Isle Of Man Signs Economic Cooperation Agreement With The Netherlands

by Jason Gorringe, Tax-News.com, London

19 October 2005

The Isle of Man and the Netherlands broke new ground last week as representatives from both governments signed a bilateral economic cooperation treaty, the first of its kind between a small international financial centre and an OECD member.

The agreements, signed in Douglas on October 12 by the Dutch Deputy Finance Minister Joop Wijn and Isle of Man Treasury Minister Allan Bell, will support business opportunities between the two countries in such areas as international shipping and aviation.

"This is an historic signing confirming the economic recognition of the Isle of Man by an important European state," declared Mr Bell.

"It opens up international business opportunities and paves the way for similar agreements with other countries," he added.

The package of measures, which was negotiated in the context of the OECD programme to develop a global network of tax co-operation and information exchange, includes a shipping and aircraft taxation agreement; a transfer pricing agreement; a modern TIEA (tax information exchange agreement) based on the OECD model of exchange of information on request on a case by case basis; and a commitment to work towards a comprehensive double taxation avoidance agreement.

Furthermore, the agreement included a commitment from the Isle of Man that Dutch firms would not be adversely affected by its '0/10' tax system when it is introduced in 2006.

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