INFORMATION MEMORANDUM DATED 9 JULY 2009 ...

They will be subject to NRIT (as described above). If the entity is resident in a
country with which Spain has entered into a double tax treaty, the provisions of such
treaty will apply. In general, double tax treaties provide for the taxation of this type of
income in the country of residence of the beneficiary.
4. Disclosure of Beneficial Owner Information in Connection with Payments
Law 4/2008, of 23 December abolishing the Wealth Tax levy, generalising the Value Added
Tax monthly refund system and introducing other amendments to the tax legal system ("Law
4/2008") was published in the Spanish Official Gazette on 25 December 2008. Law 4/2008
amends, among other things, Additional Provision Two of Law 13/1985, which was the source
of the obligation on Spanish issuers or their parent companies to report to the Spanish tax
authorities on the identity and residence of holders of their debt securities. This reporting
obligation was typically satisfied, in part, by the collection of certain information from
investors at the time of each payment of interest or principal. Spanish issuers, Euroclear and
Clearstream, Luxembourg (among others) developed certain procedures to enable the timely
delivery of such information. Law 4/2008 removes the obligation on Spanish issuers or their
parent companies to provide to the Spanish tax authorities the relevant information concerning
Beneficial Owners who are not resident in Spain. The amended wording of Additional
Provision Two of Law 13/1985, therefore, continues to apply the reporting obligation only in
respect of Spanish resident holders (individual and corporate) and non-resident holders
operating through a permanent establishment in Spain.
The implementation of the changes contemplated by Law 4/2008 is subject to the adoption of
relevant secondary legislation. At the date of this Information Memorandum, such secondary
legislation had not yet been adopted and therefore, as described under "Taxation — Taxation in
Spain — Individual and Legal Entities with no Tax Residence in Spain", interest and other
financial income paid with respect to the Notes for the benefit of non-Spanish resident investors
not acting, with respect to the Notes, through a permanent establishment in Spain will not be
subject to Spanish withholding tax unless such non-Spanish resident investor does not comply
with the relevant information procedures, as described in detail in Appendix 1 to this
Information Memorandum.
The information obligations to be complied with in order for the exemption to apply are those
laid down in Section 44 of the Spanish Royal Decree 1065/2007 ("Section 44"), being the
following:
In accordance with sub-section 1 of Section 44, an annual return must be filed with the Spanish
tax authorities by the Issuer, specifying the following information with respect to the Notes:
(a)
(b)
(c)
the identity and country of residence of the recipient of the income on the Notes
(when the income is received on behalf of a third party (for example, a Beneficial
Owner), the identity and country of residence of that third party);
the amount of income received; and
details identifying the Notes.
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