||You purchase the Notes in their original issuance at the issue price, which will equal the first price to the public (not including bond houses, brokers or similar persons or organizations acting in the
capacity of underwriters, placement agents or wholesalers) at which a substantial amount of the Notes is sold for money, and you hold such Notes as capital assets for U.S. federal income tax purposes. |
This sub-section does not purport to be a comprehensive description of all of the tax considerations
that may be relevant to any particular investor. In particular, the discussion does not address all of the tax consequences that may be applicable to investors that are subject to special rules, such as certain financial institutions, insurance
companies, tax-exempt organizations, dealers in securities or currencies, persons that elect mark-to-market treatment, persons
that hold the Notes as a position in a straddle, conversion transaction, synthetic security or other integrated financial transaction for U.S. federal tax purposes, persons subject to the alternative minimum tax and persons whose functional currency
is not the U.S. dollar. Moreover, this discussion does not address any foreign, state or local tax considerations, any aspect of the Medicare tax on net investment income or any aspect of U.S. federal
non-income tax laws, such as gift or estate tax laws.
THIS DISCUSSION OF U.S. FEDERAL INCOME TAX
CONSIDERATIONS IS NOT INTENDED, AND SHOULD NOT BE CONSTRUED, TO BE TAX OR LEGAL ADVICE TO ANY PARTICULAR INVESTOR IN OR HOLDER OF THE NOTES. PROSPECTIVE INVESTORS ARE ADVISED TO CONSULT THEIR OWN TAX ADVISORS CONCERNING THE APPLICATION OF THE U.S.
FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES ARISING UNDER THE LAWS OF ANY OTHER TAXING JURISDICTION OR ANY APPLICABLE TAX TREATIES AND THE POSSIBLE EFFECT OF CHANGES IN APPLICABLE TAX LAW.
The discussion below regarding U.S. federal income tax consequences is based upon the Internal Revenue Code of 1986, as amended, final and
proposed Treasury regulations promulgated thereunder and any relevant administrative rulings or pronouncements or judicial decisions, all as of the date hereof and as currently interpreted, and does not take into account possible changes in such tax
laws or interpretations thereof, which may apply retroactively.
If a partnership or other entity treated as a partnership for U.S.
federal income tax purposes holds the Notes, the tax treatment of a partner will generally depend upon the status of the partner and the activities of the partnership. If you are a partnership or other entity treated as a partnership for U.S.
federal income tax purposes holding the Notes or a partner therein, you are urged to consult your tax advisor.
Payments of stated interest on the Notes will be includible in your gross income as ordinary interest income at the time you receive or accrue
such amounts (in accordance with your regular method of tax accounting).
Interest on the Notes (including Additional Amounts) will
constitute foreign-source income for U.S. federal income tax purposes. For foreign tax credit limitation purposes, interest on the Notes generally will constitute passive income.
As described in PRC Taxation, if we are deemed to be a PRC resident enterprise under the PRC Enterprise Income Tax Law,
payments of interest in respect of the Notes may be subject to PRC withholding taxes. For U.S. federal income tax purposes, the amount of interest includible in taxable income would include any amounts withheld in respect of PRC taxes. If PRC
withholding taxes apply to interest paid to you with respect to the Notes, you may be able to obtain a reduced rate of PRC withholding taxes under the income tax treaty between the United States and the PRC (the U.S.-PRC income tax
treaty) if certain requirements are met. In addition, subject to certain conditions and limitations, PRC withholding taxes on interest that is non-refundable under the U.S.-PRC income tax treaty may be
treated as foreign taxes eligible for credit against your U.S. federal income tax liability. If you do not elect to claim a foreign tax credit, you may instead claim a