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Monday, August 30, 2010

When Harry Met Sally... (1989) Directed by Rob Reiner

Woody Allen's post-Mia Farrow reputation as filmmaker has undoubtedly suffered from the 'scandal' induced by Woody shacking up with Mia's adopted daughter Soon-Yi Previn. Each new Woody picture is greeted with accusations of "not as good as his earlier films" and with the added comment that Woody is obsessed with younger women. It's a constant slur carried out by the critical community and the public alike. I think Allen's pictures have remained pretty consistent in reality. Ironically, a director such as Roman Polanski has managed to avoid such a critical backlash despite being on the run since 1974 after being convicted of having non-consenting sex with a minor. Why the double standards? One could argue that Polanski's last great movie was Chinatown. I only mention this because When Harry Met Sally... is undoubtedly a homage to the kind of romantic comedy that Allen made his name with. It comes from a time when it was OK to make an Allen type picture.

But Reiner's film, although following a Annie Hall type of structure, sweetens the pill considerably. And of course, as is not so often the case, the Allen character in this movie (Billy Chrystal's Harry) gets the girl. When Harry Met Sally... has entered the annals of classic nowadays. It's a picture that has its not so subtle laughs for sure, but there is no edge here, no real examination of the difference between the sexes, which is the flimsy premise of the picture. Plot lines are predictable and the obvious denouement is soaked in sentimentality.

Performances are adequate, with Meg Ryan cementing her reputation of the cute but dim American girl next door in her role of Sally. Crystal is the typical wisecracking smart arse I've grown despise. There's not so much more to say about this film. Reiner's direction and shooting style is that of the undoubted journeyman director he has become. When Harry Met Sally...  is the kind of film I'll watch on those rare moments when I want my cinema to place no demands on my imagination. If I'm feeling sickly sentimental, I know what to stick on and wallow in the shallow, smart arse, insufferable romance of this pleased with itself picture. If there is a reason to castigate Allen, perhaps it's for inspiring such woeful cinema.

For me When Harry Met Sally is like a super violent action film for Nick. It is necessary sometimes, once a year or so. I am not going to make claims for the artistic greatness, mastery of cinematic devices, the look or acting even. I know, it's not a fantastic movie, but I'll give you my three reasons for the necessity of repetition.

1. Belief in romantic love. While pretending to criticize and question the necessity and logic of heterosexual romantic love (as known since the 19th Century) the movie subscribes to the notion. And so do we, although we are usually too scared and cynical to admit to it (or else already married). While I am offended by the film's insistence that hetero men and women cannot be friends together (because of sexual attraction), I am as happy as everybody else when Sally and Harry finally become an item.

2. A lot of talking. I like films with dense talk-filled scripts where two people are just talking to each other all the time. I like cerebral romance, living in my head and endlessly procrastinating over possibilities. That's when I can relax and pull the blanket over me. This is not Woody Allen writing though. I know it is trying to be but doesn't quite reach his level. Yet, there is a Meg Ryan variety of the dry 1990s romance and I grew up on it, I kind of thought that's life!

3. Underachievement. Experiencing and living life a little below the bar some of the time is good for me. It makes good better. Watching films can get tiring if they are always critically highly rated and excellently realized in every aspect. When Harry Met Sally offers me a safe moment of underachievement and that can be inspiring in a reversed manner.

Sunday, August 29, 2010

Giant (1956) Directed by George Stevens

I think I should discuss Elizabeth Taylor now because she is amazing. She has acted in many movies that we have reviewed here, but I have failed to mention her in any meaningful way. Possibly her presence leaves such an impression on me that I dare not go there. Whether she is playing Cleopatra, the mad girl in Suddenly Last Summer or the rebellious rich wife in Giant, she is always mostly Elizabeth Taylor – and that's the attraction.

There is something importantly different about Taylor's on-screen presence compared to Marilyn Monroe's sensuality (I am making this comparison because to me, there is also something similar). My feeling is it's in the consciousness of the actor. Taylor has a perfectly beautiful face with glittering eyes, a curvy sensual body surrounded by an air of playful but intelligent emotion. Everything about her seems intentional, her emotions easily available to her expression, her sensuality in her conscious use. The impact and power are striking. Taylor looks divine, but her characters usually also seem like people with dirt in their hands, opinions in their heads – they live.

In other words, Elizabeth Taylor is an actress with scope. In Giant she plays Leslie. We see her from the moment she falls in love with her husband Bick (a rich Texas landowner) and follow her through her life until her children have grown up (and there is nothing more to say?). The film attempts to cover such a long period of time that somewhere along the line we lose the focus on character development, but in the first half of the film Taylor is truly in the center of the story. She questions gender roles and the racist traditions of her new home state, she loves her husband but is not afraid to disagree and disobey him. But Leslie is a confusing character, her rebellion seems to lead to nowhere specific during the course of the film. I think that her weakness comes from an unsatisfying script.

I guess I should mention James Dean too. There, I just did. He was there – or was he?


I've always found it fascinating that for many years the upper classes or the rich would often be the main protagonists in the movies. And of course, often in this scenario, you'll find a poor character who makes it rich and becomes the bad guy. What is that feeling in us that wants to root for or be remotely interested in the privileged? Is it to gaze on what we can't have, or is it to dream? Royalty at one stage seemed to be the role models of the day. Giant was one of the last pictures of this type.

Giant is the story of a filthy rich Texan family, covering many years and generations. The Benedict family come across as spoiled, racist, ignorant and yes, stupid, stupid stupid. Rock Hudson plays 'Bick' Benedict (not as good as his roles for Douglas Sirk) who is a rancher who owns half a million acres. Bick goes to buy a horse in Washington and comes back with the stallion and Elizabeth Taylor (Leslie) as his wife. She's smart and independent (and impossibly rich), he's a big Texan Dumbo. We then follow their relationship and their growing  family over many years. Bick and Leslie are forever at loggerheads but still in love despite their differences. The imperialist arrogance simply drips of the screen. So, this film's attitudes and portrayal of racism is pretty dated. But despite the obnoxious vulgarity, Giant is a lumbering classic.

Nowadays the picture is probably remembered for being James Dean's last film (he died on the day he finished shooting his last scene). Dean plays Jett Rink, a poor cowhand who strikes it rich with oil and becomes a notorious playboy, and Bick's greatest enemy. Dean is pretty rubbish as Rink, especially when portraying him as an old washed up alcoholic. But his screen presence alone and his scenes with Taylor add the energy that dispels some of the lethargy elsewhere. He also looks incredible in the early scenes, pure sexual magnetism. Mind you, his Texan drawl is terrible (you might need the sub titles for his lines!)

So Giant despite its many faults, is one of the last credible American epic Westerns.  Stevens' picture looks amazing, Taylor is up to the task, great cameos from a young Dennis Hopper and Sal Mineo insert quality. It's a forerunner of Dallas, a neighbor to Gone With The Wind. Even recent pictures like There Will Be Blood owe something to Giant. This hulk of a dinosaur picture can still hold you in its grasp. As to why? I'm not sure.

A combination of favorite things

There is a lot to be said for re-using a pattern that's (a) simple and (b) classic.  Even more so if it's a type of garment you like to wear.  As the Sewing Lawyer has arrived at a certain age, she has come to appreciate sleeveless shirts and tops.  Even in the depths of winter, when the freezing winds howl around, she has found that a lined wool top is quite comfy to wear and permits climate control when paired with a long-sleeved jacket.  For summer, bien sûr,  the benefits are truly obvious, especially when it's a crisp cotton shirt.

