The D.C. Circuit Court of Appeals Affirms FERC's Income Tax Allowance Policy for Limited Partnerships
29 May 2007
Mayer Brown Legal Update
29 May 2007 - On May 29, 2007, in ExxonMobil Oil Corp. v. Federal Energy Regulatory Commission, No. 04-1102, the United States Court of Appeals for the District of Columbia Circuit resolved a long-contested issue regarding the Federal Energy Regulatory Commission's (FERC) income tax allowance (ITA) policy for pipelines operating as limited partnerships. In particular, the Court determined that FERC's decision to allow SFPP, L.P. an ITA on all of its partnership interests, to the extent the owners of such interests incurred actual or potential tax liability, was neither arbitrary nor capricious.