Table of Contents. Part One Residence of Individuals and Non-Tax Law

Transcription

1 Acknowledgements Foreword v vii Part One Residence of Individuals and Non-Tax Law Chapter 1: Residence and domicile of individuals in private international law 3 James J. Fawcett 1.1. Introduction Domicile Domicile under national rules of private international law The relevance of domicile Common law jurisdictions: England 4 Jurisdiction 4 The applicable law 4 Recognition of foreign decisions 4 Tax law Other common law jurisdictions Civil law jurisdictions 5 Jurisdiction 6 The applicable law 6 Recognition of foreign decisions The meaning of domicile Common law jurisdictions: England 8 Complex rules 8 Is the meaning of domicile the same regardless of the context? 9 No reform in England Other common law jurisdictions Civil law jurisdictions 12 The different definitions 12 Only one domicile? 13 The practical importance of residence 13 ix

2 Comparison with the common law meaning Domicile under EC rules of private international law The relevance of domicile The meaning of domicile Civil law jurisdictions The problem for England and Ireland Concepts of residence Residence The relevance of residence Common law jurisdictions: England Other common law jurisdictions Civil law jurisdictions Hague Conventions The meaning of residence Common law jurisdictions: England 21 The residence requirement for domicile 21 When operating flexible common law rules 22 Tax law Other common law jurisdictions Civil law jurisdictions Ordinary residence The relevance of ordinary residence Common law jurisdictions: England Other common law jurisdictions Civil law jurisdictions The meaning of ordinary residence Common law jurisdictions: England Other common law jurisdictions Habitual residence The relevance of habitual residence Hague Conventions on private international law National rules of private international law 27 x

3 Common law jurisdictions: England 27 Other common law jurisdictions 27 Civil law jurisdictions 28 EC law generally 29 EC rules of private international law The meaning of habitual residence Under Hague Conventions on private international law Under national law 31 Common law jurisdictions: England 31 Other common law jurisdictions 34 Civil law jurisdictions Under EC law generally Under EC private international law 36 Brussels IIbis 36 Rome I and Rome II Conclusions 39 Chapter 2: Residence under EC (non-tax) law 41 Jan Wouters 2.1. Introduction The notion of residence in EU law: In search of a definition Use of the term at treaty level Use of the term in EU legislation The term residence in ECJ case law Residence requirements as discriminatory restrictions to free movement The principle of non-discrimination on grounds of nationality The notion of covert or indirect discrimination Residence requirements as covert or indirect discrimination Residence in direct tax cases Residence requirements as non-discriminatory restrictions to free movement Residence requirements and the freedom to provide services 63 xi

4 Restriction-based reasoning in other free movement cases Residence requirements and EU citizenship rights Concluding remarks 70 Part Two Residence of Individuals and Domestic Tax Law Chapter 3: Civil law and common law perspectives: A view from the left 75 Angelo Nikolakakis 3.1. Introduction Overview Specific practices Principal structural questions Broader observations Conclusions 82 Chapter 4: The concept of residence in inheritance tax law 85 Alexander Rust 4.1. The inheritance and the estate tax concept Theoretical principles for a residence concept in estate and inheritance tax law The concept of residence in practice Double taxation in inheritance tax cases Avoidance of double taxation through estate, inheritance and gift tax treaties Double taxation in the case of emigration Solution found in Art. 4(2) of the OECD Model Alternative provision suggested by the OECD Model Solutions in tax treaty practice Apportionment of tax revenue between the old and the new residence state Art. V(2) DTC United Kingdom United States Art. 11 of the 1928 League of Nation Model Analogies derived from income tax treaties Conclusion 102 xii

5 Part Three Residence of Individuals and EC Tax Law Chapter 5: The relevance of residence under EC tax law 107 Luc De Broe 5.1. The use of the residence criterion by Member States as a factor to allocate taxing jurisdiction The basic principles Dual residence Optional residence treatment Transfer of residence Exit taxes on shareholdings and pensions Overview of the ECJ s case law Conclusion Further observations on the ECJ s case law Preliminary remark: Compatibility of exit tax with tax treaties The ECJ s case law on exit taxes 121 Fiscal territoriality and allocation of taxing jurisdiction between Member States 121 Relief for double taxation 124 How serious is the justification put forward by the Netherlands? 124 A strange but explicable position on value decreases occurring after emigration 125 Differences between the case law on exit tax on shares and on pensions 126 Unresolved issues Extended tax liability (trailing tax) Acceleration of tax liability Resident v. non-resident: Option v. discrimination 131 xiii

