Extract to table

To the extent IHDC on-lends any proceeds from the USD Tranche to IHDC Frankfurt (in addition to or in lieu of IHDC Frankfurt's direct borrowing under the EUR Sub-Tranche), such intercompany loan must be priced at arm's length under both German transfer pricing rules (§ 1 AStG) and US transfer pricing rules (IRC § 482)

Under IRC § 1272, if a debt instrument is issued with OID, the holder must include the OID in gross income over the life of the instrument using the constant-yield method, regardless of the holder's overall method of tax accounting

Accordingly, the OID on the Term Loan qualifies as de minimis OID, and neither the Lenders nor the Borrower is required to accrue the OID under the constant-yield method

Accordingly, NordBrücke AG cannot rely on the portfolio interest exemption to avoid US withholding tax, and an alternative basis for exemption must be identified

Article 11(1) of the US-Germany Treaty provides that interest arising in a Contracting State (here, the United States) and paid to a resident of the other Contracting State (here, Germany) shall be taxable only in the state of residence of the beneficial owner

Article 11(1) provides that if the beneficial owner of the interest is a resident of Germany, the United States shall impose no withholding tax on such interest — i