The Sewing Lawyer is also a sucker for a really nice batik print - especially one that's an overall repeating block print in indigo and white.  Recently while in Saskatoon, there was a flying visit to the lonely downtown fabric store, Unique Textiles Studio (on 1st Ave.).  Like so many others, this store specializes in quilting cottons of a good quality, all neatly displayed in colour-coded or print themes.  Snagged!  Some  indigo and white block-printed floral batik came home to the Nation's Capital, earmarked for a sleeveless shirt from a previously-tested vintage Simplicity pattern.

Speaking of the Nation's Capital, I came across this quaint YouTube video about my home city originally filmed in the late 1940s - though it's older than my vintage pattern, the scenes of the Parliamentary precinct and Rideau Canal, the War Memorial (seen from the roof of the Chateau Laurier) and the buildings opposite, are unchanged to a surprising extent.  Except, NB, we pronounce the canal's name REE-do, not ri-DOH; you don't see red-coated Mounties hanging about in random fashion; the rowers in the Ottawa River will surely be in modern racing hulls; and that interesting diving (?) platform is no more.  It's a great place to live.

But I digress.  Of course, the OOP Simplicity pattern was approximately 3,000km away from the place in which a decision had to be made about how much to buy.  It turns out the pattern calls for 1 3/8 yards (1.25M).  Oops.  After pre-shrinking in the washer and dryer, there was exactly 101 cm of this crisply-wonderful fabric which gave rise to a few anxious moments but in the end, only necessitated a VERY efficient layout and piecing of the under collar.  There was enough (in the lower left corner) to cut bias strips to face the arm openings instead of the facings that Simplicity wanted.  And the CB could be placed on a  natural break in the printed pattern (you can see that the selvedges are slightly offset; that's why).

If you click on this photo to enlarge it, you can see why the print was so enticing.

So here's the finished shirt (worn with Jalie jeans #1).

It made up super fast (or would have if The Sewing Lawyer's day job hadn't interfered) and has that lovely crisp quality that makes for such a great summer garment.  It's getting hot again this week, so it will have some more outings before the leaves start falling, to be sure.

Friday, August 27, 2010

BBC v The Stig

A short piece jointly written with a colleague, Marie-Therese Groarke, for Halsbury's Law Exchange.

Since its relaunch with a new format in 2002, Top Gear has become one of the BBC’s most successful programmes both domestically and internationally. Its three main presenters, Jeremy Clarkson, Richard Hammond and James May, have become rich and famous as a result, partly through promotions and other activities related to the programme. The fourth regular character of the programme is of course the anonymous “tame racing driver” known as “the Stig”, always introduced by Clarkson or one of the others with some absurd supposed facts, such as that "he only knows two facts about ducks, both of which are wrong." Much of the humour of the show concerns the comic mystery as to the Stig’s identity. The original Stig was clad wholly in black, but after revealing his true identity as the journeyman racing driver Perry McCarthy, he was replaced by another driver (or drivers) clad in white racing apparel. The BBC inserted confidentiality clauses in the driver’s contract and has done everything it can to protect, and play on, the Stig’s anonymity.

Now, however, according to recent press reports, the real Stig has an eye on the extra earnings of the others, and wishes to publish his memoirs, which will entail revealing his identity. The BBC claims that the planned memoirs breach the strict contractual confidentiality obligations.

One interesting point is whether such a confidentiality clause can be enforced if the Stig’s identity has already been revealed by others. As the Sunday Times appeared to unveil the Stig as Ben Collins, a former Formula Three driver and stuntman, it will be argued that the information is no longer confidential. Once information is in the public domain the courts will not grant an injunction to protect disclosure because the information is no longer confidential and an injunction would serve no useful purpose: Attorney General v Guardian Newspapers (No 2) [1988] 3 All ER 545.

The really interesting question is when does it become in the public domain? Is it in the public domain because the Sunday Times speculates that it was him, or would it be in the public domain only once the Stig (if it is Collins) confirms the Sunday Times’ story?

Thursday, August 26, 2010

Panama Property Tax Lawyer

You do not need a lawyer to do your property tax. If you are computer proficient and can follow some Spanish with Google translate, you can go to www.dgi.gob.pa and:

- get a NIT password to see your annual property tax statement online and print tax certificates online,

- download the eTax 2010 software from which can help you estimate payable capital gains and property transfer taxes in case of a sale.

Alternatively, CPAs are better at estimating taxes than lawyers, who can be of help if a claim against the Ministry is involved. Property tax rules change a bit every year. Some rules are posted at:

--- On Tue, 7/6/10, maukapete <maukapete@yahoo. com> wrote:

From: maukapete <maukapete@yahoo. com>
Subject: Americans In Panama - Panama Property Tax Lawyer
Date: Tuesday, July 6, 2010, 11:01 AM

Does anyone know a Panamanian lawyer named N who does property taxes for homes? If no one knows Lic. N, does anyone know a Panamanian lawyer who does property taxes without jerking me around? Pete Peterson

Wednesday, August 25, 2010

The release of Abdelbaset Ali Mohmed al-Megrahi

Another piece for Halsbury's Law Exchange

Scottish devolution gave rise to any number of issues, but it is probably fair to say not many foresaw one which has occupied many a column inch of late: the release of the Lockerbie bomber Abdelbaset Ali Mohmed al-Megrahi, who was convicted in 2001, two years after the Scottish Parliament was created. His release has generated heated and intractable public debate, the more so since three governments have different and rather entrenched views.

The Scottish Parliament in Edinburgh took the view that the release of a prisoner in their jurisdiction on compassionate grounds was an exclusive matter for them, applying Scottish law.

The United States' government in Washington, on the other hand, stated that it had previously been assured Mr al-Megrahi would not be released without its consent (2/3rds of the victims of the Lockerbie bombing were American, hence the strong views of the United States on the subject), and that consent was most certainly not forthcoming.

That assurance had been given by the United Kingdom government in Westminster, which suddenly found itself very unsure about everything. The "special relationship" with Washington was under strain, but Edinburgh wasn't budging and legally Westminster couldn't do anything about it even if it wished.

The story gave rise to many rumours. One was that the Scots feared al-Megrahi’s pending appeal would succeed, which might bring opprobrium on the Scottish legal process that had convicted him in the first place and denied previous appeals. Another was that Westminster had to ensure the release in order to secure lucrative commercial contracts with Libya, but could not do so because of its assurances given to America, and therefore had to find a way to ensure someone else (ie Edinburgh) took the blame.

Whatever the true political situation, two legal issues underlay the saga. The first was the comparatively straightforward issue of the legality of the release under Scottish law. The justice minister (Kenny MacAskill) has the power to release prisoners on compassionate grounds. In making that decision he is required among other things to take independent medical advice. This would exclude doctors not seen to be impartial, such as those in the pay of the Libyan state or oil companies hoping to do business with it (both were rumoured at different times in the press). Note also that release on compassionate grounds has nothing to do with the prisoner's innocence; any doubt about that is only to be resolved through the trial and appeal process.

Under the Prisoner Transfer Agreement between the UK and Libya law no transfer is permitted whilst an appeal is outstanding.*

In this case Mr al-Megrahi did have an appeal pending, which was withdrawn following a visit by Mr MacAskill. Days later his release was announced. Mr MacAskill insists no deal was struck, although the fact that a transfer was precluded whilst an appeal was pending had been pointed out to al-Megrahi and his legal advisers during the meeting.

Edinburgh was right on the face of it to assert that that process was a matter of Scots law and jurisdiction; indeed, the wishes of a foreign state would not ordinarily be a relevant consideration in deciding whether a particular prisoner should be released on compassionate grounds.

