AMSTERDAM: Two recent mutual agreements between the Netherlands and Switzerland will have significant implications for collective investment vehicles (CIVs). One of the agreements appears to place inappropriate restrictions on certain CIVs.
Dutch fiscal investment institutions, Swiss contractual funds, and Swiss open-ended investment funds can take less advantage of Dutch-Swiss tax treaty benefits when it comes to the dividends and interest that they receive from the other treaty state.
The other mutual agreement confirms that Dutch closed funds for joint account and Swiss limited partnerships are tax transparent and that qualifying investors in these institutions are eligible for tax treaty benefits.
Both mutual agreements aim to set procedures for reclaiming withholding tax. Investors are advised to analyse the implications of, and opportunities created by, the two mutual agreements.