Law (2009:1121) If Agreement Between Sweden And Jersey On The Mutual Agreement Procedure In Connection With The Adjustment Of Profits Of Associated Enterprises

Original Language Title: Lag (2009:1121) om avtal mellan Sverige och Jersey om förfarande för ömsesidig överenskommelse vid justering av inkomst mellan företag i intressegemenskap

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Read the untranslated law here: http://rkrattsbaser.gov.se/sfst?bet=2009:1121

Article 1 the agreement between the Kingdom of Sweden and the Jersey if

the mutual agreement procedure in connection with the adjustment of

profits of associated enterprises, signed

on October 28 2008 to apply that law in this country. The agreement

is written in English and appears in annex to this law.



section 2 of the tax rules of the agreement shall apply only to the

some of these causes restriction of the tax liability in

Sweden that would otherwise exist.



Transitional provisions



2009:1121



1. this law shall enter into force on the day the Government determines.



2. this law shall apply to the taxes levied for

tax year that begins on 1 January of the year following

immediately following the year in which the law comes into force or later.



Annex



AGREEMENT BETWEEN THE KINGDOM OF SWEDEN AND the JERSEY ON THE ACCESS TO MUTUAL AGREEMENT PROCEDURES IN CONNECTION WITH THE ADJUSTMENT OF PROFITS OF ASSOCIATED ENTERPRISES



The Government of the Kingdom of Sweden and the Government of Jersey, desiring to conclude an Agreement on the access to mutual agreement procedures in connection with the adjustment of profits of associated enterprises, have agreed as follows:



Article 1 Taxes covered



This Agreement shall apply to taxes on income and profits



Article 2



Definition



1. For the purposes of this Agreement, unless the context otherwise requires: (a) the term "Party" means Jersey or Sweden as the context requires; the term "Parties" means Jersey and Sweden;



(b) the term "Sweden" means the Kingdom of Sweden and, when used in a geographical sense, includes the national territory, the territorial sea of Canada as well as other maritime areas over which Sweden in accordance with international law, exercises sovereign rights or jurisdiction;



(c) the term "Jersey" means the Bailiwick of Jersey, including its territorial sea;



(d) the term "competent authority" means



(i) in the case of Jersey, the Treasury and Resources Minister or his authorised representative;



(ii) in the case of Canada, the Minister of Finance, his authorised representative or the authority which is designated as a competent authority for the purposes of this Agreement.



2. As regards the application of this Agreement at any time by a Party, any term not defined therein shall, unless the context otherwise requires, have the meaning that it has at that time under the law of that Party for the purposes of the taxes to which the Agreement applies, any meaning under the applicable tax laws of that Party prevailing over a meaning given to the term under other laws of that Party.



Article 3



Principles applying to the adjustment of profits of associated enterprises 1. Where:



(a) an enterprise of a Party participates directly or indirectly in the management, control or capital of an enterprise of the other Party, or



(b) the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Party and an enterprise of the other Party, and in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then any profits which would , but for those conditions, have accrued to one of the enterprises, but, by reason of those conditions, have not so accrued, may be included in the profits of that enterprise and taxed accordingly.



2. Where a Party includes in the profits of an enterprise of that Party — and taxes accordingly — profits on which an enterprise of the other Party has been charged to tax in that other Party and the profits so included are profits which would have accrued to the enterprise of the first-mentioned Party if the conditions made between the two enterprises had been those which would have been made between independent enterprises , then that other Party shall make an appropriate adjustment to the amount of the tax charged therein on those profits. In determining such adjustment, due regard shall be had to the other provisions of this Agreement.



Article 4



General commissions



Where a Party intends to adjust the profits of an enterprise in accordance with the principles set out in Article 3, it shall in accordance with its laws inform the enterprise of the intended action in due time and give it the opportunity to inform the other enterprise so as to give that other enterprise the opportunity to inform in turn the other Party.

However, the Party providing such information shall not be prevented from making the proposed adjustment.



Article 5



Mutual agreement procedures



1. Where an enterprise considers that, in any case to which this Agreement applies, the actions of one or both of the Parties result or will result for it in double taxation, it may, irrespective of the remedies provided by the domestic law of the Party concerned, present its case to the competent authority of the Party of which it is a resident. The case must be presented within three years of the first notification of the action which is contrary or is likely to be contrary to the principles set out in Article 3. The competent authority shall then without delay notify the competent authority of the other Party.



2. The competent authority shall endeavour, if the objection appears to it to be justified and if it is not itself able to arrive at a satisfactory solution, to resolve the case by mutual agreement with the competent authority of the other Party, with a view to the avoidance of taxation which is not in accordance with the Agreement. Any agreement reached shall be implemented notwithstanding any time limits in the domestic law of the Parties.



3. The competent authorities of the Parties shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of the Agreement.



4. The competent authorities of the Parties may communicate with each other directly for the purpose of reaching an agreement in the sense of the preceding paragraphs.



Article 6 Entry into force



1. This Agreement shall enter into force on the thirtieth day after the later of the dates on which each of the Parties has notified the other in writing that the procedures required by its law have been complied with. The Agreement shall have effect on taxes chargeable for any tax year beginning on or after the first day of January of the year next following that in which this Agreement enters into force.



2. Notwithstanding paragraph 1, this Agreement shall only have effect when the Agreement signed on 28 October 2008 between the Kingdom of Sweden and Jersey for the exchange of information relating to tax matters shall have effect.



Article 7



Termination



1. This Agreement shall remain in force until terminated by a Party. Either Party may terminate the Agreement by giving written notice of termination at least six months before the end of any calendar year. In such event, the Agreement shall cease to have effect on taxes chargeable for any tax year beginning on or after the first day of January of the year next following the end of the six months period.



