United States: Tax Incentive Update: Federal Circuit Rules On Calculation Of Basis For Energy Projects

Recently, in Alta Wind I Owner Lessor C et al. v. United States ("Alta Wind"),1 the US Court of Appeals for the Federal Circuit ("Federal Circuit") vacated and remanded the decision of the US Federal Court of Claims ("Claims Court"), which had awarded the owners of six California wind farms approximately $206 million of Section 1603 grants.2 Certainly, the renewable energy industry would have preferred the lower court's decision to have been upheld.

Nonetheless, for the various reasons discussed below, it remains to be seen whether the narrow legal holding of the Federal Circuit in this case will have any meaningful impact on the value of expected tax benefits to the industry. The more important decision will be the Claims Court's decision on remand. (Interestingly, the Federal Circuit took the unusual step of reassigning the case on remand.)

The dispute centered on the method for calculating the amount of the Section 1603 cash grant. However, the ultimate decision may have significant implications to the calculation of eligible basis for purposes of the investment tax credit ("ITC") and accelerated depreciation because Congress provided that the Section 1603 cash grant rules "mimic" the ITC rules in Section 48 of the Internal Revenue Code ("Code").3

The decision is likely to have more significance for the solar industry than the wind industry, as wind projects typically claim the Code Section 45 production tax credit ("PTC"), which is 2.4 cents per kilowatt hour of production during the first 10 years of a project's operation (for projects that "began construction" prior to the end of 2016). The method for calculating the tax basis (or the fair market value) of the project has no bearing on the amount of the PTC. Accordingly, the outcome of the decision on remand is of less significance to the wind industry, although the calculation of basis does remain relevant for depreciation.

Background

Section 1603 of the American Recovery and Reinvestment Tax Act, which was enacted in early 2009 to stimulate the economy in light of the financial crisis that started in 2008, provided a federal grant in lieu of tax credits with respect to certain energy property. As is the case with ITC, the amount of the grant was 30 percent of the basis of the eligible property. The program has expired.

The Alta Wind decision addressed consolidated cases involving 20 plaintiffs, all of which were special purpose limited liability companies organized for the benefit of various institutional investors. The plaintiffs owned six of the 11 wind farms comprising the Alta Wind Energy Center.4 Each project was acquired from Terra-Gen Power LLC ("Terra-Gen") after years of development work by Terra-Gen.5 For five of the projects, the plaintiffs' purchases were pursuant to sale-leaseback transactions. For the sixth project, the purchase was an outright sale.6

All of the wind projects were contracted to Southern California Edison pursuant to a longterm fixed-price power purchase agreement ("PPA"). All of the projects were sold prior to their start of commercial operation.

The plaintiffs applied to the Department of the Treasury ("Treasury") for a grant equal to 30 percent of the purchase price basis of the eligible property. The plaintiffs determined the purchase price basis by deducting from their purchase price "small allocations for ineligible property such as land and transmission lines." Treasury disagreed with the plaintiffs' approach and only paid grants equal to 30 percent of the development and construction costs of the eligible property.

The plaintiffs brought a lawsuit against the government in the Claims Court seeking additional grants of over $206 million, which represented the difference between the grants awarded and the grants calculated using the purchase price basis. The government counterclaimed. It asserted that the plaintiffs should return approximately $59 million of the grant received because these were indirect costs incurred by Terra-Gen that should be ineligible for the grant.

A significant obstacle for the government was that the Claims Court excluded the testimony of Dr. John Parsons. Parsons is a senior lecturer at the MIT Sloan School of Business and an author of economic texts. Parsons was the government's expert witness to support the determination of eligible basis. Without his testimony, the government had no expert witness to rebut the plaintiffs' experts and out of hand lost the option to pursue its counterclaims. The Claims Court excluded Parsons' testimony on the basis of credibility because Parsons failed to disclose certain publications on his CV and lied about the omission during his deposition.

The Claims Court ruled for the plaintiffs. The court stated that the basis of a property should be the cost to its owner, which would be the purchase price of the projects in this case. Here, the price the plaintiffs paid was higher than the out-of-pocket cost of developing and constructing the projects. The government argued that Section 1060 of the Code applied and the excess was goodwill or going concern value. The government also argued that the PPA had intangible value. The Claims Court rejected these arguments, instead concluding that the excess could be "turn-key" value. Turn-key value is the value derived from purchasing a facility ready for "immediate" use after purchase, as opposed to a collection of parts or an untested system or even a complete facility without operating permits.

