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New for 2020: Document automation tool for creating Loan Note Instruments to document related party debt

Intercompany Agreements

6 January 2020

A very Happy New Year to you!

As part of the ongoing development of our ‘fast track’ service for intercompany agreements, we have released a new automation tool, which is to create a loan note instrument to document related party debt.

This tool is suitable where the relevant debt is intended to be unsecured and unsubordinated, and needs to be in the form of a security. Where applicable, the tool can be used to create a listable security (for example, so that the loan notes are capable of constituting ‘Quoted Eurobonds’ for the purposes of the relevant exemption from UK withholding tax), and may include the facility to issue ‘payment in kind’ notes (or ‘PIK notes’) to satisfy an obligation to pay interest.

If you would like more information about the range of related party transactions covered by our ‘fast track’ service, including this new tool, you can find it here.

Just to be clear, our ‘fast track’ ICA drafting service is not a substitute for tax or transfer pricing advice, or legal advice for that matter. You can think of it as an ‘execution only’ drafting service, for corporates and advisers who are already clear about the key features of the controlled transactions they need to implement legally.

For clients and advisers who need help with the design, implementation and maintenance of an appropriate system of intercompany transactions, we work alongside transfer pricing professionals to provide whatever legal support is required.

If you are a transfer pricing adviser and you would like a free 30-day trial of all our document automation tools, please email us and we will be very happy to make the necessary arrangements.

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Article by
Paul Sutton
LCN Legal Co-Founder

Free Guide: Effective Intercompany Agreements for TP Compliance