Shearman & Sterling’s Capital Markets and M&A partners have once again co-authored chapters in Global Legal Insights latest edition of ‘Initial Public Offerings’ focusing on the UK, USA, France and Italy.

On May 19, 2023, the U.S., in coordination with the G7 and other international partners, released a new tranche of sanctions and other restrictive economic measures to further target Russia’s capacity to continue its aggression against Ukraine. In a multi-agency effort, the U.S. designated over 300 new sanctions targets, added 71 entities to BIS’s Entity List and introduced new restrictions on companies and individuals doing business with Russia’s architecture and engineering sectors and on the export of certain goods to Russia, Belarus or Ukraine.

On May 3, 2023, the Tax Court released a memorandum opinion in ES NPA Holding LLC v. Commissioner holding that the taxpayer’s indirect receipt of a profits interest in a lower-tier partnership qualified as a non-taxable event under the safe harbor provided in Rev. Proc. 93-27. The opinion provides a well-reasoned application of the profits interest safe harbor that puts to rest certain unsettled tax issues relating to the use of such structures.

On May 3, 2023, the SEC adopted new disclosure requirements for stock buybacks, including disclosure of daily share repurchase activity on a quarterly basis. These quarterly reports of daily share repurchase activity will be mandatory, not just for U.S. domestic companies, but also for foreign private issuers (FPIs) other than MJDS filers.

On May 12, 2023, the Department of the Treasury (“Treasury”) and the Internal Revenue Service (“IRS”) released Notice 2023-38 (the “Notice”) to provide guidance on the domestic content requirements under IRC sections 45, 45Y, 48 and 48E. 

Fourteen months into the Ukraine war, the Russian Government has introduced new countersanctions targeting foreign investors in Russia. The latest measures require businesses from “unfriendly” countries to make a “voluntary contribution” to the Russian State budget in case of asset divestments, and expose such businesses to the risk of having their management replaced with a Government-appointed administrator. Russia has additionally announced a one-off windfall tax on corporate profits, also impacting foreign businesses—including those still in the process of exiting the country.

On Friday, the Treasury Department’s Office of Investment Security proposed expanding the authority of the Committee on Foreign Investment in the United States (CFIUS) to block real estate transactions involving foreign persons within 100 miles of sensitive military installations. The proposal would add eight new military bases to the list of military installations around which CFIUS, chaired by Treasury, has jurisdiction to review real estate transactions involving foreign persons for national security concerns.

On April 18, 2023, the U.S. Department of Commerce’s Assistant Secretary for Export Enforcement issued a Memorandum titled “Clarifying Our Policy Regarding Voluntary Self-Disclosures and Disclosures Concerning Others.”

On March 22, 2023, the European Commission published its proposed Directive on Green Claims. The proposal is the latest EU initiative to take aim at the practice of greenwashing, which the Commission found was misleading for consumers as well as unfair for companies working genuinely to improve their environmental performance.

As the economy continues to face challenges and the threat of bankruptcy becomes more prevalent among businesses, landlords must be more vigilant in protecting their interests in commercial leases. One area of particular concern is leases that fall under Section 467 of the Internal Revenue Code.