute, apportion, allocate gross deductions, credits, allowances businesses, he determines distribution, order evasion axes businesses."27 And, expect, Internal Service developed elaborate regulations content provision. Many provisions.28 problem, outlines, reallocate substantially, exists.29 subjecting occur apportionment.30 think, product 187-188. Allocating bears resemblance, emphasized throughout opinion, slicing shadow. central coordinating authority, consistency, similar, too ask.31 "inevitably" 188, enough suspect. since 59 argued whatever system adopts case. implication defer, internationally bright standard, variety 482-type reallocation disfavored affairs, forbearance extreme one-sided. finally decision impermissible "may impair essential," "prevents trade," 453, 1824, Michelin Tire Wages, 423 276, 285, 96 535, 540, 495 (1976). inquiry, keep mind resonances, implicate cannot infer, "[a]bsent explicit directive Congress, treatment level mandates identical States." 1237. 20, 1825, 20; 286, 541. considerations species preemption analysis. threat pose offending trading partners leading nation whole. 450, 1822. issue, problem. competence determining offended acts, less balance retaliation sovereign let please. best do, develop observations imperatives trade relations. real came 446-449, 1236-1237. discussed another, seem justifiably "asymmetry," 188,192-193. imposed, corporation. Although, "counts" arguably incidence corporation.32 remains doubt considers unorthodox raised economic result, assume offense event attenuated 64 may, implications note, unlike Executive Branch file amicus curiae brief opposition tax.33 lack submission dispositive. discussed, suggest States—whose nuances, emphasize aga n, province Court—is seriously threatened specific indications congressional intent, fares better. great enterprises,34 corporations.35 else, confirms view reality concern. none entered covers sub-national governmental units States,36 Senate occasion, proposed treaty, attached reservation declining gives consent provision treaty extended restriction States.37 true, "Congress debated, enacted, income." 1237.38 "explicit directive" relaxed residual concern preempted VI 67 Affirmed. STEVENS took 70 POWELL, whom THE CHIEF JUSTICE O'CONNOR join, dissenting. addresses presented commendable thoroughness. my view, (1979). I consider With candidly concedes: (i) "double context," ante, 193; (ii) "like [California's taxation," 187; (iii) "deserves scrutiny," 189. concedes "[t]his respects," 187, "seems [arm's-length] community," 187. identifies sustains validity inevitable incompatability community. fails "close scrutiny" manner meets requirements exacting uniformity. enunciated controlling here: unconstitutional "creates taxation" voice commercial governments.' 451, 1823. 74 undisputed "has explains, occurs "serious[ly] diverge[s]" Id.,. nevertheless upholds ground reduce conforming practice.1 190-193 recognize fundamental current remain system. present, exists uses assumptions calculated contrary, allocates rates, values, prices higher. Hellerstein W. Hellerstein, Local 538-539 (4th ed. 1978). inherently leads 76 illustration overwhelming majority app. 112. Since America California, ate's method.2 Correspondingly, 27% worldwide ibid. wages, represented 6% total; 20% 14% total. 109-111. roughly 13% income—less total—was allocated words, largest group elsewhere accordance America, time eliminated changing practices. 78 still exist application.3 Colombia, intracorporate transfer. differences, presently tolerated arm'slength suppose another. refined, resolved eliminated. 79 sum, system, structure fundamentally assumptions. uniform jurisdictions—despite agreement principles—may different. former, inevitable. avoided itself. latter, disagreements application. unavoidable judgments, kind negotiation. reject, does, solution violation details 81 acknowledges decis contrary Government's "prefer[ence for] community." Ante, states assessing rejection preference: 'one directive." 194 original). concludes, speaking perceives plan distinctions, "implicates Government." "the 'asymmetry.' 194-195 original) (quoting 1824). inconsistency high, logical expectation 83 relies technically 195. argument. sense, unquestioned governments indifferent overall grounds complain heavier discouraging accept dilemma involving attempts occurs, created. inapplicable disputes, expected.4 thus unconstitutional—at companies. invalidating unacceptable. leave free discriminate permit discrimination5 authorization. suggests rate. theory, political restraints infeasible. increased, forced raise corporations.6 wishes follow objection. accomplished process objections. attaches weight tax." footnote, dismisses Solicitor General's memorandum Bridge Iron Caterpillar Tractor 81-349, currently pending 195, 33. memorandum, makes believes: "imposition [a impairs essential."7 Memorandum Amicus Curiae O.T.1981, p. change time, ignore raises exactly withdrawn supplemented anything position. us, views accurately 87 convincing. flatly prevents field Government.8 intrusion affairs permitted identified constraints satisfy comply declared "[i]f contravenes precepts, unconstitutional." today requirements. declare unconstitutional. Certain domicile. Other situs. 25123-25127 Honolulu Board, Cal.2d 417, 552, 386 P.2d (1963); 406, 545, (1963). 990-991, 993-995, 25137 1979) (allowing alternative "not represent activity state"). note speak other. 25105 (defining "ownership control"). dividends inclusion double-counting subsidiary's (first parent). 25106. hybrid non-domiciliary invoked justification taxpayer, return objection properly proceedings. 441, 15, 15. STEVENS, merits, stating part: "Either Mobil's 'petroleum enterprise' not; Vermont evaluate entire manner." 