[00:00:00] Speaker 04:
The first argument this morning is docker number 25-1563, Brugge versus the United States.

[00:00:09] Speaker 02:
Thank you, Your Honor, and may it please the Court.

[00:00:11] Speaker 02:
My name is Kathleen Lyon, and I represent the United States.

[00:00:15] Speaker 02:
Article 24-1 of the U.S.-Canada Tax Treaty provides that a U.S.

[00:00:20] Speaker 02:
citizen or resident may claim a foreign tax credit against the United States income tax only in accordance with the provisions and subject to the limitations of the law of the United States, a phrase the Court of Federal Claims dubbed the U.S.

[00:00:33] Speaker 02:
law limitation.

[00:00:34] Speaker 02:
The Court of Federal Claims' narrow interpretation of the US law limitation to incorporate only the Code's rules for computing foreign tax credits finds no support in the treaty's text, whose plain meaning easily extends to including Sections 27 and 901 of the Code, which restrict foreign tax credits to applying against Chapter 1 taxes.

[00:00:57] Speaker 02:
Because the net investment income tax in Section 1441

[00:01:01] Speaker 02:
was enacted in Chapter 2a of the code, no foreign tax credit may be applied to it under the code.

[00:01:08] Speaker 02:
And because Article 24 conditions any credit against United States income tax on being in accordance with the provisions and limitations of US law, are there any other income taxes aside from the NIIT located outside of Chapter 1?

[00:01:25] Speaker 02:
Income tax?

[00:01:27] Speaker 02:
No, no.

[00:01:28] Speaker 02:
But I would note that even within Chapter 1, there are Chapter 1 taxes against which the foreign tax credit cannot be applied.

[00:01:37] Speaker 02:
And you'll see in the last sentence of Section 901A, it refers to 26B, which is a list of exclusions.

[00:01:45] Speaker 05:
Those are all in Chapter 1.

[00:01:47] Speaker 05:
They're income taxes.

[00:01:49] Speaker 05:
Yes.

[00:01:49] Speaker 05:
But they're not covered by the US foreign tax credit.

[00:01:55] Speaker 05:
under the trial court's reading, would those be subject to a foreign tax credit too?

[00:02:05] Speaker 02:
Well, the court didn't address that.

[00:02:08] Speaker 05:
But they're income taxes.

[00:02:10] Speaker 02:
Correct.

[00:02:10] Speaker 05:
I mean, that's what I struggled with.

[00:02:12] Speaker 05:
I mean, it didn't come up, I don't think, at the trial court.

[00:02:15] Speaker 05:
Right.

[00:02:16] Speaker 05:
But the trial court's reasoning, as far as I can tell,

[00:02:19] Speaker 05:
The convention defines US income tax very broadly in the definitional section.

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And that establishes an independent right to offset foreign taxes against anything that's defined broadly as a US income tax by the credit.

[00:02:36] Speaker 02:
Correct.

[00:02:36] Speaker 02:
That's how it works.

[00:02:36] Speaker 05:
And if that's the case, then the foreign tax credit would apply not only to the NIIT, but to all those 26B taxes as well.

[00:02:46] Speaker 05:
I know you don't.

[00:02:47] Speaker 05:
I'm not asking you to agree.

[00:02:49] Speaker 05:
I don't agree with this position at all.

[00:02:51] Speaker 05:
Certainly.

[00:02:51] Speaker 05:
That's the logical conclusion of the court's claims position, isn't it?

[00:02:55] Speaker 02:
I think that that's probably correct.

[00:02:58] Speaker 02:
Of course, the problem with the court's reading is that there's no textual basis for limiting this to the computational provisions.

[00:03:06] Speaker 02:
Section 24.1.

[00:03:08] Speaker 05:
Well, I guess what I just suggested is what I see as the most problematic point for your

[00:03:16] Speaker 05:
argument is the convention does define in the definitional section income taxes very broadly and so what are we to do with that when we come to

[00:03:29] Speaker 05:
the foreign tax credit section in Article 24, because it does say, I mean, I know your answer is the limitations clause, but it does repeat the phrase United States tax on income, which seems to broadly mirror the definitional section.

[00:03:51] Speaker 02:
Well, but the clause, the provisions and limitations language is the condition.

[00:03:59] Speaker 05:
It's in the same sentence.

[00:04:01] Speaker 02:
Right, but it conditions credit against US income tax.

[00:04:05] Speaker 02:
And so the question here is, does the provisions and limitation language, is it broad enough to include sections 27 and 901A of the code?

[00:04:17] Speaker 02:
And of course it does.

[00:04:18] Speaker 02:
I mean, it's written very broadly to include all the provisions and limitations of US law, not just the code.

[00:04:23] Speaker 05:
If it wanted just to apply calculations rules, it could have probably referenced calculation rules.

[00:04:28] Speaker 02:
Yes, absolutely.

[00:04:29] Speaker 02:
It could have done that.

[00:04:30] Speaker 05:
In fact, in later provisions, it references calculation rules and then specifically provides for deviations from US law on the calculations rules, right?

[00:04:40] Speaker 02:
In paragraphs four, five, and six, what paragraph four is doing, that's the three-byte rule, where essentially you're prioritizing the taxation.

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It's a special ordering rule.

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And then, of course, in six, you have the resourcing provision.

[00:04:56] Speaker 02:
Do we think that that?

[00:04:58] Speaker 05:
I'm sorry.

[00:04:59] Speaker 05:
Yeah, no, I'm just sorry.

[00:05:02] Speaker 05:
I don't think any of us are tax lawyers.

[00:05:03] Speaker 05:
Tax law is very hard, and we don't see very many of us.

[00:05:06] Speaker 05:
think I need to understand specifically how four, five, and six works.

[00:05:09] Speaker 05:
But it does seem like there are specific rules that apply under the convention that wouldn't otherwise apply to the foreign tax credit.

[00:05:17] Speaker 05:
Is that right?

[00:05:18] Speaker 02:
Sorry, could you repeat that?

[00:05:19] Speaker 05:
There are specific rules under this convention that wouldn't otherwise apply to the foreign tax credit purely under the Internal Revenue Code.

[00:05:29] Speaker 02:
Yes, I think that's true.

[00:05:31] Speaker 05:
So when the parties wanted to deviate from

[00:05:36] Speaker 05:
the internal revenue provisions, they wrote it into the agreement.

[00:05:40] Speaker 02:
Yes.

[00:05:41] Speaker 02:
Yes.

