The Swiss National Council (lower house of parliament) approved the ratification of the protocol to the 2005 tax treaty with Serbia on Wednesday, 25 September 2024.

The DTA was concluded at a time when Serbia and Montenegro still formed a single state. The federation has since been dissolved and Serbia and Montenegro are now two separate states. The provisions of this protocol of amendment apply solely for Serbia, whereas the existing agreement continues to apply for Montenegro.

The protocol implements the Base Erosion and Profit Shifting (BEPS) minimum standards for double taxation agreements.

It replaces the preamble of the treaty and the article concerning the exchange of information, clarifies certain terms of the agreement and its accompanying protocol, and introduces a new article regarding entitlement to benefits.

Additionally, it also modifies the sections pertaining to business profits, associated enterprises, capital gains, the elimination of double taxation, and nondiscrimination, and the provisions outlined in the protocol that was signed alongside the treaty.

In particular, the protocol of amendment contains an abuse clause which refers to the main purpose of a tax arrangement or a transaction and thus ensures that the DTA is not abused. It also contains an administrative assistance clause in accordance with the international standard for the exchange of information upon request.

The protocol, which was originally signed on 19 September 2023, is the first amendment to the treaty. It will enter into force once the ratification instruments are exchanged and will apply from 1 January of the year following its entry into force.

Serbia Parliament ratified the protocol and published it in the official gazette on 31 October 2023.