LearCo, a non-U.S. conglomerate, generates $4 billion in gross receipts annu-ally. Its U.S. subsidiary, KingCo, accounts for $750 million of the annual gross receipts (and its average annual gross receipts for the last three years is $820 million). KingCo generates U.S. taxable income income of $180 million, after deducting a $350 million management fee that it pays to LearCo. KingCo reports no U.S. tax credits. The corporate income tax rate in LearCos country is 14%. What are the tax implications (if any) of this arrangement?