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Note: This Treaty may be impacted by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (MLI). MLI impact on Tax Treaties is available with the Orbitax International Tax Research & Compliance Expert.

ARTICLE 25

Miscellaneous Provisions

(1) Notwithstanding the provisions of any other Article of this Agreement:

  • (a) a resident of a Contracting State may not benefit from tax reductions or exemptions granted by the other Contracting State under the Convention if the main purpose or one of the main objectives of the conduct of its operations by this resident or by a person connected/related to that resident is to benefit from the advantages provided by the Convention.
  • For the purposes of this paragraph, a person shall be deemed to be connected to another person if such person owns at least 50 percent of the effective interest or if another person directly or indirectly owns at least 50 percent of effective interest in each of them. In all cases, a person shall be deemed to be connected to another if, taking into account all the facts and circumstances unique to this case, one of them is under the control of the other or if both of them are under the control of the same person or several other persons.
  • (b) the benefit of the advantages of the Convention may be denied on an item of income if:
    • (i) the recipient is not the beneficial owner of the income, and
    • (ii) the transaction allows the beneficial owner to bear a lower tax burden on this item of income than he would have had to bear if he had directly received such item of income.
  • The competent authorities shall consult each other if, in the light of this paragraph and the particular circumstances of the case, it does not seem appropriate to deny the benefit of the advantages of the Convention.
  • (c) the income referred to in Articles 12, 14, 17 and 20, whose taxation is allocated exclusively to a Contracting State may also be taxed in the other Contracting State, to the limit of the portion that is exempt or non-taxable in the first mentioned State under the tax laws applicable therein.
  • (d) France may tax individuals of French nationality residing in Andorra as if this Convention did not exist. When the French tax law allows the application of this provision, the competent authorities of the Contracting States shall resolve the implementation of the latter by mutual agreement.

(2) Where, pursuant to the provisions of this Convention, an income benefits from a tax advantage in a Contracting State, and that under the domestic legislation in force in the other Contracting State, a person is only subject to tax on a portion of such income, and not its total amount, the tax benefit granted in the first-mentioned State shall apply only to the portion of income that is taxable without being exempt from tax in the other State.