Britain has officially ratified the controversial Lisbon Treaty, it was announced today.

The Government confirmed that the final stages of passing the agreement have been completed.

But the future of the deal is still in doubt as EU leaders consider how to respond to Ireland's surprise referendum "no" vote last month.

Under the UK's ratification process, both houses of Parliament must pass the treaty.

The Queen then gives Royal Assent, and signs goatskin "instruments of ratification" along with the Foreign Secretary.

Amid fears that the Abkhazia conflict will escalate into war, German Foreign Minister Frank-Walter Steinmeier is to mediate this week, beginning a diplomatic swing Thursday, July 17, in the Georgian capital Tbilisi.

Steinmeier would then travel to Sukhumi, the chief town of the Moscow-backed breakaway Georgian region of Abkhazia, and on to Moscow to meet Russian Foreign Minister Sergei Lavrov, according to Foreign Ministry Deputy Spokesman Andreas Peschke on Wednesday.

The German delegation would meet with the de-facto president of the breakaway region, Sergei Bagapsh, in Sukhumi, which is a port city on the Black Sea.

"The goal of the trip is to find with all the affected parties ways out of the logic of escalation, out of this spiral of constantly escalating incidents. It is about building trust and creating the specific conditions for a solution that will be acceptable for all," said Peschke.

Steinmeier would try to build trust and explore a solution acceptable to all parties. In Tbilisi, he would meet with President Mikheil Saakashvili and the Georgian opposition.

"We've been in close and regular contact with all parties," said the

The French state and a private Franco-German foundation on Thursday signed an agreement paving the way for compensation payments to some 5,800 surviving World War II forced-labor victims from the Alsace-Lorraine region.

A convention was signed by French Minister of State for War Veterans Jean-Marie Bockel and the Foundation for German-French Understanding in Strasbourg on Thursday, July 17. It creates a fund of 4.6 million euros ($2.9 million) from which the compensation payments will be made.

  

Beneficiaries are to be those survivors from the Alsace-Lorraine region who were forced to work for the Nazi German wartime authorities during the Second World War. The fund will be financed in equal shares by the French state and the foundation.

 

The compensation would amount to about 800 euros per surviving victim. Most of the survivors today are women over the age of 80.

The European Union is to keep a leading Iranian opposition group on its list of prescribed terrorist organisations.

Diplomats from the member states agreed to maintain the People's Mujahideen Organisation of Iran on its terror list following a request from the French presidency of the EU.

The decision was rubberstamped late Tuesday evening by agriculture ministers meeting in Brussels and comes ahead of fresh international talks with Tehran over its nuclear energy programme.

The People's Mujahideen of Iran flag during a protest outside the Council building in Brussels (Photo: EUobserver.com)

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EU foreign policy chief Javier Solana is to meet with Iran's chief nuclear negotiator, Saeed Jalili, in Geneva on Saturday.

"The Council has decided to maintain those persons, groups and entities on the list," the EU said in its Official Journal.

The National Council of Resistance in Iran, an alliance of opponents of the Islamic government whose leading member is the PMOI, also known as the Mujahedeen-e Khalq (MEK), has been lobbying strongly to be removed from the list, claiming it has long since ceased any violent activities and is now committed to peaceful change.

The price of European emission permits is rising so rapidly that German companies are threatening to leave the country. Thousands of jobs could be lost. And the environment may, in the end, be no better off.

 Numerous German companies would relocate abroad if the EU fully implements its carbon trading scheme. They sat silently through two lectures, but then they couldn't control their anger any longer. The civil servants from the Environment Ministry, the Environment Agency and the German Emissions Trading Authority made it sound easy for industry to take up carbon trading. It was just too much for the managers to tolerate.

"If that's the shape the trading will take, we will simply move our cement operation to Ukraine," a cement factory manager shouted into the lecture hall. "Then there won't be any trading here, nothing will be produced here anymore -- the lights will simply go out here."

The businessmen's anger surprised the emissions-allowance trading experts. They had invited industry representatives to a relaxed forum at the Environment Ministry's office in Bonn. They wanted to present international developments in the carbon trading market. However, the mood in the German business world has soured -- managers no longer have the stomach for academic lectures. The reason is that emissions allowances are already burdening some companies that require a lot of energy for production purposes.

