umraniye escort pendik escort
maderba.com
implant
olabahis
canli poker siteleri meritslot oleybet giris adresi betgaranti
escort antalya
istanbul escort
sirinevler escort
antalya eskort bayan
brazzers
sikis
bodrum escort
Articles

Legal and Tax Alert - Middle East

Legal and Tax Alert - Middle East

Legal and Tax Alert - Middle East

05.03.2012

New Netherlands – Saudi tax treaty provides opportunities for structuring investments into Saudi

The tax treaty between the Netherlands and Saudi Arabia (the "Treaty") has become effective as of 1 January 2011 (click here for more details on the Treaty, Stibbe Tax Alert of 22 October 2008). Since the Treaty contains a unique provision which should generally protect Dutch investors against a 20% Saudi Arabian ("Saudi") capital gains tax levy upon a sale or a transfer of the shares of a SA subsidiary, it can be most beneficial for non-Saudi investors to structure their investments into Saudi Arabia (inbound investments) through a Dutch intermediate company. The attractive and robust tax system and reliable and flexible corporate laws of the Netherlands allow for the efficient structuring of Dutch (holding) companies.

In Saudi Arabia a capital gains tax at the rate of 20% is levied upon the transfer of shares in a Saudi entity by a non-Saudi shareholder. According to the Treaty - which contains a unique provision which is not included in the tax treaties entered into by SA with some 20 other countries - a Dutch entity should be protected against such capital gains tax levy, provided that it beneficially holds at least 10% of the shares of the Saudi entity and the shares are acquired after a date that the Treaty was signed (i.e. after 13 October 2008). Furthermore, under the Treaty in certain reorganisation structures such capital gains tax may be postponed until the date on which the final alienation of investment is made, even in case the interest would be below 10%.

Also the domestic Saudi rate on royalty payments of 15% can generally be reduced to 7% under the Treaty. Income from debt claims and dividend distributions by a Saudi entity to non-Saudi shareholders are subject to a 5% domestic withholding tax in Saudi Arabia, which rate is in principle not further reduced under tax treaties (including the Treaty) entered into by Saudi Arabia.

It can be concluded that the Netherlands with its unique Treaty with Saudi Arabia and its robust and long established position for (joint venture) holding and financing entities, is excellently positioned to be a leading jurisdiction for investments into Saudi Arabia.

Team

Related news

01.04.2021 NL law
Slovak Telekom: ECJ on essentials of the ‘essential facilities’ doctrine

Short Reads - Only dominant companies with a “genuinely tight grip” on the market can be forced to grant rivals access to their infrastructure. According to the ECJ’s rulings in Slovak Telekom and Deutsche Telekom, it is only in this scenario that the question of indispensability of the access for rivals comes into play. In the assessment of practices other than access refusal, indispensability may be indicative of a potential abuse of a dominant position, but is not a required condition.

Read more

01.04.2021 NL law
Collective action stopped due to lack of benefit for class members

Short Reads - On 9 December 2020, the Amsterdam District Court (the “Court”) declared a foundation inadmissible in a collective action regarding alleged manipulation of LIBOR, EURIBOR and other interest rate benchmarks. The foundation sought declaratory judgments that Rabobank, UBS, Lloyds Bank and ICAP (the “defendants”) had engaged in wrongful conduct and unjust enrichment vis-à-vis the class members.

Read more

01.04.2021 NL law
Pay-for-delay saga ends with nothing new; but pharma quest continues

Short Reads - On 25 March 2021, the ECJ ended the Lundbeck pay-for-delay saga by dismissing the appeals from Lundbeck and five generic manufacturers against a European Commission ‘pay-for-delay’ decision. Following its recent Paroxetine judgment, the ECJ found that Lundbeck’s process patents did not preclude generic companies being viewed as potential competitors, particularly since the patents did not represent an insurmountable barrier to entry. In addition, the patent settlement agreements constituted infringements "by object".

Read more

01.04.2021 NL law
ECJ in Pometon: beware of too much info in staggered hybrid proceedings

Short Reads - In hybrid cartel proceedings (in which one party opts out of settlement), settlement decisions should not pre-judge the outcome of the Commission's investigation into non-settling parties. When the Commission publishes the settlement decision before the decision imposing a fine on the non-settling party, it must be careful in its drafting, the European Court of Justice confirmed. Furthermore, differences in the fining methodology applied to (similarly placed) settling and non-settling parties will have to be objectively justified and sufficiently reasoned.

Read more

04.03.2021 NL law
Net(work) closing in on cross-border cartels?

Short Reads - A heads-up for companies with cross-border activities. The ECN+ Directive’s transposition deadline has expired and its provisions should by now have found their way into the national laws of the EU Member States. In the Netherlands, amendments to the Dutch Competition Act giving effect to the ECN+ Directive came into force recently, together with a new governmental decree on leniency.

Read more