Contributions From Nctm Offices Around The World Shipping & Transport Bulletin June-July 2018

On 6 April 2018, the Commission approved two measures for the purpose of encouraging ship registration in Europe and contributing to the competitiveness of maritime transportation. According to the newly introduced Portuguese tonnage tax scheme, maritime transport companies will pay taxes on the basis of the net tonnage, instead of being taxed under the normal corporate tax system. Specifically, the new method of taxation will be applied to core revenues form maritime transport activities, certain ancillary revenues and revenues from towage and dredging. The tonnage tax scheme falls within the terms of the Commission's 2004 Guidelines on State aid to maritime transport, which allows Member States to undertake actions to improve the fiscal climate for shipping companies in order to avoid their relocation to low-tax countries outside of the EU. The condition under which a company can benefit from the scheme is that a significant part of its fleet must fly the flag of a European Economic Area (EEA) state.

The second provision, the Portuguese seafarer scheme, exempts seafarers employed on vessels that are eligible under the tonnage tax scheme from paying personal income tax. In this way, the schemes will bolster ship registration in the EU whilst preserving the employment if the maritime transport sector.

Public support scheme to promote shift of freights from road to rail in Sweden

On 20 April 2018 the Commission approved a public support scheme of approximately €56 million to incentive a shift of freight transport from road to rail in Sweden. The Commission maintained that subsidies to railway companies are beneficial for both the environment and mobility, without affecting competition in the Single Market. In fact, the purpose of the Commission is to reduce the percentage of freight transported by road (40%) by increasing the one transported by rail (around 20%) to minimize pollution and road congestion.

Leave means leave?

"Leave means leave". This means that if no agreement is reached UK will be forced to trade with the EU under WTO rules which govern the vast majority of trade between countries in the world. Very few in the business world want this outcome. However, it is looking more and more likely despite a new proposal that Theresa May presented in mid-May. The idea is to keep the UK bound to some European customs rules to prevent a hard border on the island of Ireland, even though for a limited time. The plan aims to overcome the...

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