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Taxes Consolidation Act, 1997 (Number 39 of 1997)


Chapter 6

Implementation of Council Directive 2003/49/EC of 3 June 2003 on a common system of taxation applicable to interest and royalty payments made between associated companies of different Member States

267G Interpretation (Chapter 6).

(1) In this Chapter—

arrangements” means arrangements having the force of law by virtue of [2]>section 826(1)(a)<[2][2]>section 826(1)<[2];

bilateral agreement” means any arrangements, protocol or other agreement between the Government and the government of another state;

permanent establishment” means a fixed place of business through which the business of a company of a Member State is wholly or partly carried on which place of business is situated in a territory other than that Member State;

company” means a company of a Member State;

company of a Member State” has the meaning assigned to it by Article 3(a) of the Directive;


the Directive” means Council Directive 2003/49/EC of 3 June 20031;



the Directive” means Council Directive 2003/49/EC of 3 June 200324 as amended;


interest” means income from debt-claims of every kind, whether or not secured by mortgage and whether or not carrying a right to participate in the debtor’s profits, and in particular, income from securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures but does not include penalty charges for late payment;

Member State” means a Member State of the European Communities;

royalties” means payments of any kind as consideration for

(a) the use of, or the right to use—

(i) any copyright of literary, artistic or scientific work, including cinematograph films and software,

(ii) any patent, trade mark, design or model, plan, secret formula or process,

(b) information concerning industrial, commercial or scientific experience;

(c) the use of, or the right to use, industrial, commercial or scientific equipment;

tax”, in relation to a Member State other than the State, means any tax imposed in that Member State which is specified in Article 3(a)(iii) of the Directive.

(2) For the purposes of this Chapter—

(a) a company shall be treated as an “associated company” of another company during an uninterrupted period of at least 2 years throughout which—

(i) one of them directly controls not less than 25 per cent of the voting power of the other company, or

(ii) in respect of those companies, a third company directly controls not less than 25 per cent of the voting power of each of them,

(b) a permanent establishment of a company in a Member State shall be treated as being the beneficial owner of interest or royalties if—

(i) the debt-claim, right or asset in respect of which the interest arises, or as the case may be the royalties arise, consists of property or rights used by, or held by or for, the permanent establishment, and

(ii) the interest or royalties are taken into account in computing income of the permanent establishment which is subject to one of the taxes specified in Article 1.5(b) or Article 3(a)(iii) of the Directive,

(c) a word or expression used in this Chapter and in the Directive has, unless the contrary intention appears, the same meaning in this Chapter as in the Directive.



1 OJ No. L157, 26.6.2003, p.49



24 OJ No. L157, 26.6.2003, p.49




[-] [+] [-] [+]

Substituted by FA06 sched2(1)(c). Has effect as on and from 31 March 2006


[-] [+]

Substituted by FA07 sched2(1)(j). Has effect as on and from 2 April 2007



Inserted by FA04 sched1.