One minute with Russell Jacobs, partner at Milbank.
You lead the firm’s tax group in London. What’s in your in-tray?
Our tax practice reflects the full breadth of the firm’s practices. At present, I am working on: a private equity acquisition in the insurance sector, focusing especially on the management incentive arrangements; the restructuring of a major North Sea oil producer with a US parent in Chapter 11; numerous offshore fund management issues and a cross-border oil and gas project in West Africa involving an array of tax-mitigating jurisdictional issues (which are most topical in the context of the BEPS activity).
What sets Milbank, Tweed, Hadley & McCloy apart from other law firms?
Milbank remains focused on its marquis global practice areas and industry sectors, and the London office is no exception; we specialise in financial restructuring, transportation, project finance, technology and outsourcing, leveraged finance, M&A and private equity, and complex regulatory litigation. Each of these areas interlink and many rely on having a very strong capital markets practice, allowing many of the firm’s financial clients to raise (or restructure) capital from both sides of the pond under one roof. Tax and structuring are at the core of most of these practice areas.
What’s the top practical issue in tax for your clients?
Substance. There is hardly a single practice area where reinforcing the need for substance in the important tax-mitigating jurisdictions through which our clients structure their affairs is not at or near the top of the agenda.
If you could make one change to UK tax law, what would it be?
UK tax law requires at least two changes! First, HMRC needs to trawl the complicated anti-avoidance provisions peppered in the tax code like statutory land mines and work out which are really needed and which can be repealed in the light of the GAAR. Second, the Tax Acts need to be consolidated in a coherent fashion (rather like the IRS code), so that the legislation is easy to navigate and incremental changes are added within existing sections, not dotted around various Acts. After 32 years of practising tax, the Tax Acts are bordering on impossible to navigate and index.
What recent development has caught your eye?
The impending changes on domicile in the September consultation document attracted my attention. They are logical, fair and concisely argued by HMRC and, unlike a lot of other recent anti-avoidance legislation, rely on bright-line tests (especially coupled with the statutory residence test), which I applaud.
How does BEPS affect your clients?
For our clients, BEPS is all about taking a long, hard look at devoting substantial resources to tax mitigation. This includes allocating meaningful human resource to jurisdictions where value is created and tax really matters. Our clients are (or have become) extremely sensitive and receptive to advice on creating and sustaining a substantive presence in important jurisdictions; and not over-egging the tax arbitrage potential of a structure, but rather looking at the overall suitability and tax ‘ethic’ of their corporate structuring.
Tell us a secret.
I am happiest scuba diving on a coral reef at around 20 metres – close enough to sunlight, but far enough away from the Blackberry, BEPS and all matters fiscal.
One minute with Russell Jacobs, partner at Milbank.
You lead the firm’s tax group in London. What’s in your in-tray?
Our tax practice reflects the full breadth of the firm’s practices. At present, I am working on: a private equity acquisition in the insurance sector, focusing especially on the management incentive arrangements; the restructuring of a major North Sea oil producer with a US parent in Chapter 11; numerous offshore fund management issues and a cross-border oil and gas project in West Africa involving an array of tax-mitigating jurisdictional issues (which are most topical in the context of the BEPS activity).
What sets Milbank, Tweed, Hadley & McCloy apart from other law firms?
Milbank remains focused on its marquis global practice areas and industry sectors, and the London office is no exception; we specialise in financial restructuring, transportation, project finance, technology and outsourcing, leveraged finance, M&A and private equity, and complex regulatory litigation. Each of these areas interlink and many rely on having a very strong capital markets practice, allowing many of the firm’s financial clients to raise (or restructure) capital from both sides of the pond under one roof. Tax and structuring are at the core of most of these practice areas.
What’s the top practical issue in tax for your clients?
Substance. There is hardly a single practice area where reinforcing the need for substance in the important tax-mitigating jurisdictions through which our clients structure their affairs is not at or near the top of the agenda.
If you could make one change to UK tax law, what would it be?
UK tax law requires at least two changes! First, HMRC needs to trawl the complicated anti-avoidance provisions peppered in the tax code like statutory land mines and work out which are really needed and which can be repealed in the light of the GAAR. Second, the Tax Acts need to be consolidated in a coherent fashion (rather like the IRS code), so that the legislation is easy to navigate and incremental changes are added within existing sections, not dotted around various Acts. After 32 years of practising tax, the Tax Acts are bordering on impossible to navigate and index.
What recent development has caught your eye?
The impending changes on domicile in the September consultation document attracted my attention. They are logical, fair and concisely argued by HMRC and, unlike a lot of other recent anti-avoidance legislation, rely on bright-line tests (especially coupled with the statutory residence test), which I applaud.
How does BEPS affect your clients?
For our clients, BEPS is all about taking a long, hard look at devoting substantial resources to tax mitigation. This includes allocating meaningful human resource to jurisdictions where value is created and tax really matters. Our clients are (or have become) extremely sensitive and receptive to advice on creating and sustaining a substantive presence in important jurisdictions; and not over-egging the tax arbitrage potential of a structure, but rather looking at the overall suitability and tax ‘ethic’ of their corporate structuring.
Tell us a secret.
I am happiest scuba diving on a coral reef at around 20 metres – close enough to sunlight, but far enough away from the Blackberry, BEPS and all matters fiscal.
