On 9 October 2017, the Minister of Finance of Ukraine, and the UK's Minister of State for Europe and the Americas, signed a protocol on amendments to the Agreement on the Avoidance of Double Taxation between Ukraine and the United Kingdom (the "Protocol").

As reported by the Ministry of Finance of Ukraine, the Protocol provides for:

• an increase in the withholding tax rate for dividends, from 10 to 15 per cent. if the beneficial owner does not have at least 20 per cent. of the voting power or authorised capital in the company paying the dividends (the conditions for applying the lower – 5 per cent. – rate will remain unchanged);
• an increase of the withholding tax rate for interest and royalty payments, from zero to 5 per cent.;
• and new provisions concerning the exchange of fiscal information, which should broaden the possibilities for such exchanges.

Ukraine and the UK undertook to complete their own internal state procedures for ratification of the Protocol so as to make it effective. It is currently unclear when this may be, but we will continue to monitor this and provide further information when it becomes available.

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