The Federal Circuit held that the Claims Court was incorrect in determining that Section 1060 of the Code did not apply here because the projects had not been placed in service and, for this reason, vacated the Claims Court's decision. The Federal Circuit found that Section 1060 of the Code and the implementing regulations required taxpayers to allocate the purchase price among different asset classes based on each property's fair market value.7 Thus, the Federal Circuit found that a certain portion of the purchase price could in theory be attributable to the value of goodwill and other intangibles, whereas the Claims Court decision had attributed no value to intangibles. The court remanded the case to the Claims Court for factual findings to determine the proper allocation of the purchase price. In addition, the Federal Circuit held that the Claims Court's exclusion of Parsons' testimony was a reversible error.

Adoption of the Residual Method

Section 1060 requires taxpayers to use the residual method in cases of "applicable asset acquisitions."8 An applicable asset acquisition occurs when either (i) the use of the acquired assets would constitute an active trade or business or (ii) goodwill or going concern value "could" attach to the acquired assets.9

The Claims Court found that Section 1060 did not apply because goodwill and going concern value could not attach to a project until after it became operational. The Federal Circuit disagreed, based on its interpretation of the regulation quoted in the prior paragraph, focusing on the word "could" in the regulation. Pursuant to the regulation, the Federal Circuit examined the totality of the circumstances in determining whether any intangible value could exist in the transaction.10

The Federal Circuit gave particular consideration to three factors set forth in the regulation: (i) the presence of intangible assets, (ii) the existence of an excess of the total consideration over the aggregate cost of the assets purchased and (iii) any related transactions, including leases, licenses or other project agreements.11 As the last two indisputably existed in the Alta transactions, the focus was on the first factor—the presence of intangible assets.

The Claims Court found that no intangibles existed in the transaction. The lower court stated that, by definition, no goodwill or going concern value could attach to any of the facilities before they became operational.12 In addition, the Claims Court concluded that the PPAs were not separate intangible assets because they were closely related to the specific facilities and were neither transferrable nor assignable.

The Federal Circuit disagreed on both points.

First, the Federal Circuit stated that even if technically no goodwill existed when the project was sold, there was an expectation that goodwill could attach "immediately" after the transactions when the projects were placed into service. The expectation was baked into the purchase prices. The Federal Circuit relied heavily on the fact that no development work was necessary at the time of sale. It stated that "[i]n this way, the plaintiffs' relationship with [the offtaker] was largely identical to the kind of customer relationship that an operating business has with its customers." The Federal Circuit further found that the substantial history between the projects and the offtaker and the provision of the initial operation dates and guaranteed operation dates in the PPAs were facts that would suggest that goodwill could accumulate in the form of expectation even before the CODs.

Second, the Federal Circuit found that intangible value could in theory stem from the PPAs and other contracts entered into as part of the transactions. The court determined that the PPAs could constitute customer-based intangible assets because the PPAs represented the customer's commitment to purchase all energy generated at set prices before the projects were complete. The court further found that other contracts, such as the interconnection agreements that conferred transmission rights to the wind farms, could also be treated as intangible assets.

The Federal Circuit relied heavily on Example 4 in the regulation to support its finding that goodwill could arise from a contractual relationship.13 In Example 4, a manufacturing company entered into a long-term agreement with a bookkeeping business for its bookkeeping services and, in exchange, the bookkeeping business agreed to purchase from the manufacturing company its internal bookkeeping department. The regulation concluded that the transfer of the manufacturing company's internal bookkeeping department is an applicable asset acquisition. The regulation provided that goodwill is "the value of a trade or business attributable to the expectancy of continued customer patronage."14 The Claims Court read this regulation as suggesting that no goodwill could exist before a project commenced operation. However, the Federal Circuit viewed Example 4 as suggesting that goodwill could accumulate even if the expectation of "continued" customer patronage would begin only after the transaction.

The Federal Circuit did not further clarify the valuation method of the project assets. The Federal Circuit remanded the case back to the Claims Court to find proper allocations of purchase price to each project property. It is clear from the Federal Circuit's decision that a portion of the purchase price would be allocated to intangibles, thus this portion would be excluded from the facilities' bases in determining the amount of grant. Nonetheless, it is still possible that the Claims Court could ultimately determine there is only minimal value associated with goodwill and other intangibles. If that were the case, the ultimate amount of the Section 1603 grant would probably not be significantly affected.

It is worth noting that the Federal Circuit did not completely disapprove of the Claims Court's view that goodwill would only exist after the project began operation. The Federal Circuit only found that goodwill "could have attached to the group of assets transferred in the Alta transactions immediately after the transaction" (emphasis added). The Federal Circuit explained that due to the readiness of the facilities to be placed in service at the time of the transaction, the expectation that goodwill would accrue in the future itself could constitute an intangible that was baked into the purchase price. The actual value attributable to such expectation could be minimal at the time of the transaction.

