AGREEMENT
BETWEEN THE GOVERNMENT OF THE REPUBLIC OF LATVIA AND THE STATES
OF GUERNSEY FOR THE EXCHANGE OF INFORMATION RELATING TO TAX
MATTERS
WHEREAS the Government of the Republic of Latvia and the
States of Guernsey have long been active in international efforts
in the fight against financial and other crimes, including the
targeting of terrorist financing;
WHEREAS it is acknowledged that the States of Guernsey has the
right, under the terms of the Entrustment from the United Kingdom
of Great Britain and Northern Ireland, to negotiate, conclude,
perform and subject to the terms of this Agreement terminate a
tax information exchange agreement with the Government of the
Republic of Latvia;
WHEREAS the States of Guernsey on the 21st February 2002
entered into a political commitment to the OECD's principles of
effective exchange of information;
WHEREAS the Parties wish to enhance and facilitate the terms
and conditions governing the exchange of information relating to
taxes;
NOW, therefore, the Parties have agreed to conclude the
following Agreement which contains obligations on the part of the
Parties only:
Article 1
Scope of the Agreement
The competent authorities of the Parties shall provide
assistance through exchange of information that is foreseeably
relevant to the administration and enforcement of the domestic
laws of the Parties concerning the taxes covered by this
Agreement. Such information shall include information that is
foreseeably relevant to the determination, assessment and
collection of such taxes, the recovery and enforcement of tax
claims, or the investigation of tax matters or prosecution of
criminal tax matters. A requested Party is not obliged to provide
information which is neither held by its authorities, nor in the
possession of or obtainable by persons who are within its
territorial jurisdiction. The rights and safeguards secured to
persons by the laws or administrative practice of the requested
Party remain applicable to the extent that they do not unduly
prevent or delay effective exchange of information.
Article 2
Taxes Covered
1. This Agreement shall apply to the following taxes imposed
by the Parties:
(a) in the case of Guernsey:
(i) income tax;
(ii) dwellings profits tax;
(b) in the case of Latvia:
(i) the enterprise income tax (uznemumu ienakuma
nodoklis);
(ii) the micro-enterprise tax (mikrouznemumu nodoklis);
(iii) the personal income tax (iedzivotaju ienakuma
nodoklis);
(iv) the immovable property tax (nekustama ipasuma
nodoklis);
(v) the value added tax (pievienotas vertibas nodoklis).
2. This Agreement shall apply also to any identical taxes
imposed after the date of signature of the Agreement in addition
to or in place of the existing taxes, or any substantially
similar taxes if the Parties so agree. Furthermore, the taxes
covered may be expanded or modified by mutual agreement of the
Parties in the form of an exchange of notes. The competent
authority of each Party shall notify the other of substantial
changes in laws which may affect the obligations of that Party
pursuant to this Agreement.
Article 3
Definitions
1. In this Agreement:
(a) "Guernsey" means the States of Guernsey, and
when used in a geographical sense means Guernsey, Alderney and
Herm, including the territorial sea adjacent to those islands, in
accordance with international law;
(b) "Latvia" means the Republic of Latvia and, when
used in the geographical sense, means the territory of the
Republic of Latvia and any other area adjacent to the territorial
waters of the Republic of Latvia within which under the laws of
Latvia and, in accordance with international law, the rights of
Latvia may be exercised with respect to the sea bed and its
sub-soil and their natural resources;
(c) "collective investment fund or scheme" means any
pooled investment vehicle, irrespective of legal form. The term
"public collective investment fund or scheme" means any
collective investment fund or scheme provided the units, shares
or other interests in the fund or scheme can be readily
purchased, sold or redeemed by the public. Units, shares or other
interests in the fund or scheme can be readily purchased, sold or
redeemed "by the public" if the purchase, sale or
redemption is not implicitly or explicitly restricted to a
limited group of investors;
(d) "company" means any body corporate or any entity
that is treated as a body corporate for tax purposes;
(e) "competent authority" means:
(i) in the case of Guernsey, the Director of Income Tax or his
delegate;
(ii) in the case of Latvia, the State Revenue Service or its
authorised representative except that, where Latvia is the
requesting Party, the Prosecutor General or its authorised
representative may act as the competent authority in respect of
criminal tax matters;
(f) "criminal laws" means all criminal laws
designated as such under domestic law, irrespective of whether
such are contained in the tax laws, the criminal code or other
statutes;
(g) "criminal tax matters" means tax matters
involving intentional conduct whether before or after the entry
into force of this Agreement which is liable to prosecution under
the criminal laws of the requesting Party;
(h) "information" means any fact, statement,
document or record in whatever form;
(i) "information gathering measures" means laws and
administrative or judicial procedures enabling a requested Party
to obtain and provide the information requested;
(j) "Parties" means:
(i) Guernsey; and
(ii) Latvia;
(k) "person" includes an individual, a company and
any other body of persons;
(l) "principal class of shares" means the class or
classes of shares representing a majority of the voting power and
value of the company;
(m) "publicly traded company" means any company
whose principal class of shares is listed on a recognised stock
exchange provided its listed shares can be readily purchased or
sold by the public. Shares can be purchased or sold "by the
public" if the purchase or sale of shares is not implicitly
or explicitly restricted to a limited group of investors;
(n) "recognised stock exchange" means any stock
exchange agreed upon by the competent authorities of the
Parties;
(o) "requested Party" means the Party to this
Agreement which is requested to provide or has provided
information or assistance in response to a request
information;
(p) "requesting Party" means the Party to this
Agreement submitting a request for or having received information
or assistance from the requested Party;
(q) "tax" means any tax covered by this
Agreement.
