TRATADOS MULTILATERAIS. THE EFFECTS OF GLOBAL AND REGIONAL TRADE AGREEMENTS ON DOMESTIC TAX LAW AND BILATERAL TAX CONVENTIONS: GENERAL ASPECTS Howard M. Liebman. A – TYPE OF AGREEMENTS 1 – MULTILATERAL TRADE AGREEMENT: WORLD TRADE ORGANIZATION (WTO).
THE EFFECTS OF GLOBAL AND REGIONAL TRADE
AGREEMENTS ON DOMESTIC TAX LAW AND
BILATERAL TAX CONVENTIONS: GENERAL ASPECTS
Howard M. Liebman
. Successor to GATT 1947.
. WTO Laws: 16 sections of the Marrackesh Agreement and its annexes (GATT, GATS, TRIPS, SPS, SCM, DSU).
. 149 members; represents more than 95% of worldwide trade.
. Implements trade agreements, settles trade disputes, forum for trade negotiations, all with a potential/actual tax impact.
. Entered into force on January 1, 1994.
. Free movement of goods and services, fair competition, investment protection, IPR protection.
. Entered into force on January 1, 995.
. Free movement of goods and services, common external tariff and common trade policy.
. Economic and trade forum.
. Promotes the reduction of barriers to trade and investment.
. Entered into force on August 1, 1973.
. Common market.
. Treaty of rome (1957), Single European Act (1986), Treaty of Maastricht (1992).
. Internal Policies: single market, common system of indirect taxation of goods and services and excises.
. External Policies: Common external custom tariff, common trade policy, etc.
. Entered into force on May 3, 1960.
. Free movement of persons, services and investment, fair conditions of competition, IPR protection.
. Over 2,400 BITs.
. Fosters the liberalization, protection and/or promotion of foreign direct investment.
Offers protection against expropriation, free transfer of capital and transparency in legal and administrative procedures.
1 - The WTO Agreements.
. Article I:1 – MFN treatment applies to custom duties and charges of any kind. May include internal taxes.
. Article III:2 – National Treatment applies to internal taxes and any other charges.
. Covers both actual or potential direct transfers of funding as well as any governmental revenues due but foregone or not collected.
. Granted/ordered by any public body.
2. NAFTA Section 2103.
. Deals with taxation in a very etensive fashion.
. Reminder: BITs are concluded to favor foreign direct investments.
. Deal with taxation to a very limited extent (if any).
. Possible Rationale: Taxation should be dealt with in a bilateral taxation treaty.
. Case study: US-Uruguay BIT of November 11, 2005.
Taking from the left hand what one gives with the right.
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