Updates on double taxation treaties

• Treaty between the Czech Republic and the United Kingdom – a new treaty is being prepared to replace the original one from 1990, signed with the former Czechoslovakia. The second round of negotiations took place in September. Until the negotiations and ratification process are completed, the original treaty remains in force.
• Treaty between the Czech Republic and Cameroon – signed already in 2023, it entered into force in July this year, with its application beginning for tax periods starting from January 1, 2026.
• Treaty between the Czech Republic and Kenya – the treaty was signed on September 23, 2025, and has been submitted for further ratification by both contracting states.
• Treaty between the Czech Republic and Malta – also signed on September 23, 2025; once the ratification process is completed by both contracting states, it will replace the existing treaty from 1996 currently in force.

France: Constitutional court found the digital services tax compatible with the constitutional order

The French Constitutional Court concluded that the tax on digital transactions is compatible with the French constitutional order.

This tax applies to companies (whether tax residents in France or abroad) with a global consolidated turnover exceeding EUR 750 million and a turnover in France exceeding EUR 25 million. The tax base subject to the 3% rate is the turnover generated from French sources from selected digital services.

The court stated that the scope of the tax is justified by the objective of taxing digital services whose value derives from user activity. The law sets objective thresholds ensuring that the tax applies to businesses with a significant digital presence in France and globally. Determining tax liability based on the share of users in France aligns with the purpose of the tax, even if part of the service value arises outside France.

The 3% tax rate was not considered disproportionate, and its non-progressive nature does not conflict with constitutional principles, as it is based on turnover rather than profit.

Belgium: Local implementation of the Directive on the common system of taxation of Interest and Royalties does not require fulfilment of the beneficial ownership condition

A Belgian first-instance court ruled, in a dispute concerning the granting of local withholding tax exemption on interest paid by a Belgian company to a Luxembourg joint venture, that it is not necessary to meet the “beneficial ownership” criterion. According to the court, the case should be assessed under the local implementation of Council Directive 2003/49/EC of 3 June 2003 on a common system of taxation applicable to interest and royalty payments between associated companies of different Member States (“the Directive”), which does not locally incorporate this term/requirement. The Belgian implementation does not use the term “beneficial owner” but only “owner.” Therefore, the court interpreted the local legislation strictly and held that the decisive factor is the legal title/ownership of the payment, not its economic ownership.

The court also examined whether the transaction constituted an abuse of law (in light of local anti-abuse rules). It concluded that the Belgian tax administration did not present relevant evidence proving the subjective element of abuse. The court also noted that the Luxembourg recipient declared the interest income in Luxembourg, carried out relevant economic activities, and had sufficient economic substance. From the above, it can be inferred that the court did not view the beneficial ownership requirement as an anti-abuse rule, but rather as a rule allocating taxing rights. It will be interesting to observe how higher courts address this interpretation.