[00:05:42] Speaker 02:
And because of the resourcing provision in paragraph 6, we think that that illustrates that the parties did understand the code to apply to paragraph B. Because there would be no other reason to have it there.

[00:05:55] Speaker 05:
So I guess my other question, main question on this point, is this 1411 tax was enacted long after this agreement.

[00:06:03] Speaker 05:
Yes.

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And so at the time the parties entered into this agreement, there was no contemplation whatsoever of this kind of tax being enacted.

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That's an internal revenue tax outside the code.

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And so we're left grappling with what the parties would have intended.

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And we have your view that this limitations clause applies.

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But then we have, I think, from them the broader statements that any similar taxes in the future

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treated the same.

[00:06:32] Speaker 05:
How do we sort that out?

[00:06:34] Speaker 02:
Well, I think nothing in enacting the NIT in Chapter 2A changed what the parties understood paragraph 242A, excuse me, 241, to work.

[00:06:51] Speaker 02:
The foreign tax credit, of course, has always been restricted to applying against Chapter 1 tax.

[00:06:55] Speaker 02:
And again, just referencing the exclusions.

[00:06:59] Speaker 04:
The title of Article 24 is Elimination of Double Taxation, right?

[00:07:03] Speaker 02:
Yes.

[00:07:03] Speaker 04:
So that clearly was the expectation of the parties to the treaty.

[00:07:10] Speaker 04:
Was it not?

[00:07:12] Speaker 02:
Well, the terms of the credit govern.

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And it is conditioned on the provisions and limitations of US law.

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And just stepping back to the previous point, I want to emphasize that since we talked earlier about the exclusions within Chapter 1,

[00:07:32] Speaker 02:
of taxes against which the foreign tax credit cannot be applied.

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The NIT is no different from that.

[00:07:39] Speaker 02:
It's just located outside of Chapter 1.

[00:07:41] Speaker 06:
Do we know why it's located outside of Chapter 1?

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Is there any legislative history or any even common sense reason for it not to be in Chapter 1?

[00:07:49] Speaker 02:
I don't know of any legislative history on that.

[00:07:54] Speaker 02:
In terms of common sense, it would seem significant to supporting health care costs, because it's a special tax for that.

[00:08:03] Speaker 06:
So you would speculate it has something to do with where the revenue was going to go, but

[00:08:08] Speaker 06:
There's no indication.

[00:08:10] Speaker 02:
I mean, there's no indication.

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We don't know for sure.

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But the NIT is not different from these Chapter 1 taxes that were already excluded.

[00:08:20] Speaker 02:
I mean, the parties understood that at the time they signed.

[00:08:23] Speaker 06:
The trial court suggests then that you're putting an awful lot of weight on what may just be a happenstance of Congress creating Chapter 2A when, for all intents and purposes, this NIT

[00:08:37] Speaker 06:
looks just like everything in chapter one.

[00:08:40] Speaker 06:
Do we need to, in order to side with you, see that there's some meaningful significance to the fact that Congress, for whatever reason or no reason, created chapter 2a instead of chapter 1?

[00:08:56] Speaker 02:
Well, the fact remains, it's, I mean,

[00:09:01] Speaker 02:
Although we don't know the reason why, the fact is it did what it did.

[00:09:05] Speaker 02:
But what it did, effective as far as the foreign tax credit is concerned, doesn't change how the parties understood the credit to operate, which is that it would exclude taxes.

[00:09:21] Speaker 05:
Congress knew when it enacted 1411

[00:09:24] Speaker 05:
that the foreign tax credit under US law only applied to chapter one taxes with certain exceptions.

[00:09:32] Speaker 05:
And so can't we presume by placing it outside of that they intended it not to be included in the foreign tax credit?

[00:09:41] Speaker 02:
I think you can.

[00:09:42] Speaker 02:
I mean, you have to see it.

[00:09:43] Speaker 05:
I mean, they also could have just put it in that list of 26.

[00:09:46] Speaker 02:
Exactly.

[00:09:47] Speaker 02:
Right.

[00:09:47] Speaker 05:
And said these also shall be considered for foreign tax credits.

[00:09:51] Speaker 05:
It's effectively the same thing either way.

[00:09:54] Speaker 02:
Correct, correct.

[00:09:55] Speaker 04:
Any other tax consequences other than this foreign tax credit matter that are affected by putting the 1411 tax in Chapter 2 as opposed to Chapter 1?

[00:10:11] Speaker 02:
Do you mean with respect to the foreign tax credit itself?

[00:10:14] Speaker 04:
No, any other tax consequence.

[00:10:18] Speaker 04:
Is it purely the only distinction

[00:10:22] Speaker 04:
between the 1411 tax being in Chapter 2 versus the enumerated taxes in Chapter 1 that the Chapter 2 tax gets no foreign tax credit.

[00:10:35] Speaker 04:
Any other consequences?

[00:10:37] Speaker 02:
I've not looked into that.

[00:10:39] Speaker 02:
I mean, I don't know what beyond the foreign tax credit implications.

[00:10:47] Speaker 02:
The foreign tax credit scheme itself is highly articulated.

[00:10:51] Speaker 02:
So the fact that this is outside of it, I think, certainly makes a difference here.

[00:10:56] Speaker 02:
I'm sure that's not necessarily an answer to your question, but I may be misunderstanding it.

[00:11:02] Speaker 06:
Judge Solmson's view seemed to be that your interpretation of the US law limitation is completely illogical.

[00:11:09] Speaker 06:
It really just comes down to it applies when the government says it applies and doesn't apply otherwise.

[00:11:16] Speaker 06:
Can you help me understand what the logical principle is that governs when the US law limitation has an impact?

[00:11:25] Speaker 02:
Sure, I think what the court below did not understand is that paragraph 24-1 creates a general rule.

[00:11:35] Speaker 02:
that they're setting the table.

[00:11:37] Speaker 02:
This is how it's going to apply as a general rule that the credit against US income tax is conditioned on being in accordance with the provisions and subject to the limitations of the code.

[00:11:49] Speaker 02:
There are some modifications after that to the general rule.

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And so a treaty can certainly offer, it can say whatever it wants.

[00:11:57] Speaker 02:
It can give the parties whatever they negotiate for.

[00:12:00] Speaker 02:
But the fact that there are modifications to that rule doesn't mean that everything else that's covered by that rule just drops out.

[00:12:11] Speaker 06:
So if the issue is, can the tax treaty create a credit that the US code does not create, if the question is just that broad, you would say yes, the tax treaty could.

