OFFERING MEMORANDUM Global Offering of up to ... - Nordex
OFFERING MEMORANDUM Global Offering of up to ... - Nordex
OFFERING MEMORANDUM Global Offering of up to ... - Nordex
Create successful ePaper yourself
Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.
or a refund <strong>of</strong> the amount by which the rate <strong>of</strong> the regular withholding tax withheld or <strong>to</strong> be withheld<br />
exceeds the maximum permissible rate under the relevant double taxation agreement.<br />
Subject <strong>to</strong> the application <strong>of</strong> Council Directive No.90/435/EEC dated July 23, 1990 (known as the<br />
‘‘Parent-Subsidiary Directive ‘‘) a partial or complete exemption – e.g. by way <strong>of</strong> a refund -may be made<br />
on application by corporations which are resident for tax purposes in another state <strong>of</strong> the EU. For the<br />
Parent-Subsidiary Directive <strong>to</strong> apply, the parent company must have under certain circumstances in<br />
particular its tax domicile in another member state <strong>of</strong> the European Union, its equity interest in the<br />
German subsidiary must have existed for an uninterr<strong>up</strong>ted period <strong>of</strong> at least twelve months and it must<br />
amount <strong>to</strong> at least one quarter (or one-tenth in special cases) <strong>of</strong> the nominal capital.<br />
Shareholders who are not assessed for taxation in Germany are not entitled <strong>to</strong> any crediting <strong>of</strong> the<br />
corporation income tax paid by the corporation and the withholding tax withheld.<br />
Dividends distributed by the Company on shares, which are held by an appointed permanent<br />
representative in Germany or which are part <strong>of</strong> the assets <strong>of</strong> an operating establishment or a fixed<br />
place in Germany, which is run by a foreign legal person are subject <strong>to</strong> German corporate income tax<br />
with a regular rate <strong>of</strong> 25% plus 5.5% solidarity surcharge thereon until September 30, 2002. The<br />
transfer <strong>of</strong> pr<strong>of</strong>its from the operating establishment or the fixed place <strong>to</strong> the foreign parent company is<br />
exempt from withholding tax. Shareholders as individuals are subject <strong>to</strong> German income tax with the<br />
earnings received from the permanent establishment or fixed place with their individual income tax<br />
rate, but at least with 25% plus solidarity surcharge thereon. If the creditable taxes exceed the<br />
corporate income tax plus solidarity surcharge on the earnings <strong>of</strong> the operating establishment, the<br />
respective exceeding amount will be refunded.<br />
Dividend distributions <strong>to</strong> foreign corporations holding the shares as business assets in a permanent<br />
establishment or fixed place <strong>of</strong> business in Germany or via an appointed permanent representative in<br />
Germany are -subject <strong>to</strong> certain exceptions- generally exempt from corporate income tax, trade tax and<br />
solidarity surcharge from Oc<strong>to</strong>ber 1, 2002. Expenses directly related <strong>to</strong> such dividends in financial terms<br />
may not be deducted as operating expenses.<br />
From Oc<strong>to</strong>ber 1, 2002 dividends distributed by the Company <strong>to</strong> holders not subject <strong>to</strong> corporation<br />
income tax are subject <strong>to</strong> the semi-income method.<br />
Taxation <strong>of</strong> Capital Gains<br />
Shareholders Subject <strong>to</strong> Unlimited Tax Liability in Germany<br />
Capital gains from the disposal <strong>of</strong> <strong>Nordex</strong> shares held as part <strong>of</strong> private assets by natural persons with<br />
unlimited tax liability are only subject <strong>to</strong> income tax if (i) the shares are sold within one year <strong>of</strong> being<br />
acquired or if after the expiration <strong>of</strong> this period (ii) the shares arise from contributions pursuant <strong>to</strong><br />
section 21 Reorganisation Tax Act (Umwandlungsteuergesetz) or (iii) the shareholder directly or<br />
indirectly held or holds a significant equity interest. Up <strong>to</strong> September 30, 2002, a significant equity<br />
interest exists if the shareholder (in case <strong>of</strong> a gratui<strong>to</strong>us acquisition also his legal predecessor) held at<br />
any time within the last five years a direct or indirect interest <strong>of</strong> at least 10% in the share capital. After<br />
Oc<strong>to</strong>ber 1, 2002, a significant equity interest exists if at any time within the five years prior <strong>to</strong> the<br />
disposal a direct or indirect interest <strong>of</strong> at least 1% existed or exists.<br />
Up <strong>to</strong> September 30, 2002, taxable capital gains from the disposal are subject <strong>to</strong> full income tax (plus<br />
solidarity surcharge). In line with the Halbeinkünfteverfahren, 50% <strong>of</strong> these capital gains will be subject<br />
<strong>to</strong> income tax (plus solidarity surcharge) after Oc<strong>to</strong>ber 1, 2002. Only half <strong>of</strong> the expenses related <strong>to</strong> the<br />
capital gains from disposal <strong>of</strong> <strong>Nordex</strong> shares in financial terms may be deducted, regardless in which<br />
assessment period the expenses accrue.<br />
Losses from the disposal <strong>of</strong> shares incurred by a private inves<strong>to</strong>r may be <strong>of</strong> little or no relevance <strong>to</strong><br />
taxation. Losses incurred by shareholders who are individuals from a disposal that occurs within one<br />
year after the acquisition <strong>of</strong> the shares can only be <strong>of</strong>fset against the capital gains that the shareholder<br />
received in the same calendar year from other private taxable sales transactions according <strong>to</strong> section<br />
23 Income Tax Act (Einkommensteuergesetz). Losses that are not <strong>of</strong>fset reduce the shareholder’s<br />
103