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«Carrera Capital Finance Limited (incorporated with limited liability in Jersey) and Carrera Capital Finance LLC (organized with limited liability in ...»

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The matters described herein and the associated tax strategies are not confidential, proprietary or exclusive. Notwithstanding anything to the contrary herein, there is no limitation on the disclosure by any recipient of this Base Prospectus or any Final Terms of the tax treatment or tax structure of any transaction described herein.

The following summary describes the principal U.S. federal income tax consequences of the purchase, ownership and disposition of the Senior Notes, Senior Subordinated Notes and Capital Notes by U.S.

Holders (as defined below). This summary does not purport to be a comprehensive description of all the tax considerations that may be relevant to a particular investor's decision to purchase the Notes.

For example, the specific U.S. federal income tax considerations for financial institutions, regulated investment companies, entities that are treated as partnerships or trusts for U.S. federal income tax purposes or partners or beneficiaries thereof, dealers in securities or currencies, traders in securities, life insurance companies, tax exempt entities, and U.S. expatriates are not discussed here. In addition, this summary does not describe any tax consequences arising under the laws of any state, locality or taxing jurisdiction other than the U.S. federal income tax laws. In general, the summary assumes that a U.S. Holder holds a Note as a capital asset and not as part of a hedge, straddle, or conversion transaction within the meaning of Section 1258 of the U.S. Internal Revenue Code of 1986, as amended (the "Code"), and has as its "functional currency" the U.S. dollar.

The U.S. federal income tax considerations applicable to the purchase, ownership and disposition of Index-Linked Interest Notes and Dual Currency Notes, and any other special U.S. federal income tax considerations applicable to any issuance of Notes offered hereunder, will be described in the Final Terms relating thereto.

This summary is based on the Code, regulations (final, temporary and proposed), administrative rulings and practice and judicial decisions in effect or available on the date of this Base Prospectus.

All of the foregoing are subject to change or differing interpretation at any time, which change or interpretation may apply retroactively and could affect the continued validity of this summary.

This summary is included herein for general information only. There can be no assurance that the U.S.

Internal Revenue Service (the "IRS") will agree that the U.S. federal income tax consequences of an investment in the Notes are as described herein. ACCORDINGLY, PROSPECTIVE





As used in this section, the term "U.S. Holder" means a beneficial owner of a Note that, for U.S.

federal income tax purposes, is or is treated as a citizen or individual resident alien of the United States of America, an entity taxed as a corporation, created or organized in or under the laws of the United States of America, any State thereof, or the District of Columbia, an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source, or a trust if a court within the United States of America is able to exercise primary supervision over its administration and one or more U.S. persons have the authority to control all substantial decisions of such trust or the trust has validly elected to be treated as a United States person for U.S. federal tax purposes.

U.S. Tax Treatment of the Issuer The Issuer will be treated as a foreign corporation for U.S. federal income tax purposes, and it will make no elections to the contrary.

Under Section 881 of the Code, a non-U.S. corporation that does not conduct a trade or business in the United States is nonetheless subject to tax at a flat rate of 30% (or, if applicable, a lower tax treaty rate) on the gross amount of certain items of U.S. source income. The flat tax is generally collected through withholding by the payor of the income. Income subject to the flat tax rate is of a fixed or determinable annual or periodic nature, including certain interest income. There is no tax treaty between the U.S. and Jersey.

Certain types of income of a non-U.S. corporation are specifically exempted from the 30% tax and thus withholding is not required on payments of these types of income. The 30% tax does not apply to U.S. source capital gains (whether long-term or short-term) or to interest paid to a non-U.S.

corporation on its deposits with U.S. banks. The 30% tax also does not apply to interest that qualifies as "portfolio interest." The term "portfolio interest" generally includes interest on an obligation in registered form which has been issued after 18 July 1984 and with respect to which the person who would otherwise be required to deduct and withhold the 30% tax receives a statement that the beneficial owner of the obligation is not a United States person and provided that such beneficial owner is not a controlled foreign corporation related to the obligor (within the meaning of the Code) and is not treated as owning (directly or by attribution) 10% or more of the voting equity of the obligor, and the interest is not determined by reference to certain contingencies (for example, the obligor's cash flow, profits or dividends).

The Issuer expects to conduct its affairs such that its income will not be subject directly to material amounts of withholding tax imposed by the United States.

U.S. Tax Treatment of U.S. Holders of Senior Notes and Senior Subordinated Notes U.S. Federal Tax Characterization of the Senior Notes and Senior Subordinated Notes. There are no U.S. Treasury regulations, published rulings or judicial decisions addressing the characterization for U.S. federal tax purposes of securities with terms that are substantially the same as those of the Notes.

The Issuers do not intend to obtain any opinion of counsel as to the characterization of the Notes for U.S. federal tax purposes. The Issuers, nonetheless, intend to treat the Senior Notes and Senior Subordinated Notes (collectively, the "Priority Notes") as debt for U.S. federal tax purposes. The Issuers and each holder of Notes, by the acquisition of a beneficial interest therein, will agree to treat the Priority Notes as debt for U.S. federal tax purposes. No assurance can be given, however, that the IRS will respect this position. If the Priority Notes were not treated as debt for U.S. federal tax purposes, there could potentially be materially adverse consequences to U.S. Holders of the Priority Notes, including the application of the provisions of the Code applicable to the Capital Notes, which provisions are discussed below under the heading "—U.S. Tax Treatment of U.S. Holders of Capital Notes."