6 Part Four Tax Residence of Individuals under the OECD Model Convention Chapter 6: The expression liable to tax by reason of his domicile, residence under Article 4(1) of the OECD Model Convention 135 Michael Dirkis 6.1. Introduction The meaning of domicile, residence in the first sentence The historic development of the meaning of domicile, residence Current meaning of domicile, residence in the first sentence The meaning of liable to tax in the first sentence Historic development of the meaning of liable to tax in the first sentence Current meaning of liable to tax in the first sentence The meaning of liable to tax in the second sentence Difficulties in application Remittance Skilled short-term residents Diplomats Residents of external territories Conclusions 151 Chapter 7: History and interpretation of the tiebreaker rule in Article 4(2) of the OECD Model Tax Convention 153 Jacques Sasseville 7.1. Introduction History of the tiebreaker rule The 1928 models of the League of Nations The 1943 Mexico Model and the 1946 London Model The OEEC reports Interpretation of the tiebreaker rule 162 Chapter 8: The expression centre of vital interests in Article 4(2) of the OECD Model Convention 169 Philip Baker 8.1. Art. 4(2) of the OECD MC and its Commentary 169 xiv

7 8.2. A brief history of CVI Analysis of the expression CVI CVI as a preference criterion between the two Contracting States in both of which there is a permanent home More than one CVI: no CVI Domestic law meaning or international fiscal meaning? A facts and circumstances test, based on objective (or partly objective) factors Testing the application of the State with which his personal and economic relations are closer The meaning of personal relations and the meaning of economic relations The relative weight of different factors Concluding comments 182 Chapter 9: Article 4(2) of the OECD Model Convention: Practice and case law 185 Ed Stuart 9.1. Practice and case law or practice or case law? Interpretation of Art. 4(2) Permanent home Centre of vital interests Habitual abode Nationality Mutual agreement by competent authorities Emerging issues Variations in practice 197 Part Five Country Reports Chapter 10: Australia 201 Michael Dirkisi Individuals and private (international) law The connecting criteria Citizenship Domicile Residence 205 xv

8 Ordinarily resident Physical presence Resolving conflicts between the connecting criteria operative in Australian private law and those used in foreign states The connecting criteria contained in non-tax public international law treaties on social security matters Residence of individuals under domestic tax law Overview The primary test Overview Factors that assist in determining where a person reside Physical presence Term of any employment or appointment Nature of the person s family, business and social ties Frequency and regularity of a person s movements Intention (purpose) of visit or trip Summary Extension tests The domicile test The 183-day test The Commonwealth superannuation test Defining the scope of the specific purpose residence test for individuals Alternative definitions in the income tax law Temporary resident Ordinarily resident Territory resident Other residence definitions in related tax acts Summary and residual issues Relationship between public law connective factors and those used under the income tax law Taxes on abandonment of residence Diplomats, consuls and persons connected with international organizations 231 xvi

9 10.3. Residence of individuals under tax treaties Criteria applied in determining the residence of individuals in the state s tax treaty practice Overview Consistency with Art. 4(1) of the OECD Model Convention The meaning of the expression liable to tax The connecting criteria relevant to establish the resident status Individuals liable to tax in a State only in respect of income from sources located therein The tiebreaker provisions for individuals Overview Examination of the tiebreaker tests in detail Availability of permanent home test Personal and economic relations test Habitual abode Nationality Mutual agreement Effects of a tax treaty tiebreaker rule on the individual s resident status under both domestic income tax law and other tax treaties Compatibility of domestic tax law provisions with tax treaties and Community law 243 Chapter 11: Austria 245 Veronika Daure Individuals and private (international) law Austrian international private law Conflict of law rules General Subject-related factors Object-related factors Activity-related factors and the choice of law 249 xvii

10 Escape clauses Public international law treaties Residence of individuals under domestic tax law Domicile and habitual abode Domicile Habitual abode Other individuals subject to unlimited tax liability General Public servants working abroad Option for unlimited tax liability Change of residence General Exit tax on shares Exit tax on the transfer of an enterprise or a permanent establishment Exit tax on accrued interest Interactions with international private law Other concepts of tax residence Residence of individuals under tax treaties Criteria for determining residence General Liable to tax by reason of other similar criteria Connecting criteria Individuals liable to tax in a State in respect of income only from sources located therein (Art. 4(1) second sentence OECD Model) Tiebreaker provisions for individuals General Tiebreakers in Austrian DTCs Permanent home Centre of vital interests Habitual abode Nationality Mutual agreement procedure Effects of the tiebreaker Effects on national law Effects on other tax treaties Special residence provisions Compatibility of domestic tax law provisions with tax treaties and Community law 277 xviii