[00:12:26] Speaker 02:
Yes, it could, but it did not here.

[00:12:28] Speaker 06:
The specific one that they're trying to claim it did not, but it created some others, you would say, in paragraphs four, five, and six, maybe?

[00:12:37] Speaker 02:
Well, we didn't brief paragraph 5, but that may be a case.

[00:12:41] Speaker 02:
And it's not relevant here.

[00:12:43] Speaker 02:
But I would note that in the technical explanation at pages 260, it says that paragraph 4b is subject to the rules of paragraph 1.

[00:12:54] Speaker 02:
And Canada endorsed the technical explanation.

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And the technical explanation also says that paragraph 6 is necessary to achieve the objectives of 4b.

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and 5c.

[00:13:05] Speaker 02:
That's on appendix page 263.

[00:13:07] Speaker 02:
So these provisions are all interrelated and are looking back to paragraph 24-1, I think.

[00:13:13] Speaker 06:
I have a quick question about amicus.

[00:13:17] Speaker 06:
Page 12, they make a reciprocity argument and suggest your interpretation is inconsistent with a reciprocity norm.

[00:13:26] Speaker 06:
Can you help me understand the government's response?

[00:13:29] Speaker 02:
Sure.

[00:13:29] Speaker 02:
I do understand that.

[00:13:36] Speaker 02:
The terms of a treaty need not be identical.

[00:13:41] Speaker 02:
And they aren't here.

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Both countries have conditioned the tax credit on applying domestic law.

[00:13:52] Speaker 02:
And so that's not always going to match up perfectly.

[00:13:56] Speaker 02:
And of course, treaties have nonreciprocal results sometimes.

[00:14:02] Speaker 06:
Do you consider here that the implication of your position is there are not reciprocal or at least equivalent reciprocal benefits to Canadian taxpayers as there are to American taxpayers?

[00:14:15] Speaker 02:
Well, it's not exact because they have different system.

[00:14:16] Speaker 02:
They have different provisions in their tax code, which

[00:14:23] Speaker 02:
We don't know in this case, because it hasn't been developed as to what those might be.

[00:14:29] Speaker 05:
They don't have a comparable 1411 that they treat differently.

[00:14:32] Speaker 02:
So far as I know, no.

[00:14:34] Speaker 05:
They may have other kinds of taxes that we don't have in the US.

[00:14:40] Speaker 05:
And we would have to look to the agreement to determine how those are treated.

[00:14:44] Speaker 02:
Correct.

[00:14:44] Speaker 05:
And the agreement spells some of those out, right?

[00:14:46] Speaker 05:
Yes.

[00:14:47] Speaker 05:
There's things like the provincial taxes that are spelled out.

[00:14:52] Speaker 05:
The agreement also spells out something regarding our Social Security taxes about how they should be treated that may be different than we would treat them under just the basic foreign tax credit and things like that.

[00:15:05] Speaker 02:
Correct.

[00:15:05] Speaker 02:
Correct.

[00:15:05] Speaker 05:
Yes.

[00:15:07] Speaker 05:
Yes.

[00:15:07] Speaker 04:
OK.

[00:15:09] Speaker 04:
If we were to conclude that the enactment of the 1411 tax and placement in Chapter 2 violated the general principles of the treaty,

[00:15:22] Speaker 04:
Then would you agree that Mr. Brouillet is entitled to a credit, a foreign tax credit under those circumstances?

[00:15:31] Speaker 02:
In paragraph two, did you say?

[00:15:33] Speaker 02:
Sorry.

[00:15:36] Speaker 04:
If we were to conclude that the enactment of the 1411 tax and placement of it in chapter two violated the general principles of the treaty,

[00:15:51] Speaker 04:
And would you agree, under those circumstances, that Mr. Brewer would be entitled to a foreign tax credit here?

[00:16:01] Speaker 02:
Well, we don't think there's any basis for that, of course.

[00:16:04] Speaker 04:
The hypothetical.

[00:16:05] Speaker 02:
Right.

[00:16:06] Speaker 04:
Right.

[00:16:07] Speaker 04:
If we were to conclude that the placement of the 1411 tax in Chapter 2 violated the general principles of the treaty, wouldn't you agree that

[00:16:20] Speaker 04:
Under those circumstances, Mr. Bruyier would be entitled to a foreign tax credit.

[00:16:35] Speaker 02:
As a later enacted tax, it may well.

[00:16:39] Speaker 02:
But I would note that the general principle here, as explained in the technical explanation, is the general principle of paragraph one.

[00:16:48] Speaker 02:
And paragraph one is the credit against income tax that is conditioned on the provisions and limitations of US law.

[00:16:58] Speaker 02:
Now, we don't think that.

[00:17:00] Speaker 04:
I'm sorry.

[00:17:00] Speaker 04:
I'm obviously relying on this one

[00:17:04] Speaker 04:
Sorry.

[00:17:04] Speaker 04:
A phrase from Article 24 about.

[00:17:08] Speaker 04:
without changing the general principles hereof.

[00:17:11] Speaker 02:
Correct.

[00:17:11] Speaker 04:
And so you're saying, no, what's happening here with the 1411 tax is not violating the general principles of the treaty.

[00:17:19] Speaker 04:
Can you think of an example that would violate the general principles of the treaty?

[00:17:23] Speaker 04:
Because I can't think of one that the government would agree to.

[00:17:28] Speaker 04:
Of course, the language is in the article, so we have to have something

[00:17:38] Speaker 04:
And then I can better understand the conception of your argument.

[00:17:43] Speaker 04:
You can give me an example.

[00:17:44] Speaker 05:
Let me ask you.

[00:17:46] Speaker 05:
Let me try hypothetical.

[00:17:48] Speaker 05:
Oh, this will be helpful.

[00:17:50] Speaker 05:
Probably not.

[00:17:51] Speaker 05:
But if Congress decides, oh, we don't like all of this basic income tax being subject to the foreign tax credit, so it divides up basic income tax provisions and says, well, some of your income tax is under Article I still, but some of it

[00:18:07] Speaker 05:
is under now Article 2B.

[00:18:10] Speaker 05:
And it explicitly does that to reduce the foreign tax credit, which would seem inconsistent with the spirit of this treaty.

[00:18:19] Speaker 05:
But assuming we believe the limitations clause is what you said is still permitted under this treaty.

[00:18:26] Speaker 05:
Correct.

[00:18:27] Speaker 05:
What's the remedy?