This, however, is not an ordinary case, and it highlights the second legal issue, which is an intractable problem with the devolution agreement. The agreement is clear that the Scottish parliament has certain domestic powers, but that foreign affairs remain exclusively the preserve of Westminster. Yet a decision which was bound to prompt a strong diplomatic reaction from the UK's principal ally could hardly be described as anything other than a foreign policy decision. Under no circumstances would Washington consider the release of al-Megrahi to be a routine matter of Scottish domestic criminal law.

Nor, for that matter, would Westminster, except Westminster is bound by UK constitutional law that would frankly not be of interest to American politicians acting on behalf of outraged families of the Lockerbie victims. Prior to Devolution, the decision would have been taken by the Secretary of State for Scotland, who, as a member of the cabinet, would have been very mindful of foreign policy implications, and would at least have sought the opinion of the Foreign Secretary.

Trying to word a constitutional provision reserving domestic matters to Edinburgh "save where on the exceptional facts of a particular case major foreign relations implications arise" would tax the most experienced legislative drafter. Which means, one suspects, that this case will not be the last to test the limits of the present constitutional settlement.

*The Scottish Ministers received an application from the Libyan Government requesting the transfer of Mr Al-Megrahi, under the terms of the Prisoner Transfer Agreement, on 5 May 2009.

Article 3 of the PTA sets out five conditions which are required to be met to allow transfer, these are:

(a) the prisoner is a national of the receiving State;
(b) the judgement is final and no other criminal proceedings relating to the offence or any other offence committed by the prisoner are pending in the transferring State;
(c) at the time of the receipt of the request for the transfer, the prisoner still has at least six months of the sentence to serve;
(d) the acts or omissions on account of which the sentence has been imposed constitute a criminal offence according to the law of the receiving State or would constitute a criminal offence if committed on its territory; and
(e) the transferring and receiving States agree to the transfer.

As part of the consideration of the application, Mr MacAskill met or spoke with those that submitted relevant representations, this included: The US Attorney General (26 June), The US Secretary of State (13 August), The Libyan Government (6 July), UK families of victims (1 July), US families of victims (9 July), Families from Lockerbie (23 July) and Mr Al-Megrahi (5 August).

Note: I have received some correspondence from one Charles Norrie, who lists his occupation as "Lockerbie Researcher", about the correct spelling of Mr al-Megrahi's name. A google search reveals many variations, even amongst the papers of record such as the Times and the Telegraph, and the BBC - perhaps unsurprisingly since it isn't an English name and there is no single view about conventions such as the "al" prefix in surnames. I have gone with that which appears to be the most common amongst the reputable press, though there may be other acceptable versions. No offence to anyone is intended by the choice.

Thanks also to Michael Follon for the point re PTA v compassionate release, though the point about devolution still stands.

Tuesday, August 24, 2010

The Departed (2006) Directed by Martin Scorsese

Nostalgia increasingly plays a large part in our perspective responses to what we think is good or bad. I don't just mean this on a critical level. It could be in any respect. I might still persist with Head & Shoulders shampoo purely for the reason that when I was a kid it was drilled into me that it was the best for dandruff. So, even in adult life, my instinct is to stick with the Head & Shoulders. I haven't really analyzed that too much (mainly because that would make me appear insane!) However, Martin Scorsese, if he were a shampoo,  is a sure sign of quality, in that every scalp he comes across is spot free, right?

Well, The Departed sure is one messy film. One gets the feeling that Scorsese could knock this kind of movie off in his sleep. Yes, we've seen this kind of picture from him before, but watching this a second time, I'd forgotten how confusing this movies was. Scorsese has modeled his remake of the Hong Kong movie Internal Affairs (2002), on his own film exploits. I'm referring here to films like Goodfellas & Casino specifically, where a series of interchanging flowing scenes tell the story. So from the off, The Departed feels like something we have come across before, but tellingly, minus the narrator of those previous pictures. So what The Departed mostly resembles, is the sound of Martin Scorsese's voice blasting at you at a million miles an hour. Yes, when you hear Marty talk, you're entertained, it's informative but sometimes you miss the odd line. That's The Departed.

Of course, this doesn't preclude you from having some violent fun. Jack Nicholson, Ray Winstone, Leonardo DiCaprio all give first rate turns. Mark Wahlberg has the best lines and role as a foul mouthed cop. Their are lots of twists in the plot and dodgy Irish accents. It's refreshing to have a film made in Boston. But DiCaprio violently attacking some mob guys in a convenience store is Scorsese referencing his own pictures, De Niro in this case in Taxi Driver. But the nonchalance of such violence is now redundant, as we've seen it before, it doesn't carry the same shock or danger. It just is. Scorsese increasingly makes exercises in genre pictures, yes, sometimes based on his own genres. Scorsese has passed into that cultural realm where every picture is beyond criticism. He's the Bob Dylan of the movies. But where's the soul. I long for the quirk Marty. Again, I'm longing for nostalgia.

I like the idea of a good cop. When a police car passes me by or a couple of officers stroll around a festival site in their blue overalls, others feel hateful and suspicious but I feel safe. I still hold on to the (childish?) notion that there are common rules for everyone which are based on morality and therefore should be obeyed. And the cops can help you if someone strays to the wrong side.

OK, to be totally honest I am also aware of the ignorance and racism ingrained in the profession – when my brown-eyed boyfriend is stopped for his ID in the middle of Punavuori for no other reason than some global war on terrorism or something, I'm not totally trusting these guys and the purity of their judgment.

Internal and symmetrical contradictions. That is what The Departed presents. Leonardo DeCaprio plays the cop who knows internally what is right but is willing to go to extreme measures to get the bad guys. He infiltrates the Irish mob in Boston and loses his police status and then his life in the quest for some kind of truth and revelation of the bad and evil intent. Matt Damon plays the mob head's adopted son who becomes a police man because the mob needs their own guy inside the organization. He rises fast into high positions using his place only for the good of his true boss, Jack Nicholson.

The mirroring of these two positions could be very fruitful in the film, but unfortunately Scorsese builds up promisingly and then just descends into killing everybody. So the opposition between good and bad is rendered futile, as I guess everything is here in life if we assume that death is emptiness.

I cannot believe that Scorsese won an Oscar for this one and failed to win for Mean Streets, Raging Bull, Taxi Driver, Alice Doesn't Live Here Anymore or New York, New York.

Panama-France Treaty protects Panama corporations

A little-known treaty, called the Franco-Panamanian Treaty of Establishment from 1953, provides that investments in each of the signatory countries by investors of the other state, are subject to equal treatment. A Panama corporation with one Panamanian as shareholder was therefore exempt from a punitive anti-tax haven 3% tax levied on French properties owned by non-residents.

Friendship treaties can also serve as tax avoidance tools when double taxation treaties are absent.

France: Non-Discrimination and the Treaty of Establishment with Panama

by Stefan N. Frommel, London

  1. Conseil d'Etat: Resources Management Corporation S.A., 16 December, 1991

A. The facts

Resources Management Corporation was a company limited by shares incorporated in Panama. The company had issued 5,000 shares in bearer form and only two of the shareholders were known to the French tax authorities: a Mr. Arias and a Mr. Suarez, each holding one share. The remaining 4,998 shares were in the hands of shareholders who had not been identified.

Resources Management owned a villa in Eze-sur-Mer, on the Còte d'Azur; it had no other property or other activities in France. The villa was – the whole year round an free of charge – atthe disposal of Mr. Chofaras, a Greek national, who lived in Paris, at avenue de l'Are de Triomphe.

Resources Management had never filed a tax return. The tax authorities assessed the company to corporation tax for the years 1974 to 1977. For 1974 to 1976 the tax was assessed on the basis of the real rental value of the property. For 1977 it was assessed on three times the real rental value, according to article 209A, which came into force on 1 January, 1977.

