MT
Measures to Prevent Base Erosion and Profit Shifting)
Table of Provisions (20)
Statutory Text (20 Articles)
L.N. 142 of 2018
INCOME TAX ACT
(CAP. 123)
Multilateral Convention (Implementing Tax Treaty Related
Measures to Prevent Base Erosion and Profit Shifting)
Order, 2018
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 Multilateral Convention
(Implementing Tax Treaty Related Measures to Prevent Base Erosion
and Profit Shifting) Order, 2018.
(Article 2)
Multilateral Convention to Implement Tax Treaty Related Measures to Prevent
Base Erosion and Profit Shifting
The Parties to this Convention,
Recognising that governments lose substantial corporate tax revenue because
of aggressive international tax planning that has the effect of artificially shifting
profits to locations where they are subject to non-taxation or reduced taxation;
Mindful that base erosion and profit shifting (hereinafter referred to as
"BEPS") is a pressing issue not only for industrialised countries but also for
emerging economies and developing countries;
Recognising the importance of ensuring that profits are taxed where
substantive economic activities generating the profits are carried out and where
value is created;
Welcoming the package of measures developed under the OECD/G20 BEPS
project (hereinafter referred to as the "OECD/G20 BEPS package");
Noting that the OECD/G20 BEPS package included tax treaty-related
measures to address certain hybrid mismatch arrangements, prevent treaty abuse,
address artificial avoidance of permanent establishment status, and improve
dispute resolution;
Conscious of the need to ensure swift, co-ordinated and consistent
implementation of the treaty related BEPS measures in a multilateral context;
Noting the need to ensure that existing agreements for the avoidance of
double taxation on income are interpreted to eliminate double taxation with respect
to the taxes covered by those agreements without creating opportunities for non-
taxation or reduced taxation through tax evasion or avoidance (including through
treaty-shopping arrangements aimed at obtaining reliefs provided in those
agreements for the indirect benefit of residents of third jurisdictions);
Recognising the need for an effective mechanism to implement agreed
changes in a synchronised and efficient manner across the network of existing
agreements for the avoidance of double taxation on income without the need to
bilaterally renegotiate each such agreement;
Have agreed as follows
PART I
SCOPE AND INTERPRETATION OF TERMS
Article 1 - Scope of the Convention
This Convention modifies all Covered Tax Agreements as defined in
subparagraph a) of paragraph 1 of Article 2 (Interpretation of Terms).
Article 2 - Interpretation of Terms
1. For the purpose of this Convention, the following definitions apply
a)
The term "Covered Tax Agreement" means an agreement for the
avoidance of double taxation with respect to taxes on income (whether or not
other taxes are also covered)
i)
that is in force between two or more
A) Parties; and, or
B) jurisdictions or territories which are parties to an
agreement described above and for whose international relations
a Party is responsible; and
ii) with respect to which each such Party has made a
notification to the Depositary listing the agreement as well as any
amending or accompanying instruments thereto (identified by title,
names of the parties, date of signature, and, if applicable at the time of
the notification, date of entry into force) as an agreement which it
wishes to be covered by this Convention.
b)
The term "Party" means
i)
A State for which this Convention is in force pursuant to
Article 34 (Entry into Force); or
ii) A jurisdiction which has signed this Convention pursuant
to subparagraph b) or c) of paragraph 1 of Article 27 (Signature and
Ratification, Acceptance or Approval) and for which this Convention is
in force pursuant to Article 34 (Entry into Force).
c)
The term "Contracting Jurisdiction" means a party to a Covered
Tax Agreement.
d)
The term "Signatory" means a State or jurisdiction which has
signed this Convention but for which the Convention is not yet in force.
2. As regards the application of this Convention at any time by a Party, any
term not defined herein shall, unless the context otherwise requires, have the
meaning that it has at that time under the relevant Covered Tax Agreement.
PART II
HYBRID MISMATCHES
Article 3 - Transparent Entities
1. For the purposes of a Covered Tax Agreement, income derived by or
through an entity or arrangement that is treated as wholly or partly fiscally
transparent under the tax law of either Contracting Jurisdiction shall be considered
to be income of a resident of a Contracting Jurisdiction but only to the extent that
the income is treated, for purposes of taxation by that Contracting Jurisdiction, as
the income of a resident of that Contracting Jurisdiction.
2. Provisions of a Covered Tax Agreement that require a Contracting
Jurisdiction to exempt from income tax or provide a deduction or credit equal to
the income tax paid with respect to income derived by a resident of that
Contracting Jurisdiction which may be taxed in the other Contracting Jurisdiction
according to the provisions of the Covered Tax Agreement shall not apply to the
extent that such provisions allow taxation by that other Contracting Jurisdiction
solely because the income is also income derived by a resident of that other
Contracting Jurisdiction.
It is hereby declared
(a)
that it is expedient that the arrangements specified in
the Multilateral Convention (Implementing Tax Treaty Related
Measures to Prevent Base Erosion and Profit Shifting) set out in
the Schedule to this Order (hereinafter referred to as "the
Convention") made with a view to have an effective mechanism
for the implementation of agreed changes in a synchronised and
efficient manner across the network of existing agreements for
the avoidance of double taxation on income without the need to
bilaterally renegotiate each such agreement should have effect
in Malta;
(b) that the Convention set out in Schedule 1 to this
Order was signed on the 7th of June 2017;
(c)
that the list of Malta’s reservations and notifications
is set out in Schedule 2 to this Order;
(d) that the Convention shall enter into force in
accordance with Article 34 of the Multilateral Convention as set
out in the Schedule to this Order;
(e) that the date of entry into force of the Convention in Malta
shall be announced by notice in the Gazette.
(Article 2)
Malta
Status of List of Reservations and Notifications at the Time of Signature
For jurisdictions depositing a list subject to confirmation upon ratification
This document contains a list of reservations and notifications made by Malta
to be confirmed upon deposit of the instrument of ratification, acceptance or
approval subject to Articles 28(6) and 29(3) of the Convention.
Article 2 - Interpretation of Terms
Notification - Agreements Covered by the Convention
Pursuant to Article 2(1)(a)(ii) of the Convention, Malta wishes the following
agreement(s) to be covered by the Convention
Other
Original/
Date of
Date of Entry
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Albania
Original
2-05-2000
23-11-2000
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
REPUBLIC OF ALBANIA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Andorra
Original
20-09-2016
27-09-2017
THE GOVERNMENT OF
THE REPUBLIC OF MALTA
AND THE GOVERNMENT
OF THE PRINCIPALITY OF
ANDORRA
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
AGREEMENT BETWEEN Australia
Original
09-05-1984
20-05-1985
MALTA AND AUSTRALIA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Austria
Original
29-05-1978
13-07-1979
THE REPUBLIC OF MALTA
AND THE REPUBLIC OF
AUSTRIA
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
WITH
RESPECT TO TAXES ON
INCOME
AND
ON
CAPITAL
CONVENTION BETWEEN Azerbaijan
Original
29-04-2016
27-12-2016
THE GOVERNMENT OF
THE REPUBLIC OF MALTA
AND THE GOVERNMENT
OF THE REPUBLIC OF
AZERBAIJAN FOR THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Bahrain
Original
12-04-2010
28-02-2012
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
KINGDOM OF BAHRAIN
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Barbados
Original
5-12-2001
19-06-2002
MALTA AND BARBADOS
Amending
25-09-2013
30-04-2014
FOR THE AVOIDANCE OF
Instrument
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
AGREEMENT BETWEEN Belgium
Original
28-06-1974
03-01-1975
THE STATE OF MALTA
Amending
23-06-1993
17-10-2002
AND THE KINGDOM OF
Instrument
BELGIUM
FOR
THE
(a)
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
Amending
19-01-2010
n/a
PREVENTION OF FISCAL
Instrument
EVASION
(b)
AGREEMENT BETWEEN
Canada
Original
25-07-1986
20-05-1987
THE REPUBLIC OF MALTA
AND CANADA FOR THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AND ON CAPITAL
AGREEMENT BETWEEN
China
Original
23-10-2010
25-08-2011
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
PEOPLE’S REPUBLIC OF
CHINA
FOR
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AGREEMENT BETWEEN
Croatia
Original
21-10-1998
22-08-1999
THE REPUBLIC OF MALTA
AND THE REPUBLIC OF
CROATIA
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
WITH
RESPECT TO TAXES ON
INCOME
DOUBLE
TAXATION
Curaçao
Original
18-11-2015
n/a
RELIEF(TAXES
ON
INCOME) (THE KINGDOM
OF THE NETHERLANDS)
IN RESPECT OF CURAÇAO
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
AGREEMENT BETWEEN Cyprus
Original
22-10-1993
11-08-1994
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
REPUBLIC OF CYPRUS
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AND
ON
CAPITAL
CONVENTION BETWEEN Czech
Original
21-06-1996
06-06-1997
MALTA AND THE CZECH Republic
REPUBLIC
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AND ON CAPITAL
CONVENTION BETWEEN Denmark
Original
13-07-1998
28-12-1998
THE GOVERNMENT OF
THE
KINGDOM
OF
DENMARK
AND
THE
GOVERNMENT OF THE
REPUBLIC OF MALTA FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Egypt
Original
20-02-1999
07-04-2001
THE REPUBLIC OF MALTA
AND
THE
ARAB
REPUBLIC OF EGYPT FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Estonia
Original
03-05-2001
22-01-2003
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
REPUBLIC OF ESTONIA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN Finland
Original
30-10-2000
30-12-2001
MALTA
AND
THE
REPUBLIC OF FINLAND
FOR THE AVOIDANCE OF
DOUBLE TAXATION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN France
Original
25-07-1977
01-10-1979
THE GOVERNMENT OF
Amending
08-07-1994
01-09-1997
THE REPUBLIC OF MALTA
Instrument
AND THE GOVERNMENT
(a)
OF
THE
FRENCH
REPUBLIC
FOR
THE
Amending
29-08-2008
01-06-2010
AVOIDANCE OF DOUBLE
Instrument
TAXATION
AND
THE
(b)
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AND CAPITAL
AGREEMENT BETWEEN Georgia
Original
23-10-2009
30-12-2009
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT
OF
GEORGIA
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AND ON CAPITAL
AGREEMENT BETWEEN Germany
Original
08-03-2001
27-12-2001
MALTA
AND
THE
Amending
17-06-2010
19-05-2011
FEDERAL REPUBLIC OF
Instrument
GERMANY
FOR
THE
(a)
AVOIDANCE OF DOUBLE
TAXATION
WITH
RESPECT TO TAXES ON
INCOME
AND
ON
CAPITAL
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Greece
Original
13-10-2006
30-08-2008
MALTA
AND
THE
HELLENIC REPUBLIC FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN Guernsey
Original
12-03-2012
10-03-2013
THE GOVERNMENT OF
MALTA AND THE STATES
OF GUERNSEY FOR THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AGREEMENT BETWEEN Hong Kong
Original
08-11-2011
18-07-2012
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
HONG KONG SPECIAL
ADMINISTRATIVE
REGION OF THE PEOPLE’S
REPUBLIC OF CHINA FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN Hungary
Original
06-08-1991
29-11-1992
MALTA
AND
THE
REPUBLIC OF HUNGARY
FOR THE AVOIDANCE OF
DOUBLE TAXATION
CONVENTION BETWEEN Iceland
Original
23-09-2004
19-04-2006
ICELAND AND MALTA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
AGREEMENT BETWEEN India
Original
08-04-2013
07-02-2014
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
REPUBLIC OF INDIA FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Ireland
Original
14-11-2008
15-01-2009
MALTA AND IRELAND
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN Isle of Man
Original
23-10-2009
26-02-2010
MALTA AND THE ISLE OF
MAN
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Israel
Original
28-07-2011
08-12-2013
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
STATE OF ISRAEL FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN Italy
Original
16-07-1981
08-05-1985
THE GOVERNMENT OF
Amending
13-03-2009
24-11-2010
THE REPUBLIC OF MALTA
Instrument
AND THE GOVERNMENT
(a)
OF THE REPUBLIC OF
ITALY
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
WITH
RESPECT TO TAXES ON
INCOME
AND
THE
PREVENTION OF FISCAL
EVASION
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Jersey
Original
25-01-2010
19-07-2010
MALTA AND JERSEY FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Jordan
Original
16-04-2009
13-10-2010
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
HASHEMITE
KINGDOM
OF JORDAN FOR THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Korea
Original
25-03-1997
21-03-1998
THE REPUBLIC OF MALTA
AND THE REPUBLIC OF
KOREA
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Kuwait
Original
24-07-2002
19-03-2004
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
STATE OF KUWAIT FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Latvia
Original
22-05-2000
24-10-2000
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
REPUBLIC OF LATVIA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Lebanon
Original
23-02-1999
10-02-2000
MALTA AND LEBANON
Amending
16-04-2009
23-03-2010
FOR THE AVOIDANCE OF
Instrument
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Libya
Original
28-12-2008
20-05-2010
MALTA AND THE GREAT
SOCIALIST
PEOPLE'S
LIBYAN
ARAB
JAMAHIRIYA FOR THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Liechtenstein Original
27-09-2013
01-07-2014
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
CONVENTION BETWEEN Lithuania
Original
17-05-2001
02-02-2004
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
REPUBLIC OF LITHUANIA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Luxembourg
Original
29-04-1994
14-02-1996
MALTA AND THE GRAND
Amending
30-11-2011
11-07-2013
DUCHY
OF
Instrument
LUXEMBOURG FOR THE
(a)
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AND ON CAPITAL
CONVENTION BETWEEN Malaysia
Original
03-10-1995
01-09-2000
MALTA AND MALAYSIA
FOR THE AVOIDANCE OF
DOUBLE TAXATION
AGREEMENT BETWEEN Mauritius
Original
15-10-2014
23-04-2015
THE GOVERNMENT OF
THE REPUBLIC OF MALTA
AND THE GOVERNMENT
OF THE REPUBLIC OF
MAURITIUS FOR THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Mexico
Original
17-12-2012
09-08-2014
THE UNITED MEXICAN
STATES AND MALTA FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Moldova
Original
10-04-2014
17-06-2015
THE GOVERNMENT OF
THE REPUBLIC OF MALTA
AND THE GOVERNMENT
OF THE REPUBLIC OF
MOLDOVA
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAX ON INCOME
CONVENTION BETWEEN Montenegro
Original
04-11-2008
23-09-2009
MALTA
AND
MONTENEGRO FOR THE
AVOIDANCE OF DOUBLE
TAXATION
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Morocco
Original
26-10-2001
15-06-2007
MALTA
AND
THE
KINGDOM OF MOROCCO
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN Netherlands
Original
18-05-1977
09-11-1977
MALTA
AND
THE
Amending
18-07-1995
18-03-1999
KINGDOM
OF
THE
Instrument
NETHERLANDS FOR THE
(a)
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AND ON CAPITAL
CONVENTION BETWEEN Norway
Original
30-03-2012
14-02-2013
MALTA
AND
THE
KINGDOM OF NORWAY
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Pakistan
Original
08-10-1975
20-12-1975
THE REPUBLIC OF MALTA
AND
THE
ISLAMIC
REPUBLIC OF PAKISTAN
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
THE RESPECT TO TAXES
ON INCOME
AGREEMENT BETWEEN Poland
Original
07-01-1994
24-11-1994
THE GOVERNMENT OF
Amending
06-04-2011
22-11-2011
MALTA
AND
THE
Instrument
GOVERNMENT OF THE
(a)
REPUBLIC OF POLAND
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Portugal
Original
26-01-2001
05-04-2002
MALTA
AND
THE
PORTUGUESE REPUBLIC
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN Qatar
Original
26-08-2009
09-12-2009
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
STATE OF QATAR FOR THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AGREEMENT BETWEEN Romania
Original
30-11-1995
16-08-1996
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT
OF
ROMANIA
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Russia
Original
24-04-2013
22-05-2014
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
RUSSIAN
FEDERATION
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
AND
ON
CAPITAL
CONVENTION BETWEEN San Marino
Original
03-05-2005
19-07-2005
MALTA
AND
THE
Amending
10-09-2009
15-02-2010
REPUBLIC
OF
SAN
Instrument
MARINO WITH RESPECT
TO TAXES ON INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
CONVENTION BETWEEN Saudi Arabia
Original
04-01-2012
01-12-2012
THE GOVERNMENT OF
MALTA
AND
THE
GOVERNMENT OF THE
KINGDOM
OF
SAUDI
ARABIA
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF TAX
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Serbia
Original
09-09-2009
16-06-2010
MALTA
AND
THE
REPUBLIC OF SERBIA FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION WITH
RESPECT TO TAXES ON
INCOME
AGREEMENT BETWEEN Singapore
Original
21-03-2006
29-02-2008
THE GOVERNMENT OF
Amending
20-11-2009
28-06-2013
THE
REPUBLIC
OF
Instrument
SINGAPORE AND THE
GOVERNMENT OF MALTA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Slovakia
Original
07-09-1999
20-08-2000
MALTA AND THE SLOVAK
REPUBLIC
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Slovenia
Original
08-10-2002
12-06-2003
MALTA
AND
THE
REPUBLIC OF SLOVENIA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
AGREEMENT BETWEEN South Africa
Original
16-05-1997
12-11-1997
MALTA
AND
SOUTH
Amending
24-08-2012
17-12-2013
AFRICA
FOR
THE
Instrument
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Spain
Original
08-11-2005
12-09-2006
MALTA
AND
THE
KINGDOM OF SPAIN FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Sweden
Original
09-10-1995
03-02-1996
MALTA
AND SWEDEN
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Switzerland
Original
25-02-2011
06-07-2012
MALTA AND THE SWISS
CONFEDERATION
FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN Syria
Original
22-02-1999
16-10-2000
THE REPUBLIC OF MALTA
AND THE SYRIAN ARAB
REPUBLIC
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Tunisia
Original
31-05-2000
31-12-2001
MALTA
AND
THE
REPUBLIC OF TUNISIA
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Other
Original/
Date of
Date of Entry
No.