[00:18:28] Speaker 05:
Is that a judicially enforceable remedy, or is that a sovereign to sovereign treaty problem?

[00:18:37] Speaker 02:
I think that's more of a sovereign-to-sovereign issue.

[00:18:40] Speaker 02:
I would point out that Article 26-3 recognizes that there will be double taxation in certain circumstances and that the competent authority for each country may consult and figure out how to resolve those issues.

[00:18:55] Speaker 02:
And as for specific taxpayers, there are the procedures that Mr. Bourdieu used here but then withdrew from to resolve an individual taxpayer's

[00:19:07] Speaker 05:
So let me ask you again, because I have a feeling I've led you astray from what my colleague was trying to argue.

[00:19:12] Speaker 05:
Let's say we have these two provisions.

[00:19:14] Speaker 05:
One is the specific limitations provision, which has apply US law.

[00:19:18] Speaker 05:
The other is the more general one.

[00:19:20] Speaker 05:
If Congress does something that violates the more general one, but would still require a certain result under the more specific one, are the courts

[00:19:33] Speaker 05:
entitled to order a refund because the new placement of something outside of Article 1 violates that general principle of the treaty.

[00:19:42] Speaker 02:
Well, the general principle of Article 241 is to relieve double taxation via the credit that is in accordance with the provisions and subject to the limitations.

[00:19:55] Speaker 05:
Congress could tomorrow enact a statute

[00:19:59] Speaker 05:
that basically takes every income tax and internal revenue code and puts it in a new subchapter 2B.

[00:20:07] Speaker 05:
And so there is no more foreign tax credit under US law.

[00:20:12] Speaker 05:
They could do that, right?

[00:20:13] Speaker 05:
They won't, but they could.

[00:20:14] Speaker 02:
They won't.

[00:20:16] Speaker 05:
But if they did that, your argument coming in here would still be,

[00:20:21] Speaker 05:
no foreign tax credit anymore because it's subject to the limitations and conditions of US law, even though that might violate the tenor of the treaty.

[00:20:29] Speaker 05:
Is that right?

[00:20:30] Speaker 02:
Yes.

[00:20:31] Speaker 02:
Yes.

[00:20:31] Speaker 04:
That kind of amendment would not be changing the general principles underlying the treaty?

[00:20:41] Speaker 04:
Well, being out chapter one, shaking it all out so there's no more foreign tax credit at all.

[00:20:47] Speaker 02:
Getting completely rid of the foreign tax credit, yes, I think that that would.

[00:20:52] Speaker 02:
But again,

[00:20:54] Speaker 02:
The likelihood of that happening is next to nothing.

[00:20:56] Speaker 02:
There is no jurisdiction in the world that doesn't provide some relief to double taxation, except no tax jurisdictions.

[00:21:03] Speaker 02:
That's like we have found an example of that.

[00:21:07] Speaker 02:
Well, yes.

[00:21:07] Speaker 02:
I mean, yes.

[00:21:08] Speaker 02:
I mean, the general principle of paragraph one is that there will be a credit subject to the provisions and limitations of US law.

[00:21:17] Speaker 02:
So if you got rid of the credit, then yes, I think that would be

[00:21:24] Speaker 02:
that would violate that, I think.

[00:21:26] Speaker 06:
Can I ask your view on page six of the appendix?

[00:21:31] Speaker 06:
The Court of Federal Claims wrote, when it comes to a treaty, there is a notable difference from other legal instruments.

[00:21:37] Speaker 06:
Courts are encouraged to consider a treaty's purpose as well as extrinsic evidence of the intent of the parties to the treaty.

[00:21:45] Speaker 06:
You agree or you disagree?

[00:21:47] Speaker 02:
Yes.

[00:21:48] Speaker 02:
Yes.

[00:21:49] Speaker 02:
I mean, I agree.

[00:21:49] Speaker 02:
Switch.

[00:21:50] Speaker 02:
Sorry.

[00:21:50] Speaker 02:
I agree, yes.

[00:21:52] Speaker 06:
You agree.

[00:21:53] Speaker 06:
And that's problematic for you because you agree that because we're interpreting a treaty, we're encouraged to consider the treaty's purpose and also the extrinsic evidence of the intent of the parties.

[00:22:07] Speaker 06:
You agree that I need to do those things, right?

[00:22:10] Speaker 02:
Well, that is a general rule.

[00:22:13] Speaker 02:
First, the import of the treaty language is the most important.

[00:22:19] Speaker 02:
But we don't think that that is a problem for us in terms of looking at the purpose, because the purpose was never to eliminate all double taxation.

[00:22:28] Speaker 06:
In this case, do I need to consider anything beyond the text of the treaty?

[00:22:34] Speaker 02:
No.

[00:22:34] Speaker 02:
I think the text answers all of the questions.

[00:22:37] Speaker 02:
The 24.1

[00:22:40] Speaker 02:
The plain text clearly states that the credit against U.S.

[00:22:45] Speaker 02:
income tax is conditioned in accordance with the provisions and subject to the limitations of U.S.

[00:22:51] Speaker 02:
law and the credit referenced in 4B.

[00:22:55] Speaker 02:
We know from the resourcing provision that there would be no reason to have that resourcing provision in there.

[00:23:02] Speaker 02:
unless the parties understood the code to apply.

[00:23:07] Speaker 02:
And we know from the technical explanation which candidate endorsed that paragraph 4b is subject to the rules of paragraph 1.

[00:23:17] Speaker 02:
That's what the technical explanation says.

[00:23:19] Speaker 02:
And it also says that paragraph 6 is necessary to implement the objectives of paragraph 4b.

[00:23:30] Speaker 04:
You're out of time.

[00:23:31] Speaker 04:
But we'll give you two minutes for rebuttal.

[00:23:34] Speaker 04:
Thank you very much.

[00:23:35] Speaker 04:
Thank you.

[00:23:54] Speaker 01:
Good morning.

[00:23:55] Speaker 01:
My name is Stuart Horwich and I represent the taxpayers in this case, the appellant Paul Bruja.

[00:24:03] Speaker 01:
It's a foreign tax credit case.

[00:24:04] Speaker 01:
I think that we all, including the government, agree that the elimination of double taxation is the purpose that is underlying Article 24.

[00:24:15] Speaker 01:
It's a very simple problem here.

[00:24:17] Speaker 01:
Mr. Bruja sold some property in Canada.

