Double Taxation Relief (Taxes on Income)

L.N. 65 of 2014

INCOME TAX ACT

(CAP. 123)

Double Taxation Relief (Taxes on Income)

(The Principality of Liechtenstein) Order, 2014

IN exercise of the powers conferred by article 76 of the Income

Tax Act, the Minister for Finance has made the following order:-

The title of this order is the Double Taxation Relief (Taxes Citation.

on Income) (The Principality of Liechtenstein) Order, 2014.

Article 2

Convention

Between

the Government of the Republic of Malta

and

the Government of the Principality of Liechtenstein

for the avoidance of double taxation and the prevention of fiscal evasion

with respect to taxes on income and on capital

Preamble

The Government of the Republic of Malta and the Government of the

Principality of Liechtenstein, hereinafter referred to as "Contracting States",

WHEREAS the Contracting States recognise that the well-developed

economic ties between the Contracting States call for further economic

cooperation;

WHEREAS the Contracting States wish to develop their relationship further

by cooperating to their mutual benefits in the field of taxation; and

WHEREAS the Contracting States wish to conclude a Convention for the

avoidance of double taxation and the prevention of fiscal evasion with respect to

taxes on income and on capital,

have agreed as follows

Article 1

Persons covered

This Convention shall apply to persons who are residents of one or both of

the Contracting States.

Article 2

Taxes covered

1. This Convention shall apply to taxes on income and on capital imposed

on behalf of a Contracting State or of its political subdivisions or local authorities,

irrespective of the manner in which they are levied.

2. There shall be regarded as taxes on income and on capital all taxes

imposed on total income, on total capital, or on elements of income or of capital,

including taxes on gains from the alienation of movable or immovable property,

taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes

on capital appreciation.

It is hereby declared

Arrangements to

have effect.

(a)

that the arrangements specified in the Convention

set out in the Schedule to this Order (hereinafter referred to as

"the Convention") have been made with the Government of the

Principality of Liechtenstein with a view to affording relief

from double taxation in relation to the following taxes imposed

by the laws of the Principality of Liechtenstein

(i)

the personal income tax (Erwerbssteuer);

(ii) the corporate income tax (Ertragssteuer);

(iii) the corporation taxes (Gesellschaftssteuern);

(iv) the

real

estate

capital

gains

tax

(Grundstücksgewinnsteuer);

(v)

the wealth tax (Vermögenssteuer); and

(vi) the coupon tax (Couponsteuer);

(b) that it is expedient that those arrangements should

have effect following the entry into force of the Convention and

in accordance with the relevant provisions of the Convention;

(c)

that the Convention shall enter into force on such

date as may be announced by notice in the Government Gazette.

The existing taxes to which this Convention shall apply are in

particular

a)

in the Principality of Liechtenstein

(i)

the personal income tax (Erwerbssteuer);

(ii) the corporate income tax (Ertragssteuer);

(iii) the corporation taxes (Gesellschaftssteuern);

(iv) the

real

estate

capital

gains

tax

(Grundstücksgewinnsteuer);

(v)

the wealth tax (Vermögenssteuer); and

(vi) the coupon tax (Couponsteuer);

(hereinafter referred to as "Liechtenstein tax");

b)

in Malta

the income tax;

(hereinafter referred to as "Malta tax").

The Convention shall apply also to any identical or substantially similar

taxes that are imposed after the date of signature of the Convention in addition to,

or in place of, the existing taxes. The competent authorities of the Contracting

States shall notify each other of any significant changes that have been made in

their taxation laws.

Article 3

General definitions

1. For the purposes of this Convention, unless the context otherwise

requires

a)

the term "Liechtenstein" means the Principality of Liechtenstein,

and, when used in a geographical sense, the area in which the tax laws of the

Principality of Liechtenstein apply;

b)

the term "Malta" means the Republic of Malta and, when used in

a geographical sense, means the Island of Malta, the Island of Gozo and the

other islands of the Maltese archipelago including the territorial waters

thereof, as well as any area of the sea-bed, its sub-soil and the superjacent

water column adjacent to the territorial waters, wherein Malta exercises

sovereign rights, jurisdiction, or control in accordance with international law

and its national law, including its legislation relating to the exploration of the

continental shelf and exploitation of its natural resources;

c)

the terms "a Contracting State" and "the other Contracting State"

mean Malta or the Principality of Liechtenstein, as the context requires;

d)

the term "person" includes an individual, a company, an

investment fund, a pension fund, a trust, a partnership, a Liechtenstein

dormant inheritance and any other body of persons;

e)

the term "company" means any body corporate or any entity that

is treated as a body corporate for tax purposes;

f)

the term "enterprise" applies to the carrying on of any business;

g)

the terms "enterprise of a Contracting State" and "enterprise of

the other Contracting State" mean respectively an enterprise carried on by a

resident of a Contracting State and an enterprise carried on by a resident of

the other Contracting State;

h)

the term "international traffic" means any transport by a ship or

aircraft operated by an enterprise of a Contracting State, except when the

ship or aircraft is operated solely between places in the other Contracting

State;

i)

the term "business" includes the performance of professional

services and of other activities of an independent character;

j)

the term "competent authority" means

(i)

in Liechtenstein, the Fiscal Authority;

(ii) in Malta: the Minister responsible for finance or his

authorised representative;

k)

the term "national", in relation to a Contracting State, means

(i) any individual

possessing

the

nationality

of

that

Contracting State;

(ii) any person other than an individual deriving its status as

such from the laws in force in that Contracting State;

l)

the term "investment fund" means

(i) in Liechtenstein, an "Organismus für gemeinsame Anlagen

in Wertpapieren (OGAW)" within the meaning of the Law on

Undertakings for Collective Investment in Transferable Securities of 28

June

2011,

LGBl.

2011,

No.

(UCITSG),

an

"Investmentunternehmen für andere Werte oder Immobilien" within the

meaning of the "Gesetz über Investmentunternehmen für andere Werte

oder Immobilien" of 19 May 2005, LGBl. 2005, No. 156 (IUG);

(ii) in Malta, a scheme or arrangement which is licensed or

otherwise authorised under the Investment Services Act (Cap. 370 of

the Laws of Malta);

(iii) any other investment fund, arrangement or entity of a

Contracting State which the competent authorities of the Contracting

States agree to regard as a collective investment vehicle for the purpose

of this paragraph;

m)

the term "pension fund or scheme" means

(i) in Liechtenstein, any arrangement within the meaning of

the "Gesetz über die betriebliche Pensionsvorsorge" of 20 October

1987, LGBl. 1988, No. 12 (BPVG) including the associated regulations;

(ii) in Malta, a retirement fund or retirement scheme licensed,

registered or otherwise authorised under the Special Funds (Regulation)

Act (Cap. 450 of the Laws of Malta);

(iii) any other pension fund or scheme of a Contracting State

which the competent authorities of the Contracting States agree to

regard as a pension fund or a scheme for the purpose of this paragraph.

2. As regards the application of the Convention at any time by a

Contracting State, any term not defined therein shall, unless the context otherwise

requires, have the meaning that it has at that time under the law of that State for the

purposes of the taxes to which the Convention applies, any meaning under the

applicable tax laws of that State prevailing over a meaning given to the term under

other laws of that State.

Article 4

Resident

1. For the purposes of this Convention, the term "resident of a Contracting

State" means any person who, under the laws of that State, is liable to tax therein

by reason of his domicile, residence, place of management or any other criterion of

a similar nature, and also includes that State and any political subdivision or local

authority thereof. This term, however, does not include any person who is liable to

tax in that State in respect only of income from sources in that State or capital

situated therein.

2. Where by reason of the provisions of paragraph 1 an individual is a

resident of both Contracting States, then his status shall be determined as follows

a)

he shall be deemed to be a resident only of the State in which he

has a permanent home available to him; if he has a permanent home available

to him in both States, he shall be deemed to be a resident only of the State

with which his personal and economic relations are closer (centre of vital

interests);

b)

if the State in which he has his centre of vital interests cannot be

determined, or if he has not a permanent home available to him in either

State, he shall be deemed to be a resident only of the State in which he has an

habitual abode;

c)

if he has an habitual abode in both States or in neither of them, he

shall be deemed to be a resident only of the State of which he is a national;

d)

if he is a national of both States or of neither of them, the

competent authorities of the Contracting States shall settle the question by

mutual agreement.

3. Where by reason of the provisions of paragraph 1 a person other than an

individual is a resident of both Contracting States, then it shall be deemed to be a

resident only of the State in which its place of effective management is situated.

Article 5

Permanent establishment

1. For the purposes of this Convention, the term "permanent

establishment" means a fixed place of business through which the business of an

enterprise is wholly or partly carried on.

2. The term "permanent establishment" includes especially

a)

a place of management;

b)

a branch;

c)

an office;

d)

a factory;

e)

a workshop; and

f)

a mine, an oil or gas well, a quarry or any other place of

extraction of natural resources.

3. A building site or construction or installation project constitutes a

permanent establishment only if it lasts more than twelve months.

4. Notwithstanding the preceding provisions of this Article, the term

"permanent establishment" shall be deemed not to include

a)

the use of facilities solely for the purpose of storage, display or

delivery of goods or merchandise belonging to the enterprise;

b)

the maintenance of a stock of goods or merchandise belonging to

the enterprise solely for the purpose of storage, display or delivery;

c)

the maintenance of a stock of goods or merchandise belonging to

the enterprise solely for the purpose of processing by another enterprise;

d)

the maintenance of a fixed place of business solely for the

purpose of purchasing goods or merchandise or of collecting information, for

the enterprise;

e)

the maintenance of a fixed place of business solely for the

purpose of carrying on, for the enterprise, any other activity of a preparatory

or auxiliary character;

f)

the maintenance of a fixed place of business solely for any

combination of activities mentioned in subparagraphs a) to e), provided that

the overall activity of the fixed place of business resulting from this

combination is of a preparatory or auxiliary character.

