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whose compensation was exempt from tax under former section
22(b)(8) of the Internal Revenue Code of 1939. We held that,
although Fomento was created as a separate entity by law, it was
not a corporation as understood in our legal system, and in fact
was part of the Government. Relevant facts that we took into
account included that Fomento had no stockholders or members; its
governing body was fixed by law; the members of its governing
council were ex-officio or were appointed by the legislative or
executive branch of the Government; its operations were closely
regulated by law and subject to the supervision and approval of
Government departments and officers; its purposes and activities
were of a governmental nature; it was created by a public law;
its head was a cabinet member and its activities were closely
coordinated with his department; and it was supported in large
part by taxes. We compared Fomento's employees to those of the
U.S. Maritime Commission, or to the U.S. Reconstruction Finance
Corporation, whose employees were regarded as Government
employees.
In In re Investigation of World Arrangements, 13 F.R.D. 280
(D.D.C. 1952), the District Court for the District of Columbia
stated that, in determining whether or not a given corporation is
an instrumentality of its government, the object and purpose of
the corporation were most relevant. The court found that a
corporation acquired in 1914, to insure a proper supply of
petroleum, crude oil, and other products for the British fleet,
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