S.I. No. 21/2012 - Double Taxation Relief (Taxes on Income and on Capital) (Republic of Armenia) Order 2012.

1. This Agreement shall remain in force until terminated by a Contracting State.

2. Either of the Contracting States may give to the other Contracting State, through diplomatic channels, written notice of termination on or before the thirtieth day of June in any calendar year beginning after the fifth year following that in which the Agreement entered into force. In such event, this Agreement shall cease to have effect.

(

a

) in Armenia

(i) in respect of taxes withheld at source, on income derived on or after the first day of January in the calendar year next following the year in which the notice of termination is given; and

(ii) in respect of other taxes on income and on capital, for taxes chargeable for any tax year beginning on the first day of January in the calendar year next following the year in which the notice of termination is given.

(

b

) in Ireland

(i) in respect of the income tax, the universal social charge and capital gains tax, for any year of assessment beginning on or after the first day of January of the calendar year next following the year in which the notice of termination is given; and

(ii) in respects of corporation tax, for any financial year beginning on or after the first day of January of the calendar year next following the year in which the notice of termination is given.

IN WITNESS WHEREOF the undersigned, duly authorised thereto, have signed this Agreement.

Done at Dublin, on 14 July 2011 in two originals, in English and Armenian languages, both versions being equally authentic.

FOR THE GOVERNMENT OF IRELAND

Eamon Gilmore

FOR THE GOVERNMENT OF THE REPUBLIC OF ARMENIA

Edward Nalbandian

PROTOCOL

At the moment of signing the Agreement between the Government of the Republic of Armenia and the Government of Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital the undersigned have agreed that the following provisions shall form an integral part of the Agreement.

With respect to Article 4, paragraph 3

It is understood that the “place of effective management” is the place where a company is actually managed and controlled, the place that plays the leading part in the management of a company from an economic and functional point of view and the place where the accounting books are kept.

With respect to Article 5, paragraph 4

For the purposes of subparagraphs (

a

) and (

b

) of paragraph 4, it is understood that the term “delivery” does not apply where sales of the goods or merchandise are made at such a place of business.

With respect to Article 11, paragraph 2

Notwithstanding subparagraph (

b

) of paragraph 2, Ireland shall exempt such interest as specified therein from tax in Ireland when it is paid to a resident of Armenia. Furthermore, if, in any Agreement for the avoidance of double taxation signed after the date of signature of this Agreement by Armenia and a state, which is a member state of the Organisation for Economic Co- operation and Development at the date of signature of this Agreement, Armenia agrees to limit the charge on any interest specified in subparagraph (

b

) of paragraph 2 to a rate per cent that is less than 5 per cent, then such lower rate shall automatically apply under this Agreement as if it were specified in subparagraph (

b

) of paragraph 2 with effect from the date on which the provisions of that Agreement become effective.

IN WITNESS WHEREOF the undersigned, duly authorised thereto, have signed this Protocol.

Done at Dublin, on 14 July 2011, in two originals, in English and Armenian languages, both versions being equally authentic.

FOR THE GOVERNMENT OF IRELAND

Eamon Gilmore

FOR THE GOVERNMENT OF THE REPUBLIC OF ARMENIA

Edward Nalbandian

GIVEN under the Official Seal of the Government,

24 January 2012.

ENDA KENNY,

Taoiseach.

EXPLANATORY NOTE.

(This note is not part of the Instrument and does not purport to be a legal interpretation.)

This Order gives the force of law to the Agreement between Ireland and the Republic of Armenia for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital, which is set out in the Schedule to the Order. The effect of the Agreement is summarised below.

This Agreement with the Republic of Armenia, which was signed in Dublin on 14 July 2011 is comprehensive in scope and is based on the OECD Model Convention.

The taxes covered by the Agreement are, for Ireland, Income Tax, Universal Social Charge, Corporation Tax and Capital Gains Tax: for the Republic of Armenia, the Profit Tax, the Income Tax, the Property Tax and the Land Tax.

The Agreement provides for the allocation of taxing rights between Ireland and the Republic of Armenia and for the granting of relief from double taxation with regard to items of income and capital gains which, under the laws of Ireland and the laws of the Republic of Armenia may under the terms of the Agreement be taxed in both countries.

Where both countries continue to have taxing rights, for example in the case of certain interest, dividends and royalties, business profits arising through a permanent establishment which a person resident in one country has in the other country, or in the case of capital gains arising from the disposal of immovable property, the Agreement provides that the country of residence of the recipient of the income or gain will give relief against its tax on the income or gains for the tax paid in the other country on the same income or gains. Irish direct investors (i.e. Irish companies holding 5% or more of the voting power of the paying company) in receipt of dividends from an Armenian company are granted credit for the tax paid by the Armenian company on the profits out of which the dividends are paid (known as credit for underlying tax).

