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13.2. Thin-capitalization and other Restrictions to Interest Deduction

Interest paid on loans provided by shareholders, or put at the disposal of the company are tax deductible provided: a) the interest rate charged does not exceed the reference rate of the Central Bank of West African States increased by 2% points; b) the debt-equity ratio with regard to such shareholders does not exceed 2:1; and c) the company’s capital is fully paid-up. In any case, the deductible interest expense is limited to 15% of gross operating surplus, subject to certain exceptions.