Considerable thought and commentary has been given to the numerous technical features introduced by P.L. 115-97 (Dec. 22, 2017), colloquially referred to as the “Tax Cuts and Jobs Act” (the “TCJA”). Nearly one-and-a half years post-reform, tax advisors are continuing to navigate and adapt to the myriad ways in which the TCJA has affected how they interact with each other and with their clients in the M&A environment. In many respects, the TCJA has not changed the basic cross-border M&A playbook. Deal agreements are being drafted with much of the same infrastructure with respect to the general rights and obligations of buyers and sellers as existed in the market before, though several of the key international changes brought about by the TCJA have altered a number of pre-reform negotiating dynamics between buyers and sellers, amplifying existing and introducing new concerns and opportunities with respect to deal practice. The “global intangible low-taxed income” (“GILTI”), “base erosion anti-abuse tax” (“BEAT”), Code Sec. 9651 transition tax, Code Sec. 163(j) interest limitations, the Code Sec. 245A participation exemption, and foreign tax credit (“FTC”) regimes, just to name a few, each impact the evaluation, analysis and papering of international M&A deals.

Originally published in International Tax Journal - July 2019.