[00:24:20] Speaker 01:
He paid

[00:24:22] Speaker 01:
Canadian income tax, he paid British Columbia tax.

[00:24:26] Speaker 01:
That was in excess of the amount of tax that he paid would have been due in the United States.

[00:24:33] Speaker 01:
And in addition, he had to pay the net investment income tax.

[00:24:37] Speaker 01:
Paying the net investment income tax is in fact double taxation.

[00:24:43] Speaker 05:
So I don't want to get into the details of this too much because I don't think it's germane to the specific question.

[00:24:50] Speaker 05:
He has more foreign tax than he could apply against the US tax under the government's view of the foreign tax credit.

[00:24:59] Speaker 05:
Is that what?

[00:25:00] Speaker 05:
And so you want it to apply to 1411, too?

[00:25:02] Speaker 05:
Correct.

[00:25:04] Speaker 05:
Can he not carry over that foreign tax credit to subsequent years, the excess foreign tax credit?

[00:25:13] Speaker 01:
He can, but that's a no.

[00:25:15] Speaker 05:
So in essence, he's not necessarily losing out on this foreign tax credit.

[00:25:20] Speaker 05:
Because he sold some property this one year, he can carry this over or can he carry it back?

[00:25:25] Speaker 01:
He can carry it back one year.

[00:25:26] Speaker 01:
He can carry it forward 10 years.

[00:25:29] Speaker 01:
But in answer to the question directly, certainly the carry back and the carry forwards can mitigate to a degree double taxation.

[00:25:38] Speaker 01:
But it's only a mitigation and probably a specious one at that because next year, go to year two,

[00:25:46] Speaker 01:
He has more knit.

[00:25:47] Speaker 01:
He's got the same problem that has to carry forward.

[00:25:50] Speaker 01:
And in addition, the Canadian tax is going to be higher in year two than the US tax because Canada is a higher tax jurisdiction.

[00:25:59] Speaker 01:
When we talk about France, we'll find out that France is a higher tax jurisdiction as well.

[00:26:03] Speaker 01:
So nice to have.

[00:26:06] Speaker 05:
I think Americans might be surprised to hear that our taxes are not the highest.

[00:26:11] Speaker 01:
Quite.

[00:26:12] Speaker 01:
I've lived abroad for a long time, and I do laugh at that.

[00:26:15] Speaker 05:
So I understand your basic point that the general purpose of this treaty is to avoid double taxation.

[00:26:22] Speaker 05:
But I think the treaty itself recognizes that it's not going to avoid all double taxation.

[00:26:26] Speaker 05:
So the question is, where do we draw the line, right?

[00:26:29] Speaker 01:
Correct.

[00:26:31] Speaker 01:
Double taxation, the point that we would have here is what do we mean by the in accordance with the provisions and subject to the limitations.

[00:26:40] Speaker 01:
And if you look at the overall structure of Article 24, that will be, and the technical explanation I might add, that will be how can we compute the proper amount of Canadian tax that will be applied against United States tax.

[00:26:55] Speaker 01:
Those are the provisions and the limitations.

[00:26:58] Speaker 05:
The government's argument gets into the limitation of calculation.

[00:27:02] Speaker 05:
I understand this is the way the trial court read that provision to apply only to calculations.

[00:27:09] Speaker 05:
But it seems a much broader phrase, provisions and limitations, than just apply the US rules regarding calculation of the foreign tax, which is what the trial court got.

[00:27:22] Speaker 05:
And then recognizes, even then, we're going to deviate from those calculation rules in four, five, and six.

[00:27:28] Speaker 01:
Right, okay.

[00:27:30] Speaker 01:
Easy enough in terms of calculating a tax, you would say, gee, what's the income?

[00:27:34] Speaker 01:
How much is the credit?

[00:27:35] Speaker 01:
What's the foreign exchange rate?

[00:27:37] Speaker 01:
Which basket does it fall in?

[00:27:39] Speaker 01:
But there are times that the code itself will disallow or postpone the use of a Canadian tax.

[00:27:47] Speaker 04:
It seems to be an overly narrow reading of the provisions and limitations language in the treaty.

[00:27:53] Speaker 04:
I mean, the full phrase, I think, is in accordance with

[00:27:59] Speaker 04:
of and subject to the limitations of US law.

[00:28:05] Speaker 04:
And to me, in accordance with sounds a lot like in accordance with.

[00:28:09] Speaker 04:
I mean, in compliance with.

[00:28:11] Speaker 04:
In compliance with the law of the code seems to be what that phrasing is trying to say.

[00:28:18] Speaker 04:
And that's in compliance with all of the code, not just the pieces of the code that deal with computation.

[00:28:29] Speaker 04:
I don't follow why you think it's appropriate to narrow down that phrasing to just the pieces of the code that deal with computation.

[00:28:40] Speaker 01:
Taking that at face value, then let's read the rest of the sentence of the Article 24.1 because it then goes on to say that in accordance with and subject to the limitations of the United States tax, a defined term which will include the net, a credit shall be allowed against Canadian tax.

[00:29:06] Speaker 01:
Canadian tax

[00:29:08] Speaker 01:
under the code is narrower than what is defined in Article 24-7.

[00:29:13] Speaker 01:
So you could literally be looking at it.

[00:29:17] Speaker 01:
If we say that it is not, when I say computational in basis, computational-like, is there a disallowance?

[00:29:24] Speaker 01:
Isn't there a disallowance?

[00:29:26] Speaker 01:
how much is, how much isn't, has it accrued, has it not accrued.

[00:29:30] Speaker 01:
If you would say that the code always wins, then you can't have 24-7 define what is a Canadian tax, which is in contradiction to the code.

[00:29:41] Speaker 05:
These are two different topics, though.

[00:29:43] Speaker 05:
And I feel like this confuses the question about what US tax is subject

[00:29:51] Speaker 05:
to a foreign credit and what foreign taxes comprise the universe of the foreign credit.

[00:29:58] Speaker 05:
They're not the same.

[00:29:59] Speaker 05:
I agree with you that they're different, and they're not parallel.

[00:30:06] Speaker 05:
But that just recognizes there's different taxation structures in both countries.

[00:30:11] Speaker 05:
So to say that this talks about Canadian taxes and what they're included is different doesn't answer the question of,

[00:30:20] Speaker 05:
what the limitations and provisions on US tax law means.

[00:30:25] Speaker 01:
But the in accordance language covers both US tax and Canadian tax.

[00:30:30] Speaker 05:
It's in the same sentence.

