An interesting Dutch lower court pilot case was published last Friday regarding Dutch dividend withholding tax reclaims by a German open investment fund (Publikum Sondervermögen). The German fund argued that the reclaim should be granted because of its comparability with a Dutch fiscal investment institution (FBI).
The court ruled that a refund cannot be denied merely because the German fund is not subject to Dutch dividend withholding tax (cf. Fidelity Funds). Moreover, the court dismisses the inspector’s argument that a German credit at investor level provides for a residency neutralization (cf. the pending Köln-Aktienfonds Deka case) because the credit is a German facility and does not follow from the tax treaty (cf. Miljoen case). Therefore, the court assesses the comparability of the German fund with an FBI. The German fund is not considered comparable to an FBI because it did not meet the so-called distribution requirement, whereas there was no apparent impediment to distribute in practice (cf. conclusion Pitruzzella in Köln-Aktienfonds Deka case).