When SAP pays a dividend to ordinary shareholders and ADR shareholders, certain tax implications apply. The SAP dividend is subject to a German withholding tax of 26.375% of the gross amount. Under terms of the Convention for the Avoidance of Double Taxation Agreement between the United States and Germany, eligible ADR holders may reclaim 11.375%, thereby reducing their withholding tax to 15%.
ADR holders eligible for the refund must be residents of the United States in accordance with the aforementioned Convention. Contact your broker or tax adviser for more information and any applicable U.S. tax forms.
*A sponsored Level II ADR must comply with the SEC's full registration and reporting requirements. In addition to filing an F-6 registration statement, the issuer is also required to file SEC Form 20-F and comply with the SEC's other disclosure rules, including submission of its annual report, which must be prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS).