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Bahrain Ratifies Three DTAs And One FTA

Tuesday, February 9, 2010

The King of Bahrain, Hamad bin Isa Al Khalifa, has recently approved three laws regarding double taxation agreements (DTAs), and one law concerning a free trade agreement (FTA), already signed between Bahrain and other countries.

Firstly, he ratified the FTA between the Gulf Cooperation Council (GCC) states and Singapore that was signed in Doha, Qatar, on December 15, 2008. It is considered a milestone agreement in strengthening ties between the GCC countries and Singapore, particularly because it is the first FTA signed by the GCC and the second FTA that Singapore signed with the Middle East.

It is a comprehensive bilateral agreement, including trade in goods, rules of origin, customs procedures, trade in services and government procurement.

He also approved the ratification of the protocol to Bahrainís DTA between the Kingdom and France, and also of the DTA between Bahrain and Luxembourg. The former was signed in Paris on May 7, 2009, and the protocol adds provision for the exchange of tax information according to the standard set by the Organisation for Economic Co-operation and Development (OECD).

The DTA with Luxembourg was signed a day earlier and, in addition to its application to taxes on income and capital, also complies with the OECD standard on the exchange of tax information between the two countries.

Finally, the King ratified the DTA between Bahrain and Bulgaria, which was originally signed in Sofia on June 26, 2009. Similarly to the agreement with Luxembourg, the DTA aims to eliminate double taxation and allows for exchange of tax information in accordance with the OECD standard.