Other Issues

Method of appraisal. The Federal Circuit noted that the purchase prices for the Alta wind farms were negotiated based on anticipated cash flows that the projects would generate once they became operational. This fact supported the court's finding that intangibles existed in the transaction because, as the court stated, essentially, the plaintiffs "were purchasing the expectation of future cash flows based on an established customer relationship."15 However, it is unclear whether the court would have viewed the transaction differently if the plaintiffs had adopted the cost approach in determining the purchase price of the specific projects. That is, if rather than focusing on the present value of the expected discounted cash flows, the parties had focused on Terra-Gen's developmental and construction costs, plus a reasonable profit. However, such valuations do not reflect the thinking in the business world, where buyers are far less concerned about sellers' costs than they are about the available profit level as a result of paying the purchase price to acquire an asset.

Turn-key value. The turn-key value is the incremental value that a purchaser paid for an assurance that the facility would function as a unit without the need of substantial adjustment and coordination.16

The Federal Circuit and the Claims Court agreed that turn-key value accounted for at least part of the purchase price. The Claims Court treated the excess of the projects' purchase price over the aggregate value of the project property as turnkey value. However, the Federal Circuit found that the excess could be allocated to intangibles as well. The Federal Circuit found that the value derived from having secured a customer contract, regulatory approvals, transmission rights and various other arrangements that ensured the immediate operation of the wind farms was separate from the turn-key value. Therefore, in allocating the excess value on remand, the Claims Court would need to distinguish between turn-key value and the value of any intangible assets.

Claims Court's exclusion of government's witness. It is worth noting that the Federal Circuit ordered that the case be assigned to a different judge on remand. As discussed above, the Claims Court's judge excluded the testimony of the government's only witness and barred the witness from being cross-examined by the government partly due to his failure to disclose five articles he published from 1986 to 1989 on socialism. The Federal Circuit found that the government should have been permitted to cross-examine the witness, but the Federal Circuit left it for the Claims Court to determine on remand the credibility of the witness's testimony.

Lessons from Alta Wind

The Federal Circuit's decision made two things clear. First, in the view of the Federal Circuit, Section 1060 of the Code would apply to a sale of an energy facility notwithstanding that it had not been placed into service at the time of the transaction. This means that the residual method would be adopted in determining the basis of such facility. This also means that both the buyers (the plaintiffs) and the seller (Terra- Gen) of the wind farms presumably should report this transaction on Internal Revenue Service ("IRS") Form 8594.17

Second, goodwill and other intangible value could accrue even before the projects were placed into service, provided that the projects were expected to commence operation immediately after the acquisition.

However, neither the Claims Court nor the Federal Circuit addressed the plaintiffs' argument that no intangible value should be attributed to the project agreements when the terms of these agreements were not more favorable than market.

In this context, we recall that the IRS first expressed its understanding on the subject matter through a 2012 private letter ruling18 concluding that when a taxpayer purchased wind energy facilities subject to a site-specific power purchase agreement, none of the purchase price needed to be allocated to the power purchase agreement in determining the basis of the wind generation assets. Thus, the entire basis amount could be allocated to the adjusted basis of the wind generation assets. However, that ruling was revoked eight months later by another private letter ruling19 because the favorable ruling appeared to conflict with a memorandum previously issued by Treasury addressing the issue. In the subsequent ruling, the IRS concluded that the earlier ruling no longer represented the IRS's position on this issue that the portion of the purchase price attributable to the power purchase agreement should be included in its adjusted basis of the wind generation assets.

Nevertheless, even if the PPAs and other project contracts were found to have intangible value, this alone might not significantly impact the amount of the grant the plaintiffs would receive. The Claims Court could find that the value of the intangible is minimal.

If the outcome in the Claims Court leaves open the risk of the residual method attributing anything other than an insignificant amount of value to intangibles and goodwill/going concern value, then other project owners in ITC (but not cash grant, which must be litigated in the Claims Court) disputes with the IRS may want to avoid the potential for similar risk by litigating in a jurisdiction not bound by the holdings of the Federal Circuit, which at present is the only jurisdiction with a settled position on the application of Code Section 1060 to an asset acquisition where the project has not yet been placed in service. This would be done by litigating in the Tax Court or paying the tax and suing for a refund in the district court in which the taxpayer's principal place of business is located. Neither the Tax Court nor a district court would be required to treat a decision of the Federal Circuit as stare decisis. Of course, those courts could adopt its holding on the residual method if they agreed with the reasoning.

Given the Federal Circuit's holding, a material question is how to determine if a PPA has intangible value. A difficulty is presented due to the fact that there is typically a time period gap between when a PPA price is agreed to and when the project starts selling power; and market prices can change in the interim. For instance, if (i) a PPA was agreed to in 2015 but (ii) due to the time it takes to obtain the necessary permits and construct the project, power is not sold until 2018, and (iii) between 2015 and 2018 the price  of power declined, should the determination of whether the PPA that was signed in 2015 be made by comparing it to other PPAs signed in 2015 or by comparing it to PPAs signed in 2018 (that may not have power sold under them for the several years it may take to construct the applicable projects). It seems more analytically defensible to compare a PPA signed in 2015 to other PPAs signed in 2015. However, as an anecdotal matter, that is not the approach that Treasury took in administering the cash grant program, but Treasury's reasoning was never expressed.

