Abstract

The article encompasses a brief description of the tax court verdicts from different countries on compliance issue of national CFC rules with double tax treaties based on the OECD Model Tax Convention. This article as a continuation of Part 1, where technical analysis of CFC rules with the OECD Model Tax Convention was presented. The overall conclusion of both parts is that in general CFC rules are allowable under the OECD Model Tax Convention, whereas the national method of calculating and attributing CFC income is irrelevant from the perspective of such analysis. The latter conclusion is particularly valid in the light of the ‘active’ legislative actions taken by countries where the judiciary found CFC rules incompliant with double tax treaties, whereas such actions were aimed at striking down the conclusions stemming from such verdicts by changing the approach.