Subsequent to its letters of 15 July 2004 and 22 July 2005 on the amended thin capitalization rules and their application to loans granted by third parties with a right of recourse against the recipient's shareholder, the German Federal Ministry of Finance continues with its efforts to clarify these rules.
On 20 October 2005, it issued a letter (IV B 7 - S 2742a - 43/05) featuring an authorized standard template for the necessary certificate proving that the third-party loan do…