FYI

W. Wayne Gardner
Enron Broadband Services
1400 Smith Street
Houston, TX  77002-7361
Phone:  713 853 3547
Fax:  713 646 2532
----- Forwarded by Wayne Gardner/Enron Communications on 08/02/2001 18:28 
-----

	Wayne Gardner
	08/02/2001 09:24
		 
		 To: Paul Racicot/Enron Communications@Enron Communications
		 cc: James Ginty/Enron Communications@Enron Communications
		 Subject: Trading in Asia

Paul, as we discussed this morning, Regulatory is telling us that it is 
likely that we will be able to establish a regional trading desk in Singapore 
that will hold all the licenses necessary to trade in all of the priority 
countries in Asia.  Regulatory expects to receive confirmation next week that 
the 1% annual Singapore telecom license fee will apply only to Singapore 
bandwidth.  Given that Asia trading will be centralized in Singapore, we want 
to make sure that the activities of traders outside of Singapore do not cause 
the Singapore trading operations to be subject to tax outside of Singapore.  
In this regard, Asia traders should keep in mind the following general rules:

Traders that regularly engage in the execution of trades outside of Singapore 
will create a taxable presence outside of Singapore that will likely result 
in double taxation.
Traders that regularly engage in the negotiation of trades outside of 
Singapore will create a significant risk that local tax authorities will 
assert that such activities created a taxable presence outside of Singapore 
that would likely result in double taxation.  EBS Tax would want to monitor 
such a situation very closely, so please let us know immediately if these 
circumstances arise.
Traders engaging only in the solicitation of business and the provision of 
product information (including pricing) outside of Singapore will not create 
a taxable presence outside of Singapore.  In this regard, please note that 
even if traders restrict themselves to business solicitation, a large scale 
presence in any given country could attract the attention of the tax 
authorities who may adopt aggressive positions with regard to the creation of 
a taxable presence.  

When in doubt as to the application of these general rules to a specific 
situation, please do not hesitate to call.

Thanks.

W. Wayne Gardner
Enron Broadband Services
1400 Smith Street
Houston, TX  77002-7361
Phone:  713 853 3547
Fax:  713 646 2532