In Bern today the Federal Department of Finance announced that Switzerland and France had signed an additional agreement amending the double taxation agreement (DTA) in the area of taxes on income and on capital. The new additional agreement also contains a provision on the exchange of information in accordance with the OECD standard which was negotiated in line with the parameters decided by the Federal Council. The agreement was signed by President Hans-Rudolf Merz and the French Minister for the Economy, Industry and Employment Christine Lagarde.
France is the third country with which Switzerland has signed a DTA which includes the extended administrative assistance clause in accordance with Art. 26 of the OECD Model Convention, after Denmark and Luxembourg.
Switzerland has negotiated with thirteen countries on DTAs that include an extended administrative assistance clause in accordance with Art. 26 of the OECD Model Convention. Along with the agreements already signed with Denmark, Luxembourg and France, there are agreements with Norway, Mexico, the USA, Japan, the Netherlands, Poland, the UK, Austria, Finland and Qatar. The latter have been initialled but are not yet signed. The Federal Council has given the go-ahead for DTAs to be signed with Denmark, Luxembourg, Norway, France, Mexico and the United Kingdom. The other initialled DTAs will be submitted to the Federal Council shortly for approval to be signed.
The Federal Department of Finance says this additional agreement replaces the protocol signed on 12 January 2009, which was renegotiated in line with the parameters decided by the Federal Council on 13 March 2009. Along with extending administrative assistance, the negotiations with France were also used to carry out other amendments.
Along with other issues, the additional agreement specifically regulates the tax treatment of second pillar lump-sum benefits to recipients resident in France and pension institutions covered by the agreement, thereby making them eligible for the reduction of withholding tax on dividends and interest. With the introduction of a clause on abuse, the additional agreement contains more favourable solutions than was previously the case for economic interests in Switzerland. In addition, an arbitration clause has been included in the revised DTA.