In a response to calls by activist groups and the discovery that leaks found last week might have happened years ago, France has agreed to examine the groundwater near all its nuclear plants. Though the anti-nuclear groups see this as a positive step, they say it still doesn't go far enough.

 Radiation detected near France's Tricastin nuclear plant might be from older nuclear waste on its grounds rather than from the recent mishap. After tests following a uranium leak in France (more...)revealed that the radiation came from another earlier source, France's environment minister has ordered tests of the groundwater in areas surrounding all of France's nuclear power plants.

The leak was first reported last Tuesday at the Tricastin plant in southwestern France. A tank containing a solution with traces of non-enriched uranium was reportedly being cleaned the evening of July 7, and the reservoir collecting it overflowed, allowing 30,000 liters (7,925 gallons) of solution to seep into the ground and two nearby rivers. Local authorities immediately banned using ground or river water for drinking or irrigation as well as swimming or fishing in the waters.

At the time, France's nuclear safety agency (ASN) claimed that the "risk was slight." On Friday, however, while conducting tests on the extent of radioactive exposure resulting from the leak, the Institute for Radioprotection and Nuclear Safety (IRSN) -- which is responsible for safety inspections of France's nuclear facilities -- announced that it had discovered traces of uranium in the water that pre-dated the recent leak.

The French Senate on Thursday gave the green light to reform bills backed by President Nicolas Sarkozy to overhaul the constitution, opening the path for final approval by both houses of parliament.

Senators voted 162 to 125, with the governing parties in favour and the opposition of Socialists, Communists and Greens opposed to the reform package.

The 331 members of the Senate and 577 deputies of the lower-house National Assembly will now meet in Versailles, west of Paris, for a so-called congress opening on Monday.

Sarkozy championed the bill, which is to boost the powers of parliament, set a two-term limit for presidents and allow the head of state to defend his policies before parliament.

BERLIN: With Russia cutting oil deliveries to the Czech Republic, a strategic decision made by Prague in the early 1990s to reduce its energy dependence on Moscow appears to be paying off.

The Czech Republic was the only former communist country in the region to diversify energy sources immediately after the fall of the Soviet Union, and it seemed unfazed this week by the Russian decision to cut oil deliveries by about 40 percent.

"We are managing quite well," said Tomas Bartovsky, spokesman for the Trade and Industry Ministry. "We have alternative sources of supplies."

Russia, without warning, stopped sending up to 7,000 tons of oil a day via the Druzba, or Friendship, pipeline last week. That pipeline is controlled by the Russian state-owned company, Transneft. Russia sends annually about 5.5 million tons of oil via the Druzba pipeline to the Czech Republic.

MADRID: A Spanish court cleared four men and upheld the acquittal of a fifth on Thursday in convoluted legal proceedings relating to the 2004 Madrid commuter train bombings that killed 191 people, the deadliest attack by Islamic militants on European soil.

The rulings related to appeals of some of the 21 convictions decided by a lower court in October. Seven people were acquitted then.

On Thursday, the court upheld the acquittal of Rabei Osman, an Egyptian who was found guilty in 2006 in Italy of belonging to a terrorist organization and who is accused of having been a mastermind of the bombing.

With many convictions upheld and few channels of appeal left available to those sentenced, some survivors of the bombings said that they saw Thursday's decisions as moving toward the end of one of the most painful episodes in Spain's recent history.

FRANCE has taken a united stand against the burka and the veil with a leading Muslim minister in Nicolas Sarkozy's Government condemning head-to-toe Islamic dress as "a prison and a straitjacket".

Following a landmark appeal court ruling denying French citizenship to a Moroccan woman who wore a burka at the behest of her French husband, Urban Affairs Minister Fadela Amara said all Islamic coverings for women, including the popular head and shoulder veil or hijab were "symbols of oppression".

"The burka is a prison; it's a straitjacket," she told Le Parisien.

"It is not a religious insignia but the insignia of a totalitarian political project that advocates inequality between the sexes and which is totally devoid of democracy."

