By Emilio Alvarez Arjona (

Spain and United Kingdom have agreed a new Tax Treaty on Gibraltar.

In first place, the Treaty encourages the exchange of tax information between both Jurisdictions, which will probably imply that Gibraltar would exit the Spanish black list of tax havens.

But most importantly, it states that companies incorporated and managed in Gibraltar, or that are governed by its legislation, would be deemed to have fiscal residence exclusively in Spain in any of the following circumstances:

(i) Most of the company's assets, are in Spain or consist of rights that can or should be exercised in Spain;
(ii) Most of the income accrued in a calendar year is derived from sources in Spain
(iii) that the majority of individuals in charge of effective management are tax residents in Spain;
(iv) that most of the rights over capital or net worth, voting rights or profit sharing are under the direct or indirect control, either of individuals who are tax residents of Spain, or by legal entities related to tax residents of Spain.

The Treaty gives grandfather's rights to existing companies providing they meet certain criteria. Thus, existing companies will remain outside the scope of the Tax Treaty providing they are not purely artificial structures.