Germany: 051b. Transfer Pricing - Where We Stand - Developments in the United States

Last Updated: 31 July 1996
KPMG Germany Webpage
Click on the above link to visit the KPMG Germany webpage on the Mondaq website
For disclaimer and copyright see end of this article.

INDEX


1.1 U.S. Record-Keeping Requirements (section 6038A IRC)
1.2 U.S. Accuracy-Related Penalties (section 6662 (e) IRC)
1.3 U.S. Transfer Prices And Customs Value (section 1059A IRC)
1.4 New U.S. Transfer Pricing System (section 482 and Reg. sec. 1.482 
    IRC)
    In General
    Comparable Profits Method
    Arm's Length Principle
    Best Method
    Transfer Price Methods
    Arm's Length Range
    Market Entry, Defence, And Expansion Strategies
    Functional Analysis
    Intangible Assets
    Procedural Matters
1.5 U.S. Advance Pricing Agreements

DEVELOPMENTS IN THE UNITED STATES

1.1 U.S. Record-Keeping Requirements (section 6038A IRC)

Section 6038A IRC was amended in 1989 to help insure the availability to the IRS of documentation useful in reviewing the transfer pricing structures of foreign groups doing business in the United States. Congress believed that the inaccessibility of relevant documents had substantially interfered with the ability of the IRS to review international transfer prices. Allegedly, the net income of U.S.-controlled corporations had risen proportionate to the increase in gross receipts, but net income of foreign-controlled corporations had declined despite increased receipts.

As interpreted by the relevant regulations, the law establishes sweeping reporting and record-keeping requirements for foreign corporations engaged in a trade or business in the United States and for foreign-owned U.S. subsidiaries ("reporting corporations"). A U.S. corporation is foreign-owned if any single foreign person, legal or natural, directly or indirectly owns 25 % of its stock, by vote or by value. The direct or indirect 25 % foreign owners of the reporting corporation and all companies under common control therewith are "related parties". The reporting corporation must file an annual return (Form 5472) giving details of its dealings with all related parties. A separate form must be filed for each related party. Furthermore, the reporting corporation must maintain or create certain records in the English language on these transactions.

The record-keeping obligations go significantly beyond the general obligations under section 6001 IRC. An agreement can be entered into with the IRS concerning the form, location, and scope of these records. The records may be maintained abroad, but must be produced on 60 days notice (90 days if translation into English is necessary). A de minimus exemption exists for reporting corporations with limited related party transactions.

The law also requires foreign related parties to appoint their reporting corporation as agent to receive service of process if the IRS so requests. This permits the IRS to summon employees of the foreign related party to appear and give testimony on matters beyond the knowledge of the U.S. reporting corporation. Similarly, demands for production of documents not controlled by the reporting corporation can be served by this means on the foreign related party.

The penalties for non-compliance with section 6038A are twofold. Firstly, there are monetary penalties of US-$ 10,000 for isolated compliance failures (e.g. failure to submit Form 5472 or incomplete filing thereof). If non-compliance continues for more than 90 days after notice from the IRS, additional fines of US-$ 10,000 per month or fraction thereof are levied. Furthermore, the IRS is given discretion to deny deductions for sums paid or owing to a related party in the event of failure of the reporting corporation to keep and produce records, failure of a related party to appoint the reporting corporation as agent for service of process, or failure of a related party to comply with process so served.

1.2 U.S. Accuracy-Related Penalties (section 6662 (e) IRC)

Transfer pricing penalty provisions were added to this section in 1990 and modified in 1993. These penalties amount to 20 % or 40 % of the tax owing as a result of transfer pricing adjustments which exceed any of three thresholds. The 20 % penalty applies in the event of:

i.       Purchase of goods, services, rights etc. for 200 % or 
         more of their adjusted price; or
ii.      Sale of goods, services, rights etc. for at 50 % or less
         of their adjusted price; or
iii.     Net transfer pricing adjustments exceeding  
         US-$ 5 million or 10 % of gross receipts, whichever is
         less, in a single tax year, regardless of the degree of 
         the adjustments made.

For example, the penalty applies when goods or services are purchased for double or more than their adjusted value or sold for half or less than their adjusted value. Furthermore, total adjustments of US-$ 5 million or 10 % or gross receipts trigger a penalty irrespective of how close the chosen transfer price was to the adjusted price.

The 40 % penalty applies to "gross valuation misstatements", defined as

i.      purchase at 400 % or more of the adjusted price 
        (quadruple the adjusted price); or
ii.     sale at 25 % or less of the adjusted price (one 
        fourth or less); or 
iii.    net adjustments exceeding US-$ 20 million or 20 % 
        of gross receipts, whichever is less.

