House Places Limits on Contracts for Inverted Companies

On Thursday, July 10, 2014, there was a 221-220 vote in the House to amend a spending bill that would begin to curtail the recent trend for companies to reincorporate outside of the U.S. This vote will prevent companies from winning some federal contract, specifically energy and water projects for a period of one year, if the company changes their tax address to Bermuda or the Cayman Islands. Although this action won’t do much to change what companies have already done, it will bring to light the current environment and the imbalance that some federal government contractors may feel against larger foreign organizations that are able to make bolder moves.

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