Armin Hohenadler

Section 17 applies „in the place or absence“ of an existing provision. Section 17 is not a necessary provision to meet a minimum standard and, therefore, courts may reject it in its entirety. However, the minimum BEPS standard for Action 14 requires jurisdictions to provide access to the POP in the event of transfer pricing and to implement the resulting mutual agreements, regardless of whether or not the tax treaty includes a provision dealing with the corresponding adjustments. In this context, a contracting party may reserve the right not to apply Article 17, because, in the absence of an appropriate accommodation provision, it either proceeds (i) to the corresponding correction under Article 17, or (ii) its competent authority endeavours to resolve a transfer pricing case in accordance with the POP definition of its tax treaty. Under Section 3, paragraph 1, „income considered to be a resident`s income by or by an organization considered to be fully or partially transparent for the purposes of a CTA for the purposes of a CTA is considered to be a resident`s income only to the extent that the income of that contractual jurisdiction is considered to be a resident`s income for the taxation by that contractual jurisdiction as the income of a resident of that contractual jurisdiction.“ Section 5 provides three options for conventional courts for methods of eliminating double taxation. Option A provides that the provisions of a CTA which, by other means, would free up income or capital from the property of a resident of a contractual jurisdiction, would not be applicable if the other jurisdiction of the contract applied the provisions of the CTA to exempt that income or capital from tax or limit the rate at which such income or capital may be taxed (conversion clause). Instead, a tax deduction with certain restrictions is allowed. Under Option B, contract courts would not apply the dividend exemption method if these dividends are deductible in the other jurisdiction of the contract. Option C provides that the credit method must be limited to taxable net income. The contract jurisdiction may choose several options that lead to an asymmetrical application of this provision. The treaty court may also decide not to apply Article 5 to one or more of its CtAs. Article 11 – The application of tax treaties limiting the right of a party to tax its own residents Part II of the MLI (Articles 3 to 5) introduces provisions to neutralize certain effects of hybrid association agreements on the basis of the recommendations of the final reports BEPS Action 2 and Action 6 published in October 2015. The provisions relate to hybrid asymmetries related to transparent enterprises, dual-territorial enterprises and the elimination of double taxation.

Not all of these provisions are minimum standards, and conventional courts therefore have the right to choose not to apply these provisions to their ATCs. Technical discussions were also held with the Republic of Ireland, Brazil and South Africa on the opening of negotiations, while Barbados also discussed the possibility of new agreements with Slovakia. Persons who have their residence and residence in Barbados are taxed on foreign income as earned. Double taxation is avoided by foreign tax credits or by an exemption where double taxation (DT) agreements exist. In December 2009, the governments of the Netherlands and Barbados signed a protocol that amends the Convention on the Prevention of Double Taxation, which they share, to end the abuse of tax treaties. The protocol in question amends the agreement to prevent Dutch taxpayers from using the contract to transfer dividends to a third country via the Caribbean territory, tax-free.