Obviously, the penalty thresholds are particularly dangerous for large international groups which can exceed the third threshold even if their transfer prices are well within the ranges established by the first and second thresholds.

The penalties described are imposed without regard to fault. The taxpayer may, however, avoid imposition of the above penalties by qualifying for what has been called the "contemporaneous documentation exception". This due care exception is codified in section 6662 (e) (3) IRC. It essentially requires the taxpayer to show that his transfer prices, albeit incorrect, were arrived at using under the rules established by section 482 IRC and its related regulations, as evidenced by documentation created contemporaneously with application of the transfer prices (specifically, documentation in existence at the time of filing of each annual tax return). Such documentation must be presented to the IRS within 30 days of any request. The documentation involved may overlap somewhat with that under section 6038A IRC, but is not identical with it.

Furthermore, the IRS has specified the following in the regulations to section 6662 IRC:

  • In his documentation, the taxpayer must justify his choice of a particular transfer pricing method (including a method not specifically defined in the regulations) under the "best method rule" (see below sec. 1.4) by considering other methods and showing why they are not the best one;
  • If the taxpayer has used a transfer price range, he must analyse his data to see where his transfer prices fall inside the range. Prices at one extreme or the other are not regarded as at arm's length.

In view of the uncertainties surrounding transfer price determination, section 6662 IRC in effect creates a substantial risk of penalties for taxpayers who:

  • Fail to analyse (e.g. using a study performed by outside experts based on sound business accounting principles) and document their transfer pricing systems contemporaneously with their implementation, at least as regards the United States or
  • Fail to apply the United States approach to transfer pricing determination, as articulated in the final regulations to section 482 IRC.

1.3 U.S. Transfer Prices And Customs Value (section 1059A IRC)

Under section 1059A IRC, a taxpayer importing goods into the United States may not claim a transfer price in excess of that used for customs purposes. This does not prevent adjustment under section 482 IRC to a price under the customs value.

1.4 New U.S. Transfer Pricing System (section 482 and Reg. sec. 1.482 IRC)

In General

The final regulations under section 482 IRC are universally regarded as a major improvement over the initial proposed regulations and an incremental improvement over the intermediate temporary regulations. They direct attention to many relevant factors while at the same time refraining from simple solutions as to the weight to be given to each in concrete situations. They refine the established approach of analysing the allocation of risk and function chosen by the taxpayer as reflected in contractual arrangements and their actual performance. The insistence of the regulations on adjusting reported income where necessary to determine the taxpayer's "true taxable income" still sounds ominously aggressive, however. Unlike the new OECD Guidelines, the U.S. regulations contain no explicit recognition that "transfer pricing is not an exact science", hence that tax authorities should "not demand from taxpayers in their transfer pricing a precision which is unrealistic under all the facts and circumstances" (OECD Guidelines par. 4.8, 4.9).

Comparable Profits Method

The comparable profits method of transfer pricing determination was the single most objectionable aspect of the U.S. regulations in their initial form. By defining strict standards of comparison for the traditional pricing methods (comparable uncontrolled price, resale price, and cost-plus) and requiring data on the price and cost structure of competitors which is often not available, the regulations appeared to ensure that the comparable profits method would always operate by default. Despite some relaxation in the standards of comparison for other methods and better definition of the comparable profits method itself to make clear that average industry profit statistics cannot be used without analysis and adjustment, it is still by no means clear that the changes made are more than cosmetic. There is recognition that the method must be applied transactionally based on the profit from specific business operations, not with respect to average earnings from disparate activities. The comparable profits method is furthermore now identified as a "method of last resort", to be used only when all other methods are less reliable. The fear remains that the other methods will be found "less reliable" with a certain regularity and that the comparable profits method could operate to mandate that an enterprise earn the same average profit as its competitors whether this is true in fact or not, i.e. irrespective of actual performance.

Arm's Length Principle

There is considerable doubt as to whether the comparable profits method is consonant with the arm's length principle since the underlying presumption that all companies earn similar profits on similar transactions is dubious, to say the least. A second prime problem remains the treatment of transfer pricing for intangibles, as to which the Congress in 1986 expressly provided for transfer pricing commensurate with the income derived from the use of the intangible. This approach involves taking account of circumstances subsequent to the time of transfer of the intangible and is tantamount to fixing prices by hindsight. It is inconsistent with the arm's length principle, and hence most U.S. tax treaties, because unrelated parties dealing at arm's length fix prices with respect to what is known or reasonably anticipated at the time of contracting. However, the final regulations narrow the scope of operation of periodic adjustments in the transfer prices of intangibles and require no such adjustment for fluctuations due to extraordinary subsequent events or which are within a corridor of +- 20 % compared with the income forecast at the time of transfer.