11 Exit tax and free movement of capital Exit tax as treaty override? 278 Chapter 12: Belgium 281 Aagje Bellens Individuals and private (international) law The concept of residence in Belgian private law The concept of residence in private international law Residence of individuals under domestic tax law Subject to Belgian income tax Definition of a Belgian resident Interpretation and understanding of the concept of residence and the seat of wealth Tax regime on expatriates The concept of residence of individuals in the context of inheritance tax and gift taxes The concept of residence of individuals under tax treaties The interpretation of residence of individuals in Belgium s tax treaty practic Interpretation of the expression liable to tax The tiebreaker provisions for individuals residence Case law regarding residence of taxpayers involving Belgium Compatibility of domestic law provisions with tax treaties and Community law 301 Chapter 13: Canada 305 Kim Brooks Individuals and private (international) law Citizenship Domicile Residence Residence of individuals under domestic tax law Taxation on the basis of economic allegiance General approach to determining tax residence Individuals deemed to be resident in Canada Consequences of a change in residence Residence of individuals under tax treaties 320 xix

12 Criteria applied in determining the residence of individuals in the state s tax treaty practice The meaning of the expression liable to tax The connecting criteria relevant to establish the resident status Individuals liable to tax in a state in respect only of income from sources located therein The tiebreaker provisions for individuals Permanent home Centre of vital interests Habitual abode Nationality Competent authority Effects of a tax treaty tiebreaker rule on the individual s resident status under both domestic income tax law and other tax treaties Compatibility of domestic tax law provisions with tax treaties and Community law 331 Chapter14: France 333 Nicolas Message Individuals and international private law Domicile in French national law Definition of domicile Choice of domicile Existence of the domicile Uniqueness of the domicile Fixity of the domicile Legal effects of the domicile Application of the concept of domicile under international private law Link between laws and domicile Forum shopping and fraud Influences and contributions of European law The concept of usual residence Influence of European law on French international private law Residence of individuals under domestic tax law Tax residence under French law The personal criterion Permanent home 342 xx

13 Principal abode Combination of permanent home and principal abode The professional criterion The economic criterion Particular situations State officials, diplomats and employees of international organization Expatriated employees Change of domicile Taxation modalities General taxation principles Measures aimed at preventing tax evasion Residence of individuals under tax treaties Criteria applied in determining the residence of individuals in France s tax treaty practice French practice in stipulating criteria applied in determining the residence of an individual in tax treaties Meaning of the expression liable to tax Individuals liable to tax in a state in respect only of income from sources located therein The tiebreaker provisions for individuals Actual content attributed by French courts and tax authority to tiebreaker rules The permanent home The centre of vital interests The usual place of residence The nationality Scope of the OECD Commentary Mutual agreement procedure Effects of a tax treaty tiebreaker rule on the individual s resident status under both domestic income tax and other tax treaties Compatibility of domestic tax law provisions with tax treaties and Community law Compatibility of domestic law with tax treaties entered into by France Compatibility of domestic law with EU law Compatibility of Community law with the tax treaties entered into by France 362 xxi

14 Chapter 15: Germany 365 Alexander Rust Individuals and private international law Residence under the German Civil Code General remarks No definition in the Civil Code Establishment of a domicile A place to stay Physical presence The intention to stay for an unlimited period of time Termination of domicile International private law Nationality as the primary connecting factor Habitual abode as primary connecting factor Non-tax treaties Residence of individuals under domestic tax law Connecting factors for unlimited tax liability in German income tax law Deeming provisions, e.g. extended liability to tax for individuals moving their residence to tax havens Exit taxes Expatriates Diplomats and employees of international organizations Residence concepts in other areas of tax law (inheritance and gift taxes, VAT) Residence of individuals under tax treaties Criteria applied in determining the residence of individuals in the state s tax treaty practice The meaning of the expression liable to tax The connecting criteria relevant to establish the resident status Individuals liable to tax in a state in respect only of income from sources located therein The tiebreaker provisions for individuals Autonomous interpretation of treaty terms Tax treaties concluded by Germany Interpretation of the tiebreaker rules of Art. 4(2) OECD MC Permanent home 389 xxii

