Exposure draft legislation has been released which proposes amendments to the GST legislation to make it clear that liquidators and other representatives of incapacitated entities are liable for GST on transactions within the scope of their appointment.

Date of effect

It is proposed that the main operative provisions of the legislation have effect retrospectively from the commencement of the GST Act on 1 July 2000.

Background

On August 30, 2008, the United States District Court for the District of Northern Texas issued its ruling on whether Americas Mining Corporation (“AMC”) (and its parent Grupo Mexico) had caused ASARCO LLC (“ASARCO”), a wholly owned subsidiary of Grupo Mexico, to fraudulently transfer stock of Southern Peru Copper Company (“SPCC”) from ASARCO to AMC. The Court determined that AMC was liable for (1) intentional fraudulent transfer, (2) aiding and abetting breach of fiduciary duty under New Jersey law; and (3) civil conspiracy under Arizona law. See ASARCO LLC v.

On April 8, the Second Circuit Court of Appeals reversed the Bankruptcy Court and concluded that special ERISA “termination premiums” due PBGC are not contingent prepetition claims subject to discharge in a chapter 11 reorganization. Pension Benefit Guar. Corp. v. Oneida, Ltd., 2009 WL 929528 (2d Cir. April 8, 2009), rev’g Oneida Ltd. v. Pension Benefit Guar. Corp., 383 B.R. 29 (Bankr. S.D.N.Y., 2008).