Sign up for tax alert emails GTNU homepage Tax newsroom Email document Print document Download document | |||
April 11, 2019 Japan and The Netherlands submit instruments of ratification for MLI Executive summaryBased on the reservations and notifications submitted to the OECD1 by Japan and the Netherlands, through their instruments ratification, on 26 September 2018 and 29 March 2019, respectively, the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the MLI) will apply to the Japan-Netherlands tax treaty. The tax treaty with the Netherlands will be the 12th tax treaty for Japan to which the MLI will apply.2 Detailed discussionBackgroundOn 7 June 2017, Japan signed the MLI.3 On 26 September 2018, Japan deposited its instrument of ratification of the MLI with the OECD, and submitted its MLI positions and a list of 39 income tax treaties which Japan entered into with other jurisdictions that it wishes to designate as Covered Tax Agreements (CTAs), i.e., tax treaties to be amended through the MLI, including the Japan-Netherlands Income Tax Treaty (the Treaty). On 29 March 2019, the Netherlands deposited its instrument of ratification of the MLI with the OECD, and submitted its MLI positions. The provisions of the MLI that apply to the Treaty include:
Entry into force and effectThe MLI will enter into force on 1 January 2019 for Japan and on 1 July 2019 for the Netherlands. The provisions of the MLI will have effect with respect to:
Article 16 (Mutual Agreement Procedure) will have effect with respect to the Treaty for a case presented to the competent authority of Japan or the Netherlands on or after 1 July 2019, except for cases that were not eligible to be presented as of that date under the Treaty prior to its modification by the MLI, without regard to the taxable period to which the case relates. Endnotes 1. Organisation for Economic Co-operation and Development. 2. The other 11 tax treaties are the Japanese tax treaties with Australia, Finland, France, Ireland, Israel, New Zealand, Poland, Singapore, Slovakia, Sweden and the United Kingdom. 3. See EY Global Tax Alert, Japan passes bill on multilateral instrument, dated 6 June 2018. For additional information with respect to this Alert, please contact the following: Ernst & Young Tax Co., Tokyo
Ernst & Young LLP (United States), Japan Tax Desk, New York
Ernst & Young LLP (United States), Asia Pacific Business Group, New York
ATTACHMENT | |||