1. Philip Baker QC Grays Inn Tax Chambers
Confederation of Swedish Enterprise INTERNATIONAL TAX CONFERENCE EXIT TAXES AND BUSINESS RESTRUCTURING Some Technical Issues
Philip Baker QC
Grays Inn Tax Chambers

2. Some Technical Issues Double Taxation Conventions
Transfer pricing issues
Permanent Establishment issues
European Community Tax Law
Corporate exit taxes

3. 1) Double Taxation Conventions
Transfer pricing issues
Compatibility with the arm’s length principle
Status of the Guidelines
UK: Sch. 28AA, para. 2, ICTA 1988
DSG Retail Ltd v. HMRC [2007] UKFTT 31 (TC)
Basis for adjustments in domestic law
Role of Art. 9 OECD MTC – query if basis for making adjustment
Arm’s length pricing vs. arm’s length terms and conditions

4. 1) Double Taxation Conventions
Permanent establishment issues
Existing definition – Art. 5 OECD MTC
E.g. Agency: “habitually exercises … an authority to conclude contracts in the name of the enterprise …”
Dangers of a broader definition – broader impact on compliance e.g. employee taxation
Attribution of profits to PEs
Old Art. 7 vs. new Art. 7

5. 2) European Community tax law issues
Transfer pricing
Note: Arbitration Convention 90/436/EEC, Art. 4 (1) and (2)

6. 2) European Community tax law issues
The continuing uncertainty over corporate exit taxes
De Lasteyrie (Case C-9/02)
N (Case C-470/04)
Cartesio (Case C-210/06)
Balanced allocation of tax jurisdiction, and proportionality
CCCTB

7. Philip Baker QC Grays Inn Tax Chambers
Confederation of Swedish Enterprise INTERNATIONAL TAX CONFERENCE EXIT TAXES AND BUSINESS RESTRUCTURING Some Technical Issues
Philip Baker QC
Grays Inn Tax Chambers