Notwithstanding the provisions of paragraphs 1 and 2, where a person -

other than an agent of an independent status to whom paragraph 6 applies - is

acting on behalf of an enterprise and has, and habitually exercises, in a Contracting

State an authority to conclude contracts in the name of the enterprise, that

enterprise shall be deemed to have a permanent establishment in that State in

respect of any activities which that person undertakes for the enterprise, unless the

activities of such person are limited to those mentioned in paragraph 4 which, if

exercised through a fixed place of business, would not make this fixed place of

business a permanent establishment under the provisions of that paragraph.

An enterprise shall not be deemed to have a permanent establishment in

a Contracting State merely because it carries on business in that State through a

broker, general commission agent or any other agent of an independent status,

provided that such persons are acting in the ordinary course of their business.

The fact that a company which is a resident of a Contracting State

controls or is controlled by a company which is a resident of the other Contracting

State, or which carries on business in that other State (whether through a

permanent establishment or otherwise), shall not of itself constitute either

company a permanent establishment of the other.

Article 6

Income from immovable property

1. Income derived by a resident of a Contracting State from immovable

property (including income from agriculture or forestry) situated in the other

Contracting State may be taxed in that other State.

2. The term "immovable property" shall have the meaning which it has

under the law of the Contracting State in which the property in question is situated.

The term shall in any case include property accessory to immovable property,

livestock and equipment used in agriculture and forestry, rights to which the

provisions of general law respecting landed property apply, usufruct of immovable

property and rights to variable or fixed payments as consideration for the working

of, or the right to work, mineral deposits, sources and other natural resources; ships

and aircraft shall not be regarded as immovable property.

3. The provisions of paragraph 1 shall apply to income derived from the

direct use, letting, or use in any other form of immovable property.

4. The provisions of paragraphs 1 and 3 shall also apply to the income

from immovable property of an enterprise.

Article 7

Business profits

1. The profits of an enterprise of a Contracting State shall be taxable only

in that State unless the enterprise carries on business in the other Contracting State

through a permanent establishment situated therein. If the enterprise carries on

business as aforesaid, the profits of the enterprise may be taxed in the other State

but only so much of them as is attributable to that permanent establishment.

2. Subject to the provisions of paragraph 3, where an enterprise of a

Contracting State carries on business in the other Contracting State through a

permanent establishment situated therein, there shall in each Contracting State be

attributed to that permanent establishment the profits which it might be expected to

make if it were a distinct and separate enterprise engaged in the same or similar

activities under the same or similar conditions and dealing wholly independently

with the enterprise of which it is a permanent establishment.

3. In determining the profits of a permanent establishment, there shall be

allowed as deductions expenses which are incurred for the purposes of the

permanent establishment, including executive and general administrative expenses

so incurred, whether in the State in which the permanent establishment is situated

or elsewhere.

4. Insofar as it has been customary in a Contracting State to determine the

profits to be attributed to a permanent establishment on the basis of an

apportionment of the total profits of the enterprise to its various parts, nothing in

paragraph 2 shall preclude that Contracting State from determining the profits to

be taxed by such an apportionment as may be customary; the method of

apportionment adopted shall, however, be such that the result shall be in

accordance with the principles contained in this Article.

5. No profits shall be attributed to a permanent establishment by reason of

the mere purchase by that permanent establishment of goods or merchandise for

the enterprise.

6. For the purposes of the preceding paragraphs, the profits to be attributed

to the permanent establishment shall be determined by the same method year by

year unless there is good and sufficient reason to the contrary.

7. Where profits include items of income which are dealt with separately

in other Articles of this Convention, then the provisions of those Articles shall not

be affected by the provisions of this Article.

Article 8

Shipping and air transport

1. Profits of an enterprise of a Contracting State from the operation of

ships or aircraft in international traffic shall be taxable only in that State.

2. The provisions of paragraph 1 shall also apply to profits from the

participation in a pool, a joint business or an international operating agency.

Article 9

Associated enterprises

1. Where

a)

an enterprise of a Contracting State participates directly or

indirectly in the management, control or capital of an enterprise of the other

Contracting State, or

b)

the same persons participate directly or indirectly in the

management, control or capital of an enterprise of a Contracting State and an

enterprise of the other Contracting State,

and in either case conditions are made or imposed between the two enterprises in

their commercial or financial relations which differ from those which would be

made between independent enterprises, then any profits which would, but for those

conditions, have accrued to one of the enterprises, but, by reason of those

conditions, have not so accrued, may be included in the profits of that enterprise

and taxed accordingly.

