Ratified Agreements on the Protection of Investments and the Avoidance of Double Taxation with Qatar

Ratified Agreements on the Protection of Investments and the Avoidance of Double Taxation with Qatar

On March 30, laws on ratifying intergovernmental agreements with Qatar, regarding the promotion and mutual protection of investments and the avoidance of double taxation and the prevention of tax deviations of income taxes (with the Protocol) were published.

Investment Protection

In case of admission of the investments to its territory, in accordance with its legislation, the permits are granted in connection with such investments, as well as in connection with the observance of license agreements and contracts for technical, commercial or administrative assistance. Each Contracting Party, in accordance with its legislation, if necessary, will seek to issue the necessary permissions regarding the activities of consultants and other qualified persons with foreign citizenship. Investments made by investors of any Contracting Party are at any time granted a fair and equitable regime, as well as full protection and security in the territory of the other Contracting Party. If disputes cannot be resolved in a friendly way, within 6 months from the date of the written request for settlement with the information on the subject of the dispute to the competent state body of the Contracting Party, any party to the dispute may submit to its choice the settlement of the dispute in:

  1. a) the relevant court of the receiving Contracting Party for a decision; or
  2. b) International Center for the Settlement of Investment Disputes, established in accordance with the Convention on the procedure for settling investment disputes between states and foreign persons; or
  3. c) Arbitral Tribunal ad hoc.

The Agreement is valid for an initial period of 10 years with prolongation for the same period or periods unless the Contracting Party notifies the other Contracting Party in writing by diplomatic channels of its intention to terminate the Agreement at least one year before the date of termination or expiration

Avoidance of double taxation

The agreement applies to: in Ukraine – the tax on personal income and the tax on corporate profits; in Qatar, on taxes on income or profits. The agreement also applies to any identical or substantially similar taxes levied after the date of the signing of this Agreement, attached to or in place of existing taxes. The competent authorities of the Contracting States inform each other about any significant changes in tax legislation.

The provisions of the Agreement and the Protocol are consistent with the Model Convention of the Organization for Economic Cooperation and Development on Income and Capital Taxes, providing for:

– dividend taxation – a total rate of 10%; a 5% rate – for dividends received by a company that owns no less than 10% of the capital of a company that pays such dividends;

– taxation of interest and royalties – a total rate of 10%; a rate of 5% in other cases;

– a significant increase in the capacity of the signatory states to exchange tax information without reservations regarding the requirements of national tax interest or bank secrecy.

The agreement is concluded for an indefinite period. Any Contracting State may terminate the Agreement by sending diplomatic channels written a notice about its intention to terminate 6 months before the end of any calendar year that comes at the end of five years from the date of entry into force of the Agreement.

The Law No. 2691-VIII and Law No. 2690-VIII entered into force on April 10, and the agreements take effect from the date of receipt by the Contracting Parties of the last written report on the implementation of their internal state procedures.