Tax Treaty Case Law around the Globe 2013

S. 201 Switzerland: Beneficial ownership issues in the light of Art. 10

Michael Beusch

1. S. 203 Introduction

Articles 10 et seq. of the OECD Model Tax Convention have always been of crucial importance for the application of Double Tax Treaties. Thus, the meaning and scope of the notion “beneficial owner” is of major interest, which can e.g. be seen by the large response to the public discussion launched by the OECD with regard to the proposed amendments concerning the “Clarification of the meaning of 'beneficial owner' of the OECD MC” in the years 2011 and subsequent revised discussion draft in 2012. Against this background, it is no surprise at all, that the decision of the Swiss Federal Administrative Court (FAC) handed down on March 7, 2012 has attracted attention all over the world and has been discussed in academic writing, being most probably the first reported court case worldwide dealing with beneficial ownership with regard to total return swaps (TRS) in a tax treaty context. However, it should be noted at this juncture, that the decision of the FAC is not final. Both parties: the taxpayer as well as the Swiss Federal Tax Administration (SFTA), have launched an appeal with the Federal...