United States: Intercompany Arrangements Following A Flip Transaction

Many overseas companies reorganize or “flip” to create a US parent company or to access US venture financing and customers. Following a flip, there is a US “parent” company with one or more overseas “subsidiary” companies, that often hold most – if not all – of the employees, along with the original business and technology/intellectual property assets. As the parent holds the funds from the venture financing, it needs to consider:

The separate tax treatment of each subsidiary.

Any intercompany licensing arrangements required for each subsidiary’s operations. Documentation of intercompany arrangements between the parent and each subsidiary. How to […]

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