Sara,

As we discussed, attached is the memo that I wrote last September on the tax 
implications of having a financial trader in Sydney.  As you will note, we 
followed a service fee approach to reimburse the Sydney office on a cost-plus 
basis for the costs incurred by the financial trader (including his 
remuneration).  Important in this arrangement is that the Sydney financial 
trader is not the principal in the trades but is only acting in a preparatory 
or auxiliary manner for the ENA financial trades.

As we discussed yesterday, I will forward the latest draft of the service 
agreement to you by e-mail.  David, could you send Sara and me conforming 
copies of the executed agreement?

Also, we should probably also discuss the status of the documentation 
relating to these trades.

I will be happy to discuss this memo with you in more detail at your 
convenience.

Best regards,
Susan



---------------------- Forwarded by Susan Musch/ENRON_DEVELOPMENT on 
04/12/2000 08:21 AM ---------------------------


Susan Musch
09/15/99 05:02 PM
To: Colin Jackson@ECT, Alan Aronowitz/HOU/ECT@ECT, Susan 
Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Gary Hickerson/HOU/ECT@ECT, Harry 
Arora/HOU/ECT@ECT, Paul Quilkey/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Shari Stack@ENRON_DEVELOPMENT
cc:  (bcc: Susan Musch/ENRON_DEVELOPMENT)

Subject: Australian Financial Trader Tax Issues - Revised Memo

Attached is the revised memo on the Australian Financial Trader Tax Issues.  
(Note you will find the changes in the background section of the memo.)  
Please let me know if you have any questions or need any additional 
information.

Best regards,
Susan