Superior Court of Justice decision on treaty treatment of remuneration of services

On 17 May 2012, the Second Chamber of the Superior Court of Justice (Superior Tribunal de Justiça - STJ) ruled that the payments made in favour of German and Canadian resident entities in consideration for services rendered to a legal entity resident in Brazil does not trigger the withholding tax, as a result of the application of the provisions of article 7 of the tax treaties signed by Brazil with Germany and Canada (Note. The tax treaty between Brazil and Germa…