15 Centre of vital interests Habitual abode Nationality Mutual agreement procedure Effects of a tax treaty tiebreaker rule on the individual s resident status under both domestic income tax law and other tax treaties Influence on domestic income tax law Influence on the application of tax treaties concluded with third countries Compatibility of domestic tax law provisions with tax treaties and Community law Tax treaty override in case of CFC legislation Compatibility of the German exit tax with tax treaties Compatibility of the German exit tax with EC law Extended limited tax liability and tax treaties Nationality criterion in Art. 4(2)(c) OECD MC does not violate EC law 398 Chapter 16: Italy 401 Stefano Dorigo Individuals and private (international) law Connecting factors under the Italian CC The concept of domicile The concept of residence Connecting criteria under Italian private international law Connecting criteria under EC law Connecting criteria under (non-tax) international treaties Residence of individuals under domestic tax law Tax residence of individuals under Italian tax law Registration in the General Registry Office The meaning of reference to the concepts of domicile and residence under private law Legal presumption of tax residence of individuals Applicability of Art. 166 TUIR to individuals Impact of the jurisprudence on abuse of law on a transfer of residence Questions of residence of diplomatic agents and agents of international organizations 420 xxiii

16 The concept of tax residence concerning taxes other than income tax Residence of individuals under tax treaties Criteria applied in determining the residence of individuals in the state s treaty practice The meaning of the expression liable to tax The connecting criteria relevant to establish the resident status Individuals liable to tax in a state in respect only of income from sources located therein The tiebreaker provisions for individuals The change of residence by an individual before or after his/her minimum residence time in Italy has elapsed Effects of a tax treaty tiebreaker rule on the individual s resident status under both domestic income tax law and other tax treaties Compatibility of domestic tax law provisions with tax treaties and Community law Compatibility with tax treaties Compatibility with EC law 433 Chapter 17: Japan 437 Asatsuma Akiyuki Individuals and private (international) law Provisions of the CC The number of domicile Cases Leading case: Seirei Dormitory Supreme Court, 22 March Supreme Court, 15 April Private international law system The concept of habitual residence ( joukyosho) Case Residence of individuals under domestic tax law Provisions of ITA A non-permanent resident 446 Why the ITA has a category of a non-permanent resident Presumptive provisions on a domicile and will of permanent residency 447 xxiv

17 Cases Meanings of domicile and residence A translator of Harry Potter Unimat case Old provisions of Inheritance Tax Act and tax avoidance 450 Inheritance tax and gift tax provided in Inheritance Tax Act New provisions of Inheritance Tax Act Cases Hong Kong case Takefuji case Residence of individuals under tax treaties Criteria applied in determining the kyojuu (residence) of individuals in the state s tax treaty practice The meaning of the expression liable to tax The connecting criteria relevant to establish the resident status Individuals liable to tax in a state in respect only of income from sources located therein The tiebreaker provisions for individuals Effects of a tax treaty tiebreaker rule on the individual s resident status under both domestic income tax law and other tax treaties Compatibility of domestic tax law provisions with tax treaties and Community law 461 Chapter 18: Netherlands 465 Anna Gunn Introduction Private (international) law The concept of residence under Dutch civil law (woonplaats) Function of civil law place of residence Types of civil law place of residence Independent place of residence Dependent place of residence Elected place of residence Loss of civil law place of residence Use of residence in Dutch public law 470 xxv

18 Use of residence in Dutch international private law Use of connecting criteria under Dutch international private law 471 Use of nationality as a connecting factor 471 Use of residence as a connecting factor The concept of residence under Dutch international private law (gewone verblijfplaats) Conclusion Residence of individuals under national tax law Residence in Dutch national tax law (wonen) Connecting criteria under Dutch national tax law Residence under Dutch national tax law Fiscal residence determined on the basis of an open norm Circumstances under Art. 4 GTA Residence in more than one country Significance of an individual s intent Tax residence based on a legal fiction Short-term émigrés and persons employed by the Dutch state Crews of ships and aircraft Taxation of foreign diplomats (Art. 39 GTA) Elective taxpayer treatment Introduction Non-resident taxpayer chooses to be treated like a resident (Art. 2.5 IITA) Resident taxpayer chooses to be taxed as a non-resident (Art. 2.6 IITA) Conclusion Residence of individuals under tax treaties Residence in Dutch tax treaties (inwoner) 482 xxvi