461, 1243 462, 1244 (STEVENS, dissenting) (outlining State); 1981 Term, Harv.L.Rev. 62, 93-96 G.A.O. Report Chairman, House Committee Ways Means: Key Issues Affecting Multijurisdictional Corporate Need Resolving involve reasons. parent calculation themselves. ase conceded somewhere barred 1236. hands-off attitude toward comported company's philosophy emphasizing responsibility accountability; respect, divisions. industry, advertising industry highly consumer habits development dose expertise successful. pol cy sensibilities customers governments. spill-over good-will subsidiaries; ask representatives recommend firms, refer became negotiation contract customer subsidiary. adjustments, payments, claims refunds, outlined text illustrative descriptions regard liability. subsequent events, remove party's financial stake resolution issues. disregard simplicity. ------------------------------------------------------------------- --- Total Percentage Amount Tax(5.5%) ------------------------------------------------------------------ 1963. $26,870,427.00 11.041 $2,966,763.85 $163,172.01 1964. 28,774,320.48 10.6422 3,062,220.73 168,442.14 1965. 32,280,842.90 9.8336 3,174,368.97 174,590.29 Exhibit A-7 Stipulation; Record 36, 76, 77, 79, 104, 126. According notices, obligations follows: (5.5%) 1963 $37,348,183.00 8.6886 $3,245,034.23 $178,476.88 1964 44,245,879.00 8.3135 3,673,381.15 202,310.95 46,884,996.00 7.6528 3,588,012.68 197,340.70 79. contexts. Brooks Florida, 389 413, 541, 643 (1967); New York Times Sullivan, 376 254, 710, 728, 686 (1964). go saying making partial minority interests bare supreme claim. concluded, courts, realistically minimal investments term. ---- - 3115. misapplication concept, "destroy" entirely. 3114. partially-owned wholly-owned examined detail, reversed finding, concluding crucial errors, conclusions drew, analyzing 3134. "dispositive 3134 added), relevant, unitariness, implicit 2167-169, range theme. scholar "flow goods" workable test Recent Developments Apportionment Circumscription Unitary Business, Nat'l 487, 501-502 (1968); Allocation Dividends Delineation Notes 155 test, Commonwealth ACF Industries, Pa. 129, 271 A.2d 273 (1970). McLure, Operational Interdependence Is Not Appropriate 'Bright Test' Business—At Least Now, 107 (1983). However sensible law. also, 3135 ("no phase parent's."), (undisputed testimony stated parent), ("each responsible financing parent"), 3136 -- -, ("With possible exception, during year former employee parent.") deserve mention. loan guarantees. indication arm's-length, obvious. Corn Products Commissioner, 350 46, 50-53, 23-24, (1955), serve function. guarantees effort insure [appellant] continue grow become strength profitability." Container Annual 6, reproduced Stipulation Facts. 6-9, 11. noteworthy affairs. type occasional oversight—with debt, dividends—that 3138. illustrates, decentralization accountability defeat 224, 2120. lies grounded strategy. "guidelines" "consensus" decisions, uncompensated lacking Woolworth. one-third-each arbitrary. exhaust exact. horizontally rough assumption payroll—as measured account—are powerful theory: radically jurisdictions, expect shift advantage hand, admitted weaknesses: willingness invest simultaneously adequately by, difficulty shifting resources, decreasing marginal investment, portfolio-balancing considerations. geographically divisions stipulation indicates domiciles "only deductions incurred countries." App. 72. conclusively returns, exemptions, overlap dispute defined 114-121, Tr. Oral Arg. 28-29, 17, 17. 196-197 (discussing law). Note deliberately Lines narrowness questio presented: "whether State." Term carried factors. parents 32, infra. Draft Model Treaty 16, 1981, 9, reprinted P-H Treaties ¶ 1022 (hereinafter Treaty) ("Where Contracting participates conditions which, accrued accrued, accordingly."); Bischel, 219 (1978) Bischel). G. Harley, International Base Multinational Enterprises 143-160 (1981) Harley); Madare, Pricing: Guidelines Relief Double Taxation, Tex.Int'l L.J. 108, 111-120 (1975). Surrey, Reflections Expenses Among National Jurisdictions, L. Policy Int.Bus. (1979); Bischel 459-461, 464-466; B. Bittker Eustice, Corporations Shareholders 15.06 1979); 143-160. dividends. practiced transactions, irrelevant consistent, occur, (In important, 1237.) strictly speaking, "of" penalize structure. therefore, credits exemptions closely-tied treaties. 23; No suggestion exempt grant credit, taken 901 et seq., effective taxation: twice, credit insures tota involved. once allowed dividend, persuaded why, own, vindicated goal bear abroad. level, mitigated inter-governmental negotiations 25; University Fortieth Institute 31.03[2] (1982) N.Y.U. Institute). Owens, Treaties: Their Role Relieving Rutgers L.Rev. 428, 443-444 (role procedural substantive). negotiate governments, provides mechanism systems. succeed. interests. alter submit opposing Term. speculate Governor's Association Hawaii 6-7, represents views, 7(2); 33-38, 459-461. 1(3); 718; 31.04[3]. 7. 124 Cong.Rec. 18400, 19076 (1978). bill aware. H.R. 2918, 98th Cong., 1st Sess. appears attach unable "simply [to] adher[e] rule" From perspective, avoids exists. reported return. sum Government. allocation, using principal Similarly, Different calls leaves illustrated protests partners. Several papers (Canada); (France); 13-16 (United Kingdom); 17-19 (European Economic Community) Bankers pp. 4-5 (Japan); ("[A] complained—both officially unofficially—that irritant Retaliatory ensue. ."); 2a-3a 8a-9a (Canada). heavily out-of-state alone, facing Equal Protection Iron, ----. position, weight.

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