Best Method

The regulations establish no priorities among transfer pricing methods and instead enjoin the taxpayer to employ the "most reliable method" (as opposed to the "most accurate method" in the temporary regulations). Reliability is determined with respect to the quality and comparability of the available data. The regulations contain extensive comment on this subject. As mentioned above, to avoid the penalties under section 6662 IRC the taxpayer is expected to consider other methods and defend his choice of method. While the regulations state that extensive analyses and detailed studies under all conceivable methods are not required, nevertheless it is also clear that the taxpayer is not conceded a measure of discretion to choose among reasonably accurate methods. The taxpayer must use the "best" method, not just a good one. The IRS is free to challenge the taxpayer's choice of method. Furthermore, the taxpayer is required to use more than one method where this is appropriate for determining the true taxable income. Where different methods lead to varying results without it being possible to determine that any one is clearly the best, i.e. the most reliable, an averaging of results may be indicated.

Transfer Price Methods

The regulations establish five methods and a general category of "other methods":

     i.     Comparable uncontrolled price method
     ii.    Resale price method
     iii.   Cost-plus method
     iv.    Comparable profits method
     v.     Profit split method
     vi.    Other methods

The first three methods are not new as such and have been little changed in content. There is more detailed guidance as to when and how to use them. For intangibles, the first method is replaced by the "comparable uncontrolled transaction" method. The new and highly controversial comparable profits method attempts to identify the profit which unrelated third persons earn on (roughly) comparable uncontrolled transactions and to fix the profit in a controlled transaction with respect thereto. Aside from the reservations expressed above with respect to this method, one may doubt whether the true profit derived by a competitor from an activity can ever be determined based on his published financial data alone. To the extent, however, that data available only to the tax authorities (e.g. from tax audits of other firms) is used, the taxpayer has no way of verifying the assertions with which he is confronted or discovering mistakes the tax authorities may have made in gathering or applying the data. For this reason, some insist that a tax authority seeking to rely on this method must carry the burden of proof as to its reliability and accuracy.

The profit split method seeks to determine the overall profit derived by the controlled parties with respect to a transaction and then to divide this profit appropriately among the participants in light of their relative functions, risks, and contributions. While also controversial, there is nonetheless a certain appeal to the profit split method as it does not require the same degree of comparison of the controlled transaction to uncontrolled transactions as do the traditional methods. Furthermore, by dividing the total profit from the start it seems suited to avoiding double taxation, whereas the comparable profits method appears prone to the opposite. Some therefore consider the profit split method appropriate for situations in which the controlled transaction being analysed is one which has no analogy in the uncontrolled world because it, by its nature, only takes place between controlled parties. A major problem in the application of the profit split method is determining the overall profit from a transaction, since this can involve examining the accounting of many entities around the world.

Arm's Length Range

The concept of an arm's length range is in itself nothing new. At least outside of stock and commodity market transactions, reasonable unrelated third parties fix prices as the result of a bargaining process involving many imponderables and based on imperfect knowledge. There is thus no single correct arm's length price. However, the concept is not discussed in the U.S. regulations in order to remind revenue agents that transfer pricing is an inexact science. The regulations contain detailed comments on how to determine the arm's length range and seem designed to objectify and narrow it. One clear principle is that a transfer price outside of the arm's length range will be corrected to the interquartile or arithmetic average of this range. However, the mere fact that a transfer price is inside the range is not sufficient to avoid an adjustment, for instance when the "best method" has not been used and this leads to transfer prices located elsewhere within the range.

Market Entry, Defence, And Expansion Strategies

The U.S. regulations recognise in principle that expense and hence losses incurred to enter a new market or to defend or expand market share in a market on which the taxpayer is already established can be in the interest both of the group parent and its local marketing company. The proper apportionment of such expense between the two depends on their relative anticipated benefit under the particular circumstances.

Functional Analysis

The U.S. regulations contain detailed comments on how to identify relevant factors such as allocation of risk, functions performed (grouped into critical and non-critical functions), capital and assets committed, etc. They are not dogmatic as to how the individual factors are to be weighed in a particular case. The analysis is often insightful.

Intangible Assets

The regulations provide detailed analysis of the various factors of relevance in this complicated area and call attention to the differences between the many types of intangibles involved. The commensurate-with-income requirement now contained in the law has led to provision in the regulations for periodic adjustments of the transfer prices based on later developments. The incompatibility of this approach with the arm's length principle was discussed above. It should be noted that recently issued regulations under section 482 regulate cost sharing arrangements to develop intangibles such as patents or know-how. The participants in such an arrangement acquire a right to use the resulting intangible. In effect, their cost contribution replaces later royalty fees.

