Burford Capital Share Discussion Threads

[bradvert] 17/6/2025 20:23:22

The same 'big beautiful ' Bill that proposes a litigation funding levy also proposes a 35% withholding tax instead of the current 15%,so a Burford move to Delaware or anywhere in US would be a folly.

[liam1om] 17/6/2025 19:18:30

It's a negotiation tactic, go in high and negotiate down. No chance it will be that, if at all.

[time_traveller] 17/6/2025 19:07:18

41% would be absurd - hitting domestic companies harder than foreign tariffs. Looks like a personal vendetta on senator Tillis' part. Sanity will prevail.

[this tea tastes of chicken] 17/6/2025 19:03:59

Delaware is the last place you should unless you like fending off activist judges.

[foetus in your brain] 17/6/2025 17:52:16

It's a total mess. Burford acquired the Petersen case so legally it is hard to say they are third party funders. And a lot of their funding is for portfolios where it's not clear what gain is due from which case. But if I were Burford I'd move the Guernsey company to Delaware

[reddirish] 17/6/2025 17:46:53

Oops. Having sold about 10% of my (very large) holding at over £11, I had bought back in at £9:50. It's probably an overreaction by the market, but that is the way with BUR. So a big hit to my portfolio today, but that's the way of things when one takes big risks on big positions. I continue to hold of course, but will have to find some time away out of the Cretan sun over the next few days to reconsider the investment case with the risk that taxes on BUR profits rise to 25%. But one thing for sure is that the staff will still get their bonuses at the same pre tax percentage....

[greo] 17/6/2025 17:28:36

LTH here. Reading Chapter 50B, I can see how the Bill’s tax may apply to US domiciled litigants using Burford funding (for example Protein cases). But Petersen is governed by Spanish law and, though YPF is being heard in the NY courts, it is Argentinian law that is being applied. Moreover Burford is Guernsey registered. As a non lawyer or accountant, I am struggling to see how Burford would therefore count as engaged in business in the US or receiving income from sources within the US iro Petersen any more so than ETM. Any lawyers out there please?

[liam1om] 17/6/2025 17:04:40

Interesting how the UK market wasn't too fussed with the news. The fall only started to materialise once the US market started coming online after 1pm.

[riverman77] 17/6/2025 17:02:49

Not sure I'd be rushing in here - looks a serious risk of punitive taxes which could decimate the business model.

[djderry] 17/6/2025 16:36:13

Wow,what an afternoon.The portfolio is stuffed to the gills with Burford shares but I had to instruct the brokers to go back in for more.Never expected to get shares at this price again.

[bradvert] 17/6/2025 16:33:03

Are you sure about that?It's incorporated in Guernsey, hence no WHT on the (small) dividends.It doesn't pay much tax anywhere, as a % of bottom line, and there isn't much clarity on it's makeup.Artem Fokin had some interesting comments on the subject on the yavp podcast a couple of years ago.I'm long btw :)

[gettingrichslow] 17/6/2025 16:28:11

Looks like there is a difference in the wording of the proposal in the Senate version and in the House version which will need to be reconciled. Burford have spotted this but nobody else did! Clear as mud therefore.

[liam1om] 17/6/2025 16:21:32

From AI:

Based on the available information and standard international tax principles, Burford Capital pays US tax on the profits it earns from its operations within the United States.

Here’s a breakdown of the key points:

US Operations are Taxable: While Burford Capital Limited, the parent company, is domiciled in Guernsey (which has a 0% standard corporate income tax rate), this does not exempt its US-based activities from US taxation. Income and profits generated by its US subsidiaries are subject to US corporate income tax. The company has significant operations in the US, including offices in New York, Chicago, and Washington, D.C.

Implied by their Own Statement: The fact that Burford issued a statement about the proposed US bill is the strongest evidence. The bill aims to "increase the statutory tax rate on litigation finance transactions." This would be irrelevant to Burford if it did not pay US tax on these types of transactions in the first place. The company is concerned about a potential increase in a tax it is already subject to.



Corporate Structure: Multinational firms like Burford often have a parent company in a low-tax or neutral-tax jurisdiction like Guernsey, with subsidiaries in the countries where they operate. The US-based subsidiaries, such as Burford Capital Investment Management LLC, would be treated as US entities for tax purposes, paying tax on their earnings before any profits are repatriated to the parent company.

Transition to "US Domestic Issuer": As of January 1, 2025, Burford is classified as a "US domestic issuer" for the purposes of SEC reporting because the majority of its shares are now owned by US investors. While this is a securities regulation change, it reflects the company's deep and established presence in the US, further cementing the fact that its US operations are part of the US tax system.

[dagoberia] 17/6/2025 16:13:37

No concrete source, apologies, i asked chat gpt about the bloomberg law article and it came back with that summary, also quoted the 41% proposed tax . It said what i wrote but also that it would apply generally to any profits earned from US litigation. So all quite vague by the looks of it, perfect to shoot down the share price .

[papy02] 17/6/2025 16:13:05

Isn't BUR incorporated in Guernsey?
If so, do they currently pay the same US tax as they would if incorporated in e.g. NY?

[nigelpm] 17/6/2025 16:12:10

Market overreacting as ever.

[time_traveller] 17/6/2025 16:04:53

"foreign litigation funders not currently paying US taxes”
What's the source for that quote? If so, there's not so much to worry about.

[dagoberia] 17/6/2025 16:00:49

It appears this bill is aimed at "foreign litigation funders not currently paying US taxes" , but Burford pays US taxes.. anyway i guess irrelevant as the uncertainty is enough.. tried researching a time frame to expect to get certainty on this, it seems 2 to 4 months (senate committee discussions, party negotiations, floor debate and voting in both chambers)

[time_traveller] 17/6/2025 15:57:13

I don't know what planet senator Tillis is living on, to believe that those sort of profits are generated?! And he wants to make litigation more affordable by putting a huge tax on it! This ain't Saul Goodman - our major case supporting investors on an American exchange who were stolen from, and otherwise had no route to justice.

[donald pond] 17/6/2025 15:57:04

Burford just appears unlucky really. It's not always their fault, but there is always some reason unique to them why the share price doesn't go up. I'm bored of it tbh.

[bradvert] 17/6/2025 15:25:07

41% according to Bloomberg law

[dagoberia] 17/6/2025 11:38:50

So no indication what tax rate they are proposing?

[williamcooper104] 17/6/2025 08:05:07

Oops The senate version of the One Big Beautiful Deficit contains special taxes on litigation finance The House and Senate need to agree a bill between them but they do need to raise taxes generally https://www.investegate.co.uk/announcement/rns/burford-capital-npv-di---bur/statement-re-us-budget-reconciliation-bill/8932482

[this tea tastes of chicken] 10/6/2025 15:47:46

You’ve just described most US Congressmen on both sides of the house.

[planit2] 10/6/2025 08:59:38

Its incredible what Milei has achieved, I would have said it was impossible for Argentina to be in this position 18 months ago when he was elected.


But it's incredible how people always want to vote for free money now, take the money off anyone rich, whilst putting their grandchildren into ever increasing debt.