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Pakistan has notified the WTO Secretariat of a request for consultations with the European Union regarding the imposition of countervailing measures by the EU on imports of certain polyethylene terephthalate (PET) from Pakistan and regarding certain aspects of the investigation underlying those measures.
The EU appears to have acted inconsistently with several articles of the Subsidies and Countervailing Measures Agreement in determining that Pakistan's tax law and other schemes and programmes in certain cases constitute a subsidy that is contingent upon export performance.
PET is used in synthetic fibres and in beverage, food and other liquid containers.
The request for consultations formally initiates a dispute in the WTO. Consultations give the parties an opportunity to discuss the matter and to find a satisfactory solution without proceeding further with litigation. After 60 days, if consultations failed to resolve the dispute, the complainant will request adjudication by a panel.
The International Chamber of Commerce has announced its endorsement of the United Nations Convention on the Assignment of Receivables in International Trade. The ICC Executive Board endorsed the Convention at its 146th World Council Session held in New York on 19-20 November 2014, upon recommendation by the ICC Banking Commission’s Executive Committee and the Legal Committee.
ICC supports the Convention's purpose to establish principles and rules to create clarity and transparency in the legal regime applicable to the assignment of international receivables. ICC also aligns itself with the Convention's objective to promote the modernization of the law relating to assignments of receivables, while protecting existing assignment practices and facilitating the development of new practices.
ICC bank and firm members have reported situations where financings had to be reviewed or abandoned as a result of laws considering the assignment of future receivables or bulk assignments of receivables as ineffective. ICC welcomes the Convention's validation of assignments of future receivables and bulk assignments, invalidating contractual limitations to the assignment of receivables, and offering clear rules as to priority between competing claims. As such, ICC expects the Convention to remove legal obstacles to receivables financing transactions.
ICC shares a common goal with the United Nations Commission on International Trade Law (UNCITRAL) in striving to remove obstacles for international trade and considers the Convention to be a major step towards the globalization of asset-based lending.
ICC has a long history of providing needed international leadership in the field of international banking operations, particularly as a forum for developing rules of practice. Since 1933, the Uniform Customs and Practice for Documentary Credits (UCP), in its various revisions, has become a universally recognized standard, stating and establishing custom and practice for letters of credit.
Through endorsement of the subsequent UCP versions, UNCITRAL provided an important bridge to those countries that were, at the time, unable to participate directly in the work of ICC. Other ICC rules, such as Incoterms© Rules, have also been endorsed by UNCITRAL, contributing to their international acceptance. (22 December 2014)
This decision of the European Court of Justice (“ECJ”) could have significant consequences for international groups who provide services to each other cross-border. The decision will have particular consequences for all VAT exempt or partly exempt businesses; such as those operating in the financial services sector.
The ECJ has held that, for VAT purposes, where a company provides services to a foreign branch:
a) for consideration; and
b) where that branch belongs to a VAT group;
then the services should be regarded as having been provided to the VAT group and not the branch.
The consequence of this is that previously ignored transactions may now be treated as a supply of services upon which VAT is now due. The case arose from the Swedish tax authorities’ decision to charge VAT on the supply of software and software related services by Skandia America Corp., established in the USA, to its branch Skandia Sverige in Sweden – the branch having been registered as a member of a VAT group in Sweden since July 2007. In hearing the case, the Swedish Court decided to stay the proceedings and to refer two questions to the ECJ for preliminary ruling. The questions were as follows:-
1) Do supplies from externally purchased services from a company’s main establishment in a third country (here, the United States) to that company’s branch in an EU Member State, together with an allocation of costs for the purchase by the branch, constitute taxable transactions if the branch belongs to a VAT group in the Member State? and
2) If the answer to the first question is in the affirmative, is the main establishment in the third country to be viewed for VAT purposes as a taxable person which is not established in the EU Member State of the branch, with the result that the branch purchaser of the services is to be taxed for the transactions?