http://www.nytimes.com/2007/02/04/business/yourmoney/04amster.html By LYNNLEY BROWNING THE NEW YORK TIMES Published: February 4, 2007 Oh, a storm is threatâning My very life today If I donât get some shelter Oh yeah, Iâm gonna fade away âGimme Shelter,â The Rolling Stones Amsterdam LAST spring, Keith Richards, the craggy-faced and hard-partying lead guitarist for the Rolling Stones, fell from a tree at a beach resort in Fiji, slamming his head against the trunk on his way down. Mr. Richards was flown to New Zealand, where a surgeon provided emergency care to treat swelling in his brain. While the accident forced the Rolling Stones to cancel part of their summer tour, Mr. Richards, 62, handily survived his plunge. âItâs not the first brush with death Iâve had,â Mr. Richards later told Rolling Stone magazine. âI guess what I learned is, donât sit in trees anymore.â What two of the other three Rolling Stones apparently learned, including Mick Jagger and Charlie Watts, was that Mr. Richardsâs near-death experience meant that it was time to think about their heirs. For that, the aging rockers turned to a reclusive Dutch accountant, Johannes Favie, whose company, Promogroup, has helped them minimize their tax bills for more than 30 years. (The fourth Rolling Stone, Ron Wood, handles his finances apart from Promogroup.) And so, last August, according to details disclosed in documents maintained by the Handelsregister, the trade registry of the Netherlands, Promogroup helped the three performers set up a pair of private Dutch foundations that will allow them to transfer assets tax-free to heirs when they die. Other Dutch shelters that Promogroup has arranged for the three have already paid off handsomely; over the last 20 years, according to Dutch documents, the three musicians have paid just $7.2 million in taxes on earnings of $450 million that they have channeled through Amsterdam â a tax rate of about 1.5 percent, well below the British rate of 40 percent. The Rolling Stones are not the only celebrities sheltering income in the land of tulips, windmills and Rembrandt. The rock powerhouse U2 has transferred lucrative assets to Amsterdam, as have other pop singers and well-known athletes, all of whom have used or continue to take advantage of the Netherlandsâ tax shelters, according to a Dutch tax lawyer who requested anonymity because of client confidentiality agreements. Entertainment companies and others that benefit handsomely from the Dutch shelters include EMI, the giant record label, and CKX Inc., the entertainment company that owns stakes in âAmerican Idol,â the Elvis Presley estate and the soccer pin-up idol David Beckham. When it comes to attracting celebrity wealth seeking shelter from taxes, the Cayman Islands and other classic Caribbean tax havens are receding in favor like so many waves on the beach, according to tax experts here and overseas. While old-school, offshore tax havens â the warm ones with tropical fish, off-the-shelf holding companies sporting post-office-box addresses, and scant regulation or transparency â still attract money, they are largely patronized, tax lawyers and entertainment bankers say, by hedge funds and private equity firms looking to protect lush trading profits from taxes. But for earnings derived from intellectual property such as royalties, the Netherlands has become a tax shelter of choice. With celebrities lending their names and images to clothing lines, licensing their hit songs to corporate sponsors, seeking roles in Hollywood and engaging in other ventures that generate significant taxable income, the Dutch system, which does not tax royalties, offers a nifty shelter. As they flock to Amsterdam, celebrities are taking a leaf out of the playbook of major corporations that also use Dutch tax shelters to help reduce or eliminate the royalty taxes on patents, another form of intellectual property. âThe Caribbeans are thinking about trading profits, not royalties, so the smaller European countries like Holland have had to be creative, tax-wise,â said David Pullman, an investment banker in New York who caters to entertainers and athletes. âThey are going for the high-end stuff and donât want to be seen as shady like some Caribbean haven.â Many of the worldâs multinational corporations, like Coca-Cola, Nike, Ikea and Gucci, have set up holding companies here in recent years to take advantage of tax shelters nearly identical to the ones that the Rolling Stones and U2 use. An additional draw is the Dutch Finance Ministryâs recent willingness to issue advance rulings that effectively bless the tax shelters, a fast-track process that has lured in companies and individuals seeking to use the Netherlands as a tax shelter. Sun Microsystems, the giant American software and computer manufacturer, operates Dutch holding companies and is candid about why it does so. Until recently, on the Web site of the Netherlands Foreign Investment Agency, www.nfia.com, Sun offered the following blurb about the countryâs accommodating tax laws: âLetâs face it: ask foreign companies why theyâre really located here, and nearly everyone will reply that itâs because of the favorable tax ruling. The combination of this with the countryâs political stability, well-trained labor force, their linguistic skills and international attitude as well as the stable infrastructure for roads and telecommunications â this is why weâre here.â (A Sun spokeswoman declined to comment.) The Netherlands is home to almost 20,000 âmailbox companies,â Dutch shorthand for corporate shells set up by foreign companies and wealthy foreigners who use them to relieve taxes on royalties, dividends and interest payments, according to a report last November by SOMO, the Center for Research on Multinational Corporations, a nonprofit group in Amsterdam that monitors the business practices of large companies. Globally, some 1,165 companies use Dutch tax shelters to reduce or eliminate taxes on royalties and patents, according to SOMO.