What is Act No. 335 / 2020 Coll.?

Act No. 335 / 2020 Coll., on international cooperation in the resolution of tax disputes in the European Union — Act on International Cooperation in the Settlement of Tax Disputes in the European Union.

When it became Act No. 335 / 2020 Coll. effectiveness?

Act No. 335 / 2020 Coll. became effective 15.09.2020.

Is Act No. 335 / 2020 Coll. still valid?

Yes, Act No. 335 / 2020 Coll. is still valid and effective.

How many times was it Act No. 335 / 2020 Coll. amended?

Act No. 335 / 2020 Coll. has 3 time versions of the text.

Act No. 335 / 2020 Coll. - Act on International Cooperation in the...

335

THE LAW

of 22 July 2020

on international cooperation in the resolution of tax disputes in the European Union

Parliament has decided on this law of the Czech Republic:

ČÁST PRVNÍ

GENERAL PROVISIONS

§ 1

Subject matter

(1) This law provides for international cooperation in the resolution of tax disputes in accordance with a harmonised procedure under a European Union law governing the mechanism for the resolution of tax disputes in the European Union1).

(2) This law shall not apply in the procedure of an international agreement.

§ 2

Question at issue

For the purposes of the harmonised procedure, a matter leading to a dispute arising from the interpretation and application of an international treaty is an issue which is at issue.

§ 3

International Treaty

For the purposes of the harmonised procedure, the international agreement shall mean:

(a) an international agreement to prevent double taxation of income or property which is part of the legal order of the Czech Republic; or

(b) the Convention on the avoidance of double taxation in relation to the adjustment of the profits of associated undertakings.

§ 4

State concerned

For the purposes of the harmonised procedure, the State concerned shall mean the Member State of the European Union affected by the issue in question.

§ 5

The taxpayer concerned

For the purposes of the harmonised procedure, the taxpayer concerned shall mean a tax resident of a Member State of the European Union whose tax liability is directly affected by the issue.

§ 6

Means of protection

For the purposes of the harmonised procedure, the means of protection shall be:

(a) an appeal, a supervisory remedy or any other means of tax administration protection and an application to initiate proceedings before a court; and

(b) a means of protection under the legislation of another State concerned similar to that referred to in (a).

§ 7

Interpretation of terms

The term used in this Act as defined by the international agreement applicable between the Czech Republic and another State concerned on the date on which the taxpayer in question became aware of the measure leading to or leading to the issue at issue is of relevance given at this time by this Treaty, unless otherwise stated.

§ 8

Relation to the Tax Code

A harmonised procedure for the resolution of tax disputes shall be followed in accordance with the tax rules, unless otherwise provided for by this law.

ČÁST DRUHÁ

ORGANISATION SECURITY

HLAVA I

COMPETENT AUTHORITIES

§ 9

Competent authority

For the purposes of the harmonised procedure, the competent authority shall be the national competent authority or the foreign competent authority.

§ 10

Local Competent Authority

The local competent authority shall be the Ministry of Finance or the authorised competent authority.

§ 11

Ministry of Finance

(1) The Ministry of Finance shall keep a list of authorised competent authorities and publish that list on its website.

(2) The Ministry of Finance is responsible for resolving the issue in question by a harmonised procedure.

§ 12

Authorised competent authority

(1) The competent authority is the national tax administrator authorised by the Ministry of Finance to resolve the issue by a harmonised procedure.

(2) The Ministry of Finance shall, by authorisation, define the heading of the items to be dealt with by the competent authority authorised instead.

(3) In the exercise of its powers, the competent authority is subordinate to the Ministry of Finance.

§ 13

Determination of jurisdiction to resolve the issue

(1) The Ministry of Finance may take over the solution to the issue at issue, the competent authority empowered to deal with. The Ministry of Finance shall inform the competent authority empowered to do so.

(2) Should the resolution of the issue in question in view of the scope of the authorisation be partly to the competent authority and partly to the Ministry of Finance, the Ministry of Finance is responsible for dealing with it. The authorised competent authority shall cooperate with the Ministry of Finance to address this issue.