The words burka and niqab are used interchangeably in France, although burka normally refers to the head-to-toe covering including a screen over the eyes that is popular in parts of Afghanistan. The niqab generally leaves a small slit for the eyes.

Ms Amara did not stop with her denunciation of the most extreme forms of Islamic dress for women and their incompatibility with French values such as secularism, democracy and sexual equality.

"The veil and the burka are the same thing. The only difference is a few centimetres of fabric," she said. "We have to fight against this obscurantist practice which endangers equality between men and women."

At the time Berlusconi banner company Mediaset was under investigation for fiscal evasion on the order of 80 to 100 million euro. The case was linked to the All Iberian scandal, that, too, resolved with providential ad personam laws. Investigators accused Berlusconi of using two off-shore companies as a go-between to artificially inflate the price of film and TV rights purchased in the US before being "resold" to Mediaset. Berlusconi paid eventually a few thousand euro to block the case along with a large number of Italians eager to close their far more petty fiscal controversies with the state.

The Court has condemned Italy on the grounds that it violates the principal of equality among all European taxpayers. The Court now has an upcoming hearing for fiscal year 2003.

While on the subject, Berlusconi will hold a cabinet meeting tomorrow in Naples in which he will triumphantly announce that he has solved the garbage problem. The garbage will not be in view. It is now stockpiled outside the city limits under military control- quite often on property belonging to the Vatican. Rental costs have not been disclosed.

The Economist is once again criticizing Berlusconi- or rather, just stating plain facts with a good deal of understatement. At least when it writes about Italy the Economist doesn't wear halters.

International agreements on climate change, food security and energy use could drift beyond reach if next week's Geneva talks on liberalising world trade collapse, Peter Mandelson, the European Union's chief trade negotiator, warned on Thursday.

"The chances for a breakthrough are improving, but that breakthrough is not yet in the bag," said Mr Mandelson.

"If collectively we fail this test in Geneva, it will reduce our ability to pass future tests on climate change, food security, energy security and other issues."

A Doha deal was important, he said, because "the global economy faces a barrage of problems... It would bring fresh confidence to a world economy that is certainly in need of it".

The government is considering re-writing its own rules on how much it can borrow in order to counter the effects of the economic slowdown.

The new framework, which will probably be announced in the Autumn pre-Budget statement, would permit more borrowing as an alternative to increasing taxes.

BBC News Link

Life should consist in at least fifty percent pure waste of time, and the rest doing what you please.

EUOBSERVER / INTERVIEW - Power is notoriously difficult to locate, quantify and date. It cannot so easily be measured as GDP or milk production or barrels of oil that remain under the ground or the effect on an economy due to sick-days taken the fortnight after an new edition of Grand Theft Auto is released.

Both US companies and the Bush Administration lead an 'unprecedented' lobbying campaign to hold back the tide of EU regulation

Historians brawl over the precise causes and date of the collapse of civilisations' empires. Did Suez deliver the definitive coup de grace to the British Empire, or should we avoid such exactness and rather talk more generally of the empire's near-bankruptcy at the end of the Second World War? Do we date the fall of the Roman Empire as 476, when Romulus Augustulus was deposed by Odoacer? Or as 395 - upon the death of Theodosius I - the last point at which the empire was politically unified? Or do we yet wait a decided few centuries later for the Fall of Constantinople in 1453 to hold funeral rites?

Mark Schapiro - an American investigative journalist of some twenty years' standing and the editorial director of the Center for Investigative Journalism - believes however that we can date the eclipse of the United States by the European Union quite precisely indeed - 25 June, 2004.

On that day, some 200 million Europeans went to the polls to elect their representatives to the European Parliament, consolidating the union's ascendancy. Europe's parliament leap-frogged the US Congress in size of population represented, with an additional two member states, Romania and Bulgaria, boosting the numbers still further to almost half a billion people in 2007. Even more critically, in 2005, the GDP of the EU overtook that of the States.

Airlines across Europe are flying planes with known defects because pilots routinely fail to report faults when they find them, an investigation has revealed.

