Barbados and Canada sign amended air accord
The governments of Barbados and Canada Tuesday signed a reciprocal air transport agreement, which gives designated carriers from both countries “the flexibility to operate without directional or geographical limitations”. Minister of Foreign Affairs and Foreign Trade Senator Maxine McClean, who initialed the agreement at her Ministry’s Culloden Road, St Michael offices, along with Canada’s High Commissioner Marie Legault, said the accord should also redound to increased airlift and more long stay visitors from Canada, which is the island’s single largest source market for international business. “The evidence is there that there is a renewed commitment on both our parts to ensure not only that our visitor arrivals increase, but also to facilitate the business transactions that take place between our countries,” McClean said. The new pact replaces the original air services agreement signed between Barbados and Canada in 1985. High Commissioner Legault agreed with Senator McClean that air connectivity was crucial to the promotion of trade and investment between the two countries. “In 2013, 50,000 people came just with Air Canada and in three years we were able to increase that to 81,000 people . . . and it’s increasing every year. So, an instrument like this is essential to make sure there are no barriers between our countries,” Legault said.
Creditors ask court to limit Puerto Rico’s authority over its bank account
OppenheimerFunds, Franklin Advisers, Inc., and the First Puerto Rico Family of Funds asked Judge Laura Taylor Swain on Monday to limit the limit the authority of the banks in which the government has its accounts to continue honoring transfers, deposits and withdrawals. “Any order entered in connection with the Bank Transaction Motion must avoid providing banks with broad releases of liability,” the creditors said. The petition is contained in a motion in which the entities are objecting the government’s motions on how its bankruptcy process should be managed. The entities are holders of bonds from Puerto Rico and its instrumentalities. The Family of Funds are holders of over $3.5 billion in bonds from the Sales Tax Financing Corp. (Cofina by its Spanish acronym), and over $3.6 billion of other uninsured bonds issued by the Commonwealth and other territorial instrumentalities, including over $1.8 billion in uninsured Commonwealth general obligation bonds, making them one of the largest creditor group. The Commonwealth of Puerto Rico and Cofina by and through the Financial Oversight & Management Board for Puerto Rico had asked the court for an order confirming the authority of their banks to continue honoring all transactions without incurring in liability days after filing for Title III bankruptcy. The creditors said provisions that appear to insulate the banks from virtually any form of liability so long as they are acting in response to the government’s instructions, must be stricken or narrowed. “An order meant to provide comfort that section 363 does not apply should not mislead a Bank into believing that it is relieved of existing obligations or duties, and any resulting liability therefore,” they said. They noted that Promesa provides that if property is transferred in violation of a pledge, the transferee is liable for the transfer. “A bank which serves as an intermediate transferee may be liable under Promesa. This is an issue which should be resolved after a full and fair opportunity to be heard, not as part of a first-day administrative order,” they said.
EU agrees double taxation dispute resolution system
The proposal sets out to improve the mechanisms used for resolving disputes between member states when disputes arise from the interpretation of agreements on the elimination of double taxation, reports CCH Daily. Edward Scicluna, minister for finance of Malta, which currently holds the Council presidency, said: ‘This directive is an important part of our plan for strengthening tax certainty and improving the business environment in Europe.’ The draft directive requires dispute resolution mechanisms to be mandatory and binding, with clear time limits and an obligation to reach results. The aim is to create a tax environment where compliance costs for businesses are reduced to a minimum. The text allows for a ‘mutual agreement procedure’ to be initiated by the taxpayer, under which member states must reach an agreement within two years. If the procedure fails, an arbitration procedure is launched to resolve the dispute within specified timelines. For this, an advisory panel of three to five independent arbitrators is appointed together with up to two representatives of each member state. The panel (advisory commission) issues an opinion for eliminating the double taxation in the disputed case, which is binding on the member states involved unless they agree on an alternative solution. The Council endorsed a number of options covering some issues. For example, while it has agreed on a broad scope for the types of cases which can be considered, there is the option, on a case-by-case basis, of excluding disputes that are judged not to involve double taxation. It also agreed the pool of independent arbitrators must be made up of ‘independent persons of standing’. Arbitrators must not be employees of tax advice companies or have given tax advice on a professional basis. Unless agreed otherwise, the panel chair must be a judge. In addition, the Council left open the possibility of setting up a permanent structure to deal with dispute resolution cases if member states so agree. Agreement on the proposals was reached at a meeting of the economic and financial council. The Council will adopt the directive once the European Parliament has given its opinion. Member states will have until 30 June 2019 to transpose the directive into national laws and regulations. It will apply to complaints submitted after that date on questions relating to the tax year starting on or after 1 January 2018. The member states may however agree to apply the directive to complaints related to earlier tax years. CCCTB proposals The same meeting of the economic and financial council also discussed a proposal for a common corporate tax base (CCTB) in the EU, aimed at reducing the administrative burden of multinational companies. This would form the first step of an envisaged two-step corporate tax reform, which has proved controversial when originally put forward. Revamping an earlier 2011 proposal, it establishes a single rulebook for calculating companies’ corporate tax liability. The presidency confirmed its intention to continue discussions on new elements of the proposal, and that an appropriate degree of flexibility should be provided for. A separate proposal on tax consolidation (CCCTB) will be considered without delay once the CCTB rulebook has been agreed. The Council will require unanimity to adopt the directive, after consulting the European Parliament.