(3) In case of doubt as to the jurisdiction to address the issue, the Ministry of Finance shall determine which national competent authority is responsible for that solution, or, where appropriate, which of the national competent authorities shall cooperate with the Ministry of Finance in dealing with this issue.

§ 14

Foreign Competent Authority

For the purposes of the harmonised procedure, a foreign competent authority shall be the authority of another State concerned which is the competent authority under the legislation of that State.

HLAVA II

RECOGNISED UNDEPENDENT PERSONS

§ 15

Recognised independent person

For the purposes of the harmonised procedure recognised by an independent person, a natural person not belonging to the tax authority of any Member State of the European Union who may participate in the assessment under the conditions laid down in this law:

(a) the admissibility of the request for a harmonised procedure; and

(b) the issues at issue.

§ 16

Domestic recognised independent person

(1) For the purposes of the harmonised procedure, a locally recognised independent person means a natural person appointed by the Ministry of Finance to be a recognised independent person.

(2) The Ministry of Finance shall appoint at least 3 national recognised independent persons.

(3) The Ministry of Finance is continuously verifying whether the national recognised independent person fulfils the conditions for appointment recognised by the independent person.

(4) The Ministry of Finance may provide contact details of a national recognised independent person to an authority of another Member State of the European Union for the purpose of its appointment as a member of an advisory body.

§ 17

Appointment of a national recognised independent person and notification of changes

(1) A natural person may be appointed as a national recognised independent person if he is eligible to be an arbitrator under the law governing arbitration and is able to act impartially and honestly. The condition of citizenship under the law governing arbitration shall not apply.

(2) The natural person to be appointed by a national recognised independent person shall, in connection with this appointment, communicate to the Ministry of Finance:

(a) name,

(b) the date of birth;

(c) the address of the place of permanent residence or similar place in the case of foreigners;

(d) contact details,

(e) full and up-to-date information on professional and academic activities; and

(f) information on competence, competence and possible conflicts of interest.

(3) The Ministry of Finance shall inform the European Commission of the appointment of a national recognised independent person and shall inform it thereof.

(a) the information referred to in paragraph 2 (a), (e) and (f); and

(b) an indication of whether that person may be appointed as Chairman of the Advisory Committee.

(4) The Land-recognised independent person shall notify the Ministry of Finance of the change in the data referred to in paragraph 2 within 30 days of the date of such change.

(5) The Ministry of Finance shall inform the European Commission of the change in the data referred to in paragraph 3.

§ 18

Appeals of a national recognised independent person

(1) The Ministry of Finance shall withdraw the national recognised independent person if:

(a) request it;

(b) seriously infringes an obligation under this law; or

(c) no longer fulfils the conditions for appointment.

(2) If another Member State of the European Union has taken an initiative to appeal a national recognised independent person for a reasonable suspicion that that person is not independent enough, the Ministry of Finance shall assess the complaint within 6 months of receipt of the complaint.

(3) The Ministry of Finance shall inform the European Commission of the withdrawal of the national recognised independent person and of the outcome of the assessment of the complaint pursuant to paragraph 2.

§ 19

Foreign recognised independent person

(1) For the purposes of the harmonised procedure, a recognised external independent person means a natural person appointed by an authority of another Member State of the European Union to be a recognised independent person.

(2) The Ministry of Finance may initiate the appeal of a foreign recognised independent person if it has reasonable grounds to suspect that that person is not sufficiently independent. The complaint shall be lodged with the European Commission and shall provide, together with it, the supporting documents giving rise to the suspicion.

HLAVA III

ADVISORY AUTHORITIES

§ 20

Advisory body

(1) For the purposes of the harmonised procedure, an advisory committee or an alternative dispute resolution commission is understood as an advisory body.

(2) The local competent authority shall establish the conditions for and ensure the functioning of the advisory body.

(3) Advisory body

(a) receives information from the national competent authority and the taxpayer concerned;

(b) requests the national competent authority to ensure that the taxpayer or his representative is involved in the deliberations of the advisory body;

(c) assess the issue at issue.

(4) In addition, the Advisory Committee shall assess the admissibility of the request to initiate the harmonised procedure.

(5) In matters relating to the advisory body, account shall be taken of the customs usual in international trade arbitration.

(6) In carrying out the activities referred to in paragraphs 3 and 4, a member of the advisory body shall have the status of official person of the national competent authority.