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
AGREEMENT BETWEEN Turkey
Original
14-07-2011
13-06-2013
THE REPUBLIC OF MALTA
AND THE REPUBLIC OF
TURKEY
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN Ukraine
Original
04-09-2013
28-08-2017
THE GOVERNMENT OF
UKRAINE
AND
GOVERNMENT OF THE
REPUBLIC OF MALTA FOR
THE
AVOIDANCE
OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
CONVENTION BETWEEN United Arab
Original
13-03-2006
18-05-2007
MALTA AND THE UNITED Emirates
ARAB EMIRATES FOR THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
CONVENTION BETWEEN United
Original
12-05-1994
27-03-1995
MALTA AND THE UNITED Kingdom
KINGDOM
OF
GREAT
BRITAIN AND NORTHERN
IRELAND
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AND CAPITAL GAINS
CONVENTION BETWEEN Uruguay
Original
11-03-2011
13-12-2012
MALTA
AND
THE
ORIENTAL REPUBLIC OF
URUGUAY
FOR
THE
AVOIDANCE OF DOUBLE
TAXATION
AND
THE
PREVENTION OF FISCAL
EVASION WITH RESPECT
TO TAXES ON INCOME
AND ON CAPITAL
Other
Original/
Date of
Date of Entry
Title
Contracting
Amending
Signature
into Force
Jurisdiction
Instrument
AGREEMENT BETWEEN Viet Nam
Original
15-07-2016
25-11-2016
THE GOVERNMENT OF
THE REPUBLIC OF MALTA
AND THE GOVERNMENT
OF
THE
SOCIALIST
REPUBLIC OF VIET NAM
FOR THE AVOIDANCE OF
DOUBLE TAXATION AND
THE PREVENTION OF
FISCAL EVASION WITH
RESPECT TO TAXES ON
INCOME
Article 3 - Transparent Entities
Reservation
Pursuant to Article 3(5)(a) of the Convention, Malta reserves the right for the
entirety of Article 3 not to apply to its Covered Tax Agreements.
Article 4 - Dual Resident Entities
Reservation
Pursuant to Article 4(3)(a) of the Convention, Malta reserves the right for the
entirety of Article 4 not to apply to its Covered Tax Agreements.
Article 5 - Application of Methods for Elimination of Double Taxation
Reservation
Pursuant to Article 5(8) of the Convention, Malta reserves the right for the
entirety of Article 5 not to apply with respect to all of its Covered Tax Agreements.
Article 6 - Purpose of a Covered Tax Agreement
Notification of Choice of Optional Provisions
Pursuant to Article 6(6) of the Convention, Malta hereby chooses to apply
Notification of Existing Preamble Language in Listed Agreements
Pursuant to Article 6(5) of the Convention, Malta considers that the
following agreements are not within the scope of a reservation under Article 6(4)
and contain preamble language described in Article 6(2). The text of the relevant
preambular paragraph is identified below.
Preamble Text
Desiring, for the purpose of further developing and
facilitating their economic relationship, to conclude a
Convention for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on
income
desiring to further develop their economic relations and
to enhance their cooperation in tax matters by way of
concluding a Convention for the avoidance of double
taxation and the prevention of fiscal evasion with
respect to taxes on income without creating
opportunities for non-taxation or reduced taxation
through tax evasion or avoidance
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the Avoidance of
Double Taxation with respect to taxes on Income and on
Capital
Desiring to promote bilateral economic relations
between the two countries through conclusion of a
Convention for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on
income
Desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
Preamble Text
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income and on capital
Desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude an Agreement for the avoidance of
double taxation with respect to taxes on income
Desiring to conclude a convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude an Agreement for the Avoidance of
Double Taxation and the prevention of fiscal evasion
with respect to taxes on income and on capital
desiring to conclude a Convention for the avoidance of
Czech Republic double taxation and the prevention of fiscal evasion
with respect to taxes on income and on capital
desiring to conclude a Convention for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion
with Respect to Taxes on Income
Desiring to conclude a Convention for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion
with respect to Taxes on Income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude an Agreement for the avoidance of
double taxation with respect to taxes on income
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income and on capital
Desiring to promote their mutual economic relations by
removing fiscal obstacles
Desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Preamble Text
Desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude an Agreement for the Avoidance of
Double Taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income and with a view to
promoting economic cooperation between the two
countries
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude an Agreement for the Avoidance of
Double Taxation with respect to Taxes on Income and
the Prevention of Fiscal Evasion
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to promote their mutual economic relations by
removing fiscal obstacles through the conclusion of a
convention for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on
income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Preamble Text
Desiring to promote and strengthen their economic co-
operation by concluding a Convention for the avoidance
of double taxation and the prevention of fiscal evasion
with respect to taxes on income
decided to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
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
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring 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
desiring to conclude an Agreement for the Avoidance of
Double Taxation
desiring to conclude an agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
DESIRING to conclude a Convention for the avoidance
of double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to tax on income
desiring to conclude an Agreement for the Avoidance of
Double Taxation
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Desiring to conclude an agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income and on capital
Preamble Text
desiring to conclude a Convention for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion
with respect to taxes on income
desiring to conclude a Convention for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion
with respect to taxes on income
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Desiring to conclude an Agreement for the Avoidance
of Double Taxation and the Prevention of Fiscal
Evasion with Respect to Taxes on Income
Desiring to conclude an Agreement for the Avoidance
of Double Taxation and the prevention of fiscal evasion
with respect to taxes on income and to promote and
strengthen the economic relations between the two
countries on the basis of national sovereignty and
respect of independence, full equal rights, mutual
advantage and non-interference in the internal affairs
Desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention with respect to taxes
on income, and to strengthen the disciplined
development of economic relations between the two
States in the framework of greater cooperation
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of tax evasion with
respect to taxes on income
desiring to conclude a Convention for the avoidance of
double taxation with respect to taxes on income
Desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the avoidance of
Slovak Republic double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Preamble Text
desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a Convention for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion
with respect to Taxes on Income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
DESIRING to conclude a Convention for the avoidance
of double taxation with respect to taxes on income
desiring to conclude a Convention for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion
with respect to Taxes on Income
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Desiring to conclude an agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Desiring to conclude a convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income and confirming their
endeavour to develop and strengthen mutual economic
relations
desiring to conclude a Convention for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
desiring to conclude a new Convention for the
Avoidance of Double Taxation and the prevention of
fiscal evasion with respect to taxes on income and
capital gains
Desiring 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
Desiring to conclude an Agreement for the avoidance of
double taxation and the prevention of fiscal evasion
with respect to taxes on income
Notification of Listed Agreements Not Containing Existing Preamble
Pursuant to Article 6(6) of the Convention, Malta considers that the
following agreements do not contain preamble language referring to a desire to
develop an economic relationship or to enhance co-operation in tax matters.
Listed Agreement Number
Other Contracting Jurisdiction
Australia
Austria
Bahrain
Barbados
Belgium
Canada
China
Croatia
Curaçao
Cyprus
Czech Republic
Denmark
Egypt
Estonia
Finland
France
Georgia
Greece
Guernsey
Hong Kong
Hungary
Iceland
Ireland
Isle of Man
Israel
Italy
Jersey
Jordan
Korea
Latvia
Libya
Liechtenstein
Lithuania
Luxembourg
Malaysia
Mauritius
Mexico
Moldova
Listed Agreement Number
Other Contracting Jurisdiction
Montenegro
Morocco
Netherlands
Norway
Pakistan
Poland
Portugal
Qatar
Russia
Saudi Arabia
Serbia
Singapore
Slovakia
Slovenia
South Africa
Spain
Sweden
Switzerland
Syria
Tunisia
Turkey
Ukraine
United Arab Emirates
United Kingdom
Uruguay
Viet Nam
Article 7 - Prevention of Treaty Abuse
Notification of Choice of Optional Provisions
Pursuant to Article 7(17)(b) of the Convention, Malta hereby chooses to
apply Article 7(4).
Notification of Existing Provisions in Listed Agreements
Pursuant to Article 7(17)(a) of the Convention, Malta considers that the
following agreements are not subject to a reservation described in Article 7(15)(b)
and contain a provision described in Article 7(2). The article and paragraph
number of each such provision is identified below.
Listed
Other
Agreement
Contracting
Provision
Number
Jurisdiction
China
Article 10(6), 11(8), 12(7), 22(3)
Denmark
Article 10(7), 11(5), 12(5)
Estonia
Article 26(3)
France
Article 10(8), 11(8), 12(8), 22(3)
India
Article 27(2) (3)
Israel
Article 26(1),(2)
Latvia
Article 27(3)
Lithuania
Article 27(3)
Mexico
Protocol (3)(I)
Netherlands
Protocol (IV)
Norway
Article 10(7)
Poland
Article 10(6), 11(8), 12(7)
Russia
Article 10(8), 11(8), 12(8), 27(1)
Spain
Article 27(2)
Turkey
Article 26(3)
Ukraine
Article 21(1)
United Kingdom
Article 11(7), 12(7), 21(3)
Article 8 - Dividend Transfer Transactions
Reservation
Pursuant to Article 8(3)(a) of the Convention, Malta reserves the right for the
entirety of Article 8 not to apply to its Covered Tax Agreements.
Article 9 - Capital Gains from Alienation of Shares or Interests of Entities
Deriving their Value Principally from Immovable Property
Reservation
Pursuant to Article 9(6)(a) of the Convention, Malta reserves the right for
Article 9(1) not to apply to its Covered Tax Agreements.
Notification of Choice of Optional Provisions
Pursuant to Article 9(8) of the Convention, Malta hereby chooses to apply
Article 9(4).
Notification of Existing Provisions in Listed Agreements
Pursuant to Article 9(8) of the Convention, Malta considers that the
following agreements contain a provision described in Article 9(5). The article and
paragraph number of each such provision is identified below.
Listed
Other Contracting
Agreement
Provision
Jurisdiction
Number
Albania
Article 13(4)
Andorra
Article 13(4)
Australia
Article 13(2)
Azerbaijan
Article 13(4)
Bahrain
Article 13(4)
Barbados
Article 13(2)
China (People’s Republic of)
Article 13(4)
Croatia
Article 13(2)
Curaçao
Article 12(4)
Cyprus
Article 13(2)
Czech Republic
Article 13(3)
Denmark
Article 13(2)
Egypt
Article 13(2)
Estonia
Article 13(1)
Finland
Article 13(2)
France
Article 13(1)
Georgia
Article 13(4)
Germany
Article 13(2)
Greece
Article 13(2)
Guernsey
Article 13(4)
Hong Kong (China)
Article 13(4)
Hungary
Article 13(2)
Iceland
Article 13(2)
Ireland
Article 13(2)
Isle of Man
Article 13(4)
Israel
Article 13(2)(a)
Jersey
Article 13(4)
Jordan
Article 13(2)
Korea
Article 13(2)
Kuwait
Article 13(1)
Latvia
Article 13(1)
Listed
Other Contracting
Agreement
Provision
Jurisdiction
Number
Lebanon
Article 13(2)
Libya
Article 14(4)
Liechtenstein
Article 13(4)
Lithuania
Article 13(1)
Luxembourg
Article 13(1)
Malaysia
Article 14(3)
Mexico
Article 13(2)
Moldova
Article 13(4)
Montenegro
Article 13(4)
Morocco
Article 13(2)
Norway
Article 13(4)
Poland
Article 13(2)
Portugal
Article 13(2)
Qatar
Article 13(4)
Romania
Article 13(4)
Russia
Article 13(4)
San Marino
Article 13(4)
Saudi Arabia
Article 13(4)
Serbia
Article 13(4)
Singapore
Article 13(2)
Slovak Republic
Article 13(2)
Slovenia
Article 13(2)
South Africa
Article 13(2)
Spain
Article 13(4)
Sweden
Article 13(2)
Switzerland
Article 13(4)
Syria
Article 13(2)
Tunisia
Article 13(2)
Turkey
Article 13(2)
Ukraine
Article 13(4)
United Arab Emirates
Article 13(2)
United Kingdom
Article 13(2)
Uruguay
Article 13(4)
Viet Nam
Article 14(4)
Article 10 - Anti-abuse Rule for Permanent Establishments Situated in Third
Jurisdictions
Reservation
Pursuant to Article 10(5)(a) of the Convention, Malta reserves the right for
the entirety of Article 10 not to apply to its Covered Tax Agreements.