A survey of aircraft maintenance engineers, whose work covered flights to and from the UK, found many pilots only reported faults such as brake fluid leaks and loss of cabin pressure after their homebound flight or after the day's flights. The delay allowed airlines to fix faults at a more convenient time, avoiding extra expense.

On average, 80 to 90 per cent of faults were reported after a pilot had made a homebound flight or after the end of the day's flying schedule. The same picture emerged across major and budget airlines.

Engineers say a fault needing attention occurs in about one in every 20 flights. Planes can fly with certain faults but the extra precautions needed to ensure that they can travel safely cannot be taken if the concerns go unreported.

Why are we asking this now?

The German leader is dominating the European political landscape at the moment, with her meeting with Barack Obama in Berlin next Thursday being billed as the Democrat candidate's most important stop over in Europe. Echoing President John F Kennedy, Mr Obama intends to use the city as a backdrop to spell out his vision for a renewal of the US-European relationship.

And in brokering this week's landmark prisoner exchange between Israel and Hizbollah, Mrs Merkel's government has once again proved itself as the driving force behind a solution to one of the world's most intractable political problems.

How has Germany taken up such an important role in the Middle East?

German secret service agents played a central role in negotiating the last two major prisoner swaps, in 1996 and 2004. Unlike most other nations involved in attempts to resolve the Middle East crisis, Germany is nowadays renowned throughout the region as an "honest broker". In Washington, Germany was described as the most important participant in this week's prisoner-swap negotiations.

In what other ways can Mrs Merkel be consid

The United States of America is becoming less united by the day. A 30-year gap now exists in the average life expectancy between Mississippi, in the Deep South, and Connecticut, in prosperous New England. Huge disparities have also opened up in income, health and education depending on where people live in the US, according to a report published yesterday.

The American Human Development Index has applied to the US an aid agency approach to measuring well-being - more familiar to observers of the Third World - with shocking results. The US finds itself ranked 42nd in global life expectancy and 34th in survival of infants to age. Suicide and murder are among the top 15 causes of death and although the US is home to just 5 per cent of the global population it accounts for 24 per cent of the world's prisoners.

Despite an almost cult-like devotion to the belief that unfettered free enterprise is the best way to lift Americans out of poverty, the report points to a rigged system that does little to lessen inequalities.

"The report shows that although America is one of the richest nations in the world, it is woefully behind when it comes to providing opportunity and choices to all Americans to build a better life," the authors said.

Yesterday was the last day of the 2006 Lebanon war, the final chapter of Israel's folly and Hizbollah's hubris, a grisly day of corpse-swapping and refrigerated body parts and coffin after bleak wooden coffin on trucks crossing the Israeli border, which left old Ali Ahmed al-Sfeir and his wife, Wahde, stooped and broken with grief. Ali had a grizzled grey beard and stood propped on a stick while Wahde held a grey-tinged photograph of a young man - her son Ahmed, born in 1970. "He was a martyr, but I do not know which lorry he will be on," she said. In the slightly torn picture, he looked whey-faced, unsmiling, already dead.

That could not be said for Samir Kuntar - 28 years in an Israeli jail for the 1979 murder of an Israeli, his young daughter and a policeman. He arrived from Israel very much alive, clean shaven but sporting a neat moustache, overawed by the hundreds of Hizbollah supporters, a man used to solitary confinement who suddenly found himself idolised by a people he had not seen in almost three decades. His eyes moved around him, the eyes of a prisoner watching for trouble. He was Israel's longest-held Lebanese prisoner; Hizbollah's leader, Sayed Hassan Nasrallah, had promised his release. And he had kept his word.

The coffins - newly hammered together in Tyre before the 200 Hizbollah, Amal militia and Palestinian bodies arrived from Israel - were soon bathed in the Lebanese flag and golden Hizbollah banners, drawn by a flower-encrusted truck towards Beirut. Wahde climbed on to a plastic chair, desperate to see the box containing her son's skeleton. Old Ali pleaded to stand with her but she told him he was too old, so he stood, head bowed, amid the television reporters and young Hizbollah fighters, with tears in his eyes. Who knows if Ahmed was in one of the boxes?

As the International Criminal Court seeks an arrest warrant against the president of Sudan, the Rome Statute, the foundation treaty for the ICC, turns ten years old.

It took two years of fierce wrangling, but on July 17, 1998, the Rome Statute was signed, establishing the functions, jurisdiction and structure of the Hague-based International Criminal Court (ICC), which came into existence four years later.

 

"Rome should provide a signal that crimes such as genocide, crimes against humanity, war crimes and crimes of aggression will in the future no longer go unpunished," said the head of the German delegation in Rome, Gerd Westdickenberg.

 

The fundamental idea that emerged from the Rome conference was that every country should pass laws that would require even high-ranking politicians and military officials to answer charges of human rights abuses before a court.

 

Has he really got no idea what he's saying?...

Merrill Lynch on Thursday said it lost $4.6bn in the second quarter following $9.4bn in credit-related write-downs. The performance, which trailed analyst expectations, brings Merrill's losses for the last four quarters to about $18bn and has left the battered investment bank scrambling to sell assets to raise capital.

Merrill shares dropped 8 per cent in after-hours trade to $28.06 and Moody's downgraded the bank's senior long-tern debt one notch to A2 from A1.

The bank confirmed it would sell its 20 per cent stake in Bloomberg back to the financial news and data provider for $4.425bn and make other asset sales worth about another $4bn. Merrill failed to reach a deal to sell all or part of its 49 per cent stake in Blackrock, the asset management group.

Investors upset over falling Pakistan share prices smashed windows of the Karachi Stock Exchange on Thursday during a day of protests that led to scuffles between traders and investors demanding the temporary closure of the stock market.

The KSE 100 index dropped by 2.7 per cent to close at 10,212.92 points. The index has plunged 35 per cent from a record high reached on April 21.

Last night a group of large investors and brokers set up an emergency fund to buy shares from small investors, many of whom were at the centre of the violence. The Rp3bn ($43m) fund was mainly aimed at preventing the recurrence of unrest, analysts said.

The slump in investor confidence was accelerated by the weakening rupee, which dropped by 1.3 per cent due to fears of political uncertainty and an economic meltdown during Pakistan's transition to a civilian-led democracy.

Pakistan's current account and fiscal deficits are unsustainable, inflation above 21 per cent is at a three-decade high, and foreign currency reserves have fallen to less than $11bn, more than $5.5bn below the record high reached last October.

Emerging economies must make the fight against inflation their "top priority", the International Monetary Fund said on Thursday as it sharply raised its forecast for price increases in the developing world this year and next.

Many emerging markets had to raise interest rates, cut government deficits and let currencies appreciate more to contain the inflation risk, the IMF said.

The comments came as China announced mixed news on its efforts to combat inflation. Consumer price inflation continued to decline - from 7.7 per cent in May to 7.1 per cent last month - but factory gate inflation rose again from 8.2 to 8.8 per cent.

Beijing said the economy grew 10.1 per cent in the second quarter, down from 10.6 per cent in the first, and it was the fourth successive quarter in which gross domestic product growth slowed. The rate, slightly below analysts' forecasts, was the lowest since the last quarter of 2005.

Simon Johnson, the IMF's outgoing chief economist, told reporters that emerging economies in Asia, in particular, were in danger of falling behind the curve on inflation. Brazil was praised for taking steps to curb price pressures.

The IMF expects inflation to hit 9.1 per cent in the emerging world this year and remain high at 7.4 per cent next year. The fund also marked up its forecast for inflation in the industrialised world, but inflation there would subside more quickly, it said, from 3.4 per cent this year to 2.3 per cent next.

After watching its glamorous female president and the all-powerful farming lobby fight each other to a standstill, Argentina was stunned yesterday by one of the most dramatic political betrayals in living memory.

A crisis which has seen months of protests and threatened to starve the cities as the country's legendary gauchos battled against new taxes on agricultural exports, ended with a crushing Senate defeat for President Cristina Fernandez de Kirchner that left her seven-month-old government severely weakened.

