Barbados - Anti-abuse provisions

Barbados

Anti-abuse provision: Main purpose test

Article 10-4:

Where a company fails to qualify for benefits under paragraph 3, it may however qualify if the competent authority of the Contracting State which has to grant the benefits determines that the establishment, acquisition or maintenance of the company does not have as its main purpose or one of its main purposes to secure the benefits of paragraph 3.

Such determination shall be based on all facts and circumstances including:

1. the nature and volume of the activities of the company in its country of residence in relation to the nature and volume of the dividends;
2. both the historical and the current ownership of the company; and
3. the business reasons for the company residing in its country of residence.

The competent authority of the Contracting State which has to grant the benefits will consult with the competent authority of the other Contracting State before denying the benefits under this paragraph.