If you cannot see this email properly, please click here
header_1
Contact Us     |     About GS     |     Fields of Practice     |     Our Attorneys
main
Adv. Liat Graber
Adv. Yaron Sever
Adv. Tal Atsmon

New Court Ruling Concludes no Sale of FAR in a Change of Business Model

Dear Clients,

The District Court recently ruled in favor of Broadcom Semiconductor Ltd. in its case against the Israel Tax Authority, and determined that changes to its business following its acquisition by the Broadcom group, should not result in a capital gain from the sale of FAR (functions, assets and risks). This ruling is contrary to a previous decision handed down by the same judge in 2017, in the Gteko case.

The issue of reclassification of a transaction following the acquisition of an Israeli company and the change of a business model is very complex and is dependent on a fact and circumstance test which differs from case to case. This is why an accurate analysis should be made in each case.

For the full review, please click here.
* * *
The content in this Memo is provided for informational purposes only and does not serve to replace professional legal advice required on a case by case basis. The Firm does not undertake to update the information in this Memo, or its recipients, about any normative, legal, or other changes that may impact the subject matter of this Memo.

Should you have any questions or need additional information regarding this matter, please feel free to contact Adv. Yaron Sever, Deputy Department Head of Tax Department: yaron.sever@goldfarb.com; Adv. Liat Graber, Partner, Tax Department: liat.graber@goldfarb.com; or at: +972-3-6089161.