Luxembourg: Double Tax Treaties
Other International Agreements
In December, 2005, the government of Mauritius signed an agreement on the Reciprocal Promotion and Protection of Investments (IPPA) with the Belgium-Luxembourg Economic Union, which was aimed at strengthening bilateral and economic ties between the countries, and facilitating investment and mutual trade.
The agreement was signed in Belgium by the Mauritian Minister of Foreign Affairs, International Trade and Cooperation, Madun Dulloo, the Minister of Foreign Affairs of the Kingdom of Belgium, Karel De Gucht, and the Ambassador of the Grand Duchy of Luxembourg in Belgium, Alphonse Berns.
Other issues of cooperation were discussed, including development aid to Mauritius through an economic resilience index, investment in sectors like development of bio-fuels, and assistance in the training and specialization of medical practitioners.
Following the signature ceremony held at the Belgian Ministry of Foreign Affairs, the head of the Mauritian delegation, Minister Dulloo made a statement in which he emphasized the necessity for such an agreement especially with the current reform of the EU Sugar Regime and the serious difficulties facing the Mauritian tourism and textile industry.
Mr. Dulloo also pressed Belgium and Luxembourg to provide more direct private investment from Luxembourg and Belgium and presented the increased opportunities in ICT, fisheries and financial services.
The Belgian Foreign Affairs Minister, Mr. De Gucht, expressed confidence that the Belgian authorities would consider including the issues discussed in bilateral cooperation with Mauritius, while Ambassador Berns highlighted the importance of the IPPA for investors and the private sector.
In January 2010, at a seminar, a delegation from the Dubai International Finance Centre and Luxembourg for Finance, the agency responsible for developing the financial sector in Luxembourg, signed a Memorandum of Understanding (MoU) to promote cooperation and industry development across a wide range of areas – including market access, financial regulations and infrastructure, training, and industry development for firms located in the two jurisdictions.
Some of the MoU’s key areas of focus include promoting the exchange of information on banking, financial services and securities legislation and regulation; sharing trends in financial services and products; and promoting events taking place in the two jurisdictions. Other areas include welcoming delegations from each jurisdiction, cooperating in financial services training and facilitating collaboration among universities located in the two jurisdictions.
At the seminar it was noted that the two financial centers are complementary; the DIFC is a leading financial center and a global gateway for capital and investment in a region stretching between Europe and Asia, while Luxembourg is the second largest investment fund center in the world and the eurozone’s premier hub for private banking.
Ahmed Humaid Al Tayer, Governor of the DIFC, said: “By working with other leading international financial centers such as Luxembourg, the DIFC brings business opportunities and a continually expanding scope of financial products and services not only to DIFC-based firms, but also to the UAE and wider region. Luxembourg is a natural partner for DIFC, with each center’s strengths complementing those of the other, and opening many possibilities for cooperation among our regulators, as well as among the many firms located in our two jurisdictions.”
Fernand Grulms, CEO of Luxembourg for Finance, added: “Between Luxembourg and Dubai we see huge potential for bilateral business. However, in the complex world of finance, this can only be achieved by building partnerships among foreign financial centers, so that’s why we are pleased to be here today and to have signed this memorandum with DIFC. Luxembourg has enormous expertise to offer clients in the region and opportunities for collaboration with firms based in the MENA region.”
“International investors, including sovereign wealth funds from the MENA region, rely on Luxembourg’s expertise to structure their worldwide investments, namely in the area of real estate and private equity,” Grulms added. “For example, local know-how in setting up, administering and distributing investment funds has led the Bank of London and the Middle East to launch a Shari’ah-compliant dollar income fund from Luxembourg.”
Another MoU, aimed at strengthening and developing economic, trade and technical cooperation between the Kingdom of Bahrain and the Grand Duchy of Luxembourg, was signed in January 2010 in Manama by Bahrain’s Minister of Finance, Shaikh Ahmed bin Mohammed Al Khalifa, and Luc Frieden, the Luxembourg Minister of Finance.
The several areas envisaged for strengthened cooperation between the two countries include financial and professional services, investment, tourism, trade, industry, transport, telecommunications, education, and scientific research.
The MoU will encourage relevant businesses to explore the possibility of joint projects in these areas, and establishes a joint economic committee to coordinate its implementation.
Both ministers praised the MoU and its crucial role in boosting bilateral relations between Bahrain and Luxembourg. It adds its weight to the agreement for the promotion and protection of investments, previously signed by the two countries in 2006, and the convention for the avoidance of double taxation and prevention of fiscal evasion with respect to taxes, signed in 2009.
In April 2012, it was reported that the Qatar Financial Centre Regulatory Authority and the Commission de Surveillance du Secteur Financier (CSSF) had entered into a Memorandum of Understanding. According to the QFC, the signing of the MOU provides the basis for future co-operation between the regulators, including the sharing of information, resources and assistance regarding financial institutions operating in both the Qatar Financial Centre and Luxembourg.
Mr. Michael Ryan, Chief Executive Officer of the Qatar Regulatory Authority welcomed the signing of the MOU saying:
“The Regulatory Authority is committed to developing and maintaining positive relationships with members of the international regulatory community in order to ensure a regular and productive exchange of supervisory information and resources. The agreement with Commission de Surveillance du Secteur Financier will lay the foundation for a very constructive working relationship between the CSSF and the Regulatory Authority.”