Qatar – Kenya tax treaty approved forratification by Qatar25 May 2015 – Qatar’s Emir approved the Qatar – Kenyatax treaty for ratification. The treaty will enter into forceonce the ratification procedure has been fulfilled by bothcountries. The provisions of the treaty will enter intoeffect on 1 January of the year following the year in whichthe ratification procedure is fulfilled. The main treatycharacteristics can be summarized as follows:• The maximum withholding tax rate on dividenddistributions amounts to 5% of the gross amount of thedividends if the beneficial owner is a company (otherthan a partnership) which holds directly or indirectlyat least 10% of the capital in the company payingthe dividends, or 10% of the gross amount of thedividends in all other cases. However, distributions ofprofits to the other country, its political subdivisions,local authorities, statutory bodies, the Central Bankor any entity wholly owned directly or indirectly by thatother country, including, in the case of Qatar, QatarInvestment Authority and Qatar Holding are fullyexempt from dividend withholding tax.• The maximum withholding tax rate on interestpayments amounts to 10% of the gross amount ofthe interest. However, if the beneficial owner of theinterest is the other country, its political subdivisions,local authorities, statutory bodies, Central Bankor any entity wholly owned directly or indirectly bythat other country, including, in the case of Qatar,Qatar Investment Authority and Qatar Holding, thenthe interest payment is fully exempt from interestwithholding tax.• The maximum withholding tax rate on royaltypayments amounts to 10% of the gross amount ofthe royalty.• Capital gains on shares are taxable in the state inwhich the alienator is a resident.• Article 28 contains a general anti-abuse provisionwhich states that parties shall not be entitled to thebenefits of the treaty if its affairs were arranged insuch a manner as if it was the main purpose or one ofthe main purposes to take the benefits of the treaty.Qatar – Fiji tax treaty approved forratification10 May 2015 – Qatar’s Emir approved the Qatar – Fijitax treaty for ratification. The treaty will enter into forceonce the ratification procedure has been fulfilled and theprovisions of the treaty enter into effect as of 1 January ofthe year following the entry info force date.Qatar – Gambia tax treaty approved forratification10 May 2015 – Qatar’s Emir approved the Qatar –Gambia tax treaty for ratification. The treaty will enter intoforce once the ratification procedure has been fulfilled(and the provisions of the treaty enter into effect as of1 January of the year following the entry into force date).For an overview of the most notable treaty provisions,kindly refer to the previous edition of this newsletter.Qatar – Latvia tax treaty approved forratification10 May 2015 – Qatar’s Emir approved the Qatar– Latvia tax treaty for ratification. As set out in ourprevious newsletter, the treaty was ratified by Latvia on11 December 2014. The treaty will enter into force whenthe ratification instruments have been exchanged. It canexpected that the ratification procedure will be fulfilledlater this year. If that would be the case, the provisionsof the treaty can be applied as of 1 January 2016. Foran overview of the most notable treaty provisions, kindlyrefer to the previous edition of this newsletter.Qatar – Ecuador tax treaty ratified byQatar14 April 2015 – Qatar’s Emir issued an instrumentratifying the tax treaty between Qatar and Ecuador, whichwas concluded between the countries on 22 October2014 (as communicated in the fourth edition of thisnewsletter). The treaty, which is not yet in force and ineffect, contains the following main characteristics:• The maximum withholding tax rate on dividenddistributions amounts to 5% of the gross amount ofthe dividend if the beneficial owner is a company8
which holds at least 10 per cent of the voting stockof the company paying the dividend, and to 10%of the gross amount of the dividend in other cases.However, dividend distributions to governments, apolitical subdivision or a local government and tovarious specified (government-linked) institutions areexempt from dividend withholding tax.• The maximum withholding tax rate on interestpayments amounts to 10% of the gross amount ofthe interest. However, interest payments are exemptif paid to the government or government-ownedinstitutions. Article 11, paragraph 4 provides for a listof qualifying government owned institutions for thepurpose of this exemption.• The maximum withholding tax rate on royaltypayments amounts to 10% of the gross amount ofthe royalty.• Capital gains realized on shares are generally taxablein the country in which the alienator is a resident.However, such gains are exclusively taxable in thesource state (e.g. the state in which the companywhose shares are alienated is a resident) in case thevalue of the shares of that company derive, directly orindirectly, at least 50% of their value from immovableproperty situated in that country.• Article 25 of the treaty provides for an anti-abuserule. This clause provides that no treaty benefits areavailable in case it was the main purpose or one ofthe main purposes of a resident to obtain the benefitsof the treaty.Qatar – Gabon tax treaty negotiations31 March 2015 – It has been reported that officials ofQatar and Gabon entered into treaty negotiations tocome to a tax treaty between the countries. A first roundof treaty negotiations was held in Doha, Qatar on 30 and31 March 2015. More details are not yet public and will bereported once available.Qatar – Nigeria tax treaty authorized forsignature by Qatar25 March 2015 – The cabinet of Qatar authorized thesignature of the tax treaty between Qatar and Nigeria. Acopy of the treaty text is not yet available. Details of thetreaty will be reported once available.Qatar – Swaziland tax treaty negotiations6 March 2015 – It has been reported that officials ofQatar and Swaziland entered into treaty negotiations toreach a tax treaty between the countries. A first round oftreaty negotiations was held in Doha, Qatar from 16 to18 March, last. More details are not yet public and will bereported once available.9
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