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Washington - The US government has grappled for more than 30 years with corporate deals known as inversions in which US companies shift their tax domiciles abroad to avoid US taxes.
Fifty-two substantial deals like this have occurred since 1983, about half of them since the 2008 to 2009 credit crisis, according to a Reuters analysis.
Here is a summary of US government efforts to manage them.
Island time
The first inversion in 1983 was followed a year later by two new rules from the US Internal Revenue Service. No more big inversions followed for more than a decade.
In the mid-1990s, the deals resumed, typically with US corporations setting up smaller companies in Bermuda or the Cayman Islands. Many energy and insurance companies did this.
In these inversions, the new island tax haven company would become the parent of the US business, though core operations stayed in the United States.
The name "inversion" came from the idea of turning the company upside down, making the offshore company the head and US operations the body.
Inversions allowed US companies to book foreign profits at low or no taxes abroad, putting them out of the reach of the US Internal Revenue Service (IRS).
By booking the income in a foreign country with a lower tax rate, those profits could quickly be put to use at a lower cost.
Plus, the strategy made other legal tax-avoidance moves easier, such as US earnings stripping. That involves a foreign parent lending to a US unit, which deducts interest payments to make its US income smaller for tax purposes, while the foreign parent books interest income at its home country's lower tax rate.
Treasury responds
The US Treasury Department expressed concern about the deals in 2002. Congress in 2004 adopted Section 7874 of the tax code. It set two tests of whether an inverted company would be treated as foreign or domestic by the US government.
First, if the original US company's investors still held 80% or more of the new foreign parent's shares, the new parent would be treated as a US company, not a foreign one.
Second, the same treatment would apply if the new, foreign parent had no "substantial business activities" in its home country. This specifically targeted island tax-haven holding companies that were often little more than a post office box.
After these rules were adopted, the deals dried up again.
Next wave
Another wave started in 2008, but this time, the deals had changed. Most no longer targeted island havens. Instead, new foreign parents for inversions were being acquired in buyouts and mergers in Canada, Ireland, Britain and the Netherlands.
Also, deals were being structured to take advantage of a part of the law that said if the original US shareholders owned from 60% to 80% of the new, foreign parent, it would be treated as a foreign entity, but with some restrictions.
The IRS issued new rules, but they were repeatedly revised.
Obama's proposals
By 2010, large US businesses were pursuing inversions. President Barack Obama asked Congress to act on proposals from the White House to curb the deals.
Over the past four years, Obama has annually called for one or more of the following changes. One is to make inversions harder to do by scrapping the 60% to 80% test and changing the 80% original investors' test to 50%.
The president has urged a "substantial business activities" test that would deny foreign company status where operations are still primarily located in the United States and US-managed. He has called for extending inversion limits to partnerships.
Finally, Obama has repeatedly urged fighting US earnings stripping by tightening the limits on deductibility of interest paid by inverted US companies on inter-company debt.
While several bills have been filed by Democratic lawmakers, Congress has taken no action on inversions in many years.
