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Archive 2016


Mr. Alain Steichen
Mrs. Christine Beernaerts

New rules for intra-group financing
30/12/2016

On December 27th 2016, the head of the Luxembourg tax authorities issued circular L.I.R. n° 56/1 – 56bis/1 relating to the tax treatment and more specifically the transfer pricing aspects of companies engaged in intra-group financing transactions (the “Circular”). The Circular was issued further to the introduction in the Luxembourg tax code of a new article which outlines the transfer pricing rules applicable to “controlled transactions” (“Article 56 bis LIR”). The provisions of Article 56 bis LIR are inspired by the OECD Transfer Pricing Guidelines and set out the methodology that must be applied to determine “arm’s length” prices.

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Luxembourg Transfer Pricing Rules Adjusted to a Post-BEPS Environment

Luxembourg Transfer Pricing Rules Adjusted to a Post-BEPS Environment
29/12/2016

On 27 December 2016, the Luxembourg direct tax authorities issued new guidelines by way of Circular LIR n° 56/1 – 56bis/1 (the Circular) regarding the tax treatment applicable to Luxembourg companies carrying out intra-group financing transactions. The Circular details the application of the arm’s length principle to such transactions. It abrogates and replaces the previously applicable circulars of 2011 (LIR n° 164/2 and 164/2bis) as per 1 January 2017.

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Mr. Eric Fort
Mr. Alain Goebel
Mr. Thierry Lesage
Mr. Jan Neugebauer

New Circular Letter on the tax treatment of companies engaged in intra-group financing transactions
29/12/2016

On 27 December 2016 the Luxembourg Tax Authorities (Administration des contributions directes) issued Circular Letter L.I.R. – N° 56/1 – 56bis/1 (the “New Circular Letter”) on the tax treatment of companies engaged in intra-group financing transactions.

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Mr. Denis-Emmanuel Philippe

Le Luxembourg n'est pas un paradis fiscal pour les belges fortunés
27/12/2016

De plus en plus de Belges déménagent au Luxembourg. On peut observer cette tendance depuis quelques années déjà. Selon les médias, il est fort probable que leur départ soit motivé par le souhait de payer moins d'impôts. Mais est-ce bien correct ? La pression fiscale que les grandes fortunes subissent au Luxembourg n'est en effet pas plus faible qu'en Belgique.

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Mr. Philippe-Emmanuel Partsch
Mr. Thierry Lesage

The World Duty Free and Banco Santander cases
23/12/2016

On 21 December 2016, the Court of Justice (hereinafter CoJ or the Court) rendered its long awaited judgment in the World Duty Free and Banco Santander cases9regarding the selectivity criterion in the application of State aid rules to fiscal measures. Indeed, the selectivity criterion, as interpreted by the Commission in its decisions, is currently subject to several actions for annulment10 and this judgment could have a significant impact on the application of State aid rules in tax measures.

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Court of Justice of the European Union: tax benefits for multinationals could form forbidden State aid (World Duty Free Group-case)

Court of Justice of the European Union: tax benefits for multinationals could form forbidden State aid (World Duty Free Group-case)
23/12/2016

On 21 December 2016, the Court of Justice of the European Union (CJ) rendered its judgement in the Commission v World Duty Free Group case (Joined cases C-20/15 and C-21/15). The CJ ruled that tax benefits merely available for multinationals and derogating from the ordinary tax system could amount to unlawful State aid. This judgement may have a serious impact on any measure of Member States seeking to provide for preferential tax treatment for multinationals only. 

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Tax Flash: State aid update – Public version final Apple decision sheds light on European Commission’s reasoning

Tax Flash: State aid update – Public version final Apple decision sheds light on European Commission’s reasoning
20/12/2016

On 19 December 2016, the European Commission (Commission) published its final decision in the formal state aid investigation into two advance pricing agreements (APAs) obtained by Apple in Ireland in 1991 and 2007.

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Mr. David Giabbani

La transaction en droit luxembourgeois
19/12/2016

La transaction est un contrat par lequel les parties terminent une contestation née, ou préviennent une contestation à naître. Il faut donc qu’il y ait une situation contentieuse ou précontentieuse pour que puisse être conclue une transaction. Cette existence ou cette possibilité de situation litigieuse est la cause de la transaction, c’est-à-dire, la considération d’un but qui explique et justifie la création d’une obligation par la volonté des parties (cf : jurisclasseur travail verbo Transaction Fasc. 32-20). 

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Mrs. Sophie Wagner-Chartier
Mrs. Anne Contreras-Muller
Mrs. Astrid Wagner

Societal impact company
19/12/2016

The law of 12 December 2016 (the “Law”) has introduced a new legal framework for companies having a social or societal impact: the société d’impact sociétal (the “SIS”).

The purpose of the legislator is to formally recognise the specificity of companies dedicating their activities to supporting people in fragile situations or contributing to the preservation or development of specific social or societal issues, including the protection of the environment.

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Luxembourg parliament voted on the bill of law on country-by-country reporting

Luxembourg parliament voted on the bill of law on country-by-country reporting
16/12/2016

On 13 December 2016, Luxembourg parliament has, in a first vote, adopted the bill of law to implement the European Directive 2016/881/EU on country-by-country reporting by multinational enterprise groups. If a second vote is dispensed with, which we expect it will be, the law will be published in the Official Gazette of the Grand Duchy of Luxembourg and enter into force three days after its publication therein. We expect that the law will be in force before 1 January 2017.

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