IN THIS ISSUE

Fallout From Enron

Chadbourne asked many thoughtful people in the project finance community in the few days before and after Enron filed for bankruptcy what effect they foresee from Enron’s struggles on the independ...

FERC Adopts New Test For Market Rates

The Federal Energy Regulatory Commission issued two orders at the end of November that mark a significant change in its tests for approving market-based rates for public utilities...

IRS Clarifies Tax Treatment Of Electric Interties

The Internal Revenue Service said on December 6 that utilities do not have to report interconnection payments from independent generators in most cases as taxable income...

Wind Projects Advance In California

As California emerges from the power crisis of the past year, windpower is uniquely positioned to benefit from a new focus on power supply, although some barriers to more widespread development re...

Current Issues In Construction Contracts

A longstanding tenet of project finance dogma is that a project must be constructed pursuant to a lump-sum, turnkey engineering, procurement and construction or “EPC” contract where the risks of d...

Lender Held Liable For Construction Defects | Norton Rose Fulbright

Lenders want to be repaid. Taking prudent steps to protect the value of collateral enhances this prospect...

Political Risk Coverage: What’s New?

The October Newswire carried an article reviewing the core traditional political risk insurance coverages available from the private and public agency insurers, namely coverage against expropriati...

Spotlight On Captive Insurance | Norton Rose Fulbright

More and more companies appear to be setting up captive insurance subsidiaries. In 2000, the number of captives increased worldwide by 31.6% over the prior year, climbing to more than 3,400...

Mega Gas Project Advances In Bolivia

The Republic of Bolivia, Sempra Energy and an international consortium formed by Repsol-YPF, British Gas and British Petroleum signed a memorandum of understanding in early December to develop an ...

Projects Lose Acid Rain Protection

Whenever a power contract terminates or is bought out by a utility or is modified in a manner that allows the owner of the power plant to pass through new costs, it may have the unintended and cos...

Environmental Update - December 2001

Environmental issues are receiving little attention from Congress or the Bush administration in the wake of the September 11 terrorist attacks — with two notable exceptions...

IN OTHER NEWS

Year-end deals may qualify for more generous tax depreciation | Norton Rose Fulbright

YEAR-END DEALS may qualify for more generous tax depreciation...

Some convertible debt instruments have come under fire | Norton Rose Fulbright

SOME CONVERTIBLE DEBT INSTRUMENTS have come under fire...

Synfuel plant owners are breathing more easily after ruling that the projects qualify for section 29 tax credits | Norton Rose Fulbright

SYNFUEL PLANT owners are breathing more easily after the IRS resumed ruling that the projects qualify for section 29 tax credits. The US government offers a tax credit of $1...

Multinational corporations have been making retroactive elections to increase foreign tax credits | Norton Rose Fulbright

MULTINATIONAL CORPORATIONS have been making retroactive elections to increase foreign tax credits. The IRS said in late October that it will fight most such elections...

California decided to assess power plants for property tax purposes at the state level | Norton Rose Fulbright

CALIFORNIA decided to assess power plants for property tax purposes at the state level, but delayed implementing the decision until January 2003...

Louisiana

Louisiana will have to defend in court its view that owners of new merchant lower plants built in the state qualify for a 10-year tax holiday from parish and local property taxes

Wind developers got good news from the IRS | Norton Rose Fulbright

WIND DEVELOPERS got good news from the IRS. The US government offers a tax credit of 1.7 cents a kilowatt hour for generating electricity from wind...

Hungary

Hungary will overhaul its income tax system and make tax cuts in 2002,the finance minister said in October

Designating a sales contract as a hedge doesn't change the timing of when the seller must report income | Norton Rose Fulbright

DESIGNATING A SALES CONTRACT AS A HEDGE does not change the timing of when the seller must report income under the contract...

An "ownership FSC" transaction is under audit | Norton Rose Fulbright

AN “OWNERSHIP FSC” transaction is under audit...

Loan guarantee fees from a US subsidiary to its foreign parent are subject to US withholding taxes | Norton Rose Fulbright

LOAN GUARANTEE FEES from a US subsidiary to its foreign parent are subject to US withholding taxes. A US company borrowed money. Its foreign parent guaranteed repayment of the loan...

Environmental cleanup costs had to be capitalized| Norton Rose Fulbright

ENVIRONMENTAL CLEANUP costs had to be capitalized, a federal appeals court said in October. United Dairy Farmers, Inc. purchased two stores in Ohio...

Lease refinancing costs must be amortized over the remaining lease term | Norton Rose Fulbright

LEASE REFINANCING COSTS must be amortized over the remaining lease term...

IRS has asked for comments on “disguised” sales of partnership interests | Norton Rose Fulbright

MINOR MEMOS: The IRS has asked for comments on “disguised” sales of partnership interests...