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As we enter the last quarter of 2017, we continue to see strong investor interest in private equity.  The year appears on track to set records for fundraising, particularly with the closing of a number of very large funds this year.  The challenge remains for fund managers to deploy their dry powder in a period marked by high valuations.

Raising capital through special purpose acquisition companies, or SPACs, hit its peak around 10 years ago. After a period of diminished fundraising, SPACs are back with a vengeance, and a number of them are backed by private equity sponsors.

Private equity funds have long had to deal with non-US (and to a lesser extent, tax-exempt) investors’ concerns about the adverse tax consequences of investing in operating US LLCs or other pass-through entities (Operating Partnerships).

Enforcement of the Foreign Corrupt Practices Act (FCPA) reached record levels in 2016, with more than $2.4 billion in disgorgement, penalties and fines. Although the first half of 2017 was comparatively quiet, enforcement is again on the rise, with the United States, Sweden and the Netherlands announcing a global $965 million settlement with Swedish telecommunications giant Telia on September 21.

To misquote Star Trek, “It’s life, Jim, but not as we know it.” And so we must think of the global tax landscape as we head into a BEPS (base erosion and profit shifting) era. The BEPS Project, the brainchild of the OECD and the G20, is aimed at preventing tax avoidance caused by base erosion and profit shifting by multinationals.

Following the United Kingdom’s decision to leave the European Union last year, many private equity and venture capital fund managers are in limbo—they are planning for all contingencies, while still anxiously awaiting a concrete indication of the eventual relationship between the United Kingdom and the rest of the European Union.

The Private Equity Report Editorial Board

This report is a
publication of
Debevoise & Plimpton LLP
www.debevoise.com

EDITORIAL BOARD
 

Paul S. Bird
Editor-in-Chief

Andrew M. Ahern
Jennifer L. Chu
Rafael Kariyev
Scott B. Selinger
Simon Witney

Alicia E. Lee
Associate Editor

FOUNDING EDITOR

Franci J. Blassberg

All contents @2018 Debevoise & Plimpton LLP. 
All rights reserved.




 

 

 

 

 

 

 

 


 

 


 


 

 

 

 

 

 

 

 

The Private Equity Report

Fall 2017
Vol. 17, Number 2
prior issues