United Nations Climate Change
Our aim is to help our clients understand the potential opportunities and challenges that COP25 may have on their business.
In September, the Dutch Government announced changes to the treatment of dividends paid by Dutch entities, which should eliminate the difference between Dutch cooperatives and Dutch private companies (BVs) and public companies (NVs). On 16 December 2016, the Dutch State Secretary for Finance clarified certain aspects of the original proposal. The letter doing so set out in particular the difference between so-called (active) “real cooperatives” and (passive) “holding cooperatives” and certain examples of situations where no dividend tax will be due. An internet consultation is announced for the first half of 2017 and this should be followed by a formal proposal of the change in law. The changes are intended to become effective as from 1 January 2018. However, given that Dutch general elections are due in March 2017, the outcome of these processes is highly dependent on the result of these elections.
We refer to our previous publication on the initial proposal published in September for further background information.
The December letter addresses questions on the proposed amendments of the Dutch dividend tax regime for cooperatives, BVs and NVs. The main clarifications are:
As this letter is only an announcement of a future change, these developments are subject to amendment. Details of the new proposed rules will likely to be published during the internet consultation in 2017. That said, it is clear that in its current form the proposals will have both negative effects, including a 15% dividend tax on distributions made by (passive) holding cooperatives to members in a non-treaty country, as well as positive effects, i.e. an exemption from dividend tax in non-abusive business structures in treaty situations for both cooperatives, BVs and NVs.
The changes are intended to become effective as from 1 January 2018. However, given that Dutch general elections are due in March 2017, the outcome of these processes is highly dependent on the result of these elections. Nonetheless, we do recommend reviewing existing structures that make use of cooperatives for the holding of participations in light of these proposed amendments. The amendments may also allow you to simplify your corporate structures. We are obviously more than happy to assist you in reviewing your structures to ensure their effectiveness.
IMO 2020 is almost upon us. Readers are well aware of the impending switch to 0.5 percent fuel mandated by Annex VI of MARPOL which will cause an anticipated drop in HSFO demand, the potential hazards of new untested LSFO blends, the concerns around scrubber operations, the debate over open loop versus closed loop, and the myriad of other risks associated with the impending regulatory change.