June 1, 2010
Over the past several months, parties have been seeking to resolve a number of tax issues that have arisen during Nortel’s CCAA proceedings, which has led to a dialogue with the Canada Revenue Agency (the “CRA”). The CRA has been provided with written submissions on three tax issues, including issues that involve foreign service earnings, Pension Adjustment Reversals (“PAR”) and tax on cash payments of the commuted value of registered pensions. The CRA is now actively studying these issues and we expect a reply in the coming weeks. While the CRA continues to express a willingness to consider potential solutions, we cannot provide you with further information until such time as the CRA completes its analysis and provides us with its position. We will advise on these issues as soon as possible.