Introduction - The “Agreement between the German Institute in Taipei and the Taipei Representative Office in the Federal Republic of Germany for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital” and the respective protocol (together hereafter the “DTA”), as signed end of 2011 by representatives or both parties, have now been transformed into German national tax law. Negotiations for the DTA started in 2002. It will enter into force upon exchange of notifications. If both notifications take place this year, the DTA will become effective as of 1 January 2013.

Unlike typical double taxation conventions, the DTA does not qualify as a treaty for international law purposes. Nevertheless, pursuant to the German legislator in the DTA implementation act, the provisions of the DTA shall be treated in Germany as if the DTA were an international treaty. However, it remains to be seen whether the status as a double taxation convention will be fully recognized by the German tax courts.

The DTA is largely based on the 2005 OECD Model Convention. Please find below selected high-level descriptions of applicable provisions: