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Final ruling Decree with new requirements as of 1 July 2019 published


The final Decree entered into force on 1 July 2019 and replaces three earlier ruling Decrees of 3 June 2014.

The new Decree broadly corresponds to the draft ruling Decree which was submitted for consultation on 23 April 2019 by the Dutch State Secretary of Finance. See our PwC insights of 24 April 2019.

In brief, the requirements for obtaining a ruling become stricter and all ruling requests will be published anonymously. 

What does this mean for you?

If you want to conclude a ruling with an international character with the Dutch Tax Authorities from 1 July 2019, you should bear in mind that from that moment stricter requirements will be imposed.

You should also bear in mind that an anonymous summary of each ruling with an international character will be published. This also applies to ruling requests that ultimately do not result in a ruling.

How is a ruling concluded?

The competent tax inspector conducts the preliminary consultation. He is the first person handling the preliminary consultation for the granting of a ruling with an international character. 

The processing team of International Fiscal Affairs, the so-called “Behandelteam IFZ”, is the first team to be consulted for a number of topics, for obtaining a ruling with an international character.

These topics include, for example:

  • the application of the participation exemption to foreign participations;

  • the qualification of (hybrid) entities or (hybrid) financing;

  • the question whether or not a permanent establishment exists;

  • the allocation of assets to a permanent establishment;

  • the application of the dividend withholding tax exemption,

  • the application of an anti-abuse provision of a tax treaty;

  • the conclusion of an Advanced Pricing Agreement (APA). 

With effect from 1 July 2019, a new board has been established within the Dutch Tax Authorities, the College of International Fiscal Affairs (IFZ College). This board is responsible for the central coordination of the preliminary consultations and guarantees the uniformity of the policy and its implementation. 

Before a ruling with an international character can be issued, the competent tax inspector or the processing team of International Fiscal Affairs must submit the request to the College of International Fiscal Affairs for approval. 

Conditions for granting of a ruling

The Dutch Tax Authorities will only initiate preliminary consultations for the granting of a ruling with an international character if:

  • the taxpayer filing the ruling request has sufficient relevant economic nexus with the Netherlands. In short, economic nexus means operational business activities.

  • avoiding Dutch or foreign tax is not the sole or the decisive reason for a certain transaction. 

  • a transaction is not carried out with a country that is mentioned in the Dutch list of low-tax countries. Currently, these countries are, among others, Anguilla, Bahamas, Bahrain, Belize, Bermuda, British Virgin Islands, Guernsey, Isle of Man, Jersey, Cayman Islands, Kuwait, Qatar, Saudi Arabia, Turks and Caicos Islands, Vanuatu and the United Arab Emirates.

Publication of rulings

An anonymous summary will be published for each ruling with an international character. The summary will contain the reason for the granting of a ruling, the facts, the applicable legal framework, the considerations and a conclusion.

A summary will also be published even if preliminary consultations have taken place, but a ruling has not ultimately been granted. In that case, this summary will contain an explanation as to why the ruling was not concluded. 

Bilateral and multilateral APAs

The Netherlands will endeavor to conclude bilateral APAs. Requests for multilateral APAs will in principle be coordinated. If such a request is objected by one or more treaty countries, the request for a multilateral APA will be divided into several requests for bilateral APAs. 

Foreign Investors Board

Part of the IFZ College is the Foreign Investors Board (APBI). The APBI is authorized to make prior agreements on the tax aspects of potential investments by foreign investors.

Designated bodies in certain situations

The new ruling Decree indicates which bodies within the Dutch Tax Authorities are competent to decide on requests for application of the so-called "safety net provision" in the LOB provision or the so-called "corporate tiebreaker provisions" in a number of Dutch tax treaties. 

Contact us

Michel van Dun

Michel van Dun

Senior Manager, PwC Netherlands

Tel: +31 (0)61 042 11 99

Vassilis Dafnomilis

Vassilis Dafnomilis

Manager Tax, PwC Netherlands

Tel: +31 (0)61 399 87 29

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