2. Where a Contracting State includes in the profits of an enterprise of that

State - and taxes accordingly - profits on which an enterprise of the other

Contracting State has been charged to tax in that other State and the profits so

included are profits which would have accrued to the enterprise of the first-

mentioned State if the conditions made between the two enterprises had been those

which would have been made between independent enterprises, then that other

State shall make an appropriate adjustment to the amount of the tax charged

therein on those profits. In determining such adjustment, due regard shall be had to

the other provisions of this Convention and the competent authorities of the

Contracting States shall if necessary consult each other.

Article 10

Dividends

1. Dividends paid by a company which is a resident of a Contracting State

to a resident of the other Contracting State shall be taxable only in that other State,

provided that the beneficial owner of the dividends is a resident of the other State.

This paragraph shall not affect the taxation of the company in respect of the

profits out of which the dividends are paid.

2. The term "dividends" as used in this Article means income from shares,

"jouissance" shares or "jouissance" rights, mining shares, founders’ shares or other

rights, not being debtclaims, participating in profits, as well as income from other

corporate rights which is subjected to the same taxation treatment as income from

shares by the laws of the State of which the company making the distribution is a

resident.

3. The provisions of paragraph 1 shall not apply if the beneficial owner of

the dividends, being a resident of a Contracting State, carries on business in the

other Contracting State of which the company paying the dividends is a resident

through a permanent establishment situated therein and the holding in respect of

which the dividends are paid is effectively connected with such permanent

establishment. In such case the provisions of Article 7 shall apply.

4. Where a company which is a resident of a Contracting State derives

profits or income from the other Contracting State, that other State may not impose

any tax on the dividends paid by the company, except insofar as such dividends are

paid to a resident of that other State or insofar as the holding in respect of which

the dividends are paid is effectively connected with a permanent establishment

situated in that other State, nor subject the company’s undistributed profits to a tax

on the company’s undistributed profits, even if the dividends paid or the

undistributed profits consist wholly or partly of profits or income arising in such

other State.

Article 11

Interest

1. Interest arising in a Contracting State and paid to a resident of the other

Contracting State shall be taxable only in that other State, provided that the

beneficial owner of the interest is a resident of the other State.

2. The term "interest" as used in this Article means income from debt-

claims of every kind, whether or not secured by mortgage and whether or not

carrying a right to participate in the debtor’s profits, and in particular, income from

government securities and income from bonds or debentures, including premiums

and prizes attaching to such securities, bonds or debentures. However, the term

"interest" shall not include income referred to in Article 10. Penalty charges for

late payment shall not be regarded as interest for the purpose of this Article.

3. The provisions of paragraph 1 shall not apply if the beneficial owner of

the interest, being a resident of a Contracting State, carries on business in the other

Contracting State in which the interest arises through a permanent establishment

situated therein and the debt-claim in respect of which the interest is paid is

effectively connected with such permanent establishment. In such case the

provisions of Article 7 shall apply.

4. Where, by reason of a special relationship between the payer and the

beneficial owner or between both of them and some other person, the amount of

the interest, having regard to the debt-claim for which it is paid, exceeds the

amount which would have been agreed upon by the payer and the beneficial owner

in the absence of such relationship, the provisions of this Article shall apply only

to the last-mentioned amount. In such case, the excess part of the payments shall

remain taxable according to the laws of each Contracting State, due regard being

had to the other provisions of this Convention.

Article 12

Royalties

1. Royalties arising in a Contracting State and beneficially owned by a

resident of the other Contracting State shall be taxable only in that other State.

2. The term "royalties" as used in this Article means payments of any kind

received as a consideration for the use of, or the right to use, any copyright of

literary, artistic or scientific work including cinematograph films, any patent, trade

mark, design or model, plan, secret formula or process, or for information

concerning industrial, commercial or scientific experience.

3. The provisions of paragraph 1 shall not apply if the beneficial owner of

the royalties, being a resident of a Contracting State, carries on business in the

other Contracting State in which the royalties arise through a permanent

establishment situated therein and the right or property in respect of which the

royalties are paid is effectively connected with such permanent establishment. In

such case the provisions of Article 7 shall apply.

4. Where, by reason of a special relationship between the payer and the

beneficial owner or between both of them and some other person, the amount of

the royalties, having regard to the use, right or information for which they are paid,

exceeds the amount which would have been agreed upon by the payer and the

beneficial owner in the absence of such relationship, the provisions of this Article

shall apply only to the last-mentioned amount. In such case, the excess part of the

payments shall remain taxable according to the laws of each Contracting State, due

regard being had to the other provisions of this Convention.

Article 13

Capital gains

1. Gains derived by a resident of a Contracting State from the alienation of

immovable property referred to in Article 6 and situated in the other Contracting

State may be taxed in that other State.

