Article 27 - Limitation of Benefits - Malta

ARTICLE 27 LIMITATION OF BENEFITS 1. Nothing in this Agreement shall affect the application of the domestic provisions to prevent tax evasion. [REPLACED by paragraph 1 of Article 7 of the MLI] [2. Benefits of this Agreement shall not be available to a resident of a Contracting State, or with respect to any transaction undertaken by such a resident, if the main purpose or one of the main purposes of the creation or existence of such a resident or of the transaction undertaken by him, was to obtain 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 paragraph 1 and 2 of Article 27 of this Agreement: ARTICLE 7 OF THE MLI - PREVENTION OF TREATY ABUSE (Principal Purposes Test provision) Notwithstanding any provisions of [the Agreement], a benefit under [the Agreement] shall not be granted in respect of an item of income 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].