This rule can apply where there is a relatively greater amountofindebtedness in the U.S. than offshore, and net interest expense exceeds a specified percentage of adjusted taxable income.
In theory this policy of buying and cancelling some of the debt would reduce Greece's indebtedness, because the market price of its bonds is a fraction of the amount originally borrowed: if the EFSF paid 50m euros for Greek bonds with a face value of 100m euros, and agreed that Greece should have an obligation to replay only the 50m euros, that would reduce Greece's indebtedness by 50m euros.