Dutch withholding tax regime could violate EU regulations
Certain aspects of the Dutch withholding tax regime are violating EU law, concluded the Dutch court of appeal of ‘s Hertogenbosch. The case in question was an appeal of a Finnish investment fund that was unable to get a refund of withholding taxes that, according to the EU Treaty of Functioning of the European Union article 63 on the free movement of capital, the investment fund should not need to pay.
The defense asserted that their case was comparable to native Dutch tax exempt legal entities that are entitled to a refund of withholding tax. Being a foreign entity, the Finnish fund could not obtain such refund. This discrimination was seen as a violation on the free movement of capital.
Initially losing in the lower court, the fund was proven right in the court of appeal, although the case is likely to go further up. The Dutch ministry of finance will pursue an appeal with the Supreme Court, and if that proves unsatisfying, probably ask for a ruling from the European Court of Justice.
Should the Finnish investment fund prevail, it could see thousands of similar funds from Luxembourg, Liechtenstein, Austria and other EU member states claim refunds to a total value of approximately 1 billion Euro. The stakes are high in a case that we will follow with great interest.
Freemont Group receives Mondaq Award
The Freemont Group has been awarded the Mondaq Award, proving that our articles and newsletters not only inform our clients on current events, but are just as much appreciated by other financial professionals. Mondaq is one of the most comprehensive electronic resources of professionals’ knowledge and expertise providing legal, regulatory and financial commentary and information supplied directly by hundreds of the world’s leading professional advisors, covering over 80 countries.
As a “Contributor With Most Popular Article In United Arab Emirates”, the Freemont Group received this credit in February. Our efforts in popularizing the UAE as a tax haven have clearly not gone unnoticed. The Freemont Group has been involved in shaping the legal framework for Ras al Khaimah offshore companies and we were amongst the first companies to offer these to the general public. Our focus has been shifting more and more to the UAE because of their ability to reinvent themselves as a country and as a great place for doing business.
Last week we were present at the Intax-Expo in Ras Al Khaimah, attended by almost 300 financial professionals.
The success of this event underlines the value of Ras al Khaimah and the UAE as a 21st century tax haven. Do not hesitate to inquire about the benefits of the UAE for your business.
The Western exodus
The retiring baby boom generation and the economic recession in the Western world give rise to a significant population shift. Never before, or in case of Europe not since World War II, there are so many people leaving the Western world for the developing world.
Portugal has seen an exodus of over 500.000 people in the last 5 years, 150.000 of them left in 2011. Over 40.000 Irish left their home country last year. Unsurprisingly, Greeks are leaving their country in droves too. Greece’s immigrant workforce, mainly from Eastern Europe, has returned home. On the other side of the ocean, in the United States 10.000 baby boomers are retiring every day. Many of those choose to retire abroad, with Latin America topping the list.
Though numbers are hard to estimate, booming real estate markets and flourishing economies in other regions of the world speak for themselves. The African continent is booming, averaging 5.3% growth for 2012. The evidence can be found everywhere, from high-speed trains in Morocco, state of the art business centers in Uganda, to skyscrapers in Angola and shopping malls in Mozambique.
South and Central America is thriving too averaging 4.2% growth in 2011 and expected to grow 3.5% in 2012. Regional top performers are Panama (10.6%), Argentina (8%) and Chile (6.5%).
South East Asia, though initially affected by the banking crisis in the Western world, appears to have recovered and is showing growth again. Many of Asia´s poorer countries are showing impressive growth numbers, and most of its developing economies show no sign of fatigue. China boosted 9.2% growth in 2011, India 7.8% and Indonesia 6.4%. With the exception of Japan, pretty much all Asian nations demonstrate respectable growth numbers.
Going through a list of last years’ economic growth ranking, it appears that only the US and Europe are in a recession, while the remainder of the world has recovered. The Western exodus makes perfect sense. When Europe lay in shambles after WW II, people migrated mainly to the economic power house of the day, the United States. Today, it´s everywhere but Europe and the US.
The drums of war are sounding in the United States and Israel, with Iran being the target. War is a costly thing, and a war with Iran could, apart from the human death toll, severely disrupt oil supplies. With a coastline of almost 1400 km, a population of 75 million and a well trained and modern army Iran has the capabilities of preventing oil tankers leaving the Persian Gulf for months if not years. This would increase the price of oil by an estimated 50% overnight, plunging the Europe and the United States into more economic troubles.
Clearly anybody with an interest in maintaining their wealth should have an interest in supporting peaceful solutions. But history tends to repeat itself and propaganda from mainstream media has a powerful effect on people.