2. Gains from the alienation of movable property forming part of the

business property of a permanent establishment which an enterprise of a

Contracting State has in the other Contracting State, including such gains from the

alienation of such a permanent establishment (alone or with the whole enterprise),

may be taxed in that other State.

3. Gains derived by a resident of a Contracting State from the alienation of

ships or aircraft operated in international traffic by an enterprise of that State, or

movable property pertaining to the operation of such ships or aircraft, shall be

taxable only in that State.

4. Gains derived by a resident of a Contracting State from the alienation of

shares deriving more than 50 per cent of their value directly or indirectly from

immovable property situated in the other Contracting State may be taxed in that

other State.

5. Gains from the alienation of any property, other than that referred to in

paragraphs 1, 2, 3 and 4, shall be taxable only in the Contracting State of which the

alienator is a resident.

Article 14

Income from employment

1. Subject to the provisions of Articles 15, 17 and 18, salaries, wages and

other similar remuneration derived by a resident of a Contracting State in respect

of an employment shall be taxable only in that State unless the employment is

exercised in the other Contracting State. If the employment is so exercised, such

remuneration as is derived there from may be taxed in that other State.

2. Notwithstanding the provisions of paragraph 1, remuneration derived by

a resident of a Contracting State in respect of an employment exercised in the other

Contracting State shall be taxable only in the first-mentioned State if

a)

the recipient is present in the other State for a period or periods

not exceeding in the aggregate 183 days in any twelve month period

commencing or ending in the fiscal year concerned, and

b)

the remuneration is paid by, or on behalf of, an employer who is

not a resident of the other State, and

c)

the remuneration is not borne by a permanent establishment

which the employer has in the other State.

3. Notwithstanding the preceding provisions of this Article, remuneration

derived in respect of an employment exercised aboard a ship or aircraft operated in

international traffic by an enterprise of a Contracting State may be taxed in that

State.

Article 15

Directors’ fees

Directors’ fees and other similar payments derived by a resident of a

Contracting State in his capacity as a member of the board of directors (or a board

set up for a similar purpose) of a company or a trust which is a resident of the other

Contracting State, may be taxed in that other State.

Article 16

Artistes and sportsmen

1. Notwithstanding the provisions of Articles 7 and 14, income derived by

a resident of a Contracting State as an entertainer, such as a theatre, motion picture,

radio or television artiste, or a musician, or as a sportsman, from his personal

activities as such exercised in the other Contracting State, may be taxed in that

other State.

2. Where income in respect of personal activities exercised by an

entertainer or a sportsman in his capacity as such accrues not to the entertainer or

sportsman himself but to another person, that income may, notwithstanding the

provisions of Articles 7 and 14, be taxed in the Contracting State in which the

activities of the entertainer or sportsman are exercised.

3. The provisions of paragraphs 1 and 2 shall not apply to income derived

from activities exercised in a Contracting State by an artiste or a sportsman if the

visit to that State is wholly or mainly supported by public funds of one or both of

the Contracting States or political subdivisions or local authorities or statutory

bodies thereof. In such case, the income shall be taxable only in the Contracting

State in which the artiste or the sportsman is a resident.

Article 17

Pensions

1. Subject to the provisions of paragraph 2 of Article 18, pensions and

other similar remuneration (including lump sum payments) paid to a resident of a

Contracting State in consideration of past employment or self-employment shall be

taxable only in that State.

2. Notwithstanding the provisions of paragraph 1, pensions and other

payments made under the social security legislation of a Contracting State shall be

taxable only in that State.

3. Notwithstanding the provisions of paragraph 1, pensions and other

similar remuneration (including lump-sum payments) arising in a Contracting

State may be taxed in that State, provided that such payments derive from

contributions paid to or from provisions made under a pension scheme by the

recipient or on his behalf or from endowments made by an employer to a company

pensions scheme and to the extent that these contributions, provisions or the

pensions or other similar remuneration have been subjected to tax or have been tax

deductible in that State under the ordinary rules of its tax laws.

Article 18

Government service

1. a)

Salaries, wages and other similar remuneration paid by a

Contracting State or a political subdivision or a local authority thereof (including

any legal entity or authority created under public law of that State) to an individual

in respect of services rendered to that State or subdivision or authority (including

any legal entity or authority created under public law of that State) shall be taxable

only in that State.

b)

However, such salaries, wages and other similar remuneration

shall be taxable only in the other Contracting State if the services are rendered in

that State and the individual is a resident of that State who

(i)

is a national of that State; or

(ii) did not become a resident of that State solely for the purpose of

rendering the services.

2. Notwithstanding the provisions of paragraph 1, pensions and other

similar remuneration (including lump sum payments) paid by, or out of funds

created by, a Contracting State or a political subdivision or a local authority thereof

(including any legal entity or authority created under public law of that State) to an

individual in respect of services rendered to that State or subdivision or authority

(including any legal entity or authority created under public law of that State) shall

be taxable only in that State.

