Introduction

OGEL 3 (2004) is the first issue we bring out together with our new sister service - TDM (Transnational Dispute Management) at www.transnational-dispute-management.com. OGEL will continue to carry an extensive section on transnational dispute management with particular reference to the oil, gas and energy industries, but TDM will develop general materials, not specifically related to oil, gas and energy related intelligence, on the forms, methods, strategies and implications of transnational dispute management: commercial and investment arbitration, mediation, negotiation, including the culture of arbitration, economic analysis and organisational and managerial techniques.

There are two special themes in OGEL 3 (2004): the taxation of oil, gas and energy, and energy, institutional reforms and development in Latin America.

Taxation

First, OGEL 3 (2004) focuses on tax. Taxation of oil, gas and energy has become a very specialised business, with expertise shared between accountants, lawyers and economists in particular. There are international constraints on taxation (WTO - to prevent protectionist preferences; investment treaties - to prevent expropriatory taxation and discrimination; double taxation treaties). There are now a good number of on-going large and complex international arbitrations, most of which deal with very difficult tax questions, usually where the unequal national taxation power gets into conflict with the equal-level contract. The recent Occidental-Ecuador award, for example, had to deal with the question if an exploration and production oil and gas agreement did provide, implicitly or explicitly, with refund of VAT; other ongoing disputes deal with the accounting rules in production-sharing and joint operating agreements, the impact of national tax law on such contracts and their always complex interaction.

The tax treatment of decommissioning of oil and gas facilities (with the costs arising when there is no longer serious income to offset against) is another issue that awaits adjudication and more in-depth professional examination which, at present, is virtually absent. Tax credit issues, eg the decisions of US tax courts in favour of a tax credit for Norwegian and UK additional petroleum income taxes, are only intelligible for the chosen few.

With this special issue, we introduce a discussion of tax measures, both economic, legal and from the accountancy perspective. I would be pleased to receive future contributions on these questions.

Energy, Institutional Reforms and Development in Latin America

In November 2003 specialists from different disciplines met in Mexico City to debate issues related to energy reforms at an international conference sponsored jointly by the National Autonomous University of Mexico (UNAM), the University of Grenoble and the French Ministry of Foreign Affairs.

The conference objective was to debate reforms in the electricity, oil and gas industries from a historical and institutional perspective. Multiple factors have changed the organisation of the energy industries, but not always in the ways foreseen or anticipated. The conference did not consider privatisation and foreign-investor participation as the only alternative to State monopoly in its evaluation of the inadequacies and defects of industrial organisation. Nor did it advocate a return to the integrated public monopoly, considered as a viable solution.

This special feature was edited by Professor Angel de la Vega Navarro (National Autonomous University of Mexico), together with Dr Helder Queiroz Pinto Jr (Federal University of Rio de Janeiro) and Dominique Finon (Senior Research Fellow in Economics of the French National Center of Scientific Research). Speakers at the conference came from Brazil, Uruguay, Venezuela, Argentina, Colombia, France, Great Britain, Switzerland, Algeria and Mexico.

Editor in Chief
Thomas W Wälde
Professor & Jean-Monnet Chair
CEPMLP/Dundee
and Principal, Thomas Wälde & Associates