At the end of an 18-hour debate on the new tax bill, the final word came from her closest political ally, Vice-President Julio Cobos, who was close to tears as he cast the deciding vote against his boss. Their dispute centres on plans to raise the tax on soy exports, Argentina's main foreign currency earner, to almost 50 per cent. But it is being seen as a harbinger of the way in which the global food crisis could destabilise governments worldwide.

The real importance of the farmers' victory was clear on the streets outside Congress. Hundreds of government supporters who had gathered to await the outcome of the vote screamed "assassin, assassin" at the building, which was guarded by riot police. In a nearby park, farming supporters who had watched the debate on a big screen chanted: "Argentina, Argentina" as the heads of the four main agricultural organisations embraced.

Condoleezza Rice was George Bush's handmaiden for the war in Iraq but she is now emerging as the best hope for avoiding a military conflict between the United States and Iran.

The Secretary of State, who is one of the few people with the President's ear, has shown the door to Vice-President Dick Cheney's cabal of war-hungry advisers. Ms Rice was able to declare yesterday that the administration's decision to break with past policy proves that there is international unity in opposing Iran's nuclear programme. "The point that we're making is the United States is firmly behind this diplomacy, firmly behind and unified with our allies and hopefully the Iranians will take that message," Ms Rice said.

Mr Bush's decision to send the number three in the State Department, William Burns, to attend talks with Iran in Geneva at the weekend caused howls of outrage that were heard all the way from the State Department's sanctuary of Foggy Bottom to the White House on Pennsylvania Avenue. A parallel initiative to reopen the interest's section of the American embassy in Tehran, which would be the first return of a diplomatic presence on Iranian territory since 1979, has also received a cool response from neo-conservatives.

"This is a complete capitulation on the whole idea of suspending enrichment," said Mr Bush's former UN envoy, John Bolton. "Just when the administration has no more U-turns to pull, it does another."

Levin Calls for Closing Down UBS
By WebCPA staff

  As a Senate subcommittee and the Internal Revenue Service probe the use of Swiss bank accounts as tax havens by UBS, Sen. Carl Levin, D-Mich., has called for revoking the U.S. banking license of UBS.

"I don't think that any bank that goes to the extent that UBS has gone through to avoid doing what their what their agreements with the United States require them to do, should be allowed to continue to do business unless they clean up their act," Levin ... told ABC News.

Levin's Permanent Subcommittee on Investigations held a hearing Thursday on tax haven banks and U.S. tax compliance. The committee has produced a report on its six-month-long investigation.

The investigation examined LGT Bank in Lichtenstein and UBS in Switzerland to expose how tax haven banks are helping U.S. taxpayers evade taxes by urging U.S. clients to open accounts in their offshore jurisdictions, assisting them in structuring those accounts to avoid disclosure to U.S. authorities, and providing financial services in ways that do not alert U.S. authorities to the existence of the foreign accounts.

The IRS has been looking into the possibility of closing tax loopholes that allow clients of foreign banks to avoid the Qualified Intermediary rules for reporting their holdings in the accounts. Banks have been setting up sham transfer companies and foundations to help customers hide their assets.

From the Report: (It is not an honor to be in this one)

                             TAX HAVEN ABUSES:
                   THE ENABLERS, THE TOOLS, AND SECRECY

TABLE OF CONTENTS
TAX HAVEN ABUSES:
THE ENABLERS, THE TOOLS, AND SECRECY
TABLE OF CONTENTS
I. EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
A. Subcommittee Investigation  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
B. Overview of Case Histories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
C. Findings and Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Report Findings  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

