U.S. Senate Approves Protocol To Canada-U.S. Tax Treaty

The United States Senate approved the September 21, 2007 protocol (the Protocol) to the Canada-United States Income Tax Convention (the Treaty) on September 23, 2008. The Protocol will enter into force once the U.S. exchanges instruments of ratification with Canada. Ratification procedures were completed on December 14, 2007. The procedures will be completed in the U.S. once the President and the Secretary of the Treasury sign the Protocol (which is expected to occur before the end of 2008).

Among other changes to the Treaty, the Protocol:

1. eliminates withholding tax on most cross-border interest payments (phased in over two years for related party interest) and many guarantee fees;