Dear Reader,

I am very pleased to present the second edition of our Business Briefing on International Tax Law.

This Business Briefing is the result of an interdisciplinary and crossborder cooperation focusing on international tax law. The second edition is dedicated to a topic which has frequently resulted in intense
discussions with tax authorities: Substance.

Cross-border companies establish international structures to operate internationally. The reasons for the established structure can be varied, e.g. economic, legal, tax, etc. In only a few cases will the
established structure be chosen for tax reasons. When the issue of substance is discussed with tax authorities, the question is often whether the company carries out a genuine economic activity or has set up its own business establishment for business purposes in the country in which it is registered.

While the first section of this newsletter provides an overview of the tax and business principles of tax regulations as they relate to substance, the second section presents a summary of the substance tax regulations in Germany, India, Luxembourg, the Netherlands, Switzerland and the United States of America. These overviews have been prepared by experts from our partner law firms in these countries.

In this edition, the reports on other selected issues focus on the Chinese enterprise income tax from indirect property transfers by non-resident enterprises and on considerations of foreign subsidiaries and domestic commercial criminal law in Germany.

I hope you find this edition informative and entertaining.

Best regards,

Helmut König