CORPORADOS

7-11 MAKES STARBUCKS LOOK GOOD, DECIDES TO DROP CITCO

REUTERS - A week after Venezuelan President Hugo Chavez called George W.
Bush "the devil," convenience store chain 7-Eleven Inc. said on
Wednesday it will stop selling gasoline from Venezuelan-controlled Citgo
Petroleum, but both companies denied the actions were linked. The
Dallas, Texas-based company said in a statement it disapproved of
Chavez' comments, but a spokeswoman insisted politics were not part of
the decision to end its 20-year agreement with Houston-based Citgo
Petroleum Corp., a position supported by Venezuelan and Citgo officials.
. . The company's decision appeared to represent a broadening of
U.S.-Venezuela tensions, which previously had been little more than a
war of words between Chavez and the Bush administration, but 7-Eleven
spokeswoman Margaret Chabris told Reuters that was not the case.

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2006-09-27T223536Z_01_N27232538_RTRUKOC_0_US-ENERGY-7-ELEVEN-GASOLINE.
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HOW MERCK AVOIDED OVER A BILLION DOLLARS IN FEDERAL TAXES

JESSE DRUCKER, WALL STREET JOURNAL - Merck & Co.'s medications Zocor and
Mevacor have been used by millions of people to help lower their
cholesterol. But Merck also used the drugs to lower something else: its
U.S. tax bill. Thirteen years ago, Merck set up a subsidiary with an
address in tax-friendly Bermuda, in partnership with a British bank.
Merck quietly transferred patents underlying the blockbuster drugs to
the new subsidiary, according to documents and people familiar with the
transaction. Merck then paid the subsidiary for use of the patents.

The arrangement in effect allowed some of the profits to disappear into
a kind of Bermuda triangle between different tax jurisdictions. The
setup helped Merck slash $1.5 billion off its federal tax bills over
roughly the next 10 years.

Now, the complicated transaction -- never publicly disclosed -- has
sparked one of the largest tax disputes ever involving a U.S.
corporation. The Internal Revenue Service is challenging the tax
benefits from the arrangement, which the company code-named "Project
Ryland," after a fancy restaurant near the company's New Jersey
headquarters. Merck anticipates it will be ordered to hand over a total
of $2.3 billion in back taxes, interest and penalties, according to its
filings with the Securities and Exchange Commission, which give the
amounts in dispute but virtually no other details.

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