New Double Tax Treaty between France and Luxembourg: impact on real estate structures


On March 20, the Luxembourg and French Governments have signed, amongst other, a new double tax treaty (DTT), together with an accompanying Protocol.

The new DTT seeks to modernise the rules applying. The current treaty between Luxembourg and France was signed as long ago as 1 April 1958. The new DTT is fully “post-BEPS”. It implements the new approaches developed at international level during the OECD/G20 BEPS Project, now reflected in the 2017 version of the OECD Model Tax Convention, and in the Multilateral Convention to Implement Tax Treaty Related Measures (“the MLI”), signed by both Luxembourg and France in June 2017.

More particularly, several provisions of the DTT are likely to affect many French real estate investments held from Luxembourg, notably those involving French OPCIs. This flash news is based on the latest draft available at the date of its issuance and is mainly focused on provisions affecting real estate investments.

Read the full newsflash here