Procedural Matters

The most objectionable aspects of the U.S. transfer pricing system are to be found in this area. In the United States, the taxpayer bears the burden of proof for establishing the correctness of his transfer prices. To avoid the risk of penalties, the taxpayer must plan his transfer pricing in advance and document it contemporaneously. The penalties themselves are imposed without regard to fault in the event the contemporaneous documentation does not meet demanding standards. The taxpayer must use the best method in determining his transfer prices, not merely a reasonable method. He must apply a complicated system of transfer pricing rules and even apply several methods in the alternative, at least in certain circumstances. The cumulative result is considerable administrative burden with little security, not even the assurance that penalties can be avoided in the event of transfer pricing adjustments.

1.5 U.S. Advance Pricing Agreements

Advance pricing arrangements are another American transfer pricing invention. Since their inception in 1991 they have been widely discussed and also put into practice in an increasing number of instances. Nevertheless, there has been no avalanche of APAs (as of March 1996 58 completed U.S. APAs, 125 APAs pending, 50 APAs under consideration). Various countries besides the U.S. also offer APAs or something similar, at least in theory, which opens up the possibility of a bilateral APA. Germany is among the countries to have declared its willingness in principle to negotiate APAs with taxpayers and to cooperate in an international APA. A bilateral or multilateral APA has much to recommend it since the interests of the two (or more) national taxing authorities are necessarily adverse, meaning that an arrangement entered into with one party only may well prove unacceptable to the other(s). On the other hand, the more tax administrations involved, the greater the costs. APAs remain attractive as a means of avoiding the uncertainty and minimising the administrative expense inherent in transfer pricing in general and the new U.S. system in particular, especially in light of the feared aggressive application by the IRS of its new regulations and penalties.

An APA entered into with the IRS is valid for approximately three years, after which it must be reviewed (new APA). The subject of an APA is the transfer pricing methodology to be applied, not the transfer prices themselves arrived at by applying the methodology. The pros and cons of the U.S. APA procedure are as follows:

Advantages of APAs
i.   Relative assurance (subject to "critical assumptions" - see
     no. vii in drawbacks below) that the transfer pricing method 
     agreed on will not be challenged on audit, hence:

  • reduced risk of adjustment
  • no risk of penalties
  • no expense of defence of transfer pricing method on audit and in litigation
  • increased certainty for planning purposes

ii.  Possibility to define scope of record-keeping obligations
iii. Possibility of retroactive application (may, however, entail 
     adjustment for prior years)
iv.  IRS perhaps more willing to compromise in APA proceeding than 
     on audit
v.   APA perhaps quicker than audit
vi.  APA perhaps peculiarly suited to certain businesses (e.g.
     global trading) for which new regulations offer little 
     transfer pricing guidance
vii. Possibility of bilateral APA

Drawbacks of APAs

i.   Expense of APA procedure itself
ii.  Valid for limited period only (approx. three years)
iii. Widespread disclosure of internal information to IRS may 
     improve IRS bargaining position
iv.  No guarantee that the procedure will lead to agreement in fact
v.   IRS retains right to use information acquired in APA procedure 
     even if no agreement is reached
vi.  IRS can use information acquired on audit of prior years which 
     APA does not cover
vii. APA is contingent on continued validity of its defined 
     "critical assumptions" (e.g. market share, currency exchange 
     rates)
viii Security against penalties perhaps more cheaply achieved 
     without comprehensive disclosure by commissioning outside 
     transfer pricing study
ix.  Mutual agreement procedure under tax treaty may yield  
     satisfactory result in event of challenge by IRS in absence of 
     an APA
x.   APA of diminished value unless (at least) bilateral


Disclaimer and Copyright
This article treats the subjects covered in condensed form. It is intended to provide a general guide to the subject matter and should not be relied on as a basis for business decisions. Specialist advice must be sought with respect to your individual circumstances. We in particular insist that the tax law and other sources on which the article is based be consulted in the original, whether or not such sources are named in the article. Please note as well that later versions of this article or other articles on related topics may have since appeared on this database or elsewhere and should also be searched for and consulted. While our articles are carefully reviewed, we can accept no responsibility in the event of any inaccuracy or omission. Please note the date of each article and that subsequent related developments are not necessarily reported on in later articles. Any claims nevertheless raised on the basis of this article are subject to German substantive law and, to the extent permissible thereunder, to the exclusive jurisdiction of the courts in Frankfurt am Main, Germany. This article is the intellectual property of KPMG Deutsche Treuhand-Gesellschaft AG (KPMG Germany). Distribution to third persons is prohibited without our express written consent in advance.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions