In April 2007, the Federal Ministry of Finance (BMF) published a Letter on the application of the new anti-treaty-shopping rules embodied in Art. 50d(3) ITA as amended in 2007. Details are summarized below.
Under the revised Art. 50d(3) ITA, entitlement to treaty benefits is considered for each direct shareholder only. If a direct shareholder is not entitled to treaty benefits, all indirect shareholders are excluded from relief. The Letter provides an example i…