Article 11 - Application of Tax Agreements to Restrict a Party’s Right to Tax
its Own Residents
Reservation
Pursuant to Article 11(3)(a) of the Convention, Malta reserves the right for
the entirety of Article 11 not to apply to its Covered Tax Agreements.
Article 12 - Artificial Avoidance of Permanent Establishment Status through
Commissionnaire Arrangements and Similar Strategies
Reservation
Pursuant to Article 12(4) of the Convention, Malta reserves the right for the
entirety of Article 12 not to apply to its Covered Tax Agreements.
Article 13 - Artificial Avoidance of Permanent Establishment Status through
the Specific Activity Exemptions
Reservation
Pursuant to Article 13(6)(a) of the Convention, Malta reserves the right for
the entirety of Article 13 not to apply to its Covered Tax Agreements.
Article 14 - Splitting-up of Contracts
Reservation
Pursuant to Article 14(3)(a) of the Convention, Malta reserves the right for
the entirety of Article 14 not to apply to its Covered Tax Agreements.
Article 15 - Definition of a Person Closely Related to an Enterprise
Reservation
Pursuant to Article 15(2) of the Convention, Malta reserves the right for the
entirety of Article 15 not to apply to the Covered Tax Agreement to which the
reservations described in Article 12(4), Article 13(6)(a) or (c), and Article 14(3)(a)
apply.
Article 16 - Mutual Agreement Procedure
Reservation
Notification of Existing Provisions in Listed Agreements
Pursuant to Article 16(6)(a) of the Convention, Malta considers that the
following agreements contains a provision described in Article 16(4)(a)(i). The
article and paragraph number of each such provision is identified below.
Listed
Agreement
Other Contracting Jurisdiction
Provision
Number
Albania
Article 24(1), first sentence
Andorra
Article 23(1), first sentence
Australia
Article 24(1), first sentence
Austria
Article 25(1), first sentence
Azerbaijan
Article 24(1), first sentence
Bahrain
Article 23(1), first sentence
Barbados
Article 24(1), first sentence
Belgium
Article 25(1), first sentence
Canada
Article 25(1), first sentence
China
Article 26(1), first sentence
Croatia
Article 24(1), first sentence
Curaçao
Article 24(1),first sentence
Cyprus
Article 26(1), first sentence
Czech Republic
Article 25(1), first sentence
Denmark
Article 26(1), first sentence
Egypt
Article 24(1), first sentence
Estonia
Article 24(1), first sentence
Finland
Article 25(1), first sentence
France
Article 26(1), first sentence
Georgia
Article 25(1), first sentence
Germany
Article 25(1), first sentence
Greece
Article 24(1), first sentence
Guernsey
Article 23(1), first sentence
Hong Kong
Article 23(1), first sentence
Listed
Agreement
Other Contracting Jurisdiction
Provision
Number
Hungary
Article 25(1), first sentence
Iceland
Article 24(1), first sentence
India
Article 25(1), first sentence
Ireland
Article 24(1), first sentence
Isle of Man
Article 24(1), first sentence
Israel
Article 24(1), first sentence
Italy
Article 24(1), first sentence
Jersey
Article 24(1), first sentence
Jordan
Article 24(1), first sentence
Korea
Article 25(1), first sentence
Kuwait
Article 25(1), first sentence
Latvia
Article 25(1), first sentence
Lebanon
Article 24(1), first sentence
Libya
Article 26(1), first sentence
Liechtenstein
Article 24(1), first sentence
Lithuania
Article 25(1), first sentence
Luxembourg
Article 25(1), first sentence
Malaysia
Article 26(1), first sentence
Mauritius
Article 24(1), first sentence
Mexico
Article 23(1), first sentence
Moldova
Article 23(1), first sentence
Montenegro
Article 24(1), first sentence
Morocco
Article 25(1), first sentence
Netherlands
Article 27(1), first sentence
Norway
Article 24(1), first sentence
Pakistan
Article 24(1), first sentence
Poland
Article 25(1), first sentence
Portugal
Article 24(1), first sentence
Qatar
Article 25(1), first sentence
Romania
Article 26(1), first sentence
Russia
Article 24(1), first sentence
San Marino
Article 24(1), first sentence
Saudi Arabia
Article 24(1), first sentence
Serbia
Article 24(1), first sentence
Singapore
Article 24(1), first sentence
Slovakia
Article 24(1), first sentence
Slovenia
Article 25(1), first sentence
South Africa
Article 24(1), first sentence
Spain
Article 24(1), first sentence
Sweden
Article 24(1), first sentence
Listed
Agreement
Other Contracting Jurisdiction
Provision
Number
Switzerland
Article 25(1), first sentence
Syria
Article 24(1), first sentence
Tunisia
Article 24(1), first sentence
Turkey
Article 24(1), first sentence
Ukraine
Article 24(1),first sentence
United Arab Emirates
Article 24(1), first sentence
United Kingdom
Article 26(1), first sentence
Uruguay
Article 24(1), first sentence
Viet Nam
Article 25(1), first sentence
Pursuant to Article 16(6)(b)(i) of the Convention, Malta considers that the
following agreements contain a provision that provides that a case referred to in
the first sentence of Article 16(1) must be presented within a specific time period
that is shorter than three years from the first notification of the action resulting in
taxation not in accordance with the provisions of the Covered Tax Agreement. The
article and paragraph number of each such provision is identified below.
Listed
Agreement
Other Contracting Jurisdiction
Provision
Number
Canada
Article 25(1), second sentence
San Marino
Article 24(1), second sentence
Pursuant to Article 16(6)(b)(ii) of the Convention, Malta considers that the
following agreements contain a provision that provides that a case referred to in
the first sentence of Article 16(1) must be presented within a specific time period
that is at least three years from the first notification of the action resulting in
taxation not in accordance with the provisions of the Covered Tax Agreement. The
article and paragraph number of each such provision is identified below.
Listed
Agreement
Other Contracting Jurisdiction
Provision
Number
Albania
Article 24(1), second sentence
Andorra
Article 23(1), second sentence
Australia
Article 24(1), second sentence
Austria
Article 25(1), second sentence
Azerbaijan
Article 24(1), second sentence
Bahrain
Article 23(1), second sentence
Barbados
Article 24(1), second sentence
Belgium
Article 25(1), second sentence
China
Article 26(1), second sentence
Listed
Agreement
Other Contracting Jurisdiction
Provision
Number
Croatia
Article 24(1), second sentence
Curaçao
Article 25(1),second sentence
Cyprus
Article 26(1), second sentence
Czech Republic
Article 25(1), second sentence
Denmark
Article 26(1), second sentence
Egypt
Article 24(1), second sentence
Estonia
Article 24(1), second sentence
Finland
Article 25(1), second sentence
France
Article 26(1), second sentence
Georgia
Article 25(1), second sentence
Germany
Article 25(1), second sentence
Greece
Article 24(1), second sentence
Guernsey
Article 23(1), second sentence
Hong Kong
Article 23(1), second sentence
Hungary
Article 25(1), second sentence
Iceland
Article 24(1), second sentence
India
Article 25(1), second sentence
Ireland
Article 24(1), second sentence
Isle of Man
Article 24(1), second sentence
Israel
Article 24(1), second sentence
Italy
Article 24(1), second sentence
Jersey
Article 24(1), second sentence
Jordan
Article 24(1), second sentence
Korea
Article 25(1), second sentence
Kuwait
Article 25(1), second sentence
Latvia
Article 25(1), second sentence
Lebanon
Article 24(1), second sentence
Libya
Article 26(1), second sentence
Liechtenstein
Article 24(1), second sentence
Lithuania
Article 25(1), second sentence
Luxembourg
Article 25(1), second sentence
Malaysia
Article 26(1), second sentence
Mauritius
Article 24(1), second sentence
Mexico
Article 23(1), second sentence
Moldova
Article 23(1), second sentence
Montenegro
Article 24(1), second sentence
Morocco
Article 25(1), second sentence
Netherlands
Article 27(1), second sentence
Norway
Article 24(1), second sentence
Poland
Article 25(1), second sentence
Listed
Agreement
Other Contracting Jurisdiction
Provision
Number
Portugal
Article 24(1), second sentence
Qatar
Article 25(1), second sentence
Romania
Article 26(1), second sentence
Russia
Article 24(1), second sentence
Saudi Arabia
Article 24(1), second sentence
Serbia
Article 24(1), second sentence
Singapore
Article 24(1), second sentence
Slovakia
Article 24(1), second sentence
Slovenia
Article 25(1), second sentence
South Africa
Article 24(1), second sentence
Spain
Article 24(1), second sentence
Sweden
Article 24(1), second sentence
Switzerland
Article 25(1), second sentence
Syria
Article 24(1), second sentence
Tunisia
Article 24(1), second sentence
Turkey
Article 24(1), second sentence
Ukraine
Article 24(1),second sentence
United Arab Emirates
Article 24(1), second sentence
Uruguay
Article 24(1), second sentence
Viet Nam
Article 25(1), second sentence
Notification of Listed Agreements Not Containing Existing Provisions
Pursuant to Article 16(6)(c)(i) of the Convention, Malta considers that the
following agreement does not contain a provision described in Article 16(4)(b)(i).
Listed Agreement Number
Other Contracting Jurisdiction
Mexico
Pursuant to Article 16(6)(c)(ii) of the Convention, Malta considers that the
following agreements do not contain a provision described in Article 16(4)(b)(ii).
Listed Agreement Number
Other Contracting Jurisdiction
Belgium
Canada
Pakistan
Qatar
Switzerland
United Kingdom
Pursuant to Article 16(6)(d)(i) of the Convention, Malta considers that the
following agreements do not contain a provision described in Article 16(4)(c)(i).
Listed Agreement Number
Other Contracting Jurisdiction
Belgium
France
Pursuant to Article 16(6)(d)(ii) of the Convention, Malta considers that the
following agreements do not contain a provision described in Article 16(4)(c)(ii).
Listed Agreement Number
Other Contracting Jurisdiction
Australia
Belgium
Pakistan
Ukraine
United Kingdom
Article 17 - Corresponding Adjustments
Reservation
Notification of Existing Provisions in Listed Agreements
Pursuant to Article 17(4) of the Convention, Malta considers that the
following agreements contain a provision described in Article 17(2). The article
and paragraph number of each such provision is identified below.
Listed
Other Contracting
Agreement
Provision
Jurisdiction
Number
Albania
Article 9(2)
Andorra
Article 9(2)
Australia
Article 9(3)
Azerbaijan
Article 9(2)
Bahrain
Article 9(2)
Barbados
Article 9(2)
Canada
Article 9(2)
China
Article 9(2)
Curaçao
Article 9(2)
Cyprus
Article 9(3)
Czech Republic
Article 9(2)
Denmark
Article 9(2)
Listed
Other Contracting
Agreement
Provision
Jurisdiction
Number
Egypt
Article 9(2)
Estonia
Article 9(2)
Finland
Article 9(2)
Georgia
Article 9(2)
Germany
Article 9(2)
Greece
Article 9(2)
Guernsey
Article 9(2)
Hong Kong
Article 9(2)
Hungary
Article 9(3)
Iceland
Article 9(2)
India
Article 9(2)
Ireland
Article 9(2)
Isle of Man
Article 9(2)
Israel
Article 9(2)
Jersey
Article 9(2)
Jordan
Article 9(2)
Korea
Article 9(2)
Kuwait
Article 9(2)
Latvia
Article 9(2)
Lebanon
Article 9(2)
Libya
Article 10(2)
Liechtenstein
Article 9(2)
Lithuania
Article 9(2)
Luxembourg
Article 9(2)
Mauritius
Article 9(2)
Mexico
Article 9(2)
Moldova
Article 9(2)
Montenegro
Article 9(2)
Morocco
Article 9(2)
Netherlands
Article 9(2)
Norway
Article 9(2)
Poland
Article 9(3)
Portugal
Article 9(2)
Romania
Article 9(2)
Russia
Article 9(2)
San Marino
Article 9(2)
Saudi Arabia
Article 9(2)
Listed
Other Contracting
Agreement
Provision
Jurisdiction
Number
Serbia
Article 9(2)
Singapore
Article 9(2)
Slovak Republic
Article 9(2)
Slovenia
Article 9(2)
South Africa
Article 9(2)
Spain
Article 9(2)
Sweden
Article 9(2)
Switzerland
Article 9(2)
Syria
Article 9(2)
Tunisia
Article 9(2)
Turkey
Article 9(2)
Ukraine
Article 9(2)
United Arab Emirates
Article 9(2)
United Kingdom
Article 9(2)
Uruguay
Article 9(2)
Viet Nam
Article 9(2)
Article 18 - Choice to Apply Part VI
Notification of Choice of Optional Provisions
Pursuant to Article 18 of the Convention, Malta hereby chooses to apply Part
Article 19 - Mandatory Binding Arbitration
Reservation
Pursuant to Article 19(12) of the Convention, Malta reserves the right for the
following rules to apply with respect to its Covered Tax Agreements
notwithstanding the other provisions of Article 19
a)
any unresolved issue arising from a mutual agreement procedure
case otherwise within the scope of the arbitration process provided for by the
Convention shall not be submitted to arbitration, if a decision on this issue
has already been rendered by a court or administrative tribunal of either
Contracting Jurisdiction;
b)
if, at any time after a request for arbitration has been made and
before the arbitration panel has delivered its decision to the competent
authorities of the Contracting Jurisdictions, a decision concerning the issue is
rendered by a court or administrative tribunal of one of the Contracting
Jurisdictions, the arbitration process shall terminate.
Article 23 - Type of Arbitration Process
Reservation
Pursuant to Article 23(2) of the Convention, for the purpose of applying
Article 23 to its Covered Tax Agreements, Malta reserves the right for Article
23(1) not to apply to its Covered Tax Agreements.
Notification of Choice of Optional Provisions
Pursuant to Article 23(4) of the Convention, Malta hereby chooses to apply
Article 23(5).
Article 24 - Agreement on a Different Resolution
Notification of Choice of Optional Provisions
Pursuant to Article 24(1) of the Convention, Malta hereby chooses to apply
Article 24(2).
