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Unformatted text preview: lity condition is intended to prevent certain treaty abuses, it should be applied as an anti-avoidance provision, rather than as a brightline test. 44 united states, Department of the Treasury, Convention between the united states of america and France for the avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on income and Capital, signed at Paris on august 31, 1994, as amended by the protocol signed on December 8, 2004. 45 ibid. see also the technical explanation to the us-Netherlands treaty, supra note 26. i nternational tax planning n 105 ex ample 3: Interest Payments from C anadian Company to us oper ating Company Example 3 summarizes some of the issues that arise from the qualifying person and active trade or business tests. assume austriaco is resident in austria, and its principal class of shares is primarily and regularly traded on the London stock Exchange. austriaco owns all of the shares of swissco, a swiss company resident in switzerland. swissco owns all of the shares of Canco, a Canadian company resident in Canada, and all of the shares of us Holdco, a us company resident in the united states. Canco owns all of the shares of usco...
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