Only the assessment for 1977 is relevant for our purposes.

B. The Conclusions of the Commissaire du Gouvernement

In his conclusions, M. Fouquet made the observations summarized below and requested the court to discharge the assessment for 1977.

(a) The administration argued that tax treaties traditionally allocate the right to tax income from immovable property to the Contracting State in which such property is situated. M. Fouquet observed:

  • The court had previously decided (in Le Beau Logis and Quadriga) that the non-discrimination clauses in the tax ([...])

  • As a result of these decisions the Government has asked Parliament to abolish Article 209A and replace it with the 3 percent annual tax on the market value of French real property (article 990D of the General Tax Code).

  • Article 7 of the treaty with Panama, being similar (analogue) to the non-discrimination clauses found in the vast majority of tax treaties, should be given the same effect.

  • It was not contested that “nationals”, the term used in the treaty, applied not only to individuals but also to legal persons, according to Royal, which he cited.

(b) The administration argued that article 7 of the treaty with Panama did not refer to “corporation tax”. M. Fouquet observed:

  • The wording of article 7 (“duties, levies, taxes, or contributions, of whatever denomination”) was sufficiently wide to include corporation tax.

  • Moreover, it was no longer relevant, since Nicolo, that the law of 29 December 1976 (at the origin of article 209A) was subsequent to the treaty.

(c ) The administration argued that the treaty with Panama was not valid because it had not been ratified by the president of the Republic, M. Fouquet replied:

  • According to the decision in Navigator (1965), the treaty had been properly introduced into French law by a decree of the President followed by publication in the Official Journal.

(d) To conclude, M. Fouquet mentioned Société Panagest, where the court,following his own submissions, had applied article 209A to two Panamanian companies: “Lack of sufficient time”, he said, had prevented him from discovering earlier the existence of the treaty with Panama.

  • Following Carboline-Europe (1986), he added, “the equality-of-treatment clause in a treaty is of [concern to] public policy (ordre public) and must be applied by the court ex officio, [even if it has not been pleaded by the taxpayer].”

C. The Decision

The relevant part of the decision reads as follows:

As far as the year 1977 is concerned:

Whereas, according to article 209A of the General Tax Code, in force at the time: 'If a legal person (personne morale) whose seat (siège) is situated outside France, has at its disposal one or more real properties or grants the use of such property either gratuitously or for a rent inferior to the real rental value, it is subject to the corporation tax on a basis which cannot be lower than three times the real rental value of the said property'; that for 1977 the petitioner has been subject to corporation tax, according to that provision, on a base equal to three times the rental value of the aforementioned villa; that, however, petitioner invokes the provisions of article 7 of the treaty of establishment between France and Panama of 10 July, 1953, published by virtue of decree 58-438 of 12 April, 1958 in the Official Journal of 23 April, 1958, according to ([...]) within the territory of the other Party, to any other or higher duties, levies, taxes, or contributions, of whatever denomination than those which are imposed on the nationals'; that these provisions form an obstacle to the fixed rate taxation (taxation forfaitaire) foreseen by article 209A of the General Tax Code; that the company limited by shares Resources Management Corporation is, accordingly, entitled to demand the discharge of the assessment to corporation tax to which it was subjected for the year 1977.

[The court] decides: …

The company limited by shares Resources Management Corporation is discharged from the assessment to corporation tax and ancillary penalties to which it was subjected for the year 1977.”

VI. A Point That Was Not Raised: Abuse of Rights

A word of caution for anyone planning to use Panamanian companies to hold French real estate: beware of the doctrine of abus de droit. It was not raised in Resources Management, but might well be invoked in other cases.

In French tax law, the expression abus de droit (abuse of rights) refers to unacceptable tax avoidance. Outside the tax field it has a different meaning and refers to a doctrine that has been developed by the French courts and become a “general principle of law”: a person acts unlawfully, or he made use of a right with the intention or purpose of causing harm to another person. Transposed to taxation matters, the doctrine means this: although a taxpayer has a right to arrange his affairs in any way which is legal, he abuses that right if he exercises it solely to avoid tax.

VII. Are Panamanian Companies Protected from the 3 Percent Annual Tax on the Market Value of French Real Property?

A short note, signed with the initials “O.F.” (Olivier Fouquet?) is appended to the report of Resources Management in the Revue des Sociétés. ([...]) … times the rental value of French real property) appeared to be “transposable” to the “new” 3 percent annual tax on the market value of the property (imposed by article 990D which replaced article 209A) because the Cour de Cassation had also decided (in Société Royal) that a non-discrimination clause in a “bilateral treaty” was an obstacle to application of this tax.

This analysis is correct and is shared by another commentator, M. Phillipe Derouin.

Comparing Société Royal with Resources Management it is apparent that both decision have three fundamental points in common:

  • A tax that is discriminatory because it applies only to companies which have their seat outside France (both taxes are closely related: one replaced the other).

  • A treaty with a non-discrimination clause (both clauses have similar wording).

  • A constitutional principle of supremacy of treaties over domestic legislation (both taxes were enacted after conclusion of the treaties).

In this circumstances, unless the Constitution is amended or the treaty is renegotiated, it is doubtful that the 3 percent tax imposed by article 990D of the General Tax Code could ever apply to Panamanian companies.

Full text in Tax Planning International Review (1992) . Extract posted with thanks to Alexandra Stoffl (University of Vienna, B.Sc., LLM)

Saturday, August 21, 2010

Light relief ... again

 Jeans are hard.  Not only was the fitting a challenge, as you know, but the actual sewing is physically demanding.  Denim is thick and tough to sew; there's lots of practical details like belt loops and topstitching, to be sewn through multiple layers, and there are metal zippers and metal rivets, and buttons that need to be hammered in place.  Assembling the main pieces of the jeans is relatively quick; finishing them off takes three times as long.

When the Sewing Lawyer has had it with a tough project it may be time for some knit tops.  Jalie always  seems ready to come to the rescue.

By lucky coincidence there were two dark brown-based knit fabrics in stash begging to be made up, and so another iteration of Jalie 2805 and Jalie 2921 (the scarf-collar top) came quickly into being.

Here's the latest version of 2908. The most interesting thing about this shirt is the print - the fabric is a fine rib-knit cotton/lycra printed with a VERY large and colourful swirly paisley motif (this was a Fabricland offering from earlier this summer).  The motif is larger than the front or back pattern pieces as you can see here (the fabric is lying on my cutting table; those are 1" squares).  I had two complete motifs plus parts - which became the sleeves.

I cut out the back with the print in this orientation (orange swirls at the shoulder) as you can see in the next picture, but the front in the opposite direction after a moment of angst about whether the print had a noticeable direction.
What do you think?  Not obvious?  Phew!

The scarf-collar top is, as any of you who have tried it will know, quite magical.  The instructions for the ingenious construction of the collar/tie are well illustrated in the pattern, but I was also lucky enough to see Jeanne Binet demonstrate how to make this top at PR Weekend Montreal.  I'm sure it works best with a thin knit; luckily that's what was on hand in the stash (a crepey polyester knit acquired at Couture Elle in Montreal, a few years back).  This is another big-scale print, but although one needed to be alert to avoid the dreaded big "bull's eye" on the upper front, cutting it out involved less angst.

I'm wearing the top with a vintage plastic buckle in this picture.  It also looks good threaded through the little hole in the CF (another genius trick in this pattern) or simply tied in a bow.

Friday, August 20, 2010

Museums and Arts Organizations At Risk for Losing IRS Tax Exempt Recognition: Is Your Organization on the List?

