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we now turn our attention: whether the credits which EGPC in
fact took for Amoco Egypt's taxes can, whether or not authorized
by Article IV(f)(6), be considered a subsidy to Amoco Egypt.
Several regulations are implicated in considering the
subsidy question. Section 1.901-2(e)(3), Income Tax Regs.,
provides in part:
(3) Subsidies--(i) General rule. An amount is not
an amount of income tax paid or accrued by a taxpayer
to a foreign country to the extent that--
(A) The amount is used, directly or
indirectly, by the country to provide a subsidy by any
means (such as through a refund or credit) to the
taxpayer; and
(B) The subsidy is determined, directly
or indirectly, by reference to the amount of income
tax, or the base used to compute the income tax,
imposed by the country on the taxpayer.
(ii) Indirect subsidies. A foreign country is
considered to provide a subsidy to a taxpayer if the
country provides a subsidy to another person that--
(A) Owns or controls, directly or
indirectly, the taxpayer or is owned or controlled,
directly or indirectly, by the taxpayer or by the same
persons that own or control, directly or indirectly,
the taxpayer, or
(B) Engages in a transaction with the
taxpayer, but only if the subsidy received by such
other person is determined, directly or indirectly, by
reference to the amount of income tax, or the base used
to compute the income tax, imposed by the country on
the taxpayer with respect to such transaction.
Section 1.901-2(f), Income Tax Regs., provides in pertinent
part:
(f) Taxpayer--(1) In general. The person by
whom tax is considered paid for purposes of sections
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