The remainder of the discussion under the heading "—U.S. Tax Treatment of U.S. Holders of Senior Notes and Senior Subordinated Notes" assumes that the Priority Notes will be characterized as debt for U.S. federal tax purposes. INVESTORS ARE URGED TO CONSULT THEIR OWN TAX



The following discussion is based in part on the rules governing original issue discount ("OID") that are set forth in Sections 1271 through 1273 and 1275 of the Code and in Treasury regulations issued thereunder (the "OID Regulations"). The OID Regulations, however, do not adequately address certain issues relevant to securities such as the Priority Notes.

Taxation of Interest Income. Stated interest on the Priority Notes that is considered "unconditionally payable" (as described below) will be includible in income by a U.S. Holder when received or accrued in accordance with such holder's method of tax accounting. If interest that is considered unconditionally payable is paid with respect to a Priority Note issued in a Specified Currency other than the U.S. dollar (a "Foreign Currency Note"), the amount of interest income realised by a U.S.

Holder that uses the cash method of tax accounting will be the U.S. dollar value of the Specified Currency payment based on the exchange rate in effect on the date of receipt, regardless of whether the payment in fact is converted into U.S. dollars. A U.S. Holder that uses the accrual method of accounting for tax purposes will accrue stated interest that is considered unconditionally payable on the Priority Note in the relevant Specified Currency and translate the amount accrued into U.S. dollars based on the average exchange rate in effect during the interest accrual period (or portion thereof within the U.S. Holder's taxable year), or, at the accrual basis U.S. Holder's election, at the spot rate of exchange on the last day of the accrual period (or the last day of the U.S. Holder's taxable year within such accrual period if the accrual period spans more than one taxable year), or at the spot rate of exchange on the date of receipt, if such date is within five business days of the last day of the accrual period. A U.S. Holder that makes such election must apply it consistently to all debt instruments from year to year and cannot change the election without the consent of the IRS. A U.S. Holder that uses the accrual method of accounting for tax purposes will recognize foreign currency gain or loss, as the case may be, on the receipt of an interest payment made with respect to a Foreign Currency Note if the exchange rate in effect on the date the payment is received differs from the rate applicable to a previous accrual of that interest income. This foreign currency gain or loss will be treated as ordinary income or loss but generally will not be treated as an adjustment to interest income received on the Foreign Currency Note.

If the "issue price" of any Priority Note is less than the "stated redemption price at maturity" ("SRPM") of such Priority Note, the excess of the SRPM over the issue price may constitute OID.

The "issue price" of a particular issue of Priority Notes will be the first price at which a substantial amount of such Priority Notes is purchased by investors other than bond houses, brokers or similar persons acting in the capacity of underwriters, placement agents or wholesalers. Under a de minimis rule, if the excess of the SRPM of such Priority Note over its issue price is less than one-fourth of one percent of the SRPM of such Priority Note multiplied by the weighted average maturity determined under applicable Treasury regulations, such Priority Note will not be treated as issued with OID. For purposes of determining the weighted average maturity of a Priority Note, the Issuer will be deemed to exercise any Call Option in a manner that minimizes the yield to maturity of the Priority Note, and holders will be deemed to exercise any Put Option in a manner that maximizes the yield to maturity of the Priority Note. If any Priority Notes are in fact issued at a greater than de minimis discount or are otherwise treated as having been issued with OID, the excess of the SRPM of such Priority Notes over their issue price will constitute OID. Under the Code, U.S. Holders of Priority Notes issued with OID would be required to include the daily portions of OID in income as interest over the term of such Priority Notes under a constant yield method that reflects the time value of money, regardless of such U.S. Holder's method of accounting and without regard to the timing of actual payments. For this purpose, the term of the Priority Notes over which OID would be required to be included in a U.S.

Holder's income will be assumed to be the term determined applying the rules with respect to the deemed exercise of Call Options and Puts Options described above.

Treasury regulations provide, for purposes of determining whether a debt instrument is issued with OID, that stated interest must be included in the SRPM of the debt instrument if such interest is not "unconditionally payable." Interest is considered "unconditionally payable if reasonable legal remedies exist to compel timely payment or the terms and conditions of the debt instrument make the likelihood of late payment (other than late payment that occurs within a reasonable grace period) or nonpayment (ignoring the possibility of nonpayment due to default, insolvency or similar circumstances) a remote contingency. In the case of an issue of Priority Notes for which no reasonable legal remedies exist to compel timely payment, the Issuer may nonetheless, pursuant to its interpretation of the foregoing rules and the specific terms and conditions of the particular issue of Priority Notes, take the position that the late payment or nonpayment of interest on any such Priority Notes on any Payment Date is a remote contingency. Thus, the Issuer's position would be that payments of interest on such Priority Notes are considered unconditionally payable, and thus not included in the SRPM of such Priority Notes.

If interest on any Priority Notes is not considered "unconditionally payable" but such Priority Notes are issued at an issue price equal to their principal amount, the Issuer intends to treat such Priority Notes as subject to a special rule for debt instruments issued with OID that nonetheless have a fixed yield. In such event, the Issuer would take the position that, in accordance with such rule, the amount of OID that accrues on such Priority Notes in each accrual period is equal to the amount of stated interest that accrues on such Priority Notes during such period.

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