SWITZERLAND Trends and Developments Contributed by: René Matteotti, Manuel Ulrich, Gregor Steiner and Natalja Ezzaini, Tax Partner AG
management of a fund. The lower court found that B. SA had organised the fund management through offshore companies that had no demonstrable oper - ational infrastructure. As a result, management fees that would ordinarily have been subject to taxation in Switzerland were not taxed. B. SA had thus created a system that enabled the transfer of income generated by the structures acting as managers of Fund C to related parties. This fulfilled the first condition for tax avoidance. With regard to the second requirement, it emerged that the only plausible reason for the chosen structure was that the profits generated from manage - ment activities were not taxed in Switzerland, but only those from advisory activities.
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