2. As regards the application of this Agreement at any time by
a Party, any term not defined therein shall, unless the context
otherwise requires, have the meaning that it has at that time
under the laws of that Party, any meaning under the applicable
tax laws of that Party prevailing over a meaning given to the
term under other laws of that Party.
Article 4
Exchange of Information Upon Request
1. The competent authority of the requested Party shall
provide upon request by the requesting Party information for the
purposes referred to in Article 1. Such information shall be
exchanged without regard to whether the requested Party needs
such information for its own tax purposes or the conduct being
investigated would constitute a crime under the laws of the
requested Party if it had occurred in the territory of the
requested Party. The competent authority of the requesting Party
shall only make a request for information pursuant to this
Article when it is unable to obtain the requested information by
other means within its own territory, except where recourse to
such means would give rise to disproportionate difficulty.
2. If the information in the possession of the competent
authority of the requested Party is not sufficient to enable it
to comply with the request for information, the requested Party
shall use at its own discretion all relevant information
gathering measures necessary to provide the requesting Party with
the information requested, notwithstanding that the requested
Party may not need such information for its own tax purposes.
3. If specifically requested by the competent authority of the
requesting Party, the competent authority of the requested Party
shall provide information under this Article, to the extent
allowable under its domestic laws, in the form of depositions of
witnesses and authenticated copies of original records.
4. Each Party shall ensure that its competent authorities, for
the purposes specified in Article 1 of the Agreement, have the
authority to obtain and provide upon request:
(a) information held by banks, other financial institutions,
and any person acting in an agency or fiduciary capacity
including nominees and trustees;
(b) (i) information regarding the beneficial ownership of
companies, partnerships, foundations, and other persons,
including, ownership information on all such persons in an
ownership chain;
(ii) in the case of collective investment funds or schemes,
information on shares, units and other interests;
(iii) in the case of trusts, information on settlors,
trustees, protectors, enforcers and beneficiaries;
(iv) in the case of foundations, information on founders,
members of the foundation council and beneficiaries.
This Agreement does not create an obligation for a Party to
obtain or provide ownership information with respect to publicly
traded companies or public collective investment funds or
schemes, unless such information can be obtained without giving
rise to disproportionate difficulties.
5. Any request for information shall be formulated with the
greatest detail possible and shall specify in writing:
(a) the identity of the person under examination or
investigation;
(b) the period for which the information is requested;
(c) the nature of the information requested and the form in
which the requesting Party would prefer to receive it;
(d) the tax purpose for which the information is sought;
(e) the reasons for believing that the information requested
is foreseeably relevant to tax administration and enforcement of
the requesting Party, with respect to the person identified in
subparagraph (a) of this paragraph;
(f) the grounds for believing that the information requested
is present or held in the requested Party or is in the possession
of, under the control of or obtainable by a person within the
jurisdiction of the requested Party;
(g) to the extent known, the name and address of any person
believed to be in possession of, in the control of or able to
obtain the information requested;
(h) a statement that the request is in conformity with the
laws and administrative practices of the requesting Party, that
if the requested information was within the jurisdiction of the
requesting Party then the competent authority of the requesting
Party would be able to obtain the information under the laws of
the requesting Party or in the normal course of administrative
practice and that it is in conformity with this Agreement;
(i) a statement that the requesting Party has pursued all
means available in its own territory to obtain the information,
except where that would give rise to disproportionate
difficulty.
6. The competent authority of the requested Party shall
forward the requested information as promptly as possible to the
requesting Party. To ensure a prompt response, the competent
authority of the requested Party shall:
(a) confirm receipt of a request in writing to the competent
authority of the requesting Party and shall notify the competent
authority of the requesting Party of deficiencies in the request,
if any, within 60 days of the receipt of the request;
(b) if the competent authority of the requested Party has been
unable to obtain and provide the information within 90 days of
receipt of the complete request, including if it encounters
obstacles in furnishing the information or it refuses to furnish
the information it shall immediately inform the competent
authority of the requesting Party, explaining the reason for its
inability, the nature of the obstacles or the reasons for its
refusal.
Article 5
Tax Examinations Abroad
1. At the request of the competent authority of the requesting
Party, the competent authority of the requested Party may allow
representatives of the competent authority of the requesting
Party to enter its territory to interview individuals and examine
records with the prior written consent of the persons concerned.
The competent authority of the requesting Party shall notify the
competent authority of the requested Party of the time and place
of the intended meeting.
