Tax Treaty Case Law around the Globe 2012
1. Aufl. 2013
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Denmark: Beneficial Owner – Article 10(2) of the Denmark-Luxembourg Income Tax Treaty of 1980
17.1. The case
The only Danish tax treaty case of 2011 is that decided by the Eastern High Court (Østre Landsret) on 20 December 2011. The case, reported as SKM2012.121ØLR, deals with the interpretation of the term “beneficial owner” in relation to article 10(2) of the 1980 Denmark-Luxembourg tax treaty (corresponding to article 10(2) of the OECD Model Convention). The main issue of the case was whether a Danish aktieselskab (public limited company) was liable to pay withholding tax as a result of a dividend payment made to a Luxembourg S.à.r.l. The deciding factor of the case was whether the S.à.r.l could be considered a conduit company, in which case the S.à.r.l. would not be the beneficial owner of the dividend received from the Danish company.
17.2. Facts of the case
17.2.1. Factual background and the legal base
The case began with a decision of the Danish National Tax Tribunal (Landskatteretten) of 3 March 2010. In 2005, an international group of investors acquired a Danish listed public limited company via a number of limited partnerships based in Delaware (United States), Guernsey, Germa...