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Business Organizations Law

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The Three Causes Of Inversions: Reflections On Pfizer/Allergan And Notice 2015-79, Reuven S. Avi-Yonah Nov 2015

The Three Causes Of Inversions: Reflections On Pfizer/Allergan And Notice 2015-79, Reuven S. Avi-Yonah

Law & Economics Working Papers

On November 19, 2015, Treasury released Notice 2015-79 (the “Notice”). The Notice represents Treasury’s most recent response to the second wave of inversions, i.e., transactions in which US corporations become subsidiaries of foreign corporations without a meaningful change in their underlying business or in the location of their corporate headquarters. It follows on the heels of the announcement that Pfizer Inc. is considering a merger with Allergan PLC, an inverted Irish company, and supplements Notice 2014-52 from September 2014. Unfortunately, just like Notice 2014-52, the Notice is unlikely to stem the tide, and is even unlikely to stop Pfizer/Allergan. For …