§ 21

Advisory Committee

(1) The Advisory Committee shall consist of:

(a) the President,

(b) one representative of each competent authority; and

(c) 1 recognised independent persons for each State concerned.

(2) The number of persons referred to in paragraph 1 may be determined by agreement of all competent authorities when setting up an advisory panel. (b) or (c) increased to 2 persons.

(3) Each member of the Advisory Committee who is a recognised independent person, with the exception of the President, shall have an alternate who is a recognised independent person. The provisions on a recognised independent person as a member of the Advisory Committee shall apply mutatis mutandis to its alternate.

(4) Where a recognised independent person is unable to fulfil his / her duties as a member of the Advisory Committee, an alternate shall take his / her place. Where the national competent authority has appointed that alternate as member of the advisory body, it shall appoint a new alternate instead; Paragraph 42 shall apply mutatis mutandis.

(5) If the President is unable to fulfil his duties as a member of the Advisory Committee, the other members of the Advisory Committee shall appoint a new President from among all recognised independent persons.

§ 22

Alternative Dispute Settlement Commission

(1) An alternative dispute resolution committee may be set up, by agreement of all the competent authorities, to consider the issue at issue instead of the advisory panel.

(2) The ADR Commission may be established as a permanent advisory body by agreement of all competent authorities. For a permanent advisory body, the provisions on the establishment, membership and procedure of an advisory body shall apply mutatis mutandis.

(3) Unless otherwise assessed by the competent authorities, with the exception of rules on the independence of members, the provisions on the Advisory Commission shall apply mutatis mutandis to the composition of the ADR Board and its alternates.

HLAVA IV

COURT OF JUSTICE

§ 23

Proceedings

(1) Proceedings before a court under this law shall be governed by the rules governing civil proceedings.

(2) The court of the district in whose district the national competent authority is situated shall be responsible for the proceedings.

§ 24

Participation of the advisory body in the proceedings before a court

(1) The advisory body has the capacity to participate in civil proceedings under this law.

(2) The Chairperson shall act as the advisory body. The Chairman of the Advisory Body shall have the same rights and obligations in the proceedings referred to in paragraph 1 and in the enforcement of a decision given in that proceedings as the Advisory Body.

ČÁST TŘETÍ

HARMONISED PROCEDURE

HLAVA I

GENERAL PROVISIONS

§ 25

State concerned in which the submission is made

(1) For all competent authorities, a submission shall be made containing:

(a) a request to initiate a harmonised procedure;

(b) withdrawal of the request to initiate the harmonised procedure;

(c) a request for an assessment of the admissibility of the request for a harmonised procedure by the Advisory Committee; or

(d) a request for an advisory body to examine the issue at issue.

(2) In the case of administration in a simplified manner, it is sufficient to make the submission only to the national competent authority. The submissions referred to in paragraph 1 and those containing additional information may be made in a simplified manner.

(3) In a simplified way, only the taxpayer concerned, who is a tax resident of the Czech Republic, can make the submission

(a) by a natural person; or

(b) a legal person or entity without a legal personality which is not:

1. a large entity under the Accounting Act; and

2. in a large group of entities according to the Accounting Act.

(4) The local competent authority shall inform the foreign competent authorities of the submission made in a simplified manner within 2 months of the date on which such submission took place. In the case of submissions containing additional information, the national competent authority shall send a copy of that information together with the notification.

(5) Submission made in a simplified manner by the taxpayer concerned who has submitted a request to initiate a harmonised procedure (hereinafter referred to as "participant of procedure '), which is not a tax resident of the Czech Republic, to the competent authority of the State of which he is a tax resident, shall be deemed to have been made to the national competent authority on the date on which the foreign competent authority sent the notification to the national competent authority.

(6) Additional information provided in a simplified manner by a participant in a procedure that is not a tax resident of the Czech Republic to the competent authority of the State of which it is a tax resident shall be deemed to have been provided to the national competent authority on the date on which the information was obtained to the foreign competent authority if the foreign competent authority has sent a copy to the national competent authority.

§ 26

Submission in another State concerned

Where that law provides for an obligation to make submissions in another State concerned with a foreign competent authority, the law of that State shall apply to such submissions.

