Baker McKenzie's country-by-country matrix of issues that impact global stock plans. See also the link to the online version, under More Details.
With increasing frequency, U.S. companies are electing or appointing non-U.S. tax residents to serve on their board of directors. Therefore, it is important to be aware of the U.S. and foreign tax obligations that must be met and issues that arise when a U.S. nonresident director joins the board.
When granting equity awards, one of the most important questions is the tax effect of such awards. Granting awards that have a negative tax impact on the employee or the company is counter-productive and should lead companies to consider other ways to incentivize their employees. On the other hand, should companies maximize the availability of favorable tax treatment for equity awards in certain countries? This is not an easy question to answer.
It has been a year since the Brexit referendum, yet a great
deal remains unknown. Baker McKenzie asked what impact
this uncertainty is having on skilled workers from EU27
countries who are living and working in the UK.
We are seeing an accelerating trend among U.S. companies to add nonU.S.
residents to their Board of Directors. This makes sense: as more
and more companies "go global" and expand in ever more countries,
their Boards should reflect the global nature of the company.
As has been widely reported (see Baker & McKenzie client alert), the European Court of Justice
(ECJ) invalidated the EU/US Safe Harbor Program which allowed transfers of personal data of
EU/EEA residents to U.S. companies that registered under the program. Generally, such
transfers are allowed only if a permissible ground exists, and the Safe Harbor Program was a
convenient ground for many U.S. companies doing business in the EU/EEA. By invalidating the
program, these companies are now forced to rely on other grounds, such as the data subject's
express consent or Model Agreements between the transferring and receiving entity.
An "inversion transaction" is a corporate restructuring under the terms of which an existing corporation moves its corporate headquarters from one country (i.e., U.S.) to another, (i.e., Ireland) usually by inserting into its corporate structure a new parent corporation above the existing parent company. In most instances, the corporation's shares remain listed on a recognized stock exchange throughout the restructuring. This articles covers some of the key points with respect to global equity awards that you should understand if your corporation is considering an inversion transaction.
The UK 2014 Finance Bill has proposed significant amendments to the taxation of share awards for internationally mobile employees. Subject to enactment of the Finance Bill, the new rules will apply to all share vestings and option exercises occurring on or after 6 April 2015 (irrespective of the date on which the award was granted).
If we are looking at significant trends in 2013 affecting equity compensation programs, then the rise of foreign asset and account reporting obligations will have to be one of them. And Switzerland is to blame for it, sort of.
The purpose of this white paper is
to highlight the problems with using
beneficiary designations in equity
On December 9, 2010 the UK Government published draft legislation aimed at capturing what they described as “disguised remuneration”. These measures were principally intended to capture tax avoidance using, for example: employee trusts, where loans to employees are used to reduce tax on employment income (often known as Family Benefit Trusts (FBTs)) and funded unapproved pension schemes (often known as Employer-Financed Retirement Benefit Schemes (EFRBS)).