[00:30:32] Speaker 05:
It says in accordance with the provisions and subject to the limitations of the law of the United States.

[00:30:38] Speaker 05:
Right.

[00:30:39] Speaker 05:
It doesn't say in accordance with the law of Canada for determining what income tax a US taxpayer pays is subject to the limitations.

[00:30:50] Speaker 05:
But I don't understand your argument about why it matters what the universe of Canadian taxes is that can be used as a credit, how that affects what US tax is subject to that credit.

[00:31:04] Speaker 05:
They're two different questions.

[00:31:06] Speaker 05:
They're necessarily two different questions.

[00:31:08] Speaker 05:
The treaty itself recognizes that there are certain taxes that aren't normally taxes of Canada.

[00:31:17] Speaker 05:
like the provincial taxes, but should nonetheless be included in the foreign tax credit.

[00:31:22] Speaker 05:
That's answering the separate question of looking at the Canadian structure.

[00:31:26] Speaker 05:
Here's the list of taxes you can include as your foreign tax paid.

[00:31:31] Speaker 05:
And then you look at what US tax paid that offsets.

[00:31:35] Speaker 05:
But there's not any parallelism there.

[00:31:42] Speaker 05:
You can answer that, but let me just ask you, it seems to me

[00:31:46] Speaker 05:
Your reading, and we talked about it a little bit on your opposing counsel's argument, your reading would also suggest that the foreign taxes paid in Canada could offset that whole laundry list of 26B taxes that are income taxes that are nonetheless excluded from the foreign tax credit in the US.

[00:32:09] Speaker 05:
Do you agree that's the logic of your argument?

[00:32:13] Speaker 01:
Yes.

[00:32:14] Speaker 05:
And so you think that when they negotiated this, that the United States thought that this was going to provide a complete radical departure from the foreign tax credit in the IRC?

[00:32:28] Speaker 01:
Well, if you look at them, when you say radical departure, I think that we have the 26B is not what I would describe as a radical departure.

[00:32:39] Speaker 05:
There's a whole list of taxes in 26B that are not considered

[00:32:45] Speaker 05:
For offset.

[00:32:46] Speaker 01:
I understand.

[00:32:47] Speaker 01:
I have to get my treaty for a second.

[00:32:56] Speaker 01:
If you look at Article 2 of taxes covered, you will see that Article 2, this is Appendix 537.

[00:33:05] Speaker 01:
547?

[00:33:05] Speaker 01:
537.

[00:33:05] Speaker 05:
This is Article 2 of the treaty.

[00:33:09] Speaker 01:
Article 2 of the treaty, Appendix 537.

[00:33:14] Speaker 01:
You will see that there is a carve-out to United States income tax.

[00:33:18] Speaker 05:
Sorry, hold on a second.

[00:33:20] Speaker 05:
Article 2.

[00:33:22] Speaker 01:
General tax is covered.

[00:33:25] Speaker 01:
Article 2, Appendix 537.

[00:33:27] Speaker 05:
Oh, sorry, 537.

[00:33:29] Speaker 05:
Sorry.

[00:33:29] Speaker 05:
537?

[00:33:30] Speaker 05:
Thank you.

[00:33:35] Speaker 01:
You will see that there's carve-outs to that, which you will find some of those are precisely the ones that are in 26B.

[00:33:42] Speaker 05:
Right, which means that if they intended to specifically include the 26B1s, they put it in the treaty.

[00:33:50] Speaker 05:
They didn't do it by operation of this general term all US income taxes.

[00:34:00] Speaker 01:
I'm sorry.

[00:34:00] Speaker 01:
I think it's the date when they included it.

[00:34:04] Speaker 01:
They included it only with respect to the 26B1s.

[00:34:10] Speaker 01:
If we look at 26B1, it's the accumulated earnings tax, which is carved out in 26B.

[00:34:15] Speaker 01:
So 26B would not allow the accumulated earnings tax or the excise tax for 262.

[00:34:23] Speaker 01:
Those two provisions would not give you a credit in 24 because it only applies to specific articles.

[00:34:34] Speaker 05:
I don't understand how any of this is helping you.

[00:34:36] Speaker 05:
These are very specific rules negotiated.

[00:34:40] Speaker 05:
between the parties to apply portions of the United States code in a specific way.

[00:34:46] Speaker 05:
But you're saying the overall principle overrides all of the other specific provisions of the US code sub silencio.

[00:34:58] Speaker 05:
I understand we interpret treaties a little bit differently.

[00:35:03] Speaker 05:
That's just not the way you do textual interpretation to say, well, there's a general principle

[00:35:11] Speaker 05:
that overrides the way we do specific things.

[00:35:14] Speaker 05:
If they carve out specific things and leave others uncovered, then presumably those aren't carved out.

[00:35:21] Speaker 01:
And I agree.

[00:35:23] Speaker 01:
And because they do carve out certain taxes that fit within 26B, so they keep it.

[00:35:30] Speaker 05:
It still doesn't answer what subject to the provisions and limitations of means.

[00:35:36] Speaker 05:
It's a much broader phrase than you're saying it is.

[00:35:40] Speaker 05:
I don't understand how you limit it to a computational rule.

[00:35:49] Speaker 06:
Can you point to any text in the treaty itself that would tie that provision, the US law limitation, to computation, to calculation of the tax itself?

[00:36:01] Speaker 06:
Is there any textual support for that?

[00:36:03] Speaker 01:
It is in the technical explanation there.

[00:36:06] Speaker 06:
Right, but that's not the text of the treaty.

[00:36:08] Speaker 06:
In the text of the treaty.

[00:36:10] Speaker 06:
Do we have any textual tie that we could use to read the US law limitations as narrowly as you're asking us to?

[00:36:25] Speaker 01:
Let's posit a situation where we have a US citizen living in Canada who is

[00:36:35] Speaker 01:
generating some U.S.

[00:36:37] Speaker 01:
source income.

[00:36:39] Speaker 01:
Let's say I was living in Canada.

[00:36:42] Speaker 01:
I'm a U.S.

[00:36:42] Speaker 01:
citizen.

[00:36:43] Speaker 01:
I'm in Washington arguing a case.

[00:36:45] Speaker 01:
I'm generating U.S.

[00:36:46] Speaker 01:
source income.

[00:36:47] Speaker 01:
26.3 has to resource that income to be Canadian source because the Canadians have primary taxing rights.

[00:37:01] Speaker 01:
That would suggest that the

[00:37:05] Speaker 01:
reason for that limitations is that we need to compute the right amount of tax.

