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Janne Juusela As a result of the recent ECJ case law (C-170/05, Denkavit and C-379/05, Amurta) the Finnish government issued a bill (HE 113/2008) on November 12 2008 amending the act on the taxation of non-residents' income (627/1978). According to the bill, taxation of Finnish source dividends paid to non-residents were to be amended to correspond to the taxation of dividends paid to residents to conform to EC Law. The parliament passed the bill on December 5 2008 and the changes entered into force from January 1 2009.

Guillaume Glon Nicolas Jacquot On January 13 2009, the US and France signed a protocol making significant changes to the existing tax treaty, especially as regards certain dividends, royalties and the limitation on benefits (LoB) clause.

Bob van der Made At the end of January 2008, the Dutch tax authorities announced their decision to reimburse Dutch dividend withholding tax to foreign EU based pension funds. The Dutch tax authorities said they would look closely, on a case by case basis, whether the claims were filed in a timely and correct manner and whether the foreign pension funds concerned can be considered to be equivalent to a pension fund in the Netherlands.

Stephen Nelson The newly-revised value-added tax (VAT) provisional regulations and their implementation rules abolished both VAT refunds for foreign invested enterprises (FIE) purchasing domestically manufactured equipment and VAT exemptions for imported equipment. Grandfathering rules were subsequently issued in late December 2008.

Luke Mlynarczyk Jeffrey Shafer Recently, the Federal Court of Appeal unanimously upheld the Federal Court's decision in eBay Canada Limited and eBay CS Vancouver Inc. v MNR.

Nélio Weiss Philippe Jeffrey For a fourth consecutive year and with the objective to minimise the effect for Brazilian exporting companies from the appreciation of the local currency in relation to foreign currencies (specifically the US dollar and the Euro and mainly during the first semester of 2008), the Brazilian authorities issued on December 29 2008, ordinance 310 and normative instruction 898 which amended the Brazilian transfer pricing legislation. The ordinance and normative instruction state that Brazilian exporting companies will be allowed to increase their export revenues for calendar year 2008 (for transfer pricing calculation purposes) using the ratio of 1:20. This measure will apply for the fiscal year 2008.

Rolf Declerck Like many industrialised countries, Japan has felt the bite of the credit crunch. That is why the Japanese government announced on December 12 2008 plans to encourage repatriation of overseas earnings in order to boost the Japanese economy. The fiscal package includes the introduction of the foreign dividend exclusion (FDE) system, supposed to enter into force by April 1 2009. Under Japanese tax law, dividends received from foreign subsidiaries, are taxed in the hands of the Japanese parent company. Double taxation is mitigated by an indirect foreign tax credit (FTC) for foreign corporate tax imposed on taxable income of the subsidiaries and a direct FTC for foreign withholding tax imposed on dividends. Meaning that for subsidiaries located in countries, including Belgium, with lower effective taxation compared to the Japanese corporate tax charge, the higher Japanese tax burden applies to the incoming dividends. The new rules go that dividends received from qualifying foreign subsidiaries will be exempt from Japan tax up to 95%. While the new tax rules imply that the indirect FTC for foreign withholding tax on the dividend distributions will be abolished, Belgian subsidiaries of Japanese multinationals should not be aversely affected due to Belgium's domestic withholding tax exemption, under certain conditions, for dividends that Belgian subsidiaries pay to their Japanese parent since Belgium has concluded a tax treaty with Japan.

Ian Farmer On December 4 2008, Tax Laws Amendment (Taxation of Financial Arrangements) Bill 2008 (the TOFA Bill) was introduced into Australian parliament. This Bill contains the taxation of financial arrangements (TOFA) stage three and four measures, which will have a broad impact on all industries, beyond just the banks and financial institutions.

By Catherine Snowdon

Clemens Hasenauer Johannes Prinz The Austrian ministry of finance has recently published new investment fund guidelines (Investmentfondsrichtlinien 2008). The new guidelines also deal with various aspects of the Austrian tax treatment of foreign investment funds including the criteria for the classification as foreign fund and its eligibility for tax treaty benefits.