Article 26 - Compatibility
Reservation
Pursuant to Article 26(4) of the Convention, Malta reserves the right for Part
VI not to apply with respect to the following agreements that already provide for
mandatory binding arbitration of unresolved issues arising from a mutual
agreement procedure case. The article and paragraph number of each such
provision is identified below.
Listed
Other Contracting
Agreement
Provision
Jurisdiction
Number
Curaçao
Article 24(5)
Moldova
Article 23(5)
Liechtenstein
Article 24(5)
Article 28 - Reservations
Reservation Formulated for Scope of Arbitration
Pursuant to Article 28(2)(a) of the Convention, Malta has no reservations
with respect to the scope of cases that shall be eligible for arbitration under the
provisions of Part VI.
Notification of Observation to the Reservation Made by the Other
Contracting Jurisdiction
Pursuant to Article 28(2)(b) of the Convention, Malta is not yet aware of any
reservation and hence will not raise any objections at this stage.
Article 35 - Entry into Effect
Notification of Choice of Optional Provisions
Pursuant to Article 35(3) of the Convention, solely for the purpose of its own
application of Article 35(1)(b) and (5)(b), Malta hereby chooses to replace the
reference to “taxable periods beginning on or after the expiration of a period” with
reference to “taxable periods beginning on or after 1 January of the next year
beginning on or after the expiration of a period”.
Article 36 - Entry into Effect of Part VI
Reservation
Pursuant to Article 36(2) of the Convention, Malta reserves the right for Part
VI to apply to a case presented to the competent authority of a Contracting
Jurisdiction prior to the later of the dates on which the Convention enters into force
for each of the Contracting Jurisdictions to the Covered Tax Agreement only to the
extent that the competent authorities of both Contracting Jurisdictions agree that it
will apply to that specific case.
Notification of Mutual Agreement on Entry into Effect with respect to Cases
Prior to Entry into Force of the Convention
To date Malta has not reached any such mutual agreements pursuant to
Article 19(10) with the competent authorities of other Contracting Jurisdictions.
€8.73
With respect to Covered Tax Agreements for which one or more Parties
has made the reservation described in subparagraph a) of paragraph 3 of Article 11
(Application of Tax Agreements to Restrict a Party’s Right to Tax its Own
Residents), the following sentence will be added at the end of paragraph 1: "In no
case shall the provisions of this paragraph be construed to affect a Contracting
Jurisdiction’s right to tax the residents of that Contracting Jurisdiction.".
Paragraph 1 (as it may be modified by paragraph 3) shall apply in place
of or in the absence of provisions of a Covered Tax Agreement to the extent that
they address whether income derived by or through entities or arrangements that
are treated as fiscally transparent under the tax law of either Contracting
Jurisdiction (whether through a general rule or by identifying in detail the
treatment of specific fact patterns and types of entities or arrangements) shall be
treated as income of a resident of a Contracting Jurisdiction.
A Party may reserve the right
a)
for the entirety of this Article not to apply to its Covered Tax
Agreements;
b)
for paragraph 1 not to apply to its Covered Tax Agreements that
already contain a provision described in paragraph 4;
c)
for paragraph 1 not to apply to its Covered Tax Agreements that
already contain a provision described in paragraph 4 which denies treaty
benefits in the case of income derived by or through an entity or arrangement
established in a third jurisdiction;
d)
for paragraph 1 not to apply to its Covered Tax Agreements that
already contain a provision described in paragraph 4 which identifies in
detail the treatment of specific fact patterns and types of entities or
arrangements;
e)
for paragraph 1 not to apply to its Covered Tax Agreements that
already contain a provision described in paragraph 4 which identifies in
detail the treatment of specific fact patterns and types of entities or
arrangements and denies treaty benefits in the case of income derived by or
through an entity or arrangement established in a third jurisdiction;
f)
for paragraph 2 not to apply to its Covered Tax Agreements;
g)
for paragraph 1 to apply only to its Covered Tax Agreements that
already contain a provision described in paragraph 4 which identifies in
detail the treatment of specific fact patterns and types of entities or
arrangements.
Each Party that has not made a reservation described in subparagraph a)
or b) of paragraph 5 shall notify the Depositary of whether each of its Covered Tax
Agreements contains a provision described in paragraph 4 that is not subject to a
reservation under subparagraphs c) through e) of paragraph 5, and if so, the article
and paragraph number of each such provision. In the case of a Party that has made
the reservation described in subparagraph g) of paragraph 5, the notification
pursuant to the preceding sentence shall be limited to Covered Tax Agreements
that are subject to that reservation. Where all Contracting Jurisdictions have made
such a notification with respect to a provision of a Covered Tax Agreement, that
provision shall be replaced by the provisions of paragraph 1 (as it may be modified
by paragraph 3) to the extent provided in paragraph 4. In other cases, paragraph 1
(as it may be modified by paragraph 3) shall supersede the provisions of the
Covered Tax Agreement only to the extent that those provisions are incompatible
with paragraph 1 (as it may be modified by paragraph 3).
Article 4 - Dual Resident Entities
1. Where by reason of the provisions of a Covered Tax Agreement a
person other than an individual is a resident of more than one Contracting
Jurisdiction, the competent authorities of the Contracting Jurisdictions shall
endeavour to determine by mutual agreement the Contracting Jurisdiction of which
such person shall be deemed to be a resident for the purposes of the Covered Tax
Agreement, having regard to its place of effective management, the place where it
is incorporated or otherwise constituted and any other relevant factors. In the
absence of such agreement, such person shall not be entitled to any relief or
exemption from tax provided by the Covered Tax Agreement except to the extent
and in such manner as may be agreed upon by the competent authorities of the
Contracting Jurisdictions.
2. Paragraph 1 shall apply in place of or in the absence of provisions of a
Covered Tax Agreement that provide rules for determining whether a person other
than an individual shall be treated as a resident of one of the Contracting
Jurisdictions in cases in which that person would otherwise be treated as a resident
of more than one Contracting Jurisdiction. Paragraph 1 shall not apply, however, to
provisions of a Covered Tax Agreement specifically addressing the residence of
companies participating in dual-listed company arrangements.
3. A Party may reserve the right
a)
for the entirety of this Article not to apply to its Covered Tax
Agreements;
b)
for the entirety of this Article not to apply to its Covered Tax
Agreements that already address cases where a person other than an
individual is a resident of more than one Contracting Jurisdiction by
requiring the competent authorities of the Contracting Jurisdictions to
endeavour to reach mutual agreement on a single Contracting Jurisdiction of
residence;
c)
for the entirety of this Article not to apply to its Covered Tax
Agreements that already address cases where a person other than an
individual is a resident of more than one Contracting Jurisdiction by denying
treaty benefits without requiring the competent authorities of the Contracting
Jurisdictions to endeavour to reach mutual agreement on a single Contracting
Jurisdiction of residence;
d)
for the entirety of this Article not to apply to its Covered Tax
Agreements that already address cases where a person other than an
individual is a resident of more than one Contracting Jurisdiction by
requiring the competent authorities of the Contracting Jurisdictions to
endeavour to reach mutual agreement on a single Contracting Jurisdiction of
residence, and that set out the treatment of that person under the Covered Tax
Agreement where such an agreement cannot be reached;
e)
to replace the last sentence of paragraph 1 with the following text
for the purposes of its Covered Tax Agreements: "In the absence of such
agreement, such person shall not be entitled to any relief or exemption from
tax provided by the Covered Tax Agreement.";
f)
for the entirety of this Article not to apply to its Covered Tax
Agreements with Parties that have made the reservation described in
subparagraph e).
4. Each Party that has not made a reservation described in subparagraph a)
of paragraph 3 shall notify the Depositary of whether each of its Covered Tax
Agreements contains a provision described in paragraph 2 that is not subject to a
reservation under subparagraphs b) through d) of paragraph 3, and if so, the article
and paragraph number of each such provision. Where all Contracting Jurisdictions
have made such a notification with respect to a provision of a Covered Tax
Agreement, that provision shall be replaced by the provisions of paragraph 1. In
other cases, paragraph 1 shall supersede the provisions of the Covered Tax
Agreement only to the extent that those provisions are incompatible with
paragraph 1.
Article 5 - Application of Methods for Elimination of Double Taxation
1. A Party may choose to apply either paragraphs 2 and 3 (Option A),
paragraphs 4 and 5 (Option B), or paragraphs 6 and 7 (Option C), or may choose to
apply none of the Options. Where each Contracting Jurisdiction to a Covered Tax
Agreement chooses a different Option (or where one Contracting Jurisdiction
chooses to apply an Option and the other chooses to apply none of the Options),
the Option chosen by each Contracting Jurisdiction shall apply with respect to its
own residents.
Option A
2. Provisions of a Covered Tax Agreement that would otherwise exempt
income derived or capital owned by a resident of a Contracting Jurisdiction from
tax in that Contracting Jurisdiction for the purpose of eliminating double taxation
shall not apply where the other Contracting Jurisdiction applies the provisions of
the Covered Tax Agreement to exempt such income or capital from tax or to limit
the rate at which such income or capital may be taxed. In the latter case, the first-
mentioned Contracting Jurisdiction shall allow as a deduction from the tax on the
income or capital of that resident an amount equal to the tax paid in that other
Contracting Jurisdiction. Such deduction shall not, however, exceed that part of the
tax, as computed before the deduction is given, which is attributable to such items
of income or capital which may be taxed in that other Contracting Jurisdiction.
3. Paragraph 2 shall apply to a Covered Tax Agreement that would
otherwise require a Contracting Jurisdiction to exempt income or capital described
in that paragraph.
Option B
4. Provisions of a Covered Tax Agreement that would otherwise exempt
income derived by a resident of a Contracting Jurisdiction from tax in that
Contracting Jurisdiction for the purpose of eliminating double taxation because
such income is treated as a dividend by that Contracting Jurisdiction shall not
apply where such income gives rise to a deduction for the purpose of determining
the taxable profits of a resident of the other Contracting Jurisdiction under the laws
of that other Contracting Jurisdiction. In such case, the first-mentioned
Contracting Jurisdiction shall allow as a deduction from the tax on the income of
that resident an amount equal to the income tax paid in that other Contracting
Jurisdiction. Such deduction shall not, however, exceed that part of the income tax,
as computed before the deduction is given, which is attributable to such income
which may be taxed in that other Contracting Jurisdiction.
5. Paragraph 4 shall apply to a Covered Tax Agreement that would
otherwise require a Contracting Jurisdiction to exempt income described in that
paragraph.
Option C
6. a)
Where a resident of a Contracting Jurisdiction derives income or
owns capital which may be taxed in the other Contracting Jurisdiction in
accordance with the provisions of a Covered Tax Agreement (except to the extent
that these provisions allow taxation by that other Contracting Jurisdiction solely
because the income is also income derived by a resident of that other Contracting
Jurisdiction), the first-mentioned Contracting Jurisdiction shall allow
i)
as a deduction from the tax on the income of that resident, an
amount equal to the income tax paid in that other Contracting Jurisdiction;
ii)
as a deduction from the tax on the capital of that resident, an
amount equal to the capital tax paid in that other Contracting Jurisdiction.
Such deduction shall not, however, exceed that part of the income
tax or capital tax, as computed before the deduction is given, which is attributable
to the income or the capital which may be taxed in that other Contracting
Jurisdiction.
b)
Where in accordance with any provision of the Covered Tax
Agreement income derived or capital owned by a resident of a Contracting
Jurisdiction is exempt from tax in that Contracting Jurisdiction, such Contracting
Jurisdiction 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.
Paragraph 6 shall apply in place of provisions of a Covered Tax
Agreement that, for purposes of eliminating double taxation, require a Contracting
Jurisdiction to exempt from tax in that Contracting Jurisdiction income derived or
capital owned by a resident of that Contracting Jurisdiction which, in accordance
with the provisions of the Covered Tax Agreement, may be taxed in the other
Contracting Jurisdiction.
A Party that does not choose to apply an Option under paragraph 1 may
reserve the right for the entirety of this Article not to apply with respect to one or
more identified Covered Tax Agreements (or with respect to all of its Covered Tax
Agreements).
A Party that does not choose to apply Option C may reserve the right,
with respect to one or more identified Covered Tax Agreements (or with respect to
all of its Covered Tax Agreements), not to permit the other Contracting
Jurisdiction(s) to apply Option C.
Each Party that chooses to apply an Option under paragraph 1 shall
notify the Depositary of its choice of Option. Such notification shall also include
a)
in the case of a Party that chooses to apply Option A, the list of its
Covered Tax Agreements which contain a provision described in paragraph
3, as well as the article and paragraph number of each such provision;
b)
in the case of a Party that chooses to apply Option B, the list of its
Covered Tax Agreements which contain a provision described in paragraph
5, as well as the article and paragraph number of each such provision;
c)
in the case of a Party that chooses to apply Option C, the list of its
Covered Tax Agreements which contain a provision described in paragraph
7, as well as the article and paragraph number of each such provision.
An Option shall apply with respect to a provision of a Covered Tax
Agreement only where the Party that has chosen to apply that Option has made
such a notification with respect to that provision.
PART III
TREATY ABUSE
Article 6 - Purpose of a Covered Tax Agreement
1. A Covered Tax Agreement shall be modified to include the following
preamble text
"Intending to eliminate double taxation with respect to the taxes
covered by this agreement without creating opportunities for non-taxation or
reduced taxation through tax evasion or avoidance (including through treaty-
shopping arrangements aimed at obtaining reliefs provided in this agreement
for the indirect benefit of residents of third jurisdictions),".
2. The text described in paragraph 1 shall be included in a Covered Tax
Agreement in place of or in the absence of preamble language of the Covered Tax
Agreement referring to an intent to eliminate double taxation, whether or not that
language also refers to the intent not to create opportunities for non-taxation or
reduced taxation.
3. A Party may also choose to include the following preamble text with
respect to its Covered Tax Agreements that do not contain preamble language
referring to a desire to develop an economic relationship or to enhance co-
operation in tax matters
"Desiring to further develop their economic relationship and to enhance
their co-operation in tax matters,".
4. A Party may reserve the right for paragraph 1 not to apply to its
Covered Tax Agreements that already contain preamble language describing the
intent of the Contracting Jurisdictions to eliminate double taxation without
creating opportunities for non-taxation or reduced taxation, whether that language
is limited to cases of tax evasion or avoidance (including through treaty-shopping
arrangements aimed at obtaining reliefs provided in the Covered Tax Agreement
for the indirect benefit of residents of third jurisdictions) or applies more broadly.
5. Each Party shall notify the Depositary of whether each of its Covered
Tax Agreements, other than those that are within the scope of a reservation under
paragraph 4, contains preamble language described in paragraph 2, and if so, the
text of the relevant preambular paragraph. Where all Contracting Jurisdictions
have made such a notification with respect to that preamble language, such
preamble language shall be replaced by the text described in paragraph 1. In other
cases, the text described in paragraph 1 shall be included in addition to the existing
preamble language.
