What's new in the field of international tax treaties? What is the development of the 28th Regime, which brings the possibility of uniform corporate regulation within the EU? What changes do we expect in the start-up business in the Netherlands? You can read about this and more in our article.
On 16 January, representatives of the Czech Republic and Mauritius initialled the text of the double taxation treaty on the basis of a successful second round of negotiations. In order for it to enter into force, the treaty must first be signed and ratified by both sides. Previously, there was no double taxation treaty between the two countries. We will keep you informed of further developments.
European Parliament approves resolution on the 28th Regime
The European Parliament adopted a resolution on the “28th Regime” and published its recommendations to the European Commission on the forthcoming proposal.
The European Parliament stressed that the proposal must be “ambitious both in content and form”, while preferring to be introduced in the form of a regulation or directive adopted by qualified majority to ensure a uniform approach across all EU member states.
The European Parliament is proposing the creation of a new legal form of company in the EU, the so-called Single European Company (“S.EU”). This would be equivalent to a limited liability company established in one of the EU Member States and would be automatically recognised across all Member States.
The form of S.EU would be exclusively for innovative companies. Its registration would take place digitally within 48 hours with a minimum registered share capital of 1 euro.
The proposal aims to encourage cross-border investment through harmonised rules, while introducing harmonised debt financing instruments allowing investments in a company without control rights (e.g. profit-sharing rights, silent partnerships or earnings-linked loans) and unifying the related tax rules for employee share plans.
In order to speed up the resolution of disputes concerning the S.EU, it is recommended to introduce an alternative mechanism for the rapid resolution of disputes, the language of which would be English.
The European Commission has committed to present a proposal for the 28thl Regime by the end of the first quarter of 2026 as part of its 2026 Work Programme. The Commission also plans to present further proposals for simplifying tax rules, referred to as the “tax omnibus”, in the second quarter of 2026.
Tax priorities of the Cypriot Presidency of the Council of the EU
From 1 January Cyprus took over the Presidency of the Council of the EU for the first half of the year and published its programme, which puts the main emphasis on simplification and de-bureaucratisation in the area of direct taxation. As part of its presidency, Cyprus plans to start work on the expected revision of the directive on administrative cooperation (DAC) and to open a discussion on a new “omnibus” package to make tax rules more efficient and boost the competitiveness of European businesses. Cyprus will also continue to fight tax evasion and aggressive tax planning, including an update of the EU list of non-cooperative jurisdictions. Other key objectives include a significant shift in the negotiations on new EU own resources for the period 2028-2034 and promoting a balanced global debate on the UN Framework Convention on International Tax Cooperation. Last but not least, the programme focuses on legislative support for the so-called Union of Savings and Investments with the aim of further developing capital markets.
The Netherlands is preparing specific definitions for start-ups and scale-ups for tax reform purposes
The Dutch government is preparing a separate bill that will introduce more precise tax definitions for “start-ups” and “scale-ups”. The Ministry of Finance wants to better take into account the specifics of these dynamic companies, and therefore abandoned the original plan to incorporate the new criteria directly into the currently discussed and highly controversial reform of the taxation of savings and investments (the so-called Box 3).
The new definitions will apply both to the future Box 3 tax regime and to the upcoming tax regime for employee participations in start-ups and scale-ups. The draft law should be submitted for public consultation no later than March 2026, with the planned effectiveness of both legislative changes set for 1 January 2027.
Gibraltar and Australia join the MCAA GIR
In January, the two countries acceded to the GloBE Multilateral Agreement On The Exchange of Information (“GIR MCAA”). Gibraltar signed the agreement on January 14, followed by Australia on January 28.
The GIR MCAA ensures the automatic exchange of information under Pillar II, specifically between the participating countries and enables the exchange of annual GloBE Information Return (GIR) submissions.
As of the end of January, a total of 26 jurisdictions have signed the GIR MCAA. You can find the current list here.
The Czech Republic is still absent from the list of signatories and it is not known when this situation could change.
India: A Certificate of Tax Residency Is Insufficient to Claim Benefits Under a Double Taxation Treaty
In mid-January 2026, the Supreme Court of India issued a landmark decision in the closely watched dispute involving the investment group Tiger Global, concerning the taxation of gains from the sale of its investment in the Indian e-commerce platform Flipkart.
Mauritian entities belonging to Tiger Global had sold shares in a Singaporean company (under which India-based Flipkart operated), with the value of those shares primarily derived from assets located directly in India.
Although the investment group relied on tax residency certificates issued in Mauritius by the local tax authority, the court held that such formal confirmations alone are not sufficient to automatically obtain benefits under double taxation treaties. The court confirmed that the Indian authorities had successfully demonstrated the Mauritian entities’ lack of economic substance, the absence of independent decision-making at the local level, and the fact that the structure primarily served as a vehicle for tax avoidance.
The ruling also clearly established that India’s general anti-avoidance rules take precedence over protections arising from international treaties, including for investments made before 2017 (i.e., before anti-abuse rules were formally incorporated into Indian legislation), provided that the tax benefit itself was realized only after those rules came into effect.
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