3. The provisions of Articles 14, 15, 16 and 17 shall apply to salaries,

wages, pensions, and other similar remuneration (including lump sum payments)

in respect of services rendered in connection with a business carried on by a

Contracting State or a political subdivision or a local authority thereof (including

any legal entity or authority created under public law of that State).

Article 19

Students

Payments which a student or business apprentice who is or was immediately

before visiting a Contracting State a resident of the other Contracting State and

who is present in the first mentioned State solely for the purpose of his education

or training receives for the purpose of his maintenance, education or training shall

not be taxed in that State, provided that such payments arise from sources outside

that State.

Article 20

Other income

1. Items of income of a resident of a Contracting State, wherever arising,

not dealt with in the foregoing Articles of this Convention shall be taxable only in

that State.

2. The provisions of paragraph 1 shall not apply to income, other than

income from immovable property as defined in paragraph 2 of Article 6, if the

recipient of such income, being a resident of a Contracting State, carries on

business in the other Contracting State through a permanent establishment situated

therein and the right or property in respect of which the income is paid is

effectively connected with such permanent establishment. In such case the

provisions of Article 7 shall apply.

Article 21

Capital

1. Capital represented by immovable property referred to in Article 6,

owned by a resident of a Contracting State and situated in the other Contracting

State, may be taxed in that other State.

2. Capital represented by movable property forming part of the business

property of a permanent establishment which an enterprise of a Contracting State

has in the other Contracting State may be taxed in that other State.

3. Capital of an enterprise of a Contracting State represented by ships and

aircraft operated in international traffic and by movable property pertaining to the

operation of such ships and aircraft, shall be taxable only in that State.

4. All other elements of capital of a resident of a Contracting State shall be

taxable only in that State.

Article 22

Elimination of double taxation

1. Subject to the provisions of the laws of Liechtenstein regarding the

elimination of double taxation, which shall not affect the general principle hereof,

double taxation shall be eliminated as follows

a)

Where a resident of Liechtenstein derives income or owns capital

which, in accordance with the provisions of this Convention, may be taxed in

Malta, Liechtenstein shall, subject to the provisions of subparagraphs b) and

c), exempt such income or capital from tax, but may nevertheless, in

calculating the amount of tax on the remaining income or capital of such

resident, take into account the exempted income or capital.

b)

Where a resident of Liechtenstein derives items of income which,

in accordance with the provisions of Articles 14, 15, 16 and 17, may be taxed

in Malta, Liechtenstein shall credit against Liechtenstein tax on this income

the tax paid in accordance with the law of Malta and with the provisions of

this Convention. The amount of tax to be credited shall not, however, exceed

the Liechtenstein tax due on the income derived from Malta.

c)

Income from dividends within the meaning of Article 10 paid by

a company that is a resident of Malta to a company that is a resident of

Liechtenstein and that are not deductible in determining the profits of the

payor, shall not be taxed in Liechtenstein.

2. In the case of Malta, double taxation shall be eliminated as follows

Subject to the provisions of the law of Malta regarding the allowance of

a credit against Malta tax in respect of foreign tax, where, in accordance with

the provisions of this Convention, there is included in a Malta assessment

income from sources within Liechtenstein, the Liechtenstein tax on such

income shall be allowed as a credit against the relative Malta tax payable

thereon.

Article 23

Non-discrimination

1. Nationals of a Contracting State shall not be subjected in the other

Contracting State to any taxation or any requirement connected therewith, which is

other or more burdensome than the taxation and connected requirements to which

nationals of that other State in the same circumstances, in particular with respect to

residence, are or may be subjected. This provision shall, notwithstanding the

provisions of Article 1, also apply to persons who are not residents of one or both

of the Contracting States.

2. Stateless persons who are residents of a Contracting State shall not be

subjected in either Contracting State to any taxation or any requirement connected

therewith, which is other or more burdensome than the taxation and connected

requirements to which nationals of the State concerned in the same circumstances,

in particular with respect to residence, are or may be subjected.

3. The taxation on a permanent establishment which an enterprise of a

Contracting State has in the other Contracting State shall not be less favourably

levied in that other State than the taxation levied on enterprises of that other State

carrying on the same activities. This provision shall not be construed as obliging a

Contracting State to grant to residents of the other Contracting State any personal

allowances, reliefs and reductions for taxation purposes on account of civil status

or family responsibilities which it grants to its own residents.

4. Except where the provisions of paragraph 1 of Article 9, paragraph 4 of

Article 11, or paragraph 4 of Article 12, apply, interest, royalties and other

disbursements paid by an enterprise of a Contracting State to a resident of the other

Contracting State shall, for the purpose of determining the taxable profits of such

enterprise, be deductible under the same conditions as if they had been paid to a

resident of the first-mentioned State. Similarly, any debts of an enterprise of a

Contracting State to a resident of the other Contracting State shall, for the purpose

of determining the taxable capital of such enterprise, be deductible under the same

conditions as if they had been contracted to a resident of the first-mentioned State.