[00:37:12] Speaker 01:
So it is imperfect, but it is there.

[00:37:20] Speaker 06:
There is the phrase in 24.1 expressly making it subject to the provisions of paragraphs 4, 5, and 6.

[00:37:28] Speaker 06:
That's 24, 4, 5, and 6, right?

[00:37:31] Speaker 06:
Right.

[00:37:32] Speaker 06:
Um, it doesn't that, uh, harmonize the government's interpretation of when the U S law limitation applies and when it doesn't.

[00:37:43] Speaker 01:
But then my example here proves the negative proves that long because of, if you do not, the subject to language in 24 one does not include paragraph three.

[00:37:57] Speaker 01:
It only is four or five and six.

[00:37:59] Speaker 06:
But for four, five, and six, to the extent the trial court was concerned that the government had no logical principle for when the U.S.

[00:38:08] Speaker 06:
law limitation applies and when it doesn't, that's not really fair with respect to four, five, and six.

[00:38:16] Speaker 01:
From the subject to language that is accepted.

[00:38:20] Speaker 01:
For four, five, and six.

[00:38:21] Speaker 05:
You would agree with me for four, five, and six.

[00:38:23] Speaker 01:
For four, five, and six, I think you could read it both ways.

[00:38:26] Speaker 05:
But three also says it's for the purposes of this entire article.

[00:38:29] Speaker 05:
So even though it wasn't included up above, it's still a qualification on one, right?

[00:38:36] Speaker 05:
Because it said for purposes of this article.

[00:38:41] Speaker 01:
But then you also have the US law limitation.

[00:38:43] Speaker 01:
Which one then?

[00:38:45] Speaker 05:
This is a more specific treatment

[00:38:49] Speaker 05:
deviates from it.

[00:38:51] Speaker 05:
So you get the deviations in four, five, and six, but you also get the deviation in three.

[00:38:56] Speaker 05:
I mean, it's not the clearest written treaty in the world, but I just fail to see how your argument in the trial court's decision that provisions and limitations is only limited to calculation.

[00:39:12] Speaker 05:
I mean, that's just not generally the way I would read those words.

[00:39:17] Speaker 05:
And I'm particularly troubled.

[00:39:20] Speaker 05:
by what I think, in your brief on page 14 at footnote 7, you suggest that the language in the Croatia treaty is somehow different and has a different purpose.

[00:39:33] Speaker 05:
It may be different, but it's in a clause that looks an awful lot like the one we have here.

[00:39:39] Speaker 05:
Instead of saying subject to the provisions and limitations, it says, to the extent allowed under the law,

[00:39:46] Speaker 05:
of the United States.

[00:39:47] Speaker 01:
Without the general principle language at all.

[00:39:53] Speaker 05:
Yeah, but that's the problem is you want to have the general principle override the subject to the limitations and provisions clause.

[00:40:01] Speaker 05:
That just can't happen.

[00:40:03] Speaker 05:
All we're trying to determine is what the subject to the limitations and provision clause means.

[00:40:08] Speaker 05:
And the parallel language in the Croatia treaty

[00:40:12] Speaker 05:
as noted in your footnote, but also I pulled up the whole article.

[00:40:16] Speaker 05:
It's structured not exactly the same, but very similar.

[00:40:19] Speaker 05:
And all these treaties are structured very similarly, because they all come from a model convention on double taxation, which looks a lot like all the ones at issue here, with slight modifications in every one, like 3, 4, 5, and 6, because countries have slightly different rules for some of these specific things.

[00:40:40] Speaker 01:
And what I would have to say here is that in the case of an ambiguous situation, and clearly there's a lot going on here, then other principles in terms of treaty interpretation will apply.

[00:40:59] Speaker 05:
Well, that presumes it's ambiguous.

[00:41:03] Speaker 05:
I mean, the Supreme Court has instructed us, not certainly in tax law, but in administrative law, that just because parties disagree or because there's two possible readings doesn't render it ambiguous.

[00:41:15] Speaker 05:
It's told us we have to look harder and determine whether it really is ambiguous or if it's just a hard statutory interpretation question.

[00:41:23] Speaker 05:
And I don't see anything necessarily ambiguous about subject to the provisions and limitations.

[00:41:30] Speaker 05:
I know you have arguments on the other side that you convinced the two

[00:41:33] Speaker 05:
one trial court to accept on this point.

[00:41:37] Speaker 05:
But if we don't find it ambiguous, then we don't get to any of these different deference questions on treaty interpretation, do we?

[00:41:51] Speaker 01:
The standard for the treaty interpretation is the shared expectations of the parties.

[00:41:56] Speaker 01:
based on the words and based on what they're trying to achieve.

[00:42:00] Speaker 01:
What they're trying to achieve here is elimination of double taxation.

[00:42:03] Speaker 05:
But not all.

[00:42:07] Speaker 01:
Not all, but reciprocity would be such that it would be, as Judge Scalia would have said, incomprehensible for the Canadians to agree that if this property were located in Montana rather than Alberta, that Canada would have to give a credit for the net, which is undisputed, as opposed to the other way around when the property is located in Alberta and America will not give a credit for, will not let you offset the net.

[00:42:34] Speaker 01:
That is not a possible treaty negotiation.

[00:42:38] Speaker 05:
That sounds like a treaty problem, not a looking at the statutory terms.

[00:42:49] Speaker 05:
And it's what we were talking about with your opposing counsel before.

[00:42:53] Speaker 05:
Let's just assume that the plain language of this suggests that the 1411 tax is not

[00:43:03] Speaker 05:
subject to a foreign tax credit under the treaty.

[00:43:06] Speaker 05:
But nonetheless, when the United States placed it in that, it violated the overall principle and general tenor of the treaty.

[00:43:17] Speaker 05:
Can courts enforce that kind of violation if the plain language of the treaty says apply US law?

[00:43:24] Speaker 05:
And so under the tax laws, which the courts apply, the courts can order a refund.

[00:43:31] Speaker 05:
I mean, if Canada thinks this is a problem, isn't Canada bound to go to the United States and say, look, when you put 1411 in a second part of the title outside of title one, that violated what we thought we were doing.

[00:43:46] Speaker 05:
Not what the language says, but what was our general purpose and renegotiate that.

[00:43:59] Speaker 01:
I would take you back to the O'Connor case at that point where you have language which was quite unambiguous that the taxpayers would have gotten a much larger benefit and the court said it can't be right in your sovereignty for mine negotiation to come to that result.