The IRS recently published a long list of non-profits that have not filed appropriate forms for the last three years. Many museums, historical societies, and arts organizations are featured. These groups risk losing their tax-exempt status if action is not taken soon.

The IRS is giving organizations the opportunity to keep their tax-exempt recognition so long as paperwork is filed by October 15, 2010.

See if you are on the list at

The Display of Art - A Fiduciary Duty of the Museum

Recently Eli Broad, art collector and philanthropist, told the American Association of Museums about its members' duty to take art out of storage and put it on display. “If 90% of your work is in storage you need to begin lending it to other institutions. Get art out of the basements,” The Art Newspaper reported.

The fiduciary duties of care, loyalty, and obedience obligate art museums to display their works. Museums are generally institutions legally formed for the public good. They hold works in trust for the viewing public. When works are accessioned and not displayed, museum boards of directors may be putting themselves at risk of violating their fiduciary duties.

While these duties have not been traditionally enforced by state attorneys general, the rise in deaccessions by institutions to raise revenue for operating costs could prompt greater scrutiny of these fiduciary duties. Taking works out of the basement makes good legal sense.

Thursday, August 19, 2010

Requiem for a Dream (2000) Directed by Darren Aronofsky

The year 2000 seems far away. I turned 18, sat in a bar drinking the one glass of something I could afford for hours on end. I had bought my first pair of jeans in the States just before the new Millenium. Figure hugging spaghetti-shoulder tops were in, black leather pants were in, as well as tiaras and boots with square toes. The roof of the twin towers were something you could visit. I was dreaming a lot.

How innocent. Requiem for a Dream seems dated now in the same way as me being 18 does. Who wants to go back to that? Aronofsky must have been older than me then, but he certainly seemed to share my teenage perspective on the seriousness of life. The absolute pretentious grimness of very average people.

Requeim for a Dream drags you down for no apparent reason. It sits somewhere between Sid & Nancy and the blasé attitude that pervades party-drug culture today. It is as if Aronofsky is endlessly worried for the lonely mother and the sinking son, so much so that he forgot to portray multi-faceted characters and ended up with cardboard cut-outs for some educational purpose. Kinda like when a police man came to visit my class in 1995 and he told us that drugs are dangerous.

I've decided to never watch this film again. Since the year 2000 the world's gotten more complicated and yet, I can see some humor in it too.


It's one of those fascinating things, but drug users in Hollywood pictures are always tremendously handsome, pretty and have very good skin. I have come across a few junkies in my time. They always look rough. After repeated drug use they look really ill. Not in this film. I say Hollywood because Requiem for a Dream is far more a Hollywood picture, rather than some indie obscurity dealing with any sense of reality. I mean this in an aesthetic way, the look of this film is purposely doctored. Aronofsky was young, and the juvenile nature of his drug picture seems not only dated, but 10 years on,  suffers from that deadly concoction of the 90's and the post-Fight Club picture variety.

Yes, this film deals with addiction. On many levels. It's not just street drug addiction, but prescribed drugs, consumerism, TV excess, prostitution,  you name it, Aronofsky has a go. Requiem for a Dream is based on Hubert Selby Jr's novel. Selby Jr co-writes the script with Aronofsky. Selby Jr has the NY street notoriety thanks to Last Exit To Brooklyn, but one always feels he's a second rate William Burroughs. I just cant get over Selby Jr dealing with a script that now seems so contrived and cliched.

Fast picture editing and split screen is how Aronofsky tries to create a rhythm for this picture, but it only makes the picture more disjointed. The biggest problem is characterization. Again, these people are hard to feel anything for. Even Ellen Burstyn as Sara the mum addicted to diet pills and quiz shows, is shallow and cliched. As for Jared Leto and Jennifer Connelly as the drug addicted couple always looking for a fix,  it's endless 1000 yard stares and slack jawed expressions for the camera. One can't help watching Requiem for a Dream and think Leto is just auditioning for his crappy rock band videos. The thought of  30 Seconds To Mars (the name is a big clue) hangs over this picture in 2010.

So, time can be cruel. Watching this 10 years ago, it seemed powerful and deep. Its message, hey, modern life is rubbish and drugs are bad for you, comes from a very naive perspective. Aronofsky tries to conceal the lack of any real insight with camera tricks and effects which nowadays seem trite and cheap. Aronofsky followed this with the ridiculous The Fountain and the much liked The Wrestler. Is he a flash in the pan? Right now,  Requiem for a Dream feels like overrated twaddle masquerading as profound cinema.

Tuesday, August 17, 2010

Halsbury's Law Exchange

A new site set up by LNUK is Halsbury's Law Exchange. The following is a blog post published on the site here.

The day we sold the Rule of Law

R (on the application of Corner House Research and another) v Director of Serious Fraud Office (BAE Systems plc, interested party) [2008] 4 All ER 927

A central tenet of the rule of law is an independent prosecutorial process, free of influence from central government or other external pressure. British Governments have long respected this principle, and a failure to do so brought down the first ever Labour administration in 1924.

In the mid-2000s, however, that principle was tested to the extreme. A British company had concluded several highly lucrative contracts with Saudi Arabia to sell fighter jets. The Serious Fraud Office (SFA) formed the view that there might have been bribery involved in some of those deals, and began an investigation accordingly.

Up with this the Saudi authorities did not intend to put. It was made clear that not only would commercial interests be threatened by the investigation, but intelligence sharing in the “war on terror” would cease. Bluntly put, this would place British lives at heightened risk from international terrorists. Faced with this unambiguous threat the Director of the SFA halted the investigation.

Concerned groups applied for judicial review of the Director’s decision. The Divisional Court, incensed by what it saw as a direct assault by a foreign power on the administration of justice, allowed the application.

Allowing the Director’s appeal, the House of Lords tried to pour cold water on the affair. The Director had lawfully exercised his undoubted discretion not to prosecute, and the courts were not entitled to intervene.

In a forthcoming LexisNexis book, Cases That Changed Our Lives, John Cooper QC considers the case and its legacy. He finds that the ultimate decision was legally correct, though the extremely distasteful manner of the threat to which the SFA was compelled to respond remains. But he also shows that underpinning the whole saga was the thoroughly unsatisfactory state of British bribery laws - adding a further depressing angle to the story.

Different readers may view the case in a variety of ways. On the one hand it could be a straightforward example of realpolitik. On the other it might be said to be emblematic of the murky nature of international weapons sales; a shameless selling-out of principle for thirty pieces of silver; a manifestation of hapless bribery laws; a shameful capitulation of the rule of law; a shameful capitulation of the entire British state in the face of a quasi declaration of war by a so-called ally; or all of the above.

One thing is certain: realpolitik or not, nothing positive exists to be said about the saga.

Peeping Tom (1960) Directed by Michael Powell

There is a stark lesson to be learned from Peeping Tom. In 2010, stark conservatism is prevalent, it's in the air, especially in the arts. You have to dig deeper to find statements that cause you to think, that question the way we look at things or feel. Peeping Tom is a psychological horror film on one level. It deals with voyeurism and child abuse. It looks at our relationship with sexual imagery. It's also a film about cinema. It's very dark and nasty in attitude, it mixes innocence with dreamlike imagery and crudeness with cruelty. In 1960 (and maybe even in 2010),  its themes were too much for public and critics alike. The film disappeared. The picture became a cult of seediness, one you must see. A myth surrounded the picture. Peeping Tom ruined Powell's career. This is a shame in itself, Powell, along with Emeric Pressburger made some of the greatest films I've ever seen : The Red Shoes, The Life & Death Of Colonel Blimp, A Matter Of Life & Death, Black Narcissus.

