Graham Iversen reviews HMRC's practice on depository receipts following the SDRT decision in HSBC v HMRC.
The decision of the First-tier Tribunal (FTT) in HSBC v HMRC [2012] UKFTT 163 has attracted some publicity of course because of its SDRT implications. However the FTT’s comments about the legal nature of an American Depositary Receipt (ADR) and in particular whether the holder of an ADR owns a beneficial interest in the underlying shares have subsequently caused concern.
The facts of the case were essentially as follows. HSBC entered into a merger agreement under which a US corporation (Household) was to merge into a newly established subsidiary of HSBC. Under the merger the issued shares of Household were to be cancelled and...
