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EXHIBIT 8.1
December 1, 2000
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
North Tower--4th Floor
New York, New York 10281
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Europe 2001 HOLDRS/SM/ Trust
Registration Statement on Form S-1
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Ladies and Gentlemen:
We have acted as special Tax Counsel to Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch"), as Initial Depositor, and the Europe 2001
HOLDRS/SM/ Trust in connection with the preparation and filing of a Prospectus
and Registration Statement on Form S-1, as amended from time to time and filed
by the Initial Depositor (the "Registration Statement"), of which the
prospectus forms a part (the "Prospectus"), for the registration under the
Securities Act of 1933, as amended (the "Securities Act"), of 1,000,000,000
Europe 2001 HOLDRS/SM/ (the "HOLDRS/SM/") to be issued by the Trust. Capitalized
terms used herein have the meaning ascribed to them in the Prospectus. The
HOLDRS/SM/ are being issued pursuant to the Depositary Trust Agreement between
the Initial Depositor, The Bank of New York, as trustee (in such capacity, the
"Trustee"), other depositors and owners of HOLDRS/SM/ (the "Trust Agreement").
In connection with the preparation of this opinion, we have examined and
relied on such documents as we have deemed appropriate, including, inter alia,
(i) the Trust Agreement and (ii) the Prospectus. We have made such
investigations of law as we have deemed appropriate as a basis for the opinion
expressed below.
Based on the foregoing, it is our opinion that the Trust will provide for
flow through tax consequences since it will be treated as a grantor trust or
custodial arrangement for United States Federal income tax purposes. Moreover,
the discussion set forth under the caption "Federal Income Tax Consequences" in
the Prospectus represents our opinion of and, subject to the limitations
contained therein, accurately describes, the principal United States Federal
income tax consequences to a holder of HOLDRS/SM/ receipts. The foregoing
opinion is based upon provisions of the Internal Revenue Code of 1986, as
amended, Treasury regulations and administrative and judicial interpretations as
of the date hereof (all of which are subject to change, possibly with
retroactive effect, or different interpretations).
We consent to the use of this opinion as an exhibit to the Registration
Statement and to the reference to our firm under the caption "Legal Matters" in
the Prospectus.
Very truly yours,
/s/ Shearman & Sterling