Powell's world was always luridly colorful, and this is especially the case with Peeping Tom. This is not some realistic world, although the film deals with adult themes, Powell is presenting us with something that looks artificial. Mark (Carl Boehm) is addicted to filming everything he sees. This obsession with the camera (and with cinema itself?) is combined with a need for Mark to gauge how people react to fear. The obsession turns to murder as Mark captures the fear on his victims face on camera before he murders them. The plot is rudimentary. Hitchcock lurks in the shadows of Peeping Tom, even though his own later picture,  Frenzy owes a lot to this film.

Eventually Peeping Tom was rediscovered in the late 70's (mainly down to Martin Scorsese's enthusiasm for the picture). It's now heralded as one of the greatest British films ever. Too late for Powell, his career remained in limbo. It's too simplistic to call this a horror picture, there is so much more on offer. In our safe, self satisfied lives, we need to be shaken, woken up. Peeping Tom is an alarm clock going off in the head. It's not a comfortable awakening, but it is essential.

Peeping Tom was much better than Blow-Up.
Even though it is perfectly stylized, Peeping Tom has a juicy story to tell and enough rounded characters who come alive. This is cinema transforming reality, whereas Blow-Up was so wanting to capture a reality it seemed frozen.

Something happens to me when I  am photographed or captured on film. If I am aware of it happening my relationship to that moment changes. I know that something of me will be frozen forever to that situation. It is a loss of control, a shedding of me, a surrendering to never actually seeing me. If the person 'shooting' me wants to, it is very easy to make me feel awful, even frightened. The power is in the eyes behind the camera lens.

Much of the mundane everyday human life constitutes of actions that require privacy. Or at least they necessitate a sense of being unwatched. City life could be defined by the close proximity to others accompanied by a contract of ignoring this continual closeness.

A peeping tom breaks these unannounced contracts and intrudes into every room, moment and movement of people. In the movie, Mark has inherited his illness from his father (who used to film his son's life every moment as a scientific study). A victim who has never known privacy and therefore has not had a chance to own and construct himself, has no other option than to objectify others through his camera lens.

I wonder if the upcoming Facebook movie will ponder on any of these themes. In my opinion Facebook works in two ways: it provides the illusion that we are defining our image and what we give out (thus gaining control back to the object), while at the same time it makes us all peeping toms.

Saturday, August 14, 2010

New computer; new jeans

The Sewing Lawyer spent much of the past week, after mostly recovering from a nasty summer cold and jet lag (bad combination) sewing the Jalie jeans pattern.  Or rather, sewing it twice.   Why, you might wonder?  It comes down to fabric choice.  The Sewing Lawyer owns quite a lot of fabric, including what remains, after 2 previous pairs of jeans, of some very nice stretch denim purchased years ago from Wazoodle, which was claimed to be genuine Levis denim, 1% stretch.  Too nice to try on a new pattern, must save ...  THAT affliction accounts for much of our stashes, no?

Off to Fabricland, where the "denim ends" table yielded up a serviceable denim of approximately the same stretchiness.  When sewn up into the Jalie jeans pattern, the resulting pair of jeans appeared to be i-m-p-o-s-s-i-b-l-y tight.  As you already know, The Sewing Lawyer got a little discouraged and thought; well, maybe Fabricland's ends table could turn up another piece of denim that could be turned into an actually-wearable pair of jeans.  There was none of the same stretch, but for $8 a beefy and stretchier dark denim was available.  The second pair of jeans was cut and sewn to the same point.

The Sewing Lawyer hates sewing failures.  So returned to the first pair, and realized that by using ALL of the seam allowance insurance adding an extra 6cm (yes you heard that right) of width through the hips and most of the thigh, the first pair of jeans would actually be wearable.

So two pairs of jeans were sewed simultaneously.

Sometime before the cutting and sewing of the 2nd pair, The Sewing Lawyer got smart and altered the back piece to add more (let's call it) sitting room by slashing the back and adding a 2.5cm (1") wedge at the CB.  She also got confused, and thought she understood where the seam lines should always be on these Jalie jeans, but then almost instantly forgot this understanding, and sewed the 2nd pair with 2.5cm side seams.  Maybe the cold was still operating to fuzzify the Sewing Lawyer's brain.

In the end there were 2 pairs of jeans which fit remarkably similarly except the second stretchier pair is tighter through the knees, as a result of the cold-induced confusion.  It's a good thing they're stretchy!

All the pictures are on Flickr - here are the highlights.

The back - This happens to be the first pair; the second (despite the extra 2.5cm of length) looks really identical.  There are only 5 belt loops with one at CB - that extra one Jalie wants you to sew on looks weird, IMHO.

The front (this also happens to be the first pair).

And the side (for a change, this is the second pair - told you they looked identical).  Of course you will note the absence of "bootcut" flare.  The leg was redrawn to be completely straight below the knee.

Of possibly more interest is the fact that rivets were actually used, for the very first time.  And, on the 2nd pair, interesting pocketing was used, and the pocket seams were enclosed so no raw or serged edges are visible.  Behold:

This post concludes with a view of essential jeans-sewing tools and hardware.  The blue-handled and very pointy awl pokes the holes needed for the jeans buttons (to left) and the rivets (right).  Of course, to sew through denim, you also need a good jeans needle and for topstitching, heavy thread plus a topstitching needle.  Without 3 machines going to make these - my regular Pfaff threaded with dark blue thread; my Featherweight which is the topstitching and buttonhold station, and my serger, I might have gone mad.

This post was created on my new (Windows 7) computer - could you tell?

Friday, August 13, 2010

Suddenly, Last Summer (1959) Directed by Joseph L. Mankiewicz

Taboos. This picture deals with a few. Mental illness and permissive sex. Even in 2010 we struggle with the concept of insanity, the crumbling of the mind. It's as if it couldn't happen to you, yet we all do irrational things that in certain circumstances could be deemed insane. We still don't discuss the concept of insanity, is it fear for our own?  Of course, Suddenly, Last Summer is Tennessee Williams material, so secret homosexuality and incest between a mother and son are also up for examination. What's so interesting about Mankiewicz's film is how it tackles these issues head on, yet in subtle ways as to avoid the glare of the then strict US sensor.

Elizabeth Taylor plays the sexually charged Catherine Holly who witnessed the death of cousin Sebastian whilst on vacation last summer. Catherine went seemingly insane due to Sebastian's demise, yet can't really recall what happened. Eccentric socialite mother to Sebastian, Violet (Katharine Hepburn) wants Catherine lobotomized by the good Doctor Cukrowicz (played by an obviously struggling Montgomery Clift). Catherine is spreading indecent suggestions about Sebastian's sudden death, Violet wants to stop the rumors.

Hepburn and Taylor rip into the delicious script by Williams (co-written for the screen by the trusted Gore Vidal). It's terrific watching Hepburn and Taylor at the top of their respective games. Despite Clift's obvious frailty, he delivers the requisite sympathy as the Doctor who pieces together what really happened last summer. Mankiewicz uses long takes, and lets the acting and the script work its magic. At times, Suddenly, Last Summer seems too stilted, yet when the story unfolds of rough trade in far off places, cannibalistic savagery and a mothers over bearing, unnatural love, Suddenly, Last Summer comes alive through its storytelling. This is an intelligent film which requires some patience but offers ample reward for sticking with it. And Taylor's white swimsuit has become a thing of legend.

The script for Suddenly Last Summer is filled with such wonderful sentences that we have to stop watching a couple of times so I can write notes down in my black book. It's Tennessee Williams again.
Madness and homosexuality with ample animal metaphors – certainly lots of inspiration to write a song about.

Katharine Hepburn plays a rich mother, Violet, who has lost her son Sebastian a summer ago and is now convinced that her niece is to blame on the death. The mother lives in a dream-like house with a garden full of Amazonian plants, carnivorous flowers and vultures on the branches of ancient trees. When she introduces the garden to a visitor she says: "My son's garden is very unusual: like the dawn of creation." (imagine the Hepburn accent, the dramatic pronunciation)

Violet associates Sebastian with a god-like creativity and control. She is clearly in love with her son in a completely possessive, stifling manner. The odd surroundings and Violet's overly passionate monologue about her son suggest that madness actually lives under her roof instead of the accused niece's.

Elizabeth Taylor plays the niece, Catherine. Her role is less imaginative because we see immediately that she is not crazy but traumatized. Her main function is to be bate, outside and inside the film. The lobotomy doctor, Montgomery Clift, falls for her in their first scene and his job is to prove her sanity by getting her to remember what really happened on the day that Sebastian died in Spain.

In the end Catherine (why is the 'mad girl' in the attic always Cathy?) is put in front of her relatives and doctors drugged and hypnotized by the serious doctor (Clift) and she can finally remember the truth.
It is an exhilarating scene to watch: the wrongly accused and misunderstood woman unburdening her perspective while the others can only listen. Her story changes the position of the women; now Violet is mad as she ascends back upstairs in her elevator talking to the doctor as if he was her son, Catherine is sane and she goes home with the doc.

Thursday, August 12, 2010

US citizens face penalties when failing to report their offshore accounts

Kevin Mullin: Ramifications of U.S. Crackdown on Foreign Tax Havens
By Kevin Mullin, JD, CPA, LLM (Tax)

Compelled by the current recession to raise revenues from all quarters and emboldened by reports of thousands of U.S. taxpayers with unreported foreign accounts, the current administration is moving to crack down on rogue U.S. taxpayers with investments stashed abroad.

While the UBS scandal has attracted the most publicity, leading to the discovery of thousands of unreported accounts held by Americans, Switzerland is not the only focus. The Internal Revenue Service recently announced the opening of its first criminal investigation office in Panama and the agency is targeting far-flung jurisdictions which permit bank-secrecy, as well as tax havens around the world.

This has a direct impact on the thousands of U.S. taxpayers investing in real estate outside of the U.S., who often use a foreign bank, financial account, corporation, partnership or trust to take title to the property. They provide a convenient cash management account from which to make such investments or meet expenses of ownership. But they don't necessarily shield owners from IRS scrutiny, as the U.S. account-holders of UBS have found out.

Most U.S. taxpayers with international investments are likely aware that they are required to declare income earned from all sources located anywhere in the world, but many are not aware of the extensive reporting requirements on foreign accounts and investments, regardless of whether they generate any taxable income. Nor are many investors aware of the draconian penalties that attend their non-compliance.

Besides the obvious obligation to report income, there are extensive requirements for the owners (or constructive owners) of such accounts to report transfers and ownership of foreign corporations and trusts, as well as ownership or signature authority over foreign financial accounts.

While many of these reporting requirements have been on the books for years, the focus of the U.S. on enforcing them has been, until recently, pretty half-hearted. But now the IRS is pursuing this arena with vigor.

The administration's efforts culminated earlier this year with amnesty program for U.S, taxpayers with unreported income from foreign accounts--an admission that providing amnesty might bring new sources of revenue, which would otherwise simply burrow deeper underground. The amnesty program allowed qualified U.S. taxpayers with unreported income from foreign accounts to generally be relieved of criminal sanctions, although they would still be subject to back taxes, interest and civil penalties.

The announcement of the amnesty program, which ended on Oct. 15, triggered an avalanche of disclosures that have overwhelmed IRS staff. In its wake, a plethora of proposed legislation has been introduced aimed squarely at bringing a spotlight to the offshore arena.

Hereafter, the gloves are off and U.S. taxpayers who are discovered to have unreported income from foreign accounts should not expect a conciliatory attitude on the part of the IRS. For those U.S. taxpayers with foreign-source income and financial accounts, the requirement for obtaining competent legal counsel and accounting advice could not be more critical to their overall tax compliance efforts.

The following is a summary of the reporting requirements and potential civil penalties that could apply to a taxpayer, depending on their particular facts and circumstances. Note that serious criminal penalties with financial, as well, as incarceration possibilities are also possible for willful infractions. And if the IRS discovers non-compliance prior to the taxpayer providing information on a voluntary basis, the opportunity of pleading ignorance or inadvertence will likely fall on deaf ears and the likelihood of a criminal investigation increases.

A short summary of some of the compliance requirements:

  • A penalty for failing to file the Form TD F 90-22.1 (Report of Foreign Bank and Financial Accounts, commonly known as an �FBAR�). U.S. citizens, residents and certain other persons must annually report their direct or indirect financial interest in, or signature authority (or other authority that is comparable to signature authority) over a financial account that is maintained with a financial institution located in a foreign country if, for any calendar year, the aggregate value of all foreign accounts exceeded $10,000 at any time during the year. Generally, the civil penalty for willfully failing to file an FBAR can be as high as the greater of $100,000 or 50 percent of the total balance of the foreign account. Non-willful violations are subject to a civil penalty of not more than $10,000 for each account and for each year that the account is unreported.
  • A penalty for failing to file Form 3520, Annual Return to Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts. Taxpayers must also report various transactions involving foreign trusts, including creation of a foreign trust by a U.S. person, transfers of property from a U.S. person to a foreign trust and receipt of distributions from foreign trusts. This return also reports the receipt by U.S. persons of gifts from foreign entities. The penalty for failing to file each one of these information returns, or for filing an incomplete return, is 35 percent of the gross reportable amount, except for returns reporting gifts, where the penalty is five percent of the gift per month, up to a maximum penalty of 25 percent of the gift.
  • A penalty for failing to file Form 3520-A, Information Return of Foreign Trust With a U.S. Owner. Taxpayers must also report ownership interests in foreign trusts, by U.S. persons with various interests in and powers over those trusts under section 6048(b).The penalty for failing to file each one of these information returns or for filing an incomplete return, is five percent of the gross value of trust assets determined to be owned by the U.S. person.
  • A penalty for failing to file Form 5471, Information Return of U.S. Person with Respect to Certain Foreign Corporations. Certain U.S. persons who are officers, directors or shareholders in certain foreign corporations (including International Business Corporations) are required to report information. The penalty for failing to file each one of these information returns is $10,000, with an additional $10,000 added for each month the failure continues beginning 90 days after the taxpayer is notified of the delinquency, up to a maximum of $50,000 per return.
  • A penalty for failing to file Form 926, Return by a U.S. Transferor of Property to a Foreign Corporation. Taxpayers are required to report transfers of property to foreign corporations and other information. The penalty for failing to file each one of these information returns is ten percent of the value of the property transferred, up to a maximum of $100,000 per return, with no limit if the failure to report the transfer was intentional.
  • A penalty for failing to file Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships. U.S. persons with certain interests in foreign partnerships use this form to report interests in and transactions of the foreign partnerships, transfers of property to the foreign partnerships, and acquisitions, dispositions and changes in foreign partnership interests. Penalties include $10,000 for failure to file each return, with an additional $10,000 added for each month the failure continues beginning 90 days after the taxpayer is notified of the delinquency, up to a maximum of $50,000 per return, and 10 percent of the value of any transferred property that is not reported, subject to a $100,000 limit.

Kevin Mullin is a tax attorney with more than 20 years experience in international tax and estate planning services. With offices in Denver, Co., and McLean, Va., he can be reached at http://www.intl-taxlaw.com/. He also maintains representative offices in Latin America and the Middle East to support his professional and client relationships globally.

