Three Types of Trade Agreements
Although the WTO enshrines the principle of non-discrimination in international trade, Article 24 of the GATT allows for the formation of free trade areas and “customs unions” among WTO Members. A free trade area is a group of countries that eliminate all tariffs on trade between them, but retain autonomy in setting their tariffs…
Taxation of Licensing Agreements
The Innolux case conveys different lessons. Companies outside the U.S. are generally aware that maintaining U.S. subsidiaries increases the risks and costs of litigation, as plaintiffs often direct U.S. lawsuits, subpoenas, and disclosure requests to the subsidiary in addition to or in place of the parent company, even if the subsidiary is clearly the…