Article 29 - Limitation of Benefits - Luxembourg

ARTICLE 29 LIMITATION OF BENEFITS 1. Nothing in this Agreement shall affect the application of the domestic provision to prevent tax evasion. [REPLACED by paragraph 1 of Article 7 of the MLI] [2. An enterprise of a Contracting State shall not be entitled to the benefits of this Agreement if the main purpose or one of the main purposes of the creation of such enterprise was to obtain the benefits under this Agreement that would not otherwise be available. 3. The case of legal entities not having bona fide business activities shall be covered by the provisions of this Article.] The following paragraph 1 of Article 7 of the MLI replaces paragraphs 2 and 3 of Article 29 of this Agreement: ARTICLE 7 OF THE MLI - PREVENTION OF TREATY ABUSE (Principal Purposes Test provision) Notwithstanding any provisions of [1] the Agreement, a benefit under [the Agreement] shall not be granted in respect of an item of income or capital if it is reasonable to conclude, having regard to all relevant facts and circumstances, that obtaining that benefit was one of the principal purposes of any arrangement or transaction that resulted directly or indirectly in that benefit, unless it is established that granting that benefit in these circumstances would be in accordance with the object and purpose of the relevant provisions of [the Agreement]. FOOTNOTES:- 1 . The texts of the boxes in [Square brackets] and in italics indicate minor terminology changes made to the text of the MLI.