On 13 February 2007, the European Commission announced that it had decided that certain company tax regimes in Swiss cantons which exempt foreign-source income of companies established there constitute State aid incompatible with the proper functioning of the 1972 EU-Switzerland Agreement (Agreement between the European Economic Community and the Swiss Confederation of 22 July 1972, "the Agreement"). The Commission asks Switzerland to amend these tax schemes to bring them in line with the terms of the Agreement. Under Swiss law, the Cantons may exempt foreign-source profits from cantonal and municipal corporate income tax and all cantons implemented such exemptions in...