[00:44:20] Speaker 01:
So I would say no.

[00:44:22] Speaker 01:
If it's a situation where

[00:44:26] Speaker 05:
The US government is... So you're essentially saying if 1411 had been in existence at the time of this negotiation, of course it would have been included in the convention, even if it was outside of Article 1.

[00:44:45] Speaker 01:
Or Canada would have included something saying we won't give a credit for the net.

[00:44:51] Speaker 01:
Yes, that's what I would have expected.

[00:44:57] Speaker 05:
But I don't know what you want us to do with that.

[00:45:00] Speaker 05:
That's asking us to rewrite the terms of the treaty based upon an event that hadn't happened.

[00:45:07] Speaker 05:
And if the plain terms of the treaty exclude the US crediting foreign taxes against 1411, then that's what the plain terms of the treaty does.

[00:45:16] Speaker 05:
And if Canada thinks that that's a problem and they would have negotiated otherwise, then it's up to them to raise that with their counterparts.

[00:45:28] Speaker 01:
First of all, I think that we are in a counterfactual, because I do not believe the treaty is as clear as this.

[00:45:34] Speaker 05:
No, I understand.

[00:45:35] Speaker 05:
These are all hypothetical questions.

[00:45:37] Speaker 05:
I understand.

[00:45:37] Speaker 05:
Let me get your argument on what the treaty says.

[00:45:39] Speaker 01:
OK.

[00:45:40] Speaker 01:
But following along that,

[00:45:44] Speaker 01:
The interpretation of a treaty is the shared expectations of the parties.

[00:45:52] Speaker 01:
Obviously, we can have a situation where there's a difference.

[00:45:57] Speaker 01:
We obviously have one here.

[00:45:59] Speaker 01:
However, the touchstone of the argument is the shared expectations of the parties.

[00:46:05] Speaker 01:
And we have plenty of good evidence here that the purpose here was to avoid double taxation.

[00:46:14] Speaker 01:
My view, counterfactual, is specifically encouraging it, propagating it.

[00:46:22] Speaker 01:
I think that when you are looking at this, the statutory interpretation rules will not translate directly into treaty interpretation laws.

[00:46:34] Speaker 01:
There's Supreme Court precedence on that as well, saying that those are not.

[00:46:38] Speaker 04:
Thank you, Mr. Horowitz.

[00:46:39] Speaker 04:
We have your argument.

[00:46:59] Speaker 02:
Just a few points.

[00:47:00] Speaker 05:
Let me just address his last argument.

[00:47:02] Speaker 05:
Assuming we agree with him that it's ambiguous, how do these

[00:47:06] Speaker 05:
these different interpretive rules for treaty interpretation apply here?

[00:47:10] Speaker 05:
And what do you think is the evidence on both sides for your position, as opposed to his?

[00:47:16] Speaker 02:
For the shared expectations?

[00:47:18] Speaker 02:
Yes.

[00:47:19] Speaker 02:
Well, we think that the text spells out pretty clearly what the expectations were, that there's a credit that would.

[00:47:24] Speaker 05:
No, you don't need to go through that.

[00:47:27] Speaker 05:
Hypothetically, if we find that it is ambiguous, then the text itself, and we have to look to

[00:47:34] Speaker 05:
outside evidence for the interpretation.

[00:47:37] Speaker 05:
How does that play out in your view?

[00:47:38] Speaker 02:
Well, the technical explanation, I think, makes it very clear that in support of the government's position, not to sound like a broken record, but for example, with that.

[00:47:51] Speaker 04:
Is there a principle that we're supposed to apply of liberal construction that in this particular instance would be in favor of the taxpayer?

[00:48:01] Speaker 02:
Well,

[00:48:03] Speaker 02:
The import of the language is the key here.

[00:48:08] Speaker 04:
And I don't disagree with the liberal construction principle of the treaty.

[00:48:15] Speaker 04:
I mean, that's our precedent, I believe.

[00:48:16] Speaker 02:
Well, no, not as that.

[00:48:19] Speaker 02:
But I don't think you need to get to that, because the text is so clear here.

[00:48:27] Speaker 06:
But it sounds like you're conceding that if we get beyond the text,

[00:48:32] Speaker 06:
There's really not much that helped you.

[00:48:34] Speaker 06:
There's maybe a little bit in the technical explanation, although there's a lot that favors them.

[00:48:40] Speaker 06:
So you need us to stick to the text for you to win.

[00:48:42] Speaker 06:
Is that right?

[00:48:44] Speaker 02:
Well, I think we do win under the text.

[00:48:46] Speaker 06:
I understand that.

[00:48:46] Speaker 06:
The questions, though, I think we're all asking is, what if, hypothetically, you don't win on the text?

[00:48:52] Speaker 06:
Can you articulate for us how you win nonetheless?

[00:48:58] Speaker 02:
Well,

[00:49:01] Speaker 02:
Again, the technical explanation, which Canada endorsed, supports the government's position here.

[00:49:12] Speaker 05:
What in the technical explanation?

[00:49:13] Speaker 05:
Because I point to a lot of things that provide rules that suggest that this should be applied just for calculation.

[00:49:21] Speaker 05:
Although I know your response is those are just examples.

[00:49:24] Speaker 02:
It's not an exhaustive list.

[00:49:26] Speaker 05:
Where's a positive piece of evidence on your side on the technical explanation?

[00:49:37] Speaker 02:
that the credits are allowed by paragraph one are subject to the limitations of the code.

[00:49:43] Speaker 02:
That's on page 254.

[00:49:44] Speaker 02:
The Treasury's interpretation is entitled to great weight.

[00:49:50] Speaker 02:
Canada endorsed it in specific with respect to paragraph four, the credit that's referenced there.

[00:49:58] Speaker 02:
The technical explanation is very explicit in saying that the rules of paragraph one apply in paragraph four B. And it's also explicit in saying that paragraph six is necessary to implement the objectives of paragraphs four B and five C. And so we know what Canada thought here.

[00:50:23] Speaker 02:
They endorsed this.

[00:50:24] Speaker 02:
And so I don't think there's much need to go beyond that.

[00:50:30] Speaker 04:
OK, I think we have your argument.

[00:50:31] Speaker 02:
OK, thank you.

[00:50:32] Speaker 04:
We'll see you again soon.

[00:50:33] Speaker 04:
Thank you.

[00:50:34] Speaker 04:
All right, the case is submitted.