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Switzerland Lures Bermudan Companies

by Amanda Banks,, London

19 December 2008

Switzerland, with its extensive network of double taxation avoidance treaties and position in the heart of Europe, has succeeded in luring three companies presently domiciled in the fiscally attractive jurisdiction of Bermuda.

Conglomerate Tyco International Limited, global engineering firm Foster Wheeler Ltd and oil drilling firm Weatherford International Ltd all announced their intention last week to register in Switzerland.

Tyco Chairman and Chief Executive Officer Ed Breen said: "After careful consideration of this issue over a number of years, our Board of Directors has concluded that a change of domicile to Switzerland is in the best interests of Tyco and our shareholders. We believe that this move will provide important economic and operational benefits for our company and will help ensure our continued competitiveness in global markets."

Breen added: “Switzerland has a highly stable economic, political and regulatory environment, as well as long-established commercial relationships and tax treaties with the US, and numerous other countries around the world. The company believes the move to Switzerland will enhance its ability to maintain a competitive worldwide corporate tax rate and strengthen its presence in Europe."

On December 10, Foster Wheeler announced that its board of directors had unanimously approved the move of the company from Bermuda to Switzerland.

Foster Wheeler intends to establish an office in Zug, Switzerland, although its operations would continue to be conducted through existing subsidiaries and their branch offices, which are located around the world. The company would also continue to maintain its operational headquarters in Clinton, New Jersey.

Foster Wheeler's Chairman and Chief Executive Officer, Raymond J. Milchovich, said: "Our planned change of our parent company's place of incorporation from Bermuda to Switzerland would establish a corporation that is more centrally located within our area of worldwide operations in a country with a stable and well-developed tax regime and a sophisticated financial and commercial environment."

Foster Wheeler's shareholders will be asked to vote in favour of the proposal at a shareholders meeting expected to be scheduled for January 2009. If approved by shareholders, and subject to the approval of the Supreme Court of Bermuda and satisfaction of certain other conditions described in the company's proxy statement for the meeting of shareholders, Foster Wheeler is targeting completion of the move in the first quarter of 2009.

Weatherford International also announced on December 10 that its board of directors had unanimously approved moving the place of incorporation of the company from Bermuda to Switzerland, although the proposed move similarly remains subject to a vote by the company's shareholders.

Transocean Incorporated, another big offshore driller, received shareholder approval on December 8 to initiate a similar move.

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