19 Criteria applied in determining the residence of individuals in the tax treaty practice of the Netherlands Tax treaty practice of the Netherlands 482 Art. 4(1) Dutch Model Tax Convention (general rule) 483 Art. 4(2) Dutch Model Tax Convention (tiebreaker) 484 Art. 1 of the Protocol to the Dutch Model Tax Convention (residence of persons on ships) The meaning of the expression liable to tax Meaning of the expression any other similar criterion Individuals liable to tax in a state in respect only to income from sources located therein Introduction Absence of Art. 4(1) second sentence in Dutch tax treaties 487 Treaties that pre-date OECD Model Tax Convention 487 Treaties that pre-date the 1977 OECD Model Tax Convention 488 Treaties with countries that requested the omission of the second sentence 488 Conclusion Treatment of partial non-resident taxpayers under tax treaties The tiebreaker provision for individuals Tiebreaker rule in accordance with OECD Model Tax Convention Tiebreaker rule in tax treaty between Netherlands and Switzerland Use of mutual agreement procedure for determination of residency status Dutch policy on the mutual agreement procedure 496 xxvii

20 Actual use of MAP by taxpayers in the Netherlands Effects of a tax treaty tiebreaker rule on the individual s residence status under both national income tax law and other tax treaties Introduction Effect of mutual agreement for the determination of national tax residence Effect of tax treaty residence on the application of other tax treaties changes to OECD Commentaries to Art. 4(1) Taxation of members of diplomatic missions and consular posts Compatibility of national tax law provisions with tax treaties and EC law Introduction Compatibility with tax treaties Compatibility with EC law Member States are competent to establish fiscal jurisdiction Member States must exercise their competence in accordance with EC law Restrictions of EC law stemming from the resident/non-resident distinction Comparability of residents and non-residents Source state perspective: Taxation of source-state income (Proxy) resident state perspective: Taking into account the ability to pay 504 Proxy resident state: Schumacker (C-279/93) 504 Conclusion Taking into account negative source-state income by (proxy) resident state Dutch criticism of Renneberg (C-527/06) 506 xxviii

21 Use of optional regime to ensure compliance with EC law: Gielen (C-440/08) Conclusion 509 Chapter 19: Spain 511 Mercedes Nuñez Grañon Individuals and private (international) law Determination of applicable law; connecting criteria Personal law: Nationality Cases of dual nationality Lack of nationality or undetermined nationality Habitual residence and domicile Dual domicile or residence Lack of domicile or residence International jurisdiction; domicile forum Forum shopping; concept and doctrinal solutions Residence of individuals under domestic tax law Criteria for liability and presumptions of residence; national rules Criteria for liability: Habitual residence Stay in Spain Centre of economic interests Presumptions of residence in Spain Connecting criteria and presumptions of residence; regional rules Special cases Consular and diplomatic staff Workers transferred to Spain Residents in other EU Member States Effects of changes of residence Natural persons income tax Wealth tax Residence of individuals under tax treaties Criteria applied in determining the residence of individuals in the state s tax treaty practice Meaning and scope of the expression liable to tax Connecting criteria Interpretation and reservations 530 xxix

22 Variations and special criteria Individuals liable to tax in a state in respect only of income from sources located therein The tiebreaker provisions for individuals Analysis of criteria used; particularities Connecting criteria; meaning attributed by case law and administrative practice Observations and reservations Effects of a tax treaty tiebreaker rule on the individual s resident status under both domestic income tax law and other tax treaties Compatibility of domestic tax law provisions with tax treaties and Community law 542 Chapter 20: Switzerland 547 Thierry Obrist and Roland A. Pfister Individuals and private (international) law General remarks Swiss private law Domicile Notion Criteria 548 Objective criterion 548 Subjective criterion Special legal domicile Residence Notion Criteria Business establishments Notion Criteria Swiss international private law Domicile Notion Criteria and comparison with Swiss private law Habitual residence Notion Criteria and comparison with Swiss private law Place of business 554 xxx

23 Notion Criteria and comparison with Swiss private law General remarks concerning international treaties concluded by Switzerland Residence of individuals under Swiss domestic tax law General remarks Conditions of the liability to tax Personal liability to tax Economical liability to tax Criteria used in Swiss domestic tax law Domicile Notion Criteria 557 Objective criterion 557 Subjective criterion Special legal domicile Domicile of diplomats Transfer of domicile 560 Necessity of the creation of a new domicile 560 Exit tax Influence by private law Residence Notion Criteria 564 Objective criterion 564 Subjective criterion Transfer of residence Intercantonal rules versus international rules Residence of individuals under tax treaties Introduction Criteria applied in determining residence of individuals in Swiss DTC practice The basic concept of residence under DTCs The provision of Art. 4(1) first sentence OECD MC The meaning of the expression liable to tax 569 Relevance of the meaning of comprehensive taxation 569 xxxi