2. Notwithstanding paragraph 1, this Agreement will be terminated, without giving notice of termination, on the date of termination of the Agreement signed on 28 October 2008 between the Kingdom of Sweden and Jersey for the exchange of information relating to tax matters



In witness whereof the undersigned being duly authorised thereto have signed this Agreement.



Done at Helsinki, this 28th day of October 2008, in duplicate in the English language.



For the Government of the Kingdom of Sweden



Anders Borg



For the Government of Jersey



Frank Walker



(Translation)



AGREEMENT BETWEEN the KINGDOM of SWEDEN and the JERSEY on the MUTUAL AGREEMENT PROCEDURE in CONNECTION with the ADJUSTMENT of PROFITS of associated enterprises



The Government of the Kingdom of Sweden and the Jersey Government, desiring to conclude an agreement on the mutual agreement procedure in connection with the adjustment of profits of associated enterprises, have agreed as follows:



Article 1



Taxes covered by the agreement



This agreement shall apply to taxes on income.



Article 2



Definitions



1. Unless the context gives rise to different, for the purposes of this agreement the following expressions the following meaning: a) "party" means Jersey or Sweden, as the context requires; "parties" means Jersey and Sweden,



b) "Sweden" means the Kingdom of Sweden and the includes, when the expression is used in the geographic significance, Sweden's territory, territorial waters of Sweden and other maritime areas over which Sweden, in accordance with international law, exercises sovereign rights or jurisdiction;



c) "Jersey" means the Bailiwick of Jersey, including its territorial waters,



d) "competent authority" means



1) Jersey, "the Treasury and Resources Minister," or his authorised representative,



2) in Sweden, the Minister of finance or his authorised representative or the authority which has been assigned to be a competent authority for the purposes of this agreement.



2. When a party applies the contract at any time is deemed, unless the context otherwise raises, each expression that is not defined in the agreement have the same meaning as the expression has at that time under the law of that party in respect of such taxes to which the agreement applies and the importance that the term has under the applicable tax laws of that party take precedence over the significance of the expression have under other legislation of that party.



Article 3




Principles for the adjustment of profits of associated enterprises



1. In cases where the



(a)) of a party participates directly or indirectly in the management or control of a company of the other party or own part in this undertaking, or



(b)) the same person participates directly or indirectly in the management or control of a company in a party that is an enterprise of the other party or own some of both of these corporate capital, observed the following.



If between businesses in terms of trade or financial relations be agreed or prescribed conditions, which differ from those which would have been agreed between independent companies, receives all the income, that without such conditions would have been one company but because of the conditions in question did not come about this company, be included in that company's income and taxed accordingly.



2. In cases where a party to the income of an enterprise of that party include – and taxes accordingly – income, for which a company of the other party is subject to tax in that other party, and thus included the income is such as would have been the company in the first-mentioned party if the conditions agreed between the enterprises had been those which would have been agreed between independent enterprises the other party shall implement proper adjustment of the amount of tax levied on income. When such adjustments are observed with the other provisions of this agreement.



Article 4



General provision



If a party intends to adjust the income of an enterprise in accordance with the principles set out in article 3, it shall, in accordance with its legislation in good time inform the company thereof and give the company the opportunity to inform the other company so that it may in turn inform the other party. The party giving such notice is however not able to implement the proposed adjustment.



Article 5



The procedure for the mutual agreement



1. If a company believes that a party, or both parties in a case covered by this agreement, took measures for the enterprise carries or will result in double taxation, it may, without prejudice to its right to make use of the remedies available in the internal legal order, submit the matter to the competent authority of the Contracting Party in which it is domiciled. The thing to be presented within three years from the time the company learned about the action that violates or is likely to be likely to be contrary to the principles set out in article 3. The competent authority shall then promptly notify the competent authority of the other party.



2. If the competent authority finds the complaint justified but are unable to achieve a satisfactory solution, the authority shall seek to determine the matter by mutual agreement with the competent authority of the other party in order to avoid taxation which is contrary to the agreement. Agreement is carried out without prejudice to the time limits in the domestic law of the parties.



3. the competent authorities of the Parties shall, by mutual agreement, seek to determine difficulty or doubt arising in respect of the interpretation or application of the agreement.



4. the competent authorities of the parties may enter into direct relations with each other in order to reach agreement in the sense of the preceding paragraphs.



Article 6



Date of entry into force



1. This agreement shall enter into force on the thirtieth day after the date of the last written notification – which the parties should leave when the measures were taken as required under their respective legislation, has been provided. The agreement shall apply to taxes levied for the fiscal year that begins on 1 January of the year immediately following the year in which the agreement enters into force or later.



2. Notwithstanding paragraph 1, this Agreement shall apply only when the agreement between the Kingdom of Sweden and the Jersey on the exchange of information in tax matters signed on 28 October 2008.



Article 7



Termination



1. this Agreement shall remain in force until terminated by one party. Either party may terminate the agreement by notification to that effect at least six months before the end of any calendar year. In the event of such termination, the agreement ceases to apply in respect of tax levied for the fiscal year that begins on 1 January of the year immediately following the expiry of the six-month period or later.



2. Notwithstanding paragraph 1, this agreement ceases to apply, without termination, on the date of agreement between the Kingdom of Sweden and the Jersey on the exchange of information in tax matters signed on 28 October 2008, expires.



In witness whereof the undersigned, being duly authorised, have signed this agreement.



Done at Helsinki on 28 October 2008, in duplicate in the English language.



For the Government of the Kingdom of Sweden



Anders Borg



For the Government of Jersey



Frank Walker