The Meaning of ‘Associate’: An Analysis of the Outcomes of Commissioner of Taxation v BHP Billiton (2019)

Abstract

This article will discuss the judgment of the recent Australian tax case of Commissioner of Taxation v BHP Billiton Limited (‘BHP’). Specifically, it will discuss how the case affects the meaning of the word ‘associate’ and the phrase ‘sufficiently influenced.’ It will do this by recapping the original Administrative Appeals Tribunal (‘AAT’) case of MWYS v Commissioner of Taxation which formed the basis of the appeal in BHP. It will then discuss the majority and dissenting judgements in the BHP case and how they both interpreted the meaning of ‘associate’ and ‘sufficiently influenced,’ before reconciling the ideas from both judgments, and the original AAT judgement. This paper will then aim to highlight the precedential value of BHP and how BHP may affect other areas of Australian Taxation Law, namely the Controlled Foreign Corporation rules, Thin Capitalisation Rules, and the R&D grant rules.