24 Relevance of the meaning of lump-sum taxation Relevant connecting criteria to establish resident status Description of connecting criteria in Switzerland Interpretation of the connecting criteria in Switzerland The provision of Art. 4(1) second sentence OECD Model Description of Art. 4(1) second sentence OECD Model Transfer of residence Tiebreaker provisions for individuals Basic concept of the tiebreaker rules The provision of Art. 4(2) OECD Model Description of the tiebreaker rules in Switzerland Interpretation of the relevant tiebreaker rules in Switzerland 580 Permanent home 581 Centre of vital interests 582 Habitual abode 583 Nationality Effects of a tiebreaker rule on the individual s resident status under both domestic income tax law and other tax treaties Compatibility of domestic tax law provisions with tax treaties 586 Chapter 21: United Kingdom 589 Marika Lemos Individuals and private international law Relevance of domicile, nationality and residence in English private international law Examples of conflicts of criteria and their resolution in English law Jurisdiction In relation to civil and commercial matters falling within the scope of the Judgments Regulations and Brussels/Lugano Conventions 592 xxxii

25 Meaning of domicile when no special definition applies General rules, burden of proof, etc The role and tenacity of domicile of origin in English law Acquiring a domicile of choice Residence for the purposes of the law of domicile Requisite intention for the purposes of acquiring a domicile of choice Other rules determining domicile: Dependants Does domicile have a different meaning in different contexts? Meaning of residence, ordinary residence and habitual residence Residence Ordinary residence Habitual residence Connecting criteria adopted in social security legislation Residence of individuals under domestic tax law Connecting criteria under the UK tax system Post-FA 2008: The remittance basis of taxation, in outline Tax law meaning of residence and ordinary residence Statutory modifications Case law versus HMRC practice HMRC guidance on residence day test day test Day-counting Settled purpose Accommodation HMRC guidance on ordinary residence HMRC concessions: Arriving or leaving the United Kingdom during a tax year Statutory provisions extending liability to UK tax by reference to residence or domicile Deemed domicile Temporary non-residents: Income and CGT Exit charges Special legislation concerning diplomats and employees of international organizations 619 xxxiii

26 21.3. Residence of individuals under tax treaties entered into by the UK Criteria applied in determining residence of individuals in UK tax treaty practice The meaning of the expression liable to tax The connecting criteria relevant to establishing resident status Individuals liable to tax in a state in respect only of sources located therein The tiebreaker provisions for individuals Permanent home Centre of vital interests Habitual abode Nationality Mutual agreement procedure (MAP) Effects of a tax treaty tiebreaker rule on the individual s resident status under both domestic tax law and other tax treaties Compatibility of domestic tax law provisions with tax treaties and EU law Inconsistencies between domestic law and tax treaties Interaction between EU law and double tax treaties Breaches of EU law Deemed domicile: Breach of free movement of capital and/or free movement of persons? CGT exit charges: Breach of free movement of persons and/or free movement of capital? Temporary non-resident rules: Breach of free movement of persons? Other breaches of EU law? 646 Part Six Round-Table Discussion Chapter 22: Round Table: On the desirability to change Article 4 OECD Model Convention and its Commentary 651 John Avery Jones, Augusto Fantozzi, Jean Pierre Le Gall, Jonathan Schwarz Art. 4: Advantages and disadvantages 651 xxxiv

27 What are the advantages of the provisions of Arts. 4(1) and 4(2)? Subsidiary nature Nature of the advantages Tiebreaker rules Nature of the advantage Content of the tiebreaker rules What are the disadvantages of the provisions of Arts. 4(1) and 4(2)? Does the subsidiary nature of the treaty criteria lead to disadvantages? First difficulty: Change of domestic legislation Second difficulty: Timely application of domestic legislation Third difficulty: Partial liability tax Do the measures determining the residence of an individual in case of conflict (tiebreaker rules) present any disadvantages on their part? Respective relevancy of the tiebreaker rules Timely application of the tiebreaker rules The competent authority procedure Application of the tiebreaker rules to wealthy individuals Improving Art. 4(2) Desirability of change to Art. 4(2) Are the tests in Art. 4(2) the correct tests? Should there be a series of tests? What is the correct order of the tests? Conclusions 670 Contributors 675 xxxv