Monday, August 9, 2010

EB-5 visa still attractive for the millionaires moving to the US

For affluent immigrants unwilling to deal with long waiting lists, the EB-5 Visa program provides a fast track for immigrating to the U.S. The basic requirements are to set up a business for a minimum of $1 million (or $500,000 in “Regional Centers” in rural areas or urban regions with high unemployment rates) which provides 10 jobs by investing here.
For citizens in countries with political unrest such as Venezuela and Mexico and higher tax rates such as U.K., the EB-5 is a useful alternative. Advantages include:
  • 10,000 green cards reserved each year for the EB-5 regional center program
  • No minimum education requirement
  • No business or management experience requirement
  • No language requirement
  • No excessive waiting periods or quota backlogs
  • No sponsor needed
  • Investment capital can come from any lawful source
  • Investors not required to manage their investment on a daily basis so they may pursue other professional and personal ventures inside or outside of US
  • Satisfy job creation requirements by counting both direct and indirect jobs

June 11, 2010, 8:24 AM ET
Immigrant Investors, An Underserved Market

Finding new clients is a challenge for all financial advisers. But most advisers are overlooking an untapped and growing client base: wealthy foreign investors seeking to gain permanent residency in the U.S.
EB-5 green cards also allow affluent foreign investors (and their family members) to work in the U.S. in any capacity, go to school, or retire here.
Each year, 10,000 visas are available for EB-5 investors looking to come to America.
According to the U.S. State Department, the number of so-called “investor green cards” issued nearly tripled to 4,218 in the fiscal year 2009 ended September 30, compared to just 1,443 EB-5 visas issued in fiscal year 2008.


With proper advance planning, EB-5 Program applicants can undertake measures to minimize their U.S. FIT and FTT exposure. Thus, applicants for the EB-5 Program should consider tax planning prior to becoming U.S. residents, that is, while they are still non-residents. This tax planning can be formulated so as to take effect only when the applicant knows that he or she is eligible for the EB-5 Green Card, but the urgency for the applicant to undertake this FIT and FTT planning becomes more critical as the EB-5 application proceeds towards permanent residency, as depicted below:

The "EB-5" Investor Visa Program provides foreign nationals an innovative and flexible path to permanent residency in the U.S. (Green Card) for themselves, their spouses and their children less than 21 years of age.
The EB-5 Program permits an applicant to invest a minimum of $500,000 in a U.S. Government designated Regional Center in the U.S. The Regional Centers are designed to allow pooled investments to create jobs in targeted high-unemployment areas in the U.S. Thus, the qualified applicant can obtain a Green Card without having to create their own business in the U.S. or to even emigrate to the U.S. until the Green Card has been issued. A Green Card gives the holder the right to live and work anywhere in the US.

EB-5 Visa Program Process
◆ Step 1 - The qualified applicant files form I-526, a petition requesting the U.S. Citizenship and Immigration Services to certify the applicant and the investment as eligible for the EB-5 Program.
◆ Step 2 - Upon approval of the I-526 petition, the applicant files an immigrant visa application and is interviewed at the Embassy in the applicant's home country. Upon approval of the application, the applicant is issued an immigrant visa to the United States. A conditional Green Card is issued to the applicant shortly after his/her arrival in the United States.
◆ Step 3 - After two years, the applicant must file to remove the "condition" from the Green Card using form I-829. At this time, the Regional Center will provide proof of job creation.

Tax & Estate Planning for EB-5 Program Applicants
Citizens and permanent residents of the U.S. are subject to federal income tax (FIT) on their worldwide income and to gift and estate tax (FTT) on their assets located anywhere in the world, while nonresidents of the U.S. are taxed only on their income and assets arising or located in the U.S.

MDH specializes in international income and estate tax planning for EB-5 Program applicants, and we work with nationally-recognized immigration law firms in the U.S. to assure a seamless transition for applicants becoming permanent residents of the United States. Some of our planning techniques include corporate reorganizations, foreign and U.S. trusts, partnerships, limited liability companies, life insurance, annuities, and gifting programs. We also work with our client's advisors in his or her home country to assure that the client receives complete and comprehensive tax and business planning services, and that the client and their loved ones maintain the standard of living to which they are accustomed.

Kevin J. Mullin, J.D., C.P.A., has been practicing law for over 15 years with a focus on advising foreign investors on their U.S. real estate investments and international business and tax planning. Mr. Mullin has offices in Denver, Colo., and Washington, D.C. http://www.intl-taxlaw.com/ . He also maintains representative offices in Latin America and the Middle East to support his professional and client relationships globally.

Five Easy Pieces (1970) Directed by Bob Rafelson

Even after a third viewing of Five Easy Pieces I am left with such a strong emotional impact that I feel uncertain about the sense of dissecting the film in words. A song might be a more appropriate review.
But I haven't written that song just yet. Tammy Wynette's Stand By Your Man became the walking-on-stage song for my last tour because of its significance in the movie.

Now that I think of it, there was some of Robert (Jack Nicholson) on Better Than Wages (my latest album). And there is some of Robert still lingering in my life. The refusal to settle for anything. To use the verb is too much of a compromise. Now I am talking in an entirely internal way. But it is important anyhow.

No, I have not disappeared, left my relatives, my love, my home, my class. I have not moved on in that rootless nameless manner. I do not have it in me to wear the turtle neck, pass out on the peer, fuck my brother's lover, while always looking down on people and institutions. I am too nice and conventional for that stuff. In the end it is not creative (productive?) to be like Robert, although it may be so to feel like him sometimes.

This time around the pivotal scene for me was when Catherine (Susan Anspach) and Robert sit by the ocean after their short affair is over and Robert is about to leave his home again. He is still asking her to leave with him, but she has no interest to because she can see through him. She asks: If you do not love yourself, anyone or anything, how could you ask for love?

One day in Alaska he probably asked for love. But that would have not made for such a poetic film. It may be a song though.

What do we want? Ultimately, we can think we know what we want, but how well do we know ourselves? Is what we want distorted by outside pressures? Get a job, start a band, have kids, get married, find God, travel and so on. What do these things actually add up to if you don't know yourself or are not honest with yourself? Everything we are taught, every scrap of information we receive is handed down. What individual feeling are our actions based on? What makes Jack Nicholson's Bobby in Five Easy Pieces so appealing after all these years is his searching for some kind of meaning to existence, not knowing any answers and lashing out at everything and everybody. It's an honest reaction, and it gives Rafelson's picture a genuine questioning rebellion.

When I first saw Five Easy Pieces sometime in the mid 80's it was a forgotten picture. Born out of the impact of the New Hollywood and made in the wake of the influential yet overrated Easy Rider, Five Easy Pieces still stands up because it avoids sentimentality, offers no answers, ignores the obvious hippy references which blight so many pictures from this era and at it's heart has probably the greatest Nicholson performance. If Jack had not become such a big star in the 70's due to sterling work in films like One Flew Over The Cukoos Nest, Chinatown and The Shining, we might have got some more interesting characters like his Robert Dupea. This is one of the great anti-establishment performances. The fact that his character is such a shit  makes his Dupea even more appealing.

Five Easy Pieces improves with every viewing, and nowadays is rightly heralded as a major film. It's one of my favorites. Rafelson collaborated a few more times with Nicholson, with The King Of Marvin Gardens from 1972 almost equaling Five Easy Pieces, a picture which maybe gives us an idea of what happened to Dupea a couple of years down the road. He gave up fighting against everything and got depressed. He got worn down. He settled for emptiness.

Five Easy Pieces is being celebrated this year for being 40 years old. If you have not seen this, search it out. It's not life affirming, but the questions it asks are worth considering.