SIFMA provides comments to the U.S. Department of Treasury and the Internal Revenue Service (IRS) on proposed regulations issued under Section 871(m) of the Internal Revenue Code (the Code), Internal Revenue Bulletin 2012-11, REG-120282-10.  Section 871(m) of the Code was enacted in response to the perception that foreign investors were avoiding U.S. withholding tax on dividends they earned in respect of their ownership of U.S. equities by taking the position, as a matter of form, that they had disposed of their U.S. equities and were instead taking long positions in equity swaps.  Given SIFMA’s unique position not only as counterparties to equity swaps and other equity derivatives, but also as the agents primarily vested with the obligation to implement any regime for withholding on financial income derived by foreign persons, SIFMA feels it is uniquely qualified to offer both meaningful insights and practical advice in connection with the proposed regulations.