Reference:
Yeremenok V. V..
Place of effective management criteria
in agreements on avoidance of double taxation:
the history of emergence and interpretation
// Taxes and Taxation. – 2013. – № 4.
– P. 300-314.
DOI: 10.7256/1812-8688.2013.5.8075.
rubric Налогообложение участников внешнеэкономической деятельности
DOI: 10.7256/1812-8688.2013.5.8075
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Review: Within the process of cooperation on tax
matters between states, certain sets of rules which
are aimed at avoiding international double taxation
are developed. The article examines the issue
of forming a model rule set to solve the problem
of double residency for legal persons. Basing
the research on the analysis of international
organization’s documents, the author points out
the main stages of international tax cooperation.
The article provides examples for the model rule
formulas, as well as main arguments and reasons
for them. The author determined that, within the
European economic cooperation, and later in
OECD’s work, the main argument used in solving
the double residency tax collision was the criteria
of place of effective management. The author
examines the main approaches to the definition of
tax residency of legal entities, based on national
Law and practice in Continental Law countries,
as well as Common Law countries. The author
demonstrates various points of view on defining
and interpreting the place of effective management
criteria and draws conclusions about the
validity of using the substance before form approach
in defining tax residency for legal entities
using the place of effective management criteria.
Keywords: Jurisprudence, tax resident, double residency of legal entities, fiscal domicile, primary criterion, place of effective management, place of central management and control, the Vertex doctrine, dominance of substance over form
Contact information: Yeremenok Vladimir Vladimirovich, 119454, Moscow, Prospekt Vernadskogo, 76.
References:
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2. Polezharova L.V. Mezhdunarodnoe dvoynoe nalogooblozhenie: mekhanizm ustraneniya v Rossiyskoy Federatsii. M.: Magistr, 2009.
3. Khummel' R., Kozlov E.Yu. Istoriya mezhdunarodnogo nalogovogo prava // Finansovoe pravo zarubezhnykh stran: Sbornik nauchnykh trudov pod red. d.yu.n., prof. G.P. Tolstopyatenko. Vyp. II. M.: MGIMO, 2001.
4. Arnold B., McIntyre M. International Tax Primer. 2nd edition. The Hague. Kluwer Law International, 2002.
5. Burgstaller E., Haslinger K. Place of Effective Management as Tie-Breaker-Rule – Concept, Developments and Prospects // Intertax, Vol. 32, Issue 8/9, 2004.
6. Couzin R. Corporate Residence and International Taxation. Amsterdam. IBFD, 2002.
7. De Broe L. Corporate Tax Residence in Civil Law Jurisdictions in Residence of Companies under Tax Treaties & EC Law. Edited by Prof. Guglielmo Maisto. Amsterdam. IBFD, 2009.
8. Double Taxation and Tax Evasion Report and Resolutions: Document F.212, League of Nations, February 1925.
9. Draft of a Bilateral Convention for the Prevention of Double Taxation. Document C. 216. M. 85, League of Nations, 12 April 1927.
10. Draft Plurilateral Convention for the Prevention of the Double Taxation of Certain Categories of Income. League of Nations Fiscal Committee, Document C.415.M.171.1931.II.A. 29 May to 6 June 1931.
11. Draft Convention adopted for the Allocation of Business Income between States for the Purposes of Taxation. League of Nations Fiscal Committee, Document C.399.M.204. 1933.II.A. 15-26 June 1933.
12. Draft Convention for the Avoidance of Double Taxation with Respect to Taxes on Income and Capital Among the Member Countries of the O.E.C.D., Council, O.E.C.D. C(63)87 Part I. 6 July 1963.
13. The Elimination of Double Taxation: 1st Report of the Fiscal Committee of the O.E.E.C. 1958.
14. The Elimination of Double Taxation: 2nd Report by the Fiscal Committee of the O.E.E.C. 1959.
15. Fourth Report on the Concept of Fiscal Domicile, Working Party No. 2 of the Fiscal Committee of the O.E.E.C. Denmark – Luxembourg. FC/WP2(57)3. 5 November 1957.
16. Haslinger K. Der Ort der tatsachlichen Geschaftsleitung als Tie-Breaker nach Art 4 Abs 3 OECD-MA und seine in Diskussion befindlichen Reformen in Die Ansassigkeit im Recht der Doppelbesteurungsabkommen. Hrsg. von M. Lang, J. Schuch, C. Staringer. Wien. Linde, 2008.
17. Hinnekens L. Revised OECD-TAG Definition of Place of Effective Management in Treaty Tie-Breaker Rule // Intertax, Vol. 31, Issue 10, 2003.
18. International Tax Handbook in International Manual 120210 – Company residence. HM Revenue & Customs. // [Elektronnyy resurs] – Adres resursa v seti internet: http://www.hmrc.gov.uk/manuals/intmanual/INTM120210.htm (na 16.03.2013).
19. London and Mexico Model Tax Conventions Commentary and Text. League of Nations Fiscal Committee. C.88.M.88.1946.II.A.
20. OECD Glossary of Tax Terms (Residence, Residence Principle of Taxation, Resident) // [Elektronnyy resurs] – Adres resursa v seti internet: http://www.oecd.org/ctp/glossaryoftaxterms.htm#R (na 16.03.2013).
21. OECD Model Tax Convention in Materials on International & EU Tax Law. Vol. 1. Selected and edited by Kees van Raad. International Tax Centre Leiden/IBFD. 2011.
22. Oliver J.D.B. Effective management // British Tax Review. 2001. № 5.
23. Plakhin Y. The Place of Effective Management as a Tie-Breaker Criterion in Dual Residence in Tax Treaty and EC Law. Edited by M. Hofstatter, P. Plansky. Linde Verlag Wien, 2009.
24. Rivier J.M. The Fiscal Residence of Companies. General report. // Cahiers de droit fiscal international. Vol. 72a. International Fiscal Association, 1987.
25. Sasseville J. The Meaning of "Place of Effective Management" in Residence of Companies under Tax Treaties & EC Law. Edited by Prof. Guglielmo Maisto. Amsterdam. IBFD, 2009.
26. Shalhav S. The Evolution of Article 4(3) and Its Impact on the Place of Effective Management Tie Breaker Rule // Intertax, Vol. 32, Issue 10, 2004.
27. Statement of Practice - "Company Residence", SP 1/90. UK Inland Revenue.
28. Substance: Aligning International Tax Planning with Today's Business Realities by Axel Smits, Isabel Verlinden. PWC, 2009.
29. Vogel/Lehner Doppelbesteuerungsabkommen. Kommentar. 5. Auflage. Verlag C.H. Beck Munchen. 2008.
References (transliteration):
1. Nalogovoe pravo: Uchebnik / Pod red. S.G. Pepelyaeva. M.: Yurist', 2004.
2. Polezharova L.V. Mezhdunarodnoe dvoynoe nalogooblozhenie: mekhanizm ustraneniya v Rossiyskoy Federatsii. M.: Magistr, 2009.
3. Khummel' R., Kozlov E.Yu. Istoriya mezhdunarodnogo nalogovogo prava // Finansovoe pravo zarubezhnykh stran: Sbornik nauchnykh trudov pod red. d.yu.n., prof. G.P. Tolstopyatenko. Vyp. II. M.: MGIMO, 2001.
4. Arnold B., McIntyre M. International Tax Primer. 2nd edition. The Hague. Kluwer Law International, 2002.
5. Burgstaller E., Haslinger K. Place of Effective Management as Tie-Breaker-Rule – Concept, Developments and Prospects // Intertax, Vol. 32, Issue 8/9, 2004.
6. Couzin R. Corporate Residence and International Taxation. Amsterdam. IBFD, 2002.
7. De Broe L. Corporate Tax Residence in Civil Law Jurisdictions in Residence of Companies under Tax Treaties & EC Law. Edited by Prof. Guglielmo Maisto. Amsterdam. IBFD, 2009.
8. Double Taxation and Tax Evasion Report and Resolutions: Document F.212, League of Nations, February 1925.
9. Draft of a Bilateral Convention for the Prevention of Double Taxation. Document C. 216. M. 85, League of Nations, 12 April 1927.
10. Draft Plurilateral Convention for the Prevention of the Double Taxation of Certain Categories of Income. League of Nations Fiscal Committee, Document C.415.M.171.1931.II.A. 29 May to 6 June 1931.
11. Draft Convention adopted for the Allocation of Business Income between States for the Purposes of Taxation. League of Nations Fiscal Committee, Document C.399.M.204. 1933.II.A. 15-26 June 1933.
12. Draft Convention for the Avoidance of Double Taxation with Respect to Taxes on Income and Capital Among the Member Countries of the O.E.C.D., Council, O.E.C.D. C(63)87 Part I. 6 July 1963.
13. The Elimination of Double Taxation: 1st Report of the Fiscal Committee of the O.E.E.C. 1958.
14. The Elimination of Double Taxation: 2nd Report by the Fiscal Committee of the O.E.E.C. 1959.
15. Fourth Report on the Concept of Fiscal Domicile, Working Party No. 2 of the Fiscal Committee of the O.E.E.C. Denmark – Luxembourg. FC/WP2(57)3. 5 November 1957.
16. Haslinger K. Der Ort der tatsachlichen Geschaftsleitung als Tie-Breaker nach Art 4 Abs 3 OECD-MA und seine in Diskussion befindlichen Reformen in Die Ansassigkeit im Recht der Doppelbesteurungsabkommen. Hrsg. von M. Lang, J. Schuch, C. Staringer. Wien. Linde, 2008.
17. Hinnekens L. Revised OECD-TAG Definition of Place of Effective Management in Treaty Tie-Breaker Rule // Intertax, Vol. 31, Issue 10, 2003.
18. International Tax Handbook in International Manual 120210 – Company residence. HM Revenue & Customs. // [Elektronnyy resurs] – Adres resursa v seti internet: http://www.hmrc.gov.uk/manuals/intmanual/INTM120210.htm (na 16.03.2013).
19. London and Mexico Model Tax Conventions Commentary and Text. League of Nations Fiscal Committee. C.88.M.88.1946.II.A.
20. OECD Glossary of Tax Terms (Residence, Residence Principle of Taxation, Resident) // [Elektronnyy resurs] – Adres resursa v seti internet: http://www.oecd.org/ctp/glossaryoftaxterms.htm#R (na 16.03.2013).
21. OECD Model Tax Convention in Materials on International & EU Tax Law. Vol. 1. Selected and edited by Kees van Raad. International Tax Centre Leiden/IBFD. 2011.
22. Oliver J.D.B. Effective management // British Tax Review. 2001. № 5.
23. Plakhin Y. The Place of Effective Management as a Tie-Breaker Criterion in Dual Residence in Tax Treaty and EC Law. Edited by M. Hofstatter, P. Plansky. Linde Verlag Wien, 2009.
24. Rivier J.M. The Fiscal Residence of Companies. General report. // Cahiers de droit fiscal international. Vol. 72a. International Fiscal Association, 1987.
25. Sasseville J. The Meaning of "Place of Effective Management" in Residence of Companies under Tax Treaties & EC Law. Edited by Prof. Guglielmo Maisto. Amsterdam. IBFD, 2009.
26. Shalhav S. The Evolution of Article 4(3) and Its Impact on the Place of Effective Management Tie Breaker Rule // Intertax, Vol. 32, Issue 10, 2004.
27. Statement of Practice - "Company Residence", SP 1/90. UK Inland Revenue.
28. Substance: Aligning International Tax Planning with Today's Business Realities by Axel Smits, Isabel Verlinden. PWC, 2009.
29. Vogel/Lehner Doppelbesteuerungsabkommen. Kommentar. 5. Auflage. Verlag C.H. Beck Munchen. 2008.
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