5. Enterprises of a Contracting State, the capital of which is wholly or

partly owned or controlled, directly or indirectly, by one or more residents of the

other Contracting State, shall not be subjected in the first-mentioned State to any

taxation or any requirement connected therewith which is other or more

burdensome than the taxation and connected requirements to which other similar

enterprises of the first-mentioned State are or may be subjected.

6. The provisions of this Article shall, notwithstanding the provisions of

Article 2, apply to taxes of every kind and description.

Article 24

Mutual agreement procedure

1. Where a person considers that the actions of one or both of the

Contracting States result or will result for him in taxation not in accordance with

the provisions of this Convention, he may, irrespective of the remedies provided by

the domestic law of those States, present his case to the competent authority of the

Contracting State of which he is a resident or, if his case comes under paragraph 1

of Article 23, to that of the Contracting State of which he is a national. The case

must be presented within three years from the first notification of the action

resulting in taxation not in accordance with the provisions of the Convention.

2. The competent authority shall endeavour, if the objection appears to it

to be justified and if it is not itself able to arrive at a satisfactory solution, to

resolve the case by mutual agreement with the competent authority of the other

Contracting State, with a view to the avoidance of taxation which is not in

accordance with the Convention. Any agreement reached shall be implemented

notwithstanding any time limits in the domestic law of the Contracting States.

3. The competent authorities of the Contracting States shall endeavour to

resolve by mutual agreement any difficulties or doubts arising as to the

interpretation or application of the Convention. They may also consult together for

the elimination of double taxation in cases not provided for in the Convention.

4. The competent authorities of the Contracting States may communicate

with each other directly, including through a joint commission consisting of

themselves or their representatives, for the purpose of reaching an agreement in the

sense of the preceding paragraphs.

5. Where,

a)

under paragraph 1, a person has presented a case to the competent

authority of a Contracting State on the basis that the actions of one or both of

the Contracting States have resulted for that person in taxation not in

accordance with the provisions of this Convention; and

b)

the competent authorities are unable to reach an agreement to

resolve that case pursuant to paragraph 2 within two years from the

presentation of the case to the competent authority of the other Contracting

State;

any unresolved issues arising from the case shall be submitted to arbitration if the

person so requests. These unresolved issues shall not, however, be submitted to

arbitration if a decision on these issues has already been rendered by a court or

administrative tribunal of either State. Unless a person directly affected by the case

does not accept the mutual agreement that implements the arbitration decision, that

decision shall be binding on both Contracting States and shall be implemented

notwithstanding any time limits in the domestic laws of these States. The

competent authorities of the Contracting States shall by mutual agreement settle

the mode of application of this paragraph.

Article 25

Exchange of information

1. The competent authorities of the Contracting States shall exchange such

information as is foreseeably relevant for carrying out the provisions of this

Convention or to the administration or enforcement of the domestic laws

concerning taxes of every kind and description imposed on behalf of the

Contracting States, or of their political subdivisions or local authorities, insofar as

the taxation thereunder is not contrary to the Convention. The exchange of

information is not restricted by Articles 1 and 2.

2. Any information received under paragraph 1 by a Contracting State

shall be treated as secret in the same manner as information obtained under the

domestic laws of that State and shall be disclosed only to persons or authorities

(including courts and administrative bodies) concerned with the assessment or

collection of, the enforcement or prosecution in respect of, the determination of

appeals in relation to the taxes referred to in paragraph 1, or the oversight of the

above. Such persons or authorities shall use the information only for such

purposes. They may disclose the information in public court proceedings or in

judicial decisions.

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 obtainable 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 26

Members of diplomatic missions and consular posts

Nothing in this Convention 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 27

Protocol

The attached Protocol shall be an integral part of this Convention.

Article 28

Entry into force

1. The Contracting States shall notify each other in writing, through

diplomatic channels, that the procedures required by their laws for the entry into

force of this Convention have been satisfied. The Convention shall enter into force

on the date of receipt of the last notification.

2. The Convention shall have effect

a)

in respect of taxes withheld at source, to income derived on or

after 1 January of the calendar year next following the year in which the

Convention enters into force;

b)

in respect of other taxes on income and taxes on capital, to taxes

chargeable for any taxable year (any calendar year or accounting period, as

the case may be) beginning on or after 1 January of the calendar year next

following the year in which the Convention enters into force.

Article 29

Termination

This Convention shall remain in force until terminated by a Contracting

State. Either Contracting State may terminate the Convention, through diplomatic

channels, by giving notice of termination at least six months before the end of any

calendar year beginning after the expiration of a period of five years from the date

of its entry into force. In such event, the Convention shall cease to have effect

a)

in respect of taxes withheld at source, to income derived on or

after 1 January of the calendar year next following the year in which the

notice is given;

b)

in respect of other taxes on income and taxes on capital, to taxes

chargeable for any taxable year (any calendar year or accounting period, as

the case may be) beginning on or after 1 January of the calendar year next

following the year in which the notice is given.

