All material subject to strictly enforced copyright laws. © 2022 ITR is part of the Euromoney Institutional Investor PLC group.

EU: Update on patent boxes and the EU Code of Conduct Group (Business Taxation)


van der Made

The Italian EU Presidency's Code of Conduct Group (Business Taxation) six-monthly progress report to the ECOFIN Council was finalised on December 11 2014. On patent boxes, following all discussions in the OECD Forum on Harmful Tax Practices (FHTP) around BEPS Action 5, a compromise regarding the modified nexus approach and how to assess whether there is substantial activity in an IP regime, was endorsed by the Code Group on November 20 2014. The Code Group agreed that all the EU patent box regimes that had been subject to examination by the Group are not compatible with the modified nexus approach as adapted by the compromise. As a consequence, these EU patent boxes should therefore be changed in line with the compromise. As part of the agreement, countries with existing IP regimes must agree to close these to new entrants by June 30 2016 and will abolish them by June 30 2021, after which all countries will be required to operate only nexus-compliant regimes. New entrants can therefore still enter the existing patent boxes until June 2016 and benefit from the five year grandfathering. The Code Group agreed that the legislative process necessary to give effect to that change and the related monitoring by the Code Group should commence in 2015. The Netherlands has made a reservation regarding the scope of IP assets qualifying for tax benefits under an IP regime in respect of the compromise regarding the modified nexus approach.

The modified nexus approach allows a taxpayer to receive benefits on IP income in line with the expenditures linked to generating the income. The UK-German proposal has since been endorsed by all OECD and G20 countries.

Bob van der Made (

PwC Brussels

Tel: +31 88 792 3696


more across site & bottom lb ros

More from across our site

The Dutch TP decree marks a turn in the Netherlands as the country aligns its tax policies with OECD standards over claims it is a tax haven.
Gorka Echevarria talks to reporter Siqalane Taho about how inflation, e-invoicing and technology are affecting the laser printing firm in a post-COVID world.
Tax directors have called on companies to better secure their data as they generate ever-increasing amounts of information due to greater government scrutiny.
Incoming amendments to the treaty could increase costs on non-resident Indian service providers.
Experts say the proposed minimum tax does not align with the OECD’s pillar two regime and risks other countries pulling out.
The Malawian government has targeted US gemstone miner Columbia Gem House, while Amgen has successfully consolidated two separate tax disputes with the Internal Revenue Service.
ITR's latest quarterly PDF is now live, leading on the rise of tax technology.
ITR is delighted to reveal all the shortlisted firms, teams, and practitioners for the 2022 Americas Tax Awards – winners to be announced on September 22
‘Care’ is the operative word as HMRC seeks to clamp down on transfer pricing breaches next year.
Tax directors tell ITR that the CRA’s clampdown on unpaid taxes on insurance premiums is causing uncertainty for businesses as they try to stay compliant.
We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree