Chrysler 2014 Annual Report Download - page 31

2014 | ANNUAL REPORT 29
We are a Dutch public company with limited liability, and our shareholders may have rights different from those of
shareholders of companies organized in the U.S.
The rights of our shareholders may be different from the rights of shareholders governed by the laws of U.S.
jurisdictions. We are a Dutch public company with limited liability (naamloze vennootsehap). Our corporate affairs are
governed by our articles of association and by the laws governing companies incorporated in the Netherlands.
The rights of shareholders and the responsibilities of members of our board of directors may be different from the
rights of shareholders and the responsibilities of members of our board of directors in companies governed by the
laws of other jurisdictions including the U.S. In the performance of its duties, our board of directors is required by
Dutch law to consider our interests and the interests of our shareholders, our employees and other stakeholders, in all
cases with due observation of the principles of reasonableness and fairness. It is possible that some of these parties
will have interests that are different from, or in addition to, your interests as a shareholder.
It may be difficult to enforce U.S. judgments against us.
We are organized under the laws of the Netherlands, and a substantial portion of our assets are outside of the U.S.
Most of our directors and senior management and our independent auditors are resident outside the U.S., and all or
a substantial portion of their respective assets may be located outside the U.S. As a result, it may be difficult for U.S.
investors to effect service of process within the U.S. upon these persons. It may also be difficult for U.S. investors to
enforce within the U.S. judgments predicated upon the civil liability provisions of the securities laws of the U.S. or any
state thereof. In addition, there is uncertainty as to whether the courts outside the U.S. would recognize or enforce
judgments of U.S. courts obtained against us or our directors and officers predicated upon the civil liability provisions
of the securities laws of the U.S. or any state thereof. Therefore, it may be difficult to enforce U.S. judgments against
us, our directors and officers and our independent auditors.
We operate so as to be treated as exclusively resident in the United Kingdom for tax purposes, but the relevant tax
authorities may treat us as also being tax resident elsewhere.
We are not a company incorporated in the United Kingdom, or U.K. Therefore, whether we are resident in the U.K. for
tax purposes will depend on whether our “central management and control” is located (in whole or in part) in the U.K.
The test of “central management and control” is largely a question of fact and degree based on all the circumstances,
rather than a question of law. Nevertheless, the decisions of the U.K. courts and the published practice of Her
Majesty’s Revenue & Customs, or HMRC, suggest that we, a group holding company, are likely to be regarded as
having become U.K.-resident on this basis from incorporation and remaining so if, as we intend, (i) at least half of
the meetings of our Board of Directors are held in the U.K. with a majority of directors present in the U.K. for those
meetings; (ii) at those meetings there are full discussions of, and decisions are made regarding, the key strategic
issues affecting us and our subsidiaries; (iii) those meetings are properly minuted; (iv) at least some of our directors,
together with supporting staff, are based in the U.K.; and (v) we have permanent staffed office premises in the U.K.
Even if we are resident in the U.K. for tax purposes on this basis, as expected, we would nevertheless not be treated
as U.K.-resident if (a) we were concurrently resident in another jurisdiction (applying the tax residence rules of that
jurisdiction) that has a double tax treaty with the U.K. and (b) there is a tie-breaker provision in that tax treaty which
allocates exclusive residence to that other jurisdiction.
Our residence for Italian tax purposes is largely a question of fact based on all circumstances. A rebuttable
presumption of residence in Italy may apply under Article 73(5-bis) of the Italian Consolidated Tax Act, or CTA.
However, we have set up and thus far maintained, and intend to continue to maintain, our management and
organizational structure in such a manner that we should be deemed resident in the U.K. from our incorporation for the
purposes of the Italy-U.K. tax treaty. The result of this is that we should not be regarded as an Italian tax resident either
for the purposes of the Italy-U.K. tax treaty or for Italian domestic law purposes. Because this analysis is highly factual
and may depend on future changes in our management and organizational structure, there can be no assurance
regarding the final determination of our tax residence. Should we be treated as an Italian tax resident, we would
be subject to taxation in Italy on our worldwide income and may be required to comply with withholding tax and/or
reporting obligations provided under Italian tax law, which could result in additional costs and expenses.