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TREAS/IRS RIN: 1545-BG11 Publication ID: Fall 2008 
Title: Guidance Regarding Foreign Base Company Sales Income 
Abstract: The proposed regulations provide guidance relating to the manufacturing exception from foreign base company sales income (FBCSI), as defined in section 954(d), with respect to arrangements where the property sold by a controlled foreign corporation (CFC) is manufactured, produced, or constructed pursuant to a contract manufacturing arrangement. These regulations also provide two new manufacturing rules that address a CFC's use of multiple branches that engage in manufacturing, producing, constructing, growing, or extracting activities either with two different items of property or with respect to the same item of property. In addition, these regulations clarify the proper scope and application of the treaty purchasing or selling activities performed by or through a branch or similar establishment as being performed on behalf of the CFC. Finally, the regulations clarify the relationship between the reporting of sales income and "sales activity." These regulations, in general, will affect United States shareholders of controlled foreign corporations. 
Agency: Department of the Treasury(TREAS)  Priority: Substantive, Nonsignificant 
RIN Status: Previously published in the Unified Agenda Agenda Stage of Rulemaking: Final Rule Stage 
Major: No  Unfunded Mandates: Undetermined 
CFR Citation: 26 CFR 6038    26 CFR 0954   
Legal Authority: 26 USC 7805    26 USC 0954   
Legal Deadline:  None
Timetable:
Action Date FR Cite
NPRM  02/28/2008  73 FR 10716   
NPRM Comment Period End  05/28/2008    
Final Action  12/00/2008    
Additional Information: REG-124590-07 Drafting attorney: Ethan A. Atticks (202) 622-3840 Reviewing attorney: Phyllis E. Marcus (202) 622-3840 CC: INTL
Regulatory Flexibility Analysis Required: No  Government Levels Affected: None 
Small Entities Affected: No  Federalism: No 
Included in the Regulatory Plan: No 
RIN Data Printed in the FR: No 
Agency Contact:
Ethan A. Atticks
Senior Technical Reviewer
Department of the Treasury
Internal Revenue Service
1111 Constitution Avenue NW.,
Washington, DC 20224
Phone:202 622-3840
Email: ethan.a.atticks@irscounsel.treas.gov