Restructures in response to the Multinational Anti Avoidance Law (MAAL) involving foreign partnerships

The multinational group forms an entity described as a partnership. The partnership has two newly incorporated companies as partners; one Australian resident partner and a non-resident partner. The resident partner holds a minority interest in the partnership. 2. The resident partner does not have the right to be involved in the management or conduct of the business of the partnership. 3. The partnership agreement specifies all management decisions regarding the partnership will be conducted outside Australia. 4. Further complexity is introduced into the existing structure through the creation of additional entities; the transfer of legal rights and obligations; changes in contractual relationships with customers; and additional intra-group services agreements. • For example, the existing foreign entity that previously made supplies to, and derived income from, Australian customers enters into a distribution agreement with the partnership to transfer the right to distribute the products or services to Australian customers to the partnership, thereby purporting to attribute profit to the partnership. • At the same time, the partnership enters into an agency agreement that purports to authorise the existing foreign entity to continue to make supplies to Australian customers as an agent of the partnership. This is intended to give full effect to the distribution agreement. 5. There is no material change to the operational activities undertaken by the group in making supplies to Australian customers.