Designing a Legal Regime to Capture Capital Gains Tax on Indirect Tranfers of Mineral and Petroleum Rights

When a local asset (or a right relating to such asset) is sold, a country will generally have jurisdiction to levy a capital gains tax on the sale, both under domestic law and international treaty. This is called taxation of a direct transfer of a local asset. This is, however, more complicated when a company located offshore ultimately owns the local asset. It is even more complicated when the local asset is held by a chain of corporations with some of them located in tax havens