IN WITNESS WHEREOF the undersigned, being duly authorised thereto by

their respective Governments, have signed this Convention.

Done in duplicate at New York this 27 day of September 2013, in the English

and German languages, both texts being equally authentic. In case of divergence

between the texts, the English text shall be the operative one.

George W. Vella

Aurelia Frick

For the Government of the

For the Government of the

Republic of Malta

Principality of Liechtenstein

Protocol

At the signing today of the Convention between the Government of the

Republic of Malta and the Government of the Principality of Liechtenstein 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 Convention.

1. With reference to Article 3 paragraph 1 subparagraph d (Person)

It is understood that for the purposes of the Convention a Liechtenstein

dormant inheritance is the wealth of a deceased person during the period between

the time of death and the transfer of ownership to the successor(s) as taxable under

Article 7 paragraph 3 of the Liechtenstein Tax Act.

2. With reference to Article 3 paragraph 1 subparagraph e (Company)

It is understood that for the purposes of the Convention the definition of a

company includes Liechtenstein registered trusts or any other special asset

dedication that is treated as a body corporate for Liechtenstein tax purposes.

3. With reference to Article 4 (Resident)

It is understood that for the purposes of the Convention a person is a resident

of a Contracting State if under the domestic laws of that Contracting State it is

liable to tax therein by reason of his domicile, residence, place of management or

any other criterion of a similar nature. A person is also considered liable to tax if

he is subject to the tax laws of that Contracting State but is exempt from tax only if

he meets all the requirements for exemption specified in that tax laws of that

Contracting State.

It is understood that for the purposes of paragraph 3 in case of a trust, if a

trustee is resident in a Contracting State and none of the trustees is resident in the

other Contracting State, the trust is considered to be a resident of the first-

mentioned Contracting State. If trustees are resident in both Contracting States

then the trust is considered to be a resident in the Contracting State where the

decisions concerning the administration of the trust are taken. In case such

decisions are taken in both or in neither of the Contracting States then the

competent authorities of the Contracting States shall settle the residence of the

trust by mutual agreement.

4. With reference to Article 25 (Exchange of information)

It is understood that for the purposes of the Convention that

a)

this Article only obliges the Contracting States to exchange

information upon request and only in respect of taxable periods beginning on

or after 1 January of the calendar year next following the year in which this

Convention enters into force;

b)

the information exchanged

(i) may not be used for any purpose other than for the

purposes stated in paragraph 1 of Article 25 without the express written

consent of the competent authority of the requested Contracting State;

and

(ii) must not be disclosed to any other State or sovereign

territory not party to this Convention;

c)

personal data may be transmitted to the extent necessary for the

exchange of information according to Article 25 and subject to the provisions

of the law of the supplying Contracting State;

d)

any request for information shall in all cases specify in writing

(i) the identity of the person under examination or

investigation, however, it is not necessary to provide the name of the

taxpayer in order to define his identity, if this identity can be deduced

from equivalent elements;

(ii) the taxable period for which the information is sought;

(iii) a statement of the information sought including its nature

and the form in which the applicant Contracting State wishes to receive

the information from the requested Contracting State;

(iv) the matter under the applicant Contracting State’s tax law

with respect to which the information is sought;

(v) grounds for believing that the information requested is

foreseeably relevant to the administration and enforcement of the

domestic tax laws of the applicant Contracting State with regard to the

person specified in subparagraph (i);

(vi) grounds for believing that the information requested is

held in the requested Contracting State or is in the possession or control

of a person within the jurisdiction of the requested State;

(vii) to the extent known, the name and address of any person

believed to be in possession of the requested information;

(viii) a statement that the request is in conformity with the law

and administrative practices of the applicant Contracting State, that if

the requested information was within the jurisdiction of the applicant

State then the competent authority of the applicant State would be able

to obtain the information under the laws or in the normal course of

administrative practice of the applicant State and that it is in conformity

with this Convention; and

(ix) a statement that the applicant Contracting State has

pursued all means available in its own territory to obtain the

information, except those that would give rise to disproportionate

difficulties;

e)

for the purpose of paragraph d

(i)

the term "applicant Contracting State" means the

Contracting State requesting information;

(ii) the term "requested Contracting State" means the

Contracting State requested to provide information.

IN WITNESS WHEREOF the undersigned, being duly authorised thereto by

their respective Governments, have signed this Protocol.

Done in duplicate at New York this 27 day of September 2013, in the English

and German languages, both texts being equally authentic. In case of divergence

between the texts, the English text shall be the operative one.

George W. Vella

Aurelia Frick

For the Government of the

For the Government of the

Republic of Malta

Principality of Liechtenstein

€2.16