The Swiss Federal Supreme Court’s decision of October 3rd, 2024 (9C_635/2023), stands out for its comprehensive analysis of both national and international literature on the subject, as well as for considering case law from other jurisdictions. However, the ruling’s reasoning raises concerns: while the Court emphasizes a strict, text-oriented interpretation of treaty provisions for legal certainty, it simultaneously opens the door to applying unwritten anti-abuse principles that remain undefined in international law. In this specific case, the Court ultimately applies Swiss anti-avoidance tax rules, arriving at a reasonable outcome. Nevertheless, relying on the concept of “beneficial ownership" as a strict requirement risks excluding certain income from treaty benefits, challenging both the predictability and consistency of treaty application.
