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Application of the MLI to the Tax Treaty between Japan and Luxembourg

 The MLI enters into force for Japan on January 1, 2019, and for Luxembourg on August 1, 2019.
 Based on the reservations and notifications submitted by Japan on September 26, 2018 and by Luxembourg on April 9, 2019, the MLI applies to the tax treaty between Japan and Luxembourg as described below.

1. Tax treaty covered by the MLI
    - “Convention between Japan and the Grand-Duchy of Luxembourg for the Avoidance of Double Taxation and the
  Prevention of Fiscal Evasion with respect to Taxes on Income and/or to a certain other Tax”
  Date of signature: March 5, 1992
  Date of entry into force: December 27, 1992
    - “Protocol Amending the Convention between Japan and the Grand-Duchy of Luxembourg for the Avoidance of
       Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and/or to a certain other
       Tax”
       Date of signature: January 25, 2010
       Date of entry into force: December 30, 2011

2. Provisions of the MLI applicable to the tax treaty
    - Article 3(1) (Provisions regarding income derived by or through an entity or arrangement that is treated as fiscally
      transparent)
    - Article 5(2) (Provisions that limit application of exemption method for elimination of double taxation)
      * These provisions are applicable only to a resident of Luxembourg.
    - Article 6(1) (Preamble language describing the intent of the Contracting Jurisdictions that the tax treaty will not
      create opportunities for non-taxation or reduced taxation)
    - Article 6(3) (Preamble language referring to a desire of the Contracting Jurisdictions to develop their economic
      relationship and to enhance their co-operation in tax matters)
    - Article 7(1) (Provisions that deny the benefits under the tax treaty where the principal purpose or one of the
      principal purposes of any arrangement or transaction was to obtain those benefits)
    - Article 16(1), 1st sentence (Provisions for presentation of a case of taxation not in accordance with the provisions
      of the tax treaty for a mutual agreement procedure)
    - Article 17(1) (Provisions regarding corresponding adjustments to taxation in accordance with arm’s length
      principle)
    - Part VI (Provisions regarding arbitration for resolving a case of taxation not in accordance with the provisions of
      the tax treaty) 
    - Article 19(12) (Provisions that provide that an unresolved issue arising from the case on which a decision has
      already been rendered by a court or administrative tribunal shall not be submitted to arbitration)
    - Article 23(2) (Provisions regarding the arbitration process in which the arbitration panel shall make its own decision
      on the issues submitted to arbitration based on information provided by the competent authorities)
    - Article 23(5) (Provisions regarding non-disclosure obligation on the presenters of the case for any information
      received during the course of arbitration proceedings)
    - Article 28(2)(a) (Provisions regarding the scope of cases eligible for arbitration)

3. Entry into effect
  (a)  The provisions of the MLI shall have effect in each Contracting Jurisdiction with respect to the tax treaty between
        Japan and Luxembourg:
      (i)   with respect to taxes withheld at source on amounts paid or credited to non-residents, where the event giving
       rise to such taxes occurs on or after January 1, 2020; and
      (ii)   with respect to all other taxes levied by that Contracting Jurisdiction, for taxes levied with respect to taxable
       periods beginning on or after February 1, 2020.
  (b)  Notwithstanding (a), Article 16 (Mutual Agreement Procedure) shall have effect with respect to the tax treaty
        between Japan and Luxembourg for a case presented to the competent authority of a Contracting Jurisdiction on
        or after August 1, 2019, except for cases that were not eligible to be presented as of that date under the tax treaty
        between Japan and Luxembourg prior to its modification by the MLI, without regard to the taxable period to which
        the case relates.
  (c) Notwithstanding (a) and (b), the provisions of Part VI (Arbitration) shall have effect:
    (i)   with respect to cases presented to the competent authority of a Contracting Jurisdiction (as described in
       subparagraph a) of paragraph 1 of Article 19 (Mandatory Binding Arbitration)), on or after August 1, 2019; and
    (ii)   with respect to cases presented to the competent authority of a Contracting Jurisdiction prior to August 1,
       2019 (only to the extent that the competent authorities of both Contracting Jurisdictions agree that Part VI
       will apply to that specific case), on the date when both Contracting Jurisdictions have notified the Depositary
       that they have reached mutual agreement pursuant to paragraph 10 of Article 19 (Mandatory Binding
       Arbitration), along with information regarding the date or dates on which such cases shall be considered to
       have been presented to the competent authority of a Contracting Jurisdiction (as described in subparagraph
       a) of paragraph 1 of Article 19 (Mandatory Binding Arbitration)) according to the terms of that mutual
       agreement.