NAEPC 2015 Conference (Bessmer Trust), Amelia Island Plantation Resort, FL
Click here to view a recording of the MLP Webinar: IRS Issues Proposed Regulations Regarding MLP Qualifying Income.
The IRS has released proposed regulations regarding what types of income derived from natural resources satisfy the section 7704(d)(1)(E) publicly traded partnership (PTP) qualifying income rules.
The proposed regulations provide guidance on section 7704(d)(1)(E) concerning qualifying income from the exploration, development, mining and production, processing, refining, transportation, and marketing of minerals and natural resources. The proposed regulations also address income earned from providing services to others in the oil and gas industry. They do not address other forms of qualifying income.
The proposed regulations are generally applicable to periods after they are issued in final form. The IRS has requested comments on the proposed regulations before they are finalized and become effective.
The IRS had announced a halt in March 2014 on letter ruling requests regarding whether a PTP’s income is qualifying income under section 7704. In March 2015, this pause was lifted and the IRS announced that it intended to release proposed regulations that provide guidance concerning qualifying income from the exploration, development, mining and production, processing, refining, transportation, and marketing of minerals and natural resources.
Baker Botts is recognized as one of the world’s leading energy law firms, and our lawyers represent clients in this energy-rich region of the world with a platform of two offices: Dubai and Riyadh.
As client demand for legal counsel in energy and related fields continues to grow, we continue to expand the resources of our Middle East team. In 2013, we added 14 lawyers, including eight partners, to our offices in the region. This group of talented and experienced lawyers cements our position as one of the dominant legal forces in the Middle East and adds significant strength and depth to our already established team. Our new lawyers bring with them decades of experience in sophisticated corporate and commercial transactions, project finance, international dispute resolution, local law, regulatory and compliance. Their industry acumen extends into energy, aviation and defense, construction, hospitality and consumer products, with the added dimension of anti-bribery and related corporate compliance and internal investigations.
Our lawyers are well-versed in the business and cultural realities of the region. We have advised clients within the Gulf Cooperation Council and international clients on a wide range of local law issues in the United Arab Emirates and surrounding region. We also represent clients on projects in the telecommunications, defense, real estate, manufacturing, power, water, transportation and banking industries, among others. Our lawyers have extensive experience in banking and finance capital markets, corporate formation, business structuring, corporate governance, foreign investment, privatization, customs and government contracts.
We have further increased our commitment and presence in the region by forming a strategic alliance in Kuwait with the International Legal Group (“ILG”). Through the alliance, the two firms provide expanded resources to our combined client base, including access to formidable local law experience and international legal acumen across a range of subjects, disciplines and jurisdictions. A principal objective of the alliance is the enhanced ability of both firms to better serve companies active in Kuwait and Kuwait-based companies active internationally.
In 2014, our Middle East offices in the UAE were ranked Tier 1 by The Legal 500 for Projects and Energy.
We pride ourselves on the team approach we bring to every engagement, and we believe our collaborative approach improves the results we earn for our clients.
As we look to the future, it is important to revisit the past.
Baker Botts traces its history to the earliest days of the Republic of Texas. Peter Gray founded the firm in 1840 with its beginnings in the railroads that were starting to crisscross the young nation. In 1874, Mr. Gray left the firm called Gray, Botts & Baker for the Supreme Court of Texas. After his departure, his two partners, Colonel W.B. Botts and Judge James A. Baker, changed the firm name to Baker & Botts. Over the years, the name changed slightly, becoming Baker Botts L.L.P. in 2000.There are several events that catapulted the firm to national prominence:
A succession of Baker Botts lawyers have carried on the impressive accomplishments of firm founders and assisted in the development of the City of Houston, advised presidents during times of war and founded the Texas Law Review. We hired our first female lawyers in the 1920s and embraced the expanding role of lawyers in business resulting from new government regulations generated by President Franklin D. Roosevelt’s New Deal legislation.
Today, Baker Botts has approximately 725 lawyers in 14 cities around the globe from which we serve our clients with the highest ethical and professional standards, dedication to their business needs and the most collegial association among its lawyers and staff.
Baker Botts’ vision of the future was eloquently expressed by Judge Hiram M. Garwood, a partner in the early 20th century, who said of the firm:
“I have always thought of it, not as a mere temporary association of individuals, however pleasant or however profitable, but as a permanent institution, just as Harvard or the Bank of England is an institution, with a strength, a life and individuality made up from, yet greater than, all or any of its members, in that the accumulated knowledge and achievements of its members, past and present, become the common capital of all to preserve, increase and transmit to those who shall come after us.”
The firm’s M&A activity for the first half of 2015 is up approximately 16% ($9 billion) compared to the first half of 2014 when the firm worked on transactions totaling $56.6 billion. The increase marks the second year in a row in which the firm’s numbers for the first half of the year have risen, with 2015 representing a more than 205% increase when compared to 2013.
Baker Botts lawyers represented clients in a number of notable transactions over the past six months, including:
• Regency Energy Partners LP in the $18 billion merger with Energy Transfer Partners L.P. Dallas partner Neel Lemon and Houston partner A.J. Ericksen led the transaction.
• Liberty Broadband Corporation in the $5 billion acquisition of New Charter Class A Common Stock as part of Charter’s $75 billion acquisition of Time Warner Cable and $10.4 billion acquisition of Bright House Networks. New York partners Buzz McGrath and Renee Wilm led the transaction.
• Conflicts Committee of Williams Partners L.P. in the proposed $13.8 billion acquisition by The Williams Companies Inc. The transaction was led by Houston partners Josh Davidson and Tull Florey.
• MeadWestvaco Corporation in the $16 billion merger with Rock-Tenn Company. Washington, D.C. partner Joseph Ostoyich provided antitrust advice in connection with the transaction.
• Depomed, Inc. in the $1.05 billion acquisition of the U.S. rights to the NUCYNTA franchise from Janssen Pharmaceuticals, a subsidiary of Johnson & Johnson. Palo Alto partners John Martin and Brian Lee led the transaction.
“During the first half of the year we saw the trend carry forward from 2014, with a high volume of big-ticket M&A work on behalf of our clients – the work ranged from Energy, to Media/Telecoms, to Technology as well as activity in other sectors,” said David Kirkland, Co-Chair of the firm’s Corporate Department.
“Based on discussions with clients, we expect to see continued significant activity in our M&A practice for the balance of the year,” continued Kelly Rose, also Co-Chair of Baker Botts' Corporate Department.
Baker Botts lawyers provide a general overview of the key portions of the Proposed Regulations that may be relevant to your business.
Baker Botts lawyers discuss how the Supreme Court carefully guards the twenty-year expiration date of a patent, allowing the public the unrestricted right to make or use a patented article after that date.
Baker Botts lawyers discuss various tax issues in connection with the new no-rule areas.
Baker Botts lawyers discuss recent developments in the area of IP and antitrust enforcement, including recent European Commission decisions in the smartphones and pharmaceuticals industries.
Baker Botts lawyers discuss the popularity of post-grant review (“PGR”) proceedings at the U.S. Patent Office.
Baker Botts lawyers discuss the 2014 Alice Corporation v. CLS Bank International decision.
On August 18, 2015, EPA proposed a sweeping expansion of the existing Clean Air Act new source performance standards (“NSPS”) designed to reduce methane and VOC emissions from upstream and midstream operations.
Baker Botts lawyers discuss the standard for determining whether a reference qualifies as “analogous art” in connection with an assertion of obviousness.
On August 5, 2015, the SEC adopted the pay ratio disclosure rules mandated by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act.