DT7257 - Particular agreements: France: Channel Tunnel provision

Article 7A in the agreement covering the taxation of profits and emoluments linked to the Channel Tunnel. Very broadly it ensures that the taxation of the Channel Tunnel Group Ltd and its French counterpart, France-Manche SA, their holding companies (Eurotunnel plc and Eurotunnel SA), and associated companies, so long as the current arrangements set out in the Channel Tunnel Treaty remain in being, is as follows:

• The profits derived by each company are taxable only in their state of residence
• the remuneration of their employees from employments on the Tunnel exercised in both contracting states may be taxed in the state in which the effective management of the employer is to be found notwithstanding the terms of Article 15 (the employment article which is in the usual form). See also DT7263, second paragraph regarding the application of Article 15(2) to employees of these companies.
• Article 7A is of no application to concerns other than those mentioned. In particular it does not apply to contractors and subcontractors involved in building the Tunnel.