1. Control of Offshore Assets  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
   
2. Tax Haven Secrecy  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
   
3. Ascertaining Control and Beneficial Ownership  . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
   
4. Offshore Tax Haven Abuses  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
   
5. Anti-Money Laundering Abuses  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
   
6. Securities Abuses   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
   
7. Stock Option Abuses   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
   
8. Hedge Fund Transfers   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
   

Report Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

1. Presumption of Control  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
   
2. Disclosure of U.S. Stock Holdings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
   
3. Offshore Entities as Affiliates  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
   
4. 1099 Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
   
5. Real Estate and Personal Property  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
   
6. Hedge Fund AML Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
   
7. Stock Option-Annuity Swaps  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
   
8. Sanctions on Uncooperative Tax Havens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
   

II. THE OFFSHORE INDUSTRY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11
III. EDG CASE HISTORY: AN INTERNET-BASED OFFSHORE PROMOTER . . . . . . . . . . . . . . 17
IV. TURPEN-HOLLIDAY CASE HISTORY: A HOW-TO MANUAL . . . . . . . . . . . . . . . . . . . . . . 29
V. GREAVES-NEAL CASE HISTORY: DIVERTING U.S. BUSINESS INCOME OFFSHORE  . . . . 42
VI. ANDERSON CASE HISTORY: HIDING OFFSHORE OWNERSHIP . . . . . . . . . . . . . . . . . .  49
VII. POINT CASE HISTORY: OFFSHORE SECURITIES PORTFOLIO . . . . . . . . . . . . . . . . . .  55

June 9, 2008

WASHINGTON, D.C. -- In 10 of 14 former Soviet republics Gallup surveyed, residents' likelihood to say most or many people in their country are afraid to openly express their political views rose significantly between 2006 and 2007. In seven countries, the proportion responding this way now represents a majority.

The most dramatic increases occurred in Georgia and Lithuania; in each country residents were about twice as likely in 2007 as they were in 2006 to say many or most of their fellow citizens are afraid to express their political views. But substantial increases were also seen in countries where this perception was already common. In Tajikistan and Armenia, for example, the figures rose from about half of residents to about 7 in 10.

Last week UNESCO awarded six housing estates in Berlin the World Heritage seal of approval. Bauhaus Archiv Director Annemarie Jaeggi tells SPIEGEL ONLINE why these examples of modernist architecture are so important.

SPIEGEL ONLINE: Dr. Jaeggi, last week, six Berlin social housing projects were included on UNESCO's world heritage list (more...) -- all of them examples of the kind of modernist architecture not often chosen by UNESCO. Did you expect the honor?

Annemarie Jaeggi: I was delighted. The bid entailed a huge amount of work. Some people have been working on this for 10 years and I had huge concerns because of Dresden (more...). (The city's plans to build a bridge may jeopardize the Elbe Valley's UNESCO Status -- Ed.) There was a fear that UNESCO would say that Germany was not working hard enough and wouldn't deal with any of the bids from Germany.

SPIEGEL ONLINE: The Berlin region already has two sites on the UNESCO list: the palaces and gardens of Postsdam and the Museum Island in the heart of the city. What significance do these new sites have?

Jaeggi: We think it is important that Berlin, the capital of modernist architecture, now has a UNESCO status for modernist buildings. These Berlin estates were something really exceptional in Germany and in Europe.

PARIS: Even if you couldn't be on the Champs-Élysées for Bastille Day on Monday to watch seven parachutists float down in front of President Nicolas Sarkozy, you can still celebrate the greatness of France with a new local tradition.

Eat a hamburger.

Beginning a few years ago but picking up momentum in the past nine months, hamburgers and cheeseburgers have invaded the city. Anywhere tourists are likely to go this summer - in cafés in Saint Germain des Prés, in fashion-world hangouts, even in restaurants run by three-star chefs - they are likely to find a juicy beef patty, almost invariably on a sesame seed bun.

"It has the taste of the forbidden, the illicit - the subversive, even," said Hélène Samuel, a restaurant consultant in Paris. "Eating with your hands, it's pure regression. Naturally, everyone wants it."

It is a startling turnaround in a country where a chef once sued McDonald's for $2.7 million in damages over a poster that suggested he was dreaming of a Big Mac. Hamburgers were everything that French dining is not: informal, messy, fast and foreign.

A German construction company has secured the contract to build the world's third-largest mosque in Algiers, during a two-day visit to the Algerian capital by Chancellor Angela Merkel.

German architects Engel and Zimmermann, together with construction engineers Krebs and Kiefer, are to build the mosque to hold 40,000 faithful over the next four years.

  

Other members of the large business delegation traveling with the chancellor on her first visit to the country expressed confidence that other major deals would soon be signed.

  

Among the contracts under consideration is the delivery of four German-built frigates to the Algerian navy at a cost of some 5 billion euros ($8 billion).