2. At the request of the competent authority of the requesting
Party, the competent authority of the requested Party may permit
representatives of the competent authority of the requesting
Party to attend a tax examination in the territory of the
requested Party.
3. If the request referred to in paragraph 2 of this Article
is granted, the competent authority of the requested Party
conducting the examination shall, as soon as possible, notify the
competent authority of the requesting Party of the time and place
of the examination, the authority or official designated to carry
out the examination and the procedures and conditions required by
the requested Party for the conduct of the examination. All
decisions regarding the conduct of the examination shall be made
by the requested Party conducting the examination.
Article 6
Possibility of Declining a Request
1. The competent authority of the requested Party may decline
to assist:
(a) where the request is not made in conformity with this
Agreement;
(b) where the requesting Party has not pursued all means
available in its own territory to obtain the information, except
where recourse to such means would give rise to disproportionate
difficulty; or
(c) where the disclosure of the information requested would be
contrary to public policy.
2. This Agreement shall not impose upon a requested Party any
obligation to provide items subject to legal privilege, or supply
information which would disclose any trade, business, industrial,
commercial or professional secret or trade process, provided that
information described in Article 4, paragraph 4, shall not by
reason of that fact alone be treated as such a secret or trade
process.
3. A request for information shall not be refused on the
ground that the tax claim giving rise to the request is
disputed.
4. The requested Party shall not be required to obtain and
provide information which, if the requested information was
within the jurisdiction of the requesting Party, the competent
authority of the requesting Party would not be able to obtain
under its laws or in the normal course of administrative
practice.
5. The requested Party may decline a request for information
if the information is requested by the requesting Party to
administer or enforce a provision of the tax law of the
requesting Party, or any requirement connected therewith, which
discriminates against a national or citizen of the requested
Party as compared with a national or citizen of the requesting
Party in the same circumstances.
Article 7
Confidentiality
1. All information received by the competent authority of a
Party shall be treated as confidential in the same manner as
information obtained under the domestic laws of that Party.
2. Such information shall be disclosed only to persons or
authorities (including courts and administrative bodies)
concerned with the purposes specified in Article 1, and used by
such persons or authorities only for such purposes, including the
determination of any appeal. For these purposes, information may
be disclosed in public court proceedings or in judicial
decisions.
3. Such information may not be used for any purpose other than
for the purposes stated in Article 1 without the express written
consent of the competent authority of the requested Party.
4. Information provided to a requesting Party under this
Agreement may not be disclosed to any other jurisdiction.
Article 8
Costs
Unless the competent authorities of the Parties otherwise
agree, indirect costs incurred in providing assistance shall be
borne by the requested Party, and direct costs incurred in
providing assistance (including costs of engaging external
advisors in connection with litigation or otherwise) shall be
borne by the requesting Party. The respective competent
authorities shall consult from time to time with regard to this
Article, and in particular the competent authority of the
requested Party shall consult with the competent authority of the
requesting Party in advance if the costs of providing information
with respect to a specific request are expected to be
significant.
Article 9
Language
Requests for assistance and responses thereto shall be drawn
up in English.
Article 10
Mutual Agreement Procedures
1. Where difficulties or doubts arise between the Parties
regarding the implementation or interpretation of this Agreement,
the respective competent authorities shall use their best efforts
to resolve the matter by mutual agreement.
2. In addition to the agreements referred to in paragraph 1 of
this Article, the competent authorities of the Parties may
mutually agree on the procedures to be used under Articles 4, 5
and 8.
3. The Parties may also agree on other forms of dispute
resolution should this become necessary.
Article 11
Mutual Assistance Procedure
If both competent authorities of the Parties consider it
appropriate to do so they may agree to exchange technical
know-how, develop new audit techniques, identify new areas of
non-compliance, and jointly study non-compliance areas.
Article 12
Entry into Force
This Agreement shall enter into force 30 days after receipt of
written notification by the latter Party of completion of all
legal formalities required for entry into force. Upon the date of
entry into force, it shall have effect:
(a) for criminal tax matters on that date; and
(b) for all other matters covered in Article 1 on that date,
but only in respect of taxable periods beginning on or after that
date or, where there is no taxable period, all charges to tax
arising on or after that date.
Article 13
Termination
1. Either Party may terminate this Agreement by giving notice
of termination in writing. Such termination shall become
effective on the first day of the month following the expiration
of a period of 3 months after the date of receipt of notice of
termination by the other Party. All requests received up to the
effective date of termination will be dealt with in accordance
with the terms of this Agreement.
2. If the Agreement is terminated the Parties shall remain
bound by the provisions of Article 7 with respect to any
information obtained under this Agreement.
IN WITNESS WHEREOF the undersigned have signed the
Agreement.
DONE at London in duplicate this 5th day of
September 2012, in the English language.
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For the Government of the
Republic of Latvia
Eduards Stiprais
Ambassador Extraordinary and
Plenipotentiary of the Republic of Latvia to the United
Kingdom of Great Britain and Northern Ireland
|
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For the States of
Guernsey
Peter Harwood
Chief Minister
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