6. Each Party that chooses to apply paragraph 3 shall notify the Depositary
of its choice. Such notification shall also include the list of its Covered Tax
Agreements that do not already contain preamble language referring to a desire to
develop an economic relationship or to enhance co-operation in tax matters. The
text described in paragraph 3 shall be included in a Covered Tax Agreement only
where all Contracting Jurisdictions have chosen to apply that paragraph and have
made such a notification with respect to the Covered Tax Agreement.
Article 7 - Prevention of Treaty Abuse
1. Notwithstanding any provisions of a Covered Tax Agreement, a benefit
under the Covered Tax Agreement shall not be granted in respect of an item of
income or capital if it is reasonable to conclude, having regard to all relevant facts
and circumstances, that obtaining that benefit was one of the principal purposes of
any arrangement or transaction that resulted directly or indirectly in that benefit,
unless it is established that granting that benefit in these circumstances would be in
accordance with the object and purpose of the relevant provisions of the Covered
Tax Agreement.
2. Paragraph 1 shall apply in place of or in the absence of provisions of a
Covered Tax Agreement that deny all or part of the benefits that would otherwise
be provided under the Covered Tax Agreement where the principal purpose or one
of the principal purposes of any arrangement or transaction, or of any person
concerned with an arrangement or transaction, was to obtain those benefits.
3. A Party that has not made the reservation described in subparagraph a)
of paragraph 15 may also choose to apply paragraph 4 with respect to its Covered
Tax Agreements.
4. Where a benefit under a Covered Tax Agreement is denied to a person
under provisions of the Covered Tax Agreement (as it may be modified by this
Convention) that deny all or part of the benefits that would otherwise be provided
under the Covered Tax Agreement where the principal purpose or one of the
principal purposes of any arrangement or transaction, or of any person concerned
with an arrangement or transaction, was to obtain those benefits, the competent
authority of the Contracting Jurisdiction that would otherwise have granted this
benefit shall nevertheless treat that person as being entitled to this benefit, or to
different benefits with respect to a specific item of income or capital, if such
competent authority, upon request from that person and after consideration of the
relevant facts and circumstances, determines that such benefits would have been
granted to that person in the absence of the transaction or arrangement. The
competent authority of the Contracting Jurisdiction to which a request has been
made under this paragraph by a resident of the other Contracting Jurisdiction shall
consult with the competent authority of that other Contracting Jurisdiction before
rejecting the request.
5. Paragraph 4 shall apply to provisions of a Covered Tax Agreement (as it
may be modified by this Convention) that deny all or part of the benefits that
would otherwise be provided under the Covered Tax Agreement where the
principal purpose or one of the principal purposes of any arrangement or
transaction, or of any person concerned with an arrangement or transaction, was to
obtain those benefits.
6. A Party may also choose to apply the provisions contained in
paragraphs 8 through 13 (hereinafter referred to as the "Simplified Limitation on
Benefits Provision") to its Covered Tax Agreements by making the notification
described in subparagraph c) of paragraph 17. The Simplified Limitation on
Benefits Provision shall apply with respect to a Covered Tax Agreement only
where all Contracting Jurisdictions have chosen to apply it.
7. In cases where some but not all of the Contracting Jurisdictions to a
Covered Tax Agreement choose to apply the Simplified Limitation on Benefits
Provision pursuant to paragraph 6, then, notwithstanding the provisions of that
paragraph, the Simplified Limitation on Benefits Provision shall apply with
respect to the granting of benefits under the Covered Tax Agreement
a)
by all Contracting Jurisdictions, if all of the Contracting
Jurisdictions that do not choose pursuant to paragraph 6 to apply the
Simplified Limitation on Benefits Provision agree to such application by
choosing to apply this subparagraph and notifying the Depositary
accordingly; or
b)
only by the Contracting Jurisdictions that choose to apply the
Simplified Limitation on Benefits Provision, if all of the Contracting
Jurisdictions that do not choose pursuant to paragraph 6 to apply the
Simplified Limitation on Benefits Provision agree to such application by
choosing to apply this subparagraph and notifying the Depositary
accordingly.
Simplified Limitation on Benefits Provision
8. Except as otherwise provided in the Simplified Limitation on Benefits
Provision, a resident of a Contracting Jurisdiction to a Covered Tax Agreement
shall not be entitled to a benefit that would otherwise be accorded by the Covered
Tax Agreement, other than a benefit under provisions of the Covered Tax
Agreement
a)
which determine the residence of a person other than an
individual which is a resident of more than one Contracting Jurisdiction by
reason of provisions of the Covered Tax Agreement that define a resident of a
Contracting Jurisdiction;
b)
which provide that a Contracting Jurisdiction will grant to an
enterprise of that Contracting Jurisdiction a corresponding adjustment
following an initial adjustment made by the other Contracting Jurisdiction, in
accordance with the Covered Tax Agreement, to the amount of tax charged in
the first-mentioned Contracting Jurisdiction on the profits of an associated
enterprise; or
c)
which allow residents of a Contracting Jurisdiction to request that
the competent authority of that Contracting Jurisdiction consider cases of
taxation not in accordance with the Covered Tax Agreement,
unless such resident is a "qualified person", as defined in paragraph 9 at the time
that the benefit would be accorded.
9. A resident of a Contracting Jurisdiction to a Covered Tax Agreement
shall be a qualified person at a time when a benefit would otherwise be accorded
by the Covered Tax Agreement if, at that time, the resident is
a)
an individual;
b)
that Contracting Jurisdiction, or a political subdivision or local
authority thereof, or an agency or instrumentality of any such Contracting
Jurisdiction, political subdivision or local authority;
c)
a company or other entity, if the principal class of its shares is
regularly traded on one or more recognised stock exchanges;
d)
a person, other than an individual, that
i)
is a non-profit organisation of a type that is agreed to by
the Contracting Jurisdictions through an exchange of diplomatic notes;
or
ii) is an entity or arrangement established in that Contracting
Jurisdiction that is treated as a separate person under the taxation laws
of that Contracting Jurisdiction and
A)
that is established and operated exclusively or
almost exclusively to administer or provide retirement benefits
and ancillary or incidental benefits to individuals and that is
regulated as such by that Contracting Jurisdiction or one of its
political subdivisions or local authorities; or
B)
that is established and operated exclusively or
almost exclusively to invest funds for the benefit of entities or
arrangements referred to in subdivision A);
e)
a person other than an individual, if, on at least half the days of a
twelve-month period that includes the time when the benefit would otherwise
be accorded, persons who are residents of that Contracting Jurisdiction and
that are entitled to benefits of the Covered Tax Agreement under
subparagraphs a) to d) own, directly or indirectly, at least 50 per cent of the
shares of the person.
10. a)
A resident of a Contracting Jurisdiction to a Covered Tax
Agreement will be entitled to benefits of the Covered Tax Agreement with respect
to an item of income derived from the other Contracting Jurisdiction, regardless of
whether the resident is a qualified person, if the resident is engaged in the active
conduct of a business in the first-mentioned Contracting Jurisdiction, and the
income derived from the other Contracting Jurisdiction emanates from, or is
incidental to, that business. For purposes of the Simplified Limitation on Benefits
Provision, the term "active conduct of a business" shall not include the following
activities or any combination thereof
i)
operating as a holding company;
ii)
providing overall supervision or administration of a group of
companies;
iii)
providing group financing (including cash pooling); or
iv)
making or managing investments, unless these activities are
carried on by a bank, insurance company or registered securities dealer in the
ordinary course of its business as such.
b)
If a resident of a Contracting Jurisdiction to a Covered Tax
Agreement derives an item of income from a business activity conducted by that
resident in the other Contracting Jurisdiction, or derives an item of income arising
in the other Contracting Jurisdiction from a connected person, the conditions
described in subparagraph a) shall be considered to be satisfied with respect to
such item only if the business activity carried on by the resident in the first-
mentioned Contracting Jurisdiction to which the item is related is substantial in
relation to the same activity or a complementary business activity carried on by the
resident or such connected person in the other Contracting Jurisdiction. Whether a
business activity is substantial for the purposes of this subparagraph shall be
determined based on all the facts and circumstances.
c)
For purposes of applying this paragraph, activities conducted by
connected persons with respect to a resident of a Contracting Jurisdiction to a
Covered Tax Agreement shall be deemed to be conducted by such resident.
A resident of a Contracting Jurisdiction to a Covered Tax Agreement
that is not a qualified person shall also be entitled to a benefit that would otherwise
be accorded by the Covered Tax Agreement with respect to an item of income if,
on at least half of the days of any twelve-month period that includes the time when
the benefit would otherwise be accorded, persons that are equivalent beneficiaries
own, directly or indirectly, at least 75 per cent of the beneficial interests of the
resident.
If a resident of a Contracting Jurisdiction to a Covered Tax Agreement
is neither a qualified person pursuant to the provisions of paragraph 9, nor entitled
to benefits under paragraph 10 or 11, the competent authority of the other
Contracting Jurisdiction may, nevertheless, grant the benefits of the Covered Tax
Agreement, or benefits with respect to a specific item of income, taking into
account the object and purpose of the Covered Tax Agreement, but only if such
resident demonstrates to the satisfaction of such competent authority that neither
its establishment, acquisition or maintenance, nor the conduct of its operations,
had as one of its principal purposes the obtaining of benefits under the Covered
Tax Agreement. Before either granting or denying a request made under this
paragraph by a resident of a Contracting Jurisdiction, the competent authority of
the other Contracting Jurisdiction to which the request has been made shall consult
with the competent authority of the first-mentioned Contracting Jurisdiction.
For the purposes of the Simplified Limitation on Benefits Provision
a)
the term "recognised stock exchange" means
i)
any stock exchange established and regulated as such
under the laws of either Contracting Jurisdiction; and
ii) any other stock exchange agreed upon by the competent
authorities of the Contracting Jurisdictions;
b)
the term "principal class of shares" means the class or classes of
shares of a company which represents the majority of the aggregate vote and
value of the company or the class or classes of beneficial interests of an
entity which represents in the aggregate a majority of the aggregate vote and
value of the entity;
c)
the term "equivalent beneficiary" means any person who would
be entitled to benefits with respect to an item of income accorded by a
Contracting Jurisdiction to a Covered Tax Agreement under the domestic law
of that Contracting Jurisdiction, the Covered Tax Agreement or any other
international instrument which are equivalent to, or more favourable than,
benefits to be accorded to that item of income under the Covered Tax
Agreement; for the purposes of determining whether a person is an
equivalent beneficiary with respect to dividends, the person shall be deemed
to hold the same capital of the company paying the dividends as such capital
the company claiming the benefit with respect to the dividends holds;
d)
with respect to entities that are not companies, the term "shares"
means interests that are comparable to shares;
e)
two persons shall be "connected persons" if one owns, directly or
indirectly, at least 50 per cent of the beneficial interest in the other (or, in the
case of a company, at least 50 per cent of the aggregate vote and value of the
company’s shares) or another person owns, directly or indirectly, at least 50
per cent of the beneficial interest (or, in the case of a company, at least 50 per
cent of the aggregate vote and value of the company’s shares) in each person;
in any case, a person shall be connected to another if, based on all the
relevant facts and circumstances, one has control of the other or both are
under the control of the same person or persons.
The Simplified Limitation on Benefits Provision shall apply in place of
or in the absence of provisions of a Covered Tax Agreement that would limit the
benefits of the Covered Tax Agreement (or that would limit benefits other than a
benefit under the provisions of the Covered Tax Agreement relating to residence,
associated enterprises or non-discrimination or a benefit that is not restricted solely
to residents of a Contracting Jurisdiction) only to a resident that qualifies for such
benefits by meeting one or more categorical tests.
A Party may reserve the right
a)
for paragraph 1 not to apply to its Covered Tax Agreements on
the basis that it intends to adopt a combination of a detailed limitation on
benefits provision and either rules to address conduit financing structures or
a principal purpose test, thereby meeting the minimum standard for
preventing treaty abuse under the OECD/G20 BEPS package; in such cases,
the Contracting Jurisdictions shall endeavour to reach a mutually satisfactory
solution which meets the minimum standard;
b)
for paragraph 1 (and paragraph 4, in the case of a Party that has
chosen to apply that paragraph) not to apply to its Covered Tax Agreements
that already contain provisions that deny all of the benefits that would
otherwise be provided under the Covered Tax Agreement where the principal
purpose or one of the principal purposes of any arrangement or transaction,
or of any person concerned with an arrangement or transaction, was to obtain
those benefits;
c)
for the Simplified Limitation on Benefits Provision not to apply
to its Covered Tax Agreements that already contain the provisions described
in paragraph 14.
Except where the Simplified Limitation on Benefits Provision applies
with respect to the granting of benefits under a Covered Tax Agreement by one or
more Parties pursuant to paragraph 7, a Party that chooses pursuant to paragraph 6
to apply the Simplified Limitation on Benefits Provision may reserve the right for
the entirety of this Article not to apply with respect to its Covered Tax Agreements
for which one or more of the other Contracting Jurisdictions has not chosen to
apply the Simplified Limitation on Benefits Provision. In such cases, the
Contracting Jurisdictions shall endeavour to reach a mutually satisfactory solution
which meets the minimum standard for preventing treaty abuse under the OECD/
G20 BEPS package.
a)
Each Party that has not made the reservation described in
subparagraph a) of paragraph 15 shall notify the Depositary of whether each of its
Covered Tax Agreements that is not subject to a reservation described in
subparagraph b) of paragraph 15 contains a provision described in paragraph 2,
and if so, the article and paragraph number of each such provision. Where all
Contracting Jurisdictions have made such a notification with respect to a provision
of a Covered Tax Agreement, that provision shall be replaced by the provisions of
paragraph 1 (and where applicable, paragraph 4). In other cases, paragraph 1 (and
where applicable, paragraph 4) shall supersede the provisions of the Covered Tax
Agreement only to the extent that those provisions are incompatible with
paragraph 1 (and where applicable, paragraph 4). A Party making a notification
under this subparagraph may also include a statement that while such Party accepts
the application of paragraph 1 alone as an interim measure, it intends where
possible to adopt a limitation on benefits provision, in addition to or in
replacement of paragraph 1, through bilateral negotiation.
b)
Each Party that chooses to apply paragraph 4 shall notify the
Depositary of its choice. Paragraph 4 shall apply to a Covered Tax Agreement only
where all Contracting Jurisdictions have made such a notification.
c)
Each Party that chooses to apply the Simplified Limitation on
Benefits Provision pursuant to paragraph 6 shall notify the Depositary of its
choice. Unless such Party has made the reservation described in subparagraph c) of
paragraph 15, such notification shall also include the list of its Covered Tax
Agreements which contain a provision described in paragraph 14, as well as the
article and paragraph number of each such provision.
d)
Each Party that does not choose to apply the Simplified
Limitation on Benefits Provision pursuant to paragraph 6, but chooses to apply
either subparagraph a) or b) of paragraph 7 shall notify the Depositary of its choice
of subparagraph. Unless such Party has made the reservation described in
subparagraph c) of paragraph 15, such notification shall also include the list of its
Covered Tax Agreements which contain a provision described in paragraph 14, as
well as the article and paragraph number of each such provision.
e)
Where all Contracting Jurisdictions have made a notification
under subparagraph c) or d) with respect to a provision of a Covered Tax
Agreement, that provision shall be replaced by the Simplified Limitation on
Benefits Provision. In other cases, the Simplified Limitation on Benefits Provision
shall supersede the provisions of the Covered Tax Agreement only to the extent
that those provisions are incompatible with the Simplified Limitation on Benefits
Provision.
Article 8 - Dividend Transfer Transactions
1. Provisions of a Covered Tax Agreement that exempt dividends paid by
a company which is a resident of a Contracting Jurisdiction from tax or that limit
the rate at which such dividends may be taxed, provided that the beneficial owner
or the recipient is a company which is a resident of the other Contracting
Jurisdiction and which owns, holds or controls more than a certain amount of the
capital, shares, stock, voting power, voting rights or similar ownership interests of
the company paying the dividends, shall apply only if the ownership conditions
described in those provisions are met throughout a 365 day period that includes the
day of the payment of the dividends (for the purpose of computing that period, no
account shall be taken of changes of ownership that would directly result from a
corporate reorganisation, such as a merger or divisive reorganisation, of the
company that holds the shares or that pays the dividends).
2. The minimum holding period provided in paragraph 1 shall apply in
place of or in the absence of a minimum holding period in provisions of a Covered
Tax Agreement described in paragraph 1.
3. A Party may reserve the right
a)
for the entirety of this Article not to apply to its Covered Tax
Agreements;
b)
for the entirety of this Article not to apply to its Covered Tax
Agreements to the extent that the provisions described in paragraph 1 already
include
i)
a minimum holding period;
ii)
a minimum holding period shorter than a 365 day period;
or
iii)
a minimum holding period longer than a 365 day period.
4. Each Party that has not made a reservation described in subparagraph a)
of paragraph 3 shall notify the Depositary of whether each of its Covered Tax
Agreements contains a provision described in paragraph 1 that is not subject to a
reservation described in subparagraph b) of paragraph 3, and if so, the article and
paragraph number of each such provision. Paragraph 1 shall apply with respect to a
provision of a Covered Tax Agreement only where all Contracting Jurisdictions
have made such a notification with respect to that provision.
Article 9 - Capital Gains from Alienation of Shares or Interests of Entities
Deriving their Value Principally from Immovable Property
1. Provisions of a Covered Tax Agreement providing that gains derived by
a resident of a Contracting Jurisdiction from the alienation of shares or other rights
of participation in an entity may be taxed in the other Contracting Jurisdiction
provided that these shares or rights derived more than a certain part of their value
from immovable property (real property) situated in that other Contracting
Jurisdiction (or provided that more than a certain part of the property of the entity
consists of such immovable property (real property))
a)
shall apply if the relevant value threshold is met at any time
during the 365 days preceding the alienation; and
b)
shall apply to shares or comparable interests, such as interests in
a partnership or trust (to the extent that such shares or interests are not
already covered) in addition to any shares or rights already covered by the
provisions.
2. The period provided in subparagraph a) of paragraph 1 shall apply in
place of or in the absence of a time period for determining whether the relevant
value threshold in provisions of a Covered Tax Agreement described in paragraph
1 was met.
3. A Party may also choose to apply paragraph 4 with respect to its
Covered Tax Agreements.
4. For purposes of a Covered Tax Agreement, gains derived by a resident
of a Contracting Jurisdiction from the alienation of shares or comparable interests,
such as interests in a partnership or trust, may be taxed in the other Contracting
Jurisdiction if, at any time during the 365 days preceding the alienation, these
shares or comparable interests derived more than 50 per cent of their value directly
or indirectly from immovable property (real property) situated in that other
Contracting Jurisdiction.
5. Paragraph 4 shall apply in place of or in the absence of provisions of a
Covered Tax Agreement providing that gains derived by a resident of a
Contracting Jurisdiction from the alienation of shares or other rights of
participation in an entity may be taxed in the other Contracting Jurisdiction
provided that these shares or rights derived more than a certain part of their value
from immovable property (real property) situated in that other Contracting
Jurisdiction, or provided that more than a certain part of the property of the entity
consists of such immovable property (real property).
6. A Party may reserve the right
a)
for paragraph 1 not to apply to its Covered Tax Agreements;
b)
for subparagraph a) of paragraph 1 not to apply to its Covered
Tax Agreements;
c)
for subparagraph b) of paragraph 1 not to apply to its Covered
Tax Agreements;
d)
for subparagraph a) of paragraph 1 not to apply to its Covered
Tax Agreements that already contain a provision of the type described in
paragraph 1 that includes a period for determining whether the relevant value
threshold was met;
e)
for subparagraph b) of paragraph 1 not to apply to its Covered
Tax Agreements that already contain a provision of the type described in
paragraph 1 that applies to the alienation of interests other than shares;
f)
for paragraph 4 not to apply to its Covered Tax Agreements that
already contain the provisions described in paragraph 5.
7. Each Party that has not made the reservation described in subparagraph
a) of paragraph 6 shall notify the Depositary of whether each of its Covered Tax
Agreements contains a provision described in paragraph 1, and if so, the article and
paragraph number of each such provision. Paragraph 1 shall apply with respect to a
provision of a Covered Tax Agreement only where all Contracting Jurisdictions
have made a notification with respect to that provision.
8. Each Party that chooses to apply paragraph 4 shall notify the Depositary
of its choice. Paragraph 4 shall apply to a Covered Tax Agreement only where all
Contracting Jurisdictions have made such a notification. In such case, paragraph 1
shall not apply with respect to that Covered Tax Agreement. In the case of a Party
that has not made the reservation described in subparagraph f) of paragraph 6 and
has made the reservation described in subparagraph a) of paragraph 6, such
notification shall also include the list of its Covered Tax Agreements which
contain a provision described in paragraph 5, as well as the article and paragraph
number of each such provision. Where all Contracting Jurisdictions have made a
notification with respect to a provision of a Covered Tax Agreement under this
paragraph or paragraph 7, that provision shall be replaced by the provisions of
paragraph 4. In other cases, paragraph 4 shall supersede the provisions of the
Covered Tax Agreement only to the extent that those provisions are incompatible
with paragraph 4.
Article 10 - Anti-abuse Rule for Permanent Establishments Situated in Third
Jurisdictions
1. Where
a)
an enterprise of a Contracting Jurisdiction to a Covered Tax
Agreement derives income from the other Contracting Jurisdiction and the
first-mentioned Contracting Jurisdiction treats such income as attributable to
a permanent establishment of the enterprise situated in a third jurisdiction;
and
b)
the profits attributable to that permanent establishment are
exempt from tax in the first-mentioned Contracting Jurisdiction,
the benefits of the Covered Tax Agreement shall not apply to any item of income
on which the tax in the third jurisdiction is less than 60 per cent of the tax that
would be imposed in the first-mentioned Contracting Jurisdiction on that item of
income if that permanent establishment were situated in the first-mentioned
Contracting Jurisdiction. In such a case, any income to which the provisions of this
paragraph apply shall remain taxable according to the domestic law of the other
Contracting Jurisdiction, notwithstanding any other provisions of the Covered Tax
Agreement.
2. Paragraph 1 shall not apply if the income derived from the other
Contracting Jurisdiction described in paragraph 1 is derived in connection with or
is incidental to the active conduct of a business carried on through the permanent
establishment (other than the business of making, managing or simply holding
investments for the enterprise’s own account, unless these activities are banking,
insurance or securities activities carried on by a bank, insurance enterprise or
registered securities dealer, respectively).
3. If benefits under a Covered Tax Agreement are denied pursuant to
paragraph 1 with respect to an item of income derived by a resident of a
Contracting Jurisdiction, the competent authority of the other Contracting
Jurisdiction may, nevertheless, grant these benefits with respect to that item of
income if, in response to a request by such resident, such competent authority
determines that granting such benefits is justified in light of the reasons such
resident did not satisfy the requirements of paragraphs 1 and 2. The competent
authority of the Contracting Jurisdiction to which a request has been made under
the preceding sentence by a resident of the other Contracting Jurisdiction shall
consult with the competent authority of that other Contracting Jurisdiction before
either granting or denying the request.
4. Paragraphs 1 through 3 shall apply in place of or in the absence of
provisions of a Covered Tax Agreement that deny or limit benefits that would
otherwise be granted to an enterprise of a Contracting Jurisdiction which derives
income from the other Contracting Jurisdiction that is attributable to a permanent
establishment of the enterprise situated in a third jurisdiction.
5. A Party may reserve the right
a)
for the entirety of this Article not to apply to its Covered Tax
Agreements;
b)
for the entirety of this Article not to apply to its Covered Tax
Agreements that already contain the provisions described in paragraph 4;
c)
for this Article to apply only to its Covered Tax Agreements that
already contain the provisions described in paragraph 4.
6. Each Party that has not made the reservation described in subparagraph
a) or b) of paragraph 5 shall notify the Depositary of whether each of its Covered
Tax Agreements contains a provision described in paragraph 4, and if so, the
article and paragraph number of each such provision. Where all Contracting
Jurisdictions have made such a notification with respect to a provision of a
Covered Tax Agreement, that provision shall be replaced by the provisions of
paragraphs 1 through 3. In other cases, paragraphs 1 through 3 shall supersede the
provisions of the Covered Tax Agreement only to the extent that those provisions
are incompatible with those paragraphs.
Article 11 - Application of Tax Agreements to Restrict a Party’s Right to Tax
its Own Residents
1. A Covered Tax Agreement shall not affect the taxation by a Contracting
Jurisdiction of its residents, except with respect to the benefits granted under
provisions of the Covered Tax Agreement
a)
which require that Contracting Jurisdiction to grant to an
enterprise of that Contracting Jurisdiction a correlative or corresponding
adjustment following an initial adjustment made by the other Contracting
Jurisdiction, in accordance with the Covered Tax Agreement, to the amount
of tax charged in the first-mentioned Contracting Jurisdiction on the profits
of a permanent establishment of the enterprise or the profits of an associated
enterprise;
b)
which may affect how that Contracting Jurisdiction taxes an
individual who is a resident of that Contracting Jurisdiction if that individual
derives income in respect of services rendered to the other Contracting
Jurisdiction or a political subdivision or local authority or other comparable
body thereof;
c)
which may affect how that Contracting Jurisdiction taxes an
individual who is a resident of that Contracting Jurisdiction if that individual
is also a student, business apprentice or trainee, or a teacher, professor,
lecturer, instructor, researcher or research scholar who meets the conditions
of the Covered Tax Agreement;
d)
which require that Contracting Jurisdiction to provide a tax credit
or tax exemption to residents of that Contracting Jurisdiction with respect to
the income that the other Contracting Jurisdiction may tax in accordance with
the Covered Tax Agreement (including profits that are attributable to a
permanent establishment situated in that other Contracting Jurisdiction in
accordance with the Covered Tax Agreement);
e)
which protect residents of that Contracting Jurisdiction against
certain discriminatory taxation practices by that Contracting Jurisdiction;
f)
which allow residents of that Contracting Jurisdiction to request
that the competent authority of that or either Contracting Jurisdiction
consider cases of taxation not in accordance with the Covered Tax
Agreement;
g)
which may affect how that Contracting Jurisdiction taxes an
individual who is a resident of that Contracting Jurisdiction when that
individual is a member of a diplomatic mission, government mission or
consular post of the other Contracting Jurisdiction;
h)
which provide that pensions or other payments made under the
social security legislation of the other Contracting Jurisdiction shall be
taxable only in that other Contracting Jurisdiction;
i)
which provide that pensions and similar payments, annuities,
alimony payments or other maintenance payments arising in the other
Contracting Jurisdiction shall be taxable only in that other Contracting
Jurisdiction; or
j)
which otherwise expressly limit a Contracting Jurisdiction’s right
to tax its own residents or provide expressly that the Contracting Jurisdiction
in which an item of income arises has the exclusive right to tax that item of
income.
2. Paragraph 1 shall apply in place of or in the absence of provisions of a
Covered Tax Agreement stating that the Covered Tax Agreement would not affect
the taxation by a Contracting Jurisdiction of its residents.
3. A Party may reserve the right
a)
for the entirety of this Article not to apply to its Covered Tax
Agreements;
b)
for the entirety of this Article not to apply to its Covered Tax
Agreements that already contain the provisions described in paragraph 2.
4. Each Party that has not made the reservation described in subparagraph
a) or b) of paragraph 3 shall notify the Depositary of whether each of its Covered
Tax Agreements contains a provision described in paragraph 2, and if so, the
article and paragraph number of each such provision. Where all Contracting
Jurisdictions have made such a notification with respect to a provision of a
Covered Tax Agreement, that provision shall be replaced by the provisions of
paragraph 1. In other cases, paragraph 1 shall supersede the provisions of the
Covered Tax Agreement only to the extent that those provisions are incompatible
with paragraph 1.
PART IV
AVOIDANCE OF PERMANENT ESTABLISHMENT STATUS
Article 12 - Artificial Avoidance of Permanent Establishment Status through
Commissionnaire Arrangements and Similar Strategies
1. Notwithstanding the provisions of a Covered Tax Agreement that define
the term "permanent establishment", but subject to paragraph 2, where a person is
acting in a Contracting Jurisdiction to a Covered Tax Agreement on behalf of an
enterprise and, in doing so, habitually concludes contracts, or habitually plays the
principal role leading to the conclusion of contracts that are routinely concluded
without material modification by the enterprise, and these contracts are
a)
in the name of the enterprise; or
b)
for the transfer of the ownership of, or for the granting of the
right to use, property owned by that enterprise or that the enterprise has the
right to use; or
c)
for the provision of services by that enterprise,
that enterprise shall be deemed to have a permanent establishment in that
Contracting Jurisdiction in respect of any activities which that person undertakes
for the enterprise unless these activities, if they were exercised by the enterprise
through a fixed place of business of that enterprise situated in that Contracting
Jurisdiction, would not cause that fixed place of business to be deemed to
constitute a permanent establishment under the definition of permanent
establishment included in the Covered Tax Agreement (as it may be modified by
this Convention).
2. Paragraph 1 shall not apply where the person acting in a Contracting
Jurisdiction to a Covered Tax Agreement on behalf of an enterprise of the other
Contracting Jurisdiction carries on business in the first-mentioned Contracting
Jurisdiction as an independent agent and acts for the enterprise in the ordinary
course of that business. Where, however, a person acts exclusively or almost
exclusively on behalf of one or more enterprises to which it is closely related, that
person shall not be considered to be an independent agent within the meaning of
this paragraph with respect to any such enterprise.
3. a)
Paragraph 1 shall apply in place of provisions of a Covered Tax
Agreement that describe the conditions under which an enterprise shall be deemed
to have a permanent establishment in a Contracting Jurisdiction (or a person shall
be deemed to be a permanent establishment in a Contracting Jurisdiction) in
respect of an activity which a person other than an agent of an independent status
undertakes for the enterprise, but only to the extent that such provisions address
the situation in which such person has, and habitually exercises, in that
Contracting Jurisdiction an authority to conclude contracts in the name of the
enterprise.
b)
Paragraph 2 shall apply in place of provisions of a Covered Tax
Agreement that provide that an enterprise shall not be deemed to have a permanent
establishment in a Contracting Jurisdiction in respect of an activity which an agent
of an independent status undertakes for the enterprise.
4. A Party may reserve the right for the entirety of this Article not to apply
to its Covered Tax Agreements.
5. Each Party that has not made a reservation described in paragraph 4
shall notify the Depositary of whether each of its Covered Tax Agreements
contains a provision described in subparagraph a) of paragraph 3, as well as the
article and paragraph number of each such provision. Paragraph 1 shall apply with
respect to a provision of a Covered Tax Agreement only where all Contracting
Jurisdictions have made a notification with respect to that provision.
6. Each Party that has not made a reservation described in paragraph 4
shall notify the Depositary of whether each of its Covered Tax Agreements
contains a provision described in subparagraph b) of paragraph 3, as well as the
article and paragraph number of each such provision. Paragraph 2 shall apply with
respect to a provision of a Covered Tax Agreement only where all Contracting
Jurisdictions have made such a notification with respect to that provision.
Article 13 - Artificial Avoidance of Permanent Establishment Status through
the Specific Activity Exemptions
1. A Party may choose to apply paragraph 2 (Option A) or paragraph 3
(Option B) or to apply neither Option.
Option A
2. Notwithstanding the provisions of a Covered Tax Agreement that define
the term "permanent establishment", the term "permanent establishment" shall be
deemed not to include
a)
the activities specifically listed in the Covered Tax Agreement
(prior to modification by this Convention) as activities deemed not to
constitute a permanent establishment, whether or not that exception from
permanent establishment status is contingent on the activity being of a
preparatory or auxiliary character;
b)
the maintenance of a fixed place of business solely for the
purpose of carrying on, for the enterprise, any activity not described in
subparagraph a);
c)
the maintenance of a fixed place of business solely for any
combination of activities mentioned in subparagraphs a) and b),
provided that such activity or, in the case of subparagraph c), the overall activity of
the fixed place of business, is of a preparatory or auxiliary character.
Option B
3. Notwithstanding the provisions of a Covered Tax Agreement that define
the term "permanent establishment", the term "permanent establishment" shall be
deemed not to include
a)
the activities specifically listed in the Covered Tax Agreement
(prior to modification by this Convention) as activities deemed not to
constitute a permanent establishment, whether or not that exception from
permanent establishment status is contingent on the activity being of a
preparatory or auxiliary character, except to the extent that the relevant
provision of the Covered Tax Agreement provides explicitly that a specific
activity shall be deemed not to constitute a permanent establishment
provided that the activity is of a preparatory or auxiliary character;
b)
the maintenance of a fixed place of business solely for the
purpose of carrying on, for the enterprise, any activity not described in
subparagraph a), provided that this activity is of a preparatory or auxiliary
character;
c)
the maintenance of a fixed place of business solely for any
combination of activities mentioned in subparagraphs a) and b), provided
that the overall activity of the fixed place of business resulting from this
combination is of a preparatory or auxiliary character.
4. A provision of a Covered Tax Agreement (as it may be modified by
paragraph 2 or 3) that lists specific activities deemed not to constitute a permanent
establishment shall not apply to a fixed place of business that is used or maintained
by an enterprise if the same enterprise or a closely related enterprise carries on
business activities at the same place or at another place in the same Contracting
Jurisdiction and
a)
that place or other place constitutes a permanent establishment
for the enterprise or the closely related enterprise under the provisions of a
Covered Tax Agreement defining a permanent establishment; or
b)
the overall activity resulting from the combination of the
activities carried on by the two enterprises at the same place, or by the same
enterprise or closely related enterprises at the two places, is not of a
preparatory or auxiliary character,
provided that the business activities carried on by the two enterprises at the same
place, or by the same enterprise or closely related enterprises at the two places,
constitute complementary functions that are part of a cohesive business operation.
5. a)
Paragraph 2 or 3 shall apply in place of the relevant parts of
provisions of a Covered Tax Agreement that list specific activities that are deemed
not to constitute a permanent establishment even if the activity is carried on
through a fixed place of business (or provisions of a Covered Tax Agreement that
operate in a comparable manner).
b)
Paragraph 4 shall apply to provisions of a Covered Tax
Agreement (as they may be modified by paragraph 2 or 3) that list specific
activities that are deemed not to constitute a permanent establishment even if the
activity is carried on through a fixed place of business (or provisions of a Covered
Tax Agreement that operate in a comparable manner).
6. A Party may reserve the right
a)
for the entirety of this Article not to apply to its Covered Tax
Agreements;
b)
for paragraph 2 not to apply to its Covered Tax Agreements that
explicitly state that a list of specific activities shall be deemed not to
constitute a permanent establishment only if each of the activities is of a
preparatory or auxiliary character;
c)
for paragraph 4 not to apply to its Covered Tax Agreements.
7. Each Party that chooses to apply an Option under paragraph 1 shall
notify the Depositary of its choice of Option. Such notification shall also include
the list of its Covered Tax Agreements which contain a provision described in
subparagraph a) of paragraph 5, as well as the article and paragraph number of
each such provision. An Option shall apply with respect to a provision of a
Covered Tax Agreement only where all Contracting Jurisdictions have chosen to
apply the same Option and have made such a notification with respect to that
provision.
8. Each Party that has not made a reservation described in subparagraph a)
or c) of paragraph 6 and does not choose to apply an Option under paragraph 1
shall notify the Depositary of whether each of its Covered Tax Agreements
contains a provision described in subparagraph b) of paragraph 5, as well as the
article and paragraph number of each such provision. Paragraph 4 shall apply with
respect to a provision of a Covered Tax Agreement only where all Contracting
Jurisdictions have made a notification with respect to that provision under this
paragraph or paragraph 7.
Article 14 - Splitting-up of Contracts
1. For the sole purpose of determining whether the period (or periods)
referred to in a provision of a Covered Tax Agreement that stipulates a period (or
periods) of time after which specific projects or activities shall constitute a
permanent establishment has been exceeded
a)
where an enterprise of a Contracting Jurisdiction carries on
activities in the other Contracting Jurisdiction at a place that constitutes a
building site, construction project, installation project or other specific
project identified in the relevant provision of the Covered Tax Agreement, or
carries on supervisory or consultancy activities in connection with such a
place, in the case of a provision of a Covered Tax Agreement that refers to
such activities, and these activities are carried on during one or more periods
of time that, in the aggregate, exceed 30 days without exceeding the period or
periods referred to in the relevant provision of the Covered Tax Agreement;
and
b)
where connected activities are carried on in that other
Contracting Jurisdiction at (or, where the relevant provision of the Covered
Tax Agreement applies to supervisory or consultancy activities, in
connection with) the same building site, construction or installation project,
or other place identified in the relevant provision of the Covered Tax
Agreement during different periods of time, each exceeding 30 days, by one
or more enterprises closely related to the first-mentioned enterprise,
these different periods of time shall be added to the aggregate period of time
during which the first-mentioned enterprise has carried on activities at that
building site, construction or installation project, or other place identified in the
relevant provision of the Covered Tax Agreement.
2. Paragraph 1 shall apply in place of or in the absence of provisions of a
Covered Tax Agreement to the extent that such provisions address the division of
contracts into multiple parts to avoid the application of a time period or periods in
relation to the existence of a permanent establishment for specific projects or
activities described in paragraph 1.
3. A Party may reserve the right
a)
for the entirety of this Article not to apply to its Covered Tax
Agreements;
b)
for the entirety of this Article not to apply with respect to
provisions of its Covered Tax Agreements relating to the exploration for or
exploitation of natural resources.
4. Each Party that has not made a reservation described in subparagraph a)
of paragraph 3 shall notify the Depositary of whether each of its Covered Tax
Agreements contains a provision described in paragraph 2 that is not subject to a
reservation under subparagraph b) of paragraph 3, and if so, the article and
paragraph number of each such provision. Where all Contracting Jurisdictions
have made such a notification with respect to a provision of a Covered Tax
Agreement, that provision shall be replaced by the provisions of paragraph 1 to the
extent provided in paragraph 2. In other cases, paragraph 1 shall supersede the
provisions of the Covered Tax Agreement only to the extent that those provisions
are incompatible with paragraph 1.
Article 15 - Definition of a Person Closely Related to an Enterprise
1. For the purposes of the provisions of a Covered Tax Agreement that are
modified by paragraph 2 of Article 12 (Artificial Avoidance of Permanent
Establishment Status through Commissionnaire Arrangements and Similar
Strategies), paragraph 4 of Article 13 (Artificial Avoidance of Permanent
Establishment Status through the Specific Activity Exemptions), or paragraph 1 of
Article 14 (Splitting-up of Contracts), a person is closely related to an enterprise if,
based on all the relevant facts and circumstances, one has control of the other or
both are under the control of the same persons or enterprises. In any case, a person
shall be considered to be closely related to an enterprise if one possesses directly
or indirectly more than 50 per cent of the beneficial interest in the other (or, in the
case of a company, more than 50 per cent of the aggregate vote and value of the
company’s shares or of the beneficial equity interest in the company) or if another
person possesses directly or indirectly more than 50 per cent of the beneficial
interest (or, in the case of a company, more than 50 per cent of the aggregate vote
and value of the company’s shares or of the beneficial equity interest in the
company) in the person and the enterprise.
2. A Party that has made the reservations described in paragraph 4 of
Article 12 (Artificial Avoidance of Permanent Establishment Status through
Commissionnaire Arrangements and Similar Strategies), subparagraph a) or c) of
paragraph 6 of Article 13 (Artificial Avoidance of Permanent Establishment Status
through the Specific Activity Exemptions), and subparagraph a) of paragraph 3 of
Article 14 (Splitting-up of Contracts) may reserve the right for the entirety of this
Article not to apply to the Covered Tax Agreements to which those reservations
apply.
PART V
IMPROVING DISPUTE RESOLUTION
Article 16 - Mutual Agreement Procedure
1. Where a person considers that the actions of one or both of the
Contracting Jurisdictions result or will result for that person in taxation not in
accordance with the provisions of the Covered Tax Agreement, that person may,
irrespective of the remedies provided by the domestic law of those Contracting
Jurisdictions, present the case to the competent authority of either Contracting
Jurisdiction. 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 Covered Tax Agreement.
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 Jurisdiction, with a view to the avoidance of taxation which is not in
accordance with the Covered Tax Agreement. Any agreement reached shall be
implemented notwithstanding any time limits in the domestic law of the
Contracting Jurisdictions.
3. The competent authorities of the Contracting Jurisdictions shall
endeavour to resolve by mutual agreement any difficulties or doubts arising as to
the interpretation or application of the Covered Tax Agreement. They may also
consult together for the elimination of double taxation in cases not provided for in
the Covered Tax Agreement.
4. a)
i) The first sentence of paragraph 1 shall apply in place of or in
the absence of provisions of a Covered Tax Agreement (or parts thereof) that
provide that where a person considers that the actions of one or both of the
Contracting Jurisdiction result or will result for that person in taxation not in
accordance with the provisions of the Covered Tax Agreement, that person may,
irrespective of the remedies provided by the domestic law of those Contracting
Jurisdictions, present the case to the competent authority of the Contracting
Jurisdiction of which that person is a resident including provisions under which, if
the case presented by that person comes under the provisions of a Covered Tax
Agreement relating to non-discrimination based on nationality, the case may be
presented to the competent authority of the Contracting Jurisdiction of which that
person is a national.
ii) The second sentence of paragraph 1 shall apply in place of
provisions of a Covered Tax Agreement that provide that a case referred to in the
first sentence of paragraph 1 must be presented within a specific time period that is
shorter than three years from the first notification of the action resulting in taxation
not in accordance with the provisions of the Covered Tax Agreement, or in the
absence of a provision of a Covered Tax Agreement describing the time period
within which such a case must be presented.
b)
i) The first sentence of paragraph 2 shall apply in the absence
of provisions of a Covered Tax Agreement that provide that the competent
authority that is presented with the case by the person referred to in paragraph 1
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 Jurisdiction, with a view to
the avoidance of taxation which is not in accordance with the Covered Tax
Agreement.
ii) The second sentence of paragraph 2 shall apply in the
absence of provisions of a Covered Tax Agreement providing that any agreement
reached shall be implemented notwithstanding any time limits in the domestic law
of the Contracting Jurisdictions.
c)
i) The first sentence of paragraph 3 shall apply in the absence
of provisions of a Covered Tax Agreement that provide that the competent
authorities of the Contracting Jurisdictions shall endeavour to resolve by mutual
agreement any difficulties or doubts arising as to the interpretation or application
of the Covered Tax Agreement.
ii) The second sentence of paragraph 3 shall apply in the
absence of provisions of a Covered Tax Agreement that provide that the competent
authorities of the Contracting Jurisdictions may also consult together for the
elimination of double taxation in cases not provided for in the Covered Tax
Agreement.