 

Merkel put business interests at the focus of the visit to Algeria, which is the third-largest provider of natural gas to European markets. Mutual trade between Germany and Algeria was running at 1.2 billion euros in 2007.

 

"We can increase this and want to do so," said Merkel, who met President Abdel-Aziz Bouteflika and his ministers on Wednesday.

Trams are enjoying a comeback in France. From Nantes to Marseille, city planners are building new, high-tech streetcar lines as central elements in urban redevelopment. And they haven't forgotten any of the French flair the world has come to love.

It's bright yellow with black stripes -- like some kind of futuristic tiger on rails -- and it runs through Mulhouse at eight-minute intervals like a streak of light. This city in France's Alsace region was once a leader in the industrial revolution, but it is now visibly struggling with structural change. The new tram system has brought it fresh pride and and a new sense of self-confidence.

"We wanted a tram that called attention to itself," says Deputy Mayor Michel Samuel-Weis, "as a symbol of economic vitality, environmental awareness and civic improvement -- transportation as an integrated cultural concept."

FARNBOROUGH, England : Airbus notched another plane order as the trade days of the Farnborough International Airshow wound to a close Thursday, pushing the European plane maker even further ahead of its U.S. rival Boeing in deals done at the event.

Airbus announced that it would sell 10 long-haul A350 XWB aircraft to South American consortium Synergy Aerospace in a deal worth $2.1 billion at catalogue prices.

The order firms up a previous tentative agreement with Synergy Aerospace, the main shareholder in Avianca and SAM airlines in Colombia, Oceanair in Brazil and VIP in Ecuador, that was signed in February.

The deal takes Airbus' total orders so far at the weeklong show outside of London to 251 planes worth $39.1 billion - more than double the value of the orders taken by Chicago-based Boeing, which has booked 152 deals worth $16.8 billion.

A new threat to the fragile marine ecosystems of Antarctica from global warming has been identified, with the discovery that an increasing number of icebergs are tearing up the sea floor and destroying any life in their way.

The shallow habitats of species such as giant sea spiders, Antarctic worms, sea urchins and corals are facing a growing risk from icebergs, research has revealed, with more bergs floating freely in coastal waters as temperatures rise.

While these near-shore ecosystems have always ben pounded by icebergs from time to time, crushing the animals and plants that live there, the strike rate is increasing as a warmer climate shrinks the winter sea ice that would otherwise lock the bergs in, scientists said.

The retreat of coastal glaciers and the collapse of floating ice shelves also mean that more bergs are being calved into the sea, adding to the risk of scouring.

The rock dinosaurs of the 1960s are in line for a spectacular windfall after the EU announced plans yesterday to extend musicians' entitlement to retrospective royalties from 50 to 95 years.

Sir Paul McCartney, Sir Cliff Richard and Roger Daltrey have all campaigned for what the record industry calls "the Beatles extension", which will guarantee most artists royalties covering their entire careers.

The first Beatles recordings will come out of copyright in 2012 and EMI, which owns them, has been a leading campaigner for the change in legislation. Sir Cliff, 67, sees his first hit go out of copyright this year but under the EU proposal he would not lose a penny before his 113th birthday.

Daltrey, lead singer of The Who, has said that thousands of musicians have no pensions and rely on royalties in their old age. For many campaigners, however, the extra income is probably not essential for paying the winter heating bills. Yoko Ono and Barry Gibb were among 4,500 who took out a newspaper advertisement in 2006 calling for 95-year copyright control.

Surely the Guantanamo detention facility is his best memorial, to be renamed the Richard Cheney FunLand Interrogation Centre.

keep to the Fen Causeway

The net result of all of this, it seems, will be the status quo. The best we can hope for is that perhaps we will stop torturing; upon anything even approaching that, we will be expected to celebrate it as a victory, since even "stop torturing potentially innocent humans" is at this point a controversial premise. We will perhaps stop politicizing fragments of government that should never have been politicized, and the result will be to dilute the existing corruption, letting the poisoned buffoonery and incompetent hackery slowly work its way through the system for the next decade. Perhaps we shall stop abusing the very f