Non-Discrimination in European and Tax Treaty Law

I. S. 218Introduction and Scope

A. Context

The development of technology combined with the constant removal of economic boundaries among countries facilitates trade and gives businesses a broad field in which to operate and frequently restructure to optimize profits. When taking their activities to a global scale, multinationals normally seek to minimize the risk of uncertainty and neutralize negative effects that might arise from rules that differ from those in their home countries, especially with respect to political, economic and environmental issues. Nonetheless, besides the great attention given to the negative consequences in the application of different sets of laws, there is also room to benefit from the use of those disparities, particularly when it comes to tax matters. The starting point for such planning tools is the evaluation of aspects such as the form of corporations to be used in the target markets, as well as the proper way of providing their capital once the vehicles are incorporated.

In addition, selecting the proper way to invest capital may be decisive for the return on the investment and depends on in-depth financial and economic analyses as to whether the shareholde...