Where source State taxation of dividends applies (depending on the ownership interest in the paying company), this is restricted to 5% or 15% of the gross dividend. Source State taxation of interest and royalties is restricted to 5% or 10%. Exemptions from Source State taxation include dividends paid to a company which holds more than 25% of the capital of the paying company and interest beneficially owned by the Government or the Central Bank of a Contracting State or any institution, agency or fund wholly owned by a Contracting State.

The Agreement also provides for safeguarding nationals and enterprises of one country against discriminatory taxation in the other country, for consultation between the competent authorities of the two countries for the purpose of resolving any doubts or difficulties arising as to the interpretation or application of the Agreement and for the exchange of such information between these authorities as is forseeably relevant for carrying out the provisions of the Agreement or of the domestic law of either country in relation to the taxes of every kind.

The Agreement will enter into force when each country notifies the other of the completion of its procedures for bringing the Agreement into force. It will thereupon have effect in both countries for tax periods in the following year.

3. In no case shall the provisions of paragraphs 1 and 2 be construed so as to impose on a Contracting State the obligation

(

a

) to carry out administrative measures at variance with the laws and administrative practice of that or of the other Contracting State;

(

b

) to supply information which is not obtained under the laws or in the normal course of the administration of that or of the other Contracting State;

(

c

) to supply information which would disclose any trade, business, industrial, commercial or professional secret or trade process, or information, the disclosure of which would be contrary to public policy (

ordre public

).

4. If information is requested by a Contracting State in accordance with this Article, the other Contracting State shall use its information gathering measures to obtain the requested information, even though that other State may not need such information for its own tax purposes. The obligation contained in the preceding sentence is subject to the limitations of paragraph 3 but in no case shall such limitations be construed to permit a Contracting State to decline to supply information solely because it has no domestic interest in such information.

5. In no case shall the provisions of paragraph 3 be construed to permit a Contracting State to decline to supply information solely because the information is held by a bank, other financial institution, nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in a person.

Article 28

MEMBERS OF DIPLOMATIC MISSIONS AND CONSULAR POSTS

Nothing in this Agreement shall affect the fiscal privileges of members of diplomatic missions or consular posts under the general rules of international law or under the provisions of special agreements.

Article 29

ENTRY INTO FORCE

6. The provisions of paragraph 5 shall not affect the right of a Contracting State to levy, according to its law, a tax on gains from the alienation of any property derived by an individual who is a resident of the other Contracting State and has been a resident of the first-mentioned State at any time during the five years immediately preceding the alienation of the property.

Article 14

INCOME FROM EMPLOYMENT

7. Where profits include items of income which are dealt with separately in other Articles of this Agreement, then the provisions of those Articles shall not be affected by the provisions of this Article.

Article 8

SHIPPING AND AIR TRANSPORT

Notice of the making of this Statutory Instrument was published in

“Iris Oifigiúil” of

31

st January

, 2012.

WHEREAS it is enacted by section 826(1) (as substituted by

section 35

of the

Finance Act 2007

(No. 11 of 2007)) of the

Taxes Consolidation Act 1997

(No. 39 of 1997) that where the Government by order declare that arrangements specified in the order have been made with the government of any territory outside the State in relation to affording relief from double taxation in respect of income tax, corporation tax in respect of income and chargeable gains, capital gains tax or any taxes of a similar character imposed by the laws of the State or by the laws of that territory and, in the case of taxes of any kind or description imposed by the laws of the State or the laws of that territory, in relation to exchanging information for the purposes of the prevention and detection of tax evasion or granting relief from taxation under the laws of that territory to persons who are resident in the State for the purposes of tax, and that it is expedient that those arrangements should have the force of law, and that the order so made is referred to in Part 1 of Schedule 24A of the

Taxes Consolidation Act 1997

, then, subject to section 826 of that Act, the arrangements shall, notwithstanding any enactment, have the force of law as if such order were an Act of the Oireachtas on and from the date of the insertion of a reference to the order into Part 1 of Schedule 24A;

AND WHEREAS it is further enacted by

section 826

(6) of the

Taxes Consolidation Act 1997

that where such an order is proposed to be made, a draft of the order shall be laid before Dáil Éireann and the order shall not be made until a resolution approving of the draft has been passed by Dáil Éireann;

AND WHEREAS a draft of the following Order has been laid before Dáil Éireann and a resolution approving of the draft has been passed by Dáil Éireann;

NOW, the Government, in exercise of the powers conferred on them by

section 826

(1) (as substituted by

section 35

of the

Finance Act 2007

) of the

Taxes Consolidation Act 1997

, hereby order as follows