Question
Alfa Group Limited (Alfa ) is a public limited company incorporated in the United Kingdom and listed on the London Stock Exchange. Alfa wholly owns
Alfa Group Limited (Alfa ) is a public limited company incorporated in the United Kingdom\ and listed on the London Stock Exchange. Alfa wholly owns Bravo Company (Kenya) Limited\ (Bravo ), a Kenyan incorporated company which in turns own 80% of shares of Charlie Coy\ Public Ltd Company (Charlie ), a company organized under the laws of Tanzania and listed\ with the Dar es Salaam Stock Exchange (DSE), collectively referred to as the Group. The\ Group is renown word wide for operation in the Aviation industry with a size able competitive\ fleet of commercial Aircrafts in the World.\ 2\ The Group is desirous to solidify its commercial aircraft operation in Tanzania, especially after\ development of the welcoming investment climate in Tanzania, making the Country one of the\ investment and tourism hub of Africa. The Group together with its business partner Ventures\ Holdings (South Africa), a South African company, intends to acquire Moto Airways, a reputed\ aircraft in Tanzania which is owned by Moto Tanzania Limited (Moto), a private limited\ company incorporated under the Tanzanias Companies legislation.\ The transaction set up is that Charlie and Bravo will acquire 100% shares in Moto which are held\ by Maja Investment (Mauritius) Ltd (Maja Mauritius), 99% shares incorporated in Mauritius\ and Maja IP (South African) Limited (Maja IP) 1% shares incorporated in South Africa\ respectively.\ To consummate the transaction Charlie and Bravo (as joint purchasers) and Maja Mauritius and\ Maja IP (as joint sellers) respectively did execute the Sale of Shares Agreement on 30th January\ 2024. Under the Agreement, following a successful acquisition Moto will subject to the Tanzania\ Civil Aviation Authority approval transfer all its aviation licences to Charlie and it is intended that\ Moto will be wound up there after under the provisions of the Companies Act.\ Required\ Parties have approached you, please provide a detailed LEGAL OPINION on the tax compliance\ and implications regarding the Acquisition and their contemplated post-acquisition arrangements.\ Hint: In respect of the Legal opinion, please provide the issues clearly subject of the opinion and\ their corresponding income tax treatment (except for the computation issues). If you assume facts\ based on the background above, please make it clear and to the extent which the facts and the law\ would require provide reasons, qualifications, conditions, and extent satisfied where applicable\ from the facts in terms of the Tanzanian legislation and judicial decisions.
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