5. A Party may reserve the right
a)
for the first sentence of paragraph 1 not to apply to its Covered
Tax Agreements on the basis that it intends to meet the minimum standard for
improving dispute resolution under the OECD/G20 BEPS Package by
ensuring that under each of its Covered Tax Agreements (other than a
Covered Tax Agreement that permits a person to present a case to the
competent authority of either Contracting Jurisdiction), where a person
considers that the actions of one or both of the Contracting Jurisdictions
result or will result for that person in taxation not in accordance with the
provisions of the Covered Tax Agreement, irrespective of the remedies
provided by the domestic law of those Contracting Jurisdictions, that person
may present the case to the competent authority of the Contracting
Jurisdiction of which the person is a resident or, if the case presented by that
person comes under a provision of a Covered Tax Agreement relating to non-
discrimination based on nationality, to that of the Contracting Jurisdiction of
which that person is a national; and the competent authority of that
Contracting Jurisdiction will implement a bilateral notification or
consultation process with the competent authority of the other Contracting
Jurisdiction for cases in which the competent authority to which the mutual
agreement procedure case was presented does not consider the taxpayer’s
objection to be justified;
b)
for the second sentence of paragraph 1 not to apply to its Covered
Tax Agreements that do not provide that the case referred to in the first
sentence of paragraph 1 must be presented within a specific time period on
the basis that it intends to meet the minimum standard for improving dispute
resolution under the OECD/G20 BEPS package by ensuring that for the
purposes of all such Covered Tax Agreements the taxpayer referred to in
paragraph 1 is allowed to present the case within a period of at least three
years from the first notification of the action resulting in taxation not in
accordance with the provisions of the Covered Tax Agreement;
c)
for the second sentence of paragraph 2 not to apply to its Covered
Tax Agreements on the basis that for the purposes of all of its Covered Tax
Agreements
i)
any agreement reached via the mutual agreement
procedure shall be implemented notwithstanding any time limits in the
domestic laws of the Contracting Jurisdictions; or
ii) it intends to meet the minimum standard for improving
dispute resolution under the OECD/G20 BEPS package by accepting, in
its bilateral treaty negotiations, a treaty provision providing that
A)
the Contracting Jurisdictions shall make no
adjustment to the profits that are attributable to a permanent
establishment of an enterprise of one of the Contracting
Jurisdictions after a period that is mutually agreed between both
Contracting Jurisdictions from the end of the taxable year in
which the profits would have been attributable to the permanent
establishment (this provision shall not apply in the case of fraud,
gross negligence or wilful default); and
B)
the Contracting Jurisdictions shall not include in the
profits of an enterprise, and tax accordingly, profits that would
have accrued to the enterprise but that by reason of the
conditions referred to in a provision in the Covered Tax
Agreement relating to associated enterprises have not so
accrued, after a period that is mutually agreed between both
Contracting Jurisdictions from the end of the taxable year in
which the profits would have accrued to the enterprise (this
provision shall not apply in the case of fraud, gross negligence
or wilful default).
6. a)
Each Party that has not made a reservation described in
subparagraph a) of paragraph 5 shall notify the Depositary of whether each of its
Covered Tax Agreements contains a provision described in clause i) of
subparagraph a) of paragraph 4, and if so, the article and paragraph number of each
such provision. Where all Contracting Jurisdictions have made a notification with
respect to a provision of a Covered Tax Agreement, that provision shall be
replaced by the first sentence of paragraph 1. In other cases, the first sentence of
paragraph 1 shall supersede the provisions of the Covered Tax Agreement only to
the extent that those provisions are incompatible with that sentence.
b)
Each Party that has not made the reservation described in
subparagraph b) of paragraph 5 shall notify the Depositary of
i)
the list of its Covered Tax Agreements which contain a provision
that provides that a case referred to in the first sentence of paragraph 1 must
be presented within a specific time period that is shorter than three years
from the first notification of the action resulting in taxation not in accordance
with the provisions of the Covered Tax Agreement, as well as the article and
paragraph number of each such provision; a provision of a Covered Tax
Agreement shall be replaced by the second sentence of paragraph 1 where all
Contracting Jurisdictions have made such a notification with respect to that
provision; in other cases, subject to clause ii), the second sentence of
paragraph 1 shall supersede the provisions of the Covered Tax Agreement
only to the extent that those provisions are incompatible with the second
sentence of paragraph 1;
ii)
the list of its Covered Tax Agreements which contain a provision
that provides that a case referred to in the first sentence of paragraph 1 must
be presented within a specific time period that is at least three years from the
first notification of the action resulting in taxation not in accordance with the
provisions of the Covered Tax Agreement, as well as the article and
paragraph number of each such provision; the second sentence of paragraph
1 shall not apply to a Covered Tax Agreement where any Contracting
Jurisdiction has made such a notification with respect to that Covered Tax
Agreement.
c)
Each Party shall notify the Depositary of
i)
the list of its Covered Tax Agreements which do not contain a
provision described in clause i) of subparagraph b) of paragraph 4; the first
sentence of paragraph 2 shall apply to a Covered Tax Agreement only where
all Contracting Jurisdictions have made such a notification with respect to
that Covered Tax Agreement;
ii)
in the case of a Party that has not made the reservation described
in subparagraph c) of paragraph 5, the list of its Covered Tax Agreements
which do not contain a provision described in clause ii) of subparagraph b) of
paragraph 4; the second sentence of paragraph 2 shall apply to a Covered Tax
Agreement only where all Contracting Jurisdictions have made such a
notification with respect to that Covered Tax Agreement.
d)
Each Party shall notify the Depositary of
i)
the list of its Covered Tax Agreements which do not contain a
provision described in clause i) of subparagraph c) of paragraph 4; the first
sentence of paragraph 3 shall apply to a Covered Tax Agreement only where
all Contracting Jurisdictions have made such a notification with respect to
that Covered Tax Agreement;
ii)
the list of its Covered Tax Agreements which do not contain a
provision described in clause ii) of subparagraph c) of paragraph 4; the
second sentence of paragraph 3 shall apply to a Covered Tax Agreement only
where all Contracting Jurisdictions have made such a notification with
respect to that Covered Tax Agreement.
Article 17 - Corresponding Adjustments
1. Where a Contracting Jurisdiction includes in the profits of an enterprise
of that Contracting Jurisdiction - and taxes accordingly - profits on which an
enterprise of the other Contracting Jurisdiction has been charged to tax in that
other Contracting Jurisdiction and the profits so included are profits which would
have accrued to the enterprise of the first-mentioned Contracting Jurisdiction if the
conditions made between the two enterprises had been those which would have
been made between independent enterprises, then that other Contracting
Jurisdiction 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 the Covered Tax Agreement and the competent authorities
of the Contracting Jurisdictions shall if necessary consult each other.
2. Paragraph 1 shall apply in place of or in the absence of a provision that
requires a Contracting Jurisdiction to make an appropriate adjustment to the
amount of the tax charged therein on the profits of an enterprise of that Contracting
Jurisdiction where the other Contracting Jurisdiction includes those profits in the
profits of an enterprise of that other Contracting Jurisdiction and taxes those
profits accordingly, and the profits so included are profits which would have
accrued to the enterprise of that other Contracting Jurisdiction if the conditions
made between the two enterprises had been those which would have been made
between independent enterprises.
3. A Party may reserve the right
a)
for the entirety of this Article not to apply to its Covered Tax
Agreements that already contain a provision described in paragraph 2;
b)
for the entirety of this Article not to apply to its Covered Tax
Agreements on the basis that in the absence of a provision referred to in
paragraph 2 in its Covered Tax Agreement
i)
it shall make the appropriate adjustment referred to in
paragraph 1; or
ii) its competent authority shall endeavour to resolve the case
under the provisions of a Covered Tax Agreement relating to mutual
agreement procedure;
c)
in the case of a Party that has made a reservation under clause ii)
of subparagraph c) of paragraph 5 of Article 16 (Mutual Agreement
Procedure), for the entirety of this Article not to apply to its Covered Tax
Agreements on the basis that in its bilateral treaty negotiations it shall accept
a treaty provision of the type contained in paragraph 1, provided that the
Contracting Jurisdictions were able to reach agreement on that provision and
on the provisions described in clause ii) of subparagraph c) of paragraph 5 of
Article 16 (Mutual Agreement Procedure).
4. Each Party that has not made a reservation described in paragraph 3
shall notify the Depositary of whether each of its Covered Tax Agreements
contains a provision described in paragraph 2, and if so, the article and paragraph
number of each such provision. Where all Contracting Jurisdictions have made
such a notification with respect to a provision of a Covered Tax Agreement, that
provision shall be replaced by the provisions of paragraph 1. In other cases,
paragraph 1 shall supersede the provisions of the Covered Tax Agreement only to
the extent that those provisions are incompatible with paragraph 1.
PART VI
ARBITRATION
Article 18 - Choice to Apply Part VI
A Party may choose to apply this Part with respect to its Covered Tax
Agreements and shall notify the Depositary accordingly. This Part shall apply in
relation to two Contracting Jurisdictions with respect to a Covered Tax Agreement
only where both Contracting Jurisdictions have made such a notification.
Article 19 - Mandatory Binding Arbitration
1. Where
a)
under a provision of a Covered Tax Agreement (as it may be
modified by paragraph 1 of Article 16 (Mutual Agreement Procedure)) that
provides that a person may present a case to a competent authority of a
Contracting Jurisdiction where that person considers that the actions of one
or both of the Contracting Jurisdictions result or will result for that person in
taxation not in accordance with the provisions of the Covered Tax Agreement
(as it may be modified by the Convention), a person has presented a case to
the competent authority of a Contracting Jurisdiction on the basis that the
actions of one or both of the Contracting Jurisdictions have resulted for that
person in taxation not in accordance with the provisions of the Covered Tax
Agreement (as it may be modified by the Convention); and
b)
the competent authorities are unable to reach an agreement to
resolve that case pursuant to a provision of a Covered Tax Agreement (as it
may be modified by paragraph 2 of Article 16 (Mutual Agreement
Procedure)) that provides that the competent authority shall endeavour to
resolve the case by mutual agreement with the competent authority of the
other Contracting Jurisdiction, within a period of two years beginning on the
start date referred to in paragraph 8 or 9, as the case may be (unless, prior to
the expiration of that period the competent authorities of the Contracting
Jurisdictions have agreed to a different time period with respect to that case
and have notified the person who presented the case of such agreement),
any unresolved issues arising from the case shall, if the person so requests in
writing, be submitted to arbitration in the manner described in this Part, according
to any rules or procedures agreed upon by the competent authorities of the
Contracting Jurisdictions pursuant to the provisions of paragraph 10.
2. Where a competent authority has suspended the mutual agreement
procedure referred to in paragraph 1 because a case with respect to one or more of
the same issues is pending before court or administrative tribunal, the period
provided in subparagraph b) of paragraph 1 will stop running until either a final
decision has been rendered by the court or administrative tribunal or the case has
been suspended or withdrawn. In addition, where a person who presented a case
and a competent authority have agreed to suspend the mutual agreement
procedure, the period provided in subparagraph b) of paragraph 1 will stop running
until the suspension has been lifted.
3. Where both competent authorities agree that a person directly affected
by the case has failed to provide in a timely manner any additional material
information requested by either competent authority after the start of the period
provided in subparagraph b) of paragraph 1, the period provided in subparagraph
b) of paragraph 1 shall be extended for an amount of time equal to the period
beginning on the date by which the information was requested and ending on the
date on which that information was provided.
4. a)
The arbitration decision with respect to the issues submitted to
arbitration shall be implemented through the mutual agreement concerning the
case referred to in paragraph 1. The arbitration decision shall be final.
b)
The arbitration decision shall be binding on both Contracting
Jurisdictions except in the following cases
i)
if a person directly affected by the case does not accept the
mutual agreement that implements the arbitration decision. In such a case,
the case shall not be eligible for any further consideration by the competent
authorities. The mutual agreement that implements the arbitration decision
on the case shall be considered not to be accepted by a person directly
affected by the case if any person directly affected by the case does not,
within 60 days after the date on which notification of the mutual agreement is
sent to the person, withdraw all issues resolved in the mutual agreement
implementing the arbitration decision from consideration by any court or
administrative tribunal or otherwise terminate any pending court or
administrative proceedings with respect to such issues in a manner consistent
with that mutual agreement.
ii)
if a final decision of the courts of one of the Contracting
Jurisdictions holds that the arbitration decision is invalid. In such a case, the
request for arbitration under paragraph 1 shall be considered not to have been
made, and the arbitration process shall be considered not to have taken place
(except for the purposes of Articles 21 (Confidentiality of Arbitration
Proceedings) and 25 (Costs of Arbitration Proceedings)). In such a case, a
new request for arbitration may be made unless the competent authorities
agree that such a new request should not be permitted.
iii) if a person directly affected by the case pursues litigation on the
issues which were resolved in the mutual agreement implementing the
arbitration decision in any court or administrative tribunal.
5. The competent authority that received the initial request for a mutual
agreement procedure as described in subparagraph a) of paragraph 1 shall, within
two calendar months of receiving the request
a)
send a notification to the person who presented the case that it has
received the request; and
b)
send a notification of that request, along with a copy of the
request, to the competent authority of the other Contracting Jurisdiction.
6. Within three calendar months after a competent authority receives the
request for a mutual agreement procedure (or a copy thereof from the competent
authority of the other Contracting Jurisdiction) it shall either
a)
notify the person who has presented the case and the other
competent authority that it has received the information necessary to
undertake substantive consideration of the case; or
b)
request additional information from that person for that purpose.
7. Where pursuant to subparagraph b) of paragraph 6, one or both of the
competent authorities have requested from the person who presented the case
additional information necessary to undertake substantive consideration of the
case, the competent authority that requested the additional information shall,
within three calendar months of receiving the additional information from that
person, notify that person and the other competent authority either
a)
that it has received the requested information; or
b)
that some of the requested information is still missing.
8. Where neither competent authority has requested additional information
pursuant to subparagraph b) of paragraph 6, the start date referred to in paragraph 1
shall be the earlier of
a)
the date on which both competent authorities have notified the
person who presented the case pursuant to subparagraph a) of paragraph 6;
and
b)
the date that is three calendar months after the notification to the
competent authority of the other Contracting Jurisdiction pursuant to
subparagraph b) of paragraph 5.
9. Where additional information has been requested pursuant to
subparagraph b) of paragraph 6, the start date referred to in paragraph 1 shall be
the earlier of
a)
the latest date on which the competent authorities that requested
additional information have notified the person who presented the case and
the other competent authority pursuant to subparagraph a) of paragraph 7;
and
b)
the date that is three calendar months after both competent
authorities have received all information requested by either competent
authority from the person who presented the case.
If, however, one or both of the competent authorities send the notification
referred to in subparagraph b) of paragraph 7, such notification shall be treated as a
request for additional information under subparagraph b) of paragraph 6.
10. The competent authorities of the Contracting Jurisdictions shall by
mutual agreement (pursuant to the article of the relevant Covered Tax Agreement
regarding procedures for mutual agreement) settle the mode of application of the
provisions contained in this Part, including the minimum information necessary
for each competent authority to undertake substantive consideration of the case.
Such an agreement shall be concluded before the date on which unresolved issues
in a case are first eligible to be submitted to arbitration and may be modified from
time to time thereafter.
11. For purposes of applying this Article to its Covered Tax Agreements, a
Party may reserve the right to replace the two-year period set forth in subparagraph
b) of paragraph 1 with a three-year period.
12. A Party may reserve the right for the following rules to apply with
respect to its Covered Tax Agreements notwithstanding the other provisions of this
Article
a)
any unresolved issue arising from a mutual agreement procedure
case otherwise within the scope of the arbitration process provided for by this
Convention shall not be submitted to arbitration, if a decision on this issue
has already been rendered by a court or administrative tribunal of