HLAVA II

INITIATION OF THE PROCEDURE

§ 27

Request to initiate the harmonised procedure

(1) The harmonised procedure is initiated at the request of the taxpayer concerned. The initiation of a harmonised procedure does not preclude the fact that:

(a) the measure leading to the issue at issue has become final under the legislation of the State concerned;

(b) proceedings concerning a means of protection are under way; or

(c) proceedings have been carried out on a means of protection, with the exception of the administrative procedure referred to in Paragraph 65 (2).

(2) The application referred to in paragraph 1 shall contain:

(a) the designation of all States concerned;

(b) name, place of residence or registered office, tax identification number and other information necessary for identification

1. party to the procedure; and

2. other persons or units without a legal personality covered by the question at issue;

(c) the definition of the tax period covered by the question in question, if it is a tax which has a tax period;

(d) details of the issue at issue, including the nature and date of the operations leading to the question at issue and the amount of the related amount in the currency of the State concerned, including copies of supporting documents;

(e) a reference to the applicable national provisions and to the applicable international agreement; where more than 1 international contract is applicable, the application on the basis of which contract the procedure for resolving the issue is to be followed,

(f) a statement by the party to the procedure that it will respond as fully as possible and as quickly as possible to the appropriate request of the competent authority and provide all the documentation at the request of the competent authority; and

(g) information, if any, with copies of all supporting documents, in relation to the question at issue:

1. an explanation of why the party to the procedure considers that there is a question at issue,

2. detailed information on the means of protection applied by the party to the procedure in relation to the measure leading to the issue at issue;

3. Judgement on the matter at issue,

4. a copy of the final decision establishing a tax or other document having equivalent effect and copies of other documents issued by the tax authorities in connection with the contested question; and

5. Information on further requests to initiate procedures to resolve a dispute raised under an international agreement, submitted by a party to the procedure in connection with the same question.

(3) The request referred to in paragraph 1 may be made within 3 years of the date on which the party to the procedure became aware of the measure leading to or leading to the issue at issue.

(4) The local competent authority may, not later than 3 months after the date of receipt of the request referred to in paragraph 1, invite the party to the procedure to provide the additional information necessary for the examination of the issue at issue which is the subject of the request, not later than 3 months after the date on which the request was notified to it.

(5) The local competent authority shall transmit the information provided by the participant in the procedure referred to in paragraph 4 to foreign competent authorities.

§ 28

Confirmation of receipt of the application and notification of the foreign competent authorities

(1) The local competent authority shall confirm that it has received a request to initiate the harmonised procedure no later than 2 months from the date on which the request was received.

(2) Within the time limit referred to in paragraph 1, the local competent authority shall inform the foreign competent authorities of the receipt of the request to initiate the harmonised procedure. The notification shall include information on the language which the national competent authority intends to use when communicating with foreign competent authorities and the date on which the request was received by that authority. The provisions on the language of the case under the tax rules shall not apply when communicating between the national competent authority and the foreign competent authorities.

§ 29

Withdrawal of request to initiate the harmonised procedure

(1) The local competent authority shall inform the foreign competent authorities of the withdrawal of the request for the initiation of a harmonised procedure made to it.

Citation	Act No. 335 / 2020 Coll., on international cooperation in the resolution of tax disputes in the European Union
Regulation Type	Law
Author	-
Collection	Code of Laws

Date of Promulgation	06.08.2020
Effective from	15.09.2020
Effective until	-
Status	Valid

Act No. 335 / 2020 Coll.

Act on International Cooperation in the Settlement of Tax Disputes in the European Union

Contents

ČÁST PRVNÍ

§ 1

§ 2

§ 3

§ 4

§ 5

§ 6

§ 7

§ 8

ČÁST DRUHÁ

HLAVA I

§ 9

§ 10

§ 11

§ 12

§ 13

§ 14

HLAVA II

§ 15

§ 16

§ 17

§ 18

§ 19

HLAVA III

§ 20

§ 21

§ 22

HLAVA IV

§ 23

§ 24

ČÁST TŘETÍ

HLAVA I

§ 25

§ 26

HLAVA II

§ 27

§ 28

§ 29

Contents

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