At the trial level, the government asserted "peculiar circumstances"20 existed in the form of the federal grant and the sale-leaseback and that such "circumstances" justified second-guessing of the purported purchase price despite the buyers (the plaintiffs) and the seller (Terra-Gen) being unrelated. The Claims Court ruled that no such "peculiar circumstances" were present. Importantly, the Federal Circuit did not expressly disagree with that holding. Therefore, in ITC transactions, taxpayers can take some comfort in knowing that a purchase price is not subject to special scrutiny.

Footnotes

1 897 F.3d 1365 (2018).

2 For prior coverage of this case, see Burton, Court of Federal Claims Awards $206 Million to Alta Wind Cash Grant Applicants, reprinted at https://www.taxequitytimes.com/2016/10/court-federal- claims-awards-206-million-alta-wind-cash-grant- applicants/ and Davis and Burton, Court of Federal Claims to Treasury: "Basis Equals Purchase Price," reprinted at https://www.taxequitytimes.com/2016/11/court-of-federal-claims-to-treasury-basis-equals-purchase-price/ . The Claims Court decision is available at 128 Fed Cl. 702 (2016).

3 111 H. Rpt. 16 provides that "It is intended that the grant provision mimic the operation of the credit under section 48. For example, the amount of the grant is not includable in gross income. However, the basis of the property is reduced by fifty percent of the amount of the grant. In addition, some or all of each grant is subject to recapture if the grant eligible property is disposed of by the grant recipient within five years of being placed in service."

4 The Alta Wind Energy Center may be one of the largest wind centers in the world.

5 The projects were initially developed through the joint efforts of Oak Creek Energy Systems and Allco Wind Energy Management Pty. Ltd. ("Allco"). The projects and their associated development rights were later transferred to Terra-Gen in its acquisition of Allco's US wind energy business.

6 The government argued that the sale lease back transactions and other related transactions between the plaintiffs and Terra-Gen created "peculiar" circumstances, which would justify not using the purchase price for determining basis. The Claims Court found that there were no special circumstances and the Federal Circuit did not disagree.

7 The value would be allocated on a waterfall basis among seven classes of assets. These asset classes include: Class I: cash and general deposit accounts; Class II: actively traded personal property, including certificates of deposits, foreign currency, US government securities and publicly traded stock; Class III: debt instruments; Class IV: inventory and other property held for sale to customers; Class V: assets that do not fit within any other class, including tangible property; Class VI: Code Section 197 intangibles, except goodwill and going concern value; Class VII: goodwill and going concern value. See Regulation § 1.338-6(b). In Alta Wind, the tangible assets would be Class V assets. The contractual rights, if determined to be intangibles, would be Class VI assets. Goodwill and going concern value, if any, would be Class VII assets. This method of allocation is referred to as the "residual method."

8Code § 1060(a).

9Regulation § 1.1060-1(b)(2)(i).

10 See Regulation § 1.1060-1(b)(2)(iii) (providing that in making the determination of whether a transaction is an "applicable asset acquisition," all the facts and circumstances surrounding the transaction should betaken into account).

11See Regulation § 1.1060-1(b)(2)(iii)(A)-(C).

12 The Claims Court stated that goodwill is the value a business acquired from its ability to attract and maintain customer relationships over time and going concern value is the value inherent in an established plant continuing tooperate.

13Regulation § 1.1060-1(b)(3).

14Regulation § 1.197-2(b)(1).

15 The court overlooks the fact that the same discounted cash flow modeling approach is used to evaluate projects without PPAs. In such situations, appraisers typically use projected energy prices and it is not unusual for those prices to be higher than fixed rates under PPAs; albeitthere is more risk.

16 See Miami Valley Broadcasting Corp. v. United States, 499F.2d 677, 680 (Ct. Cl. 1974).

17 The failure to file a correct Form 8594 by the due date without reasonable cause may trigger the imposition of penalties pursuant to Sections 6721 through 6724 of the Code. The penalty for failure to file a correct informationreturn on the prescribed date is generally $250 per return.

18P.L.R. 201214007 (Jan 3, 2012).

19P.L.R. 201249013 (Dec. 12, 2012).

20 See Lemmen v. Comm'r, 77 T.C. 1326, 1348 (1981) (quoting Bixby v. Comm'r, 58 T.C. 757, 776 (1972)).

Visit us at mayerbrown.com

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the "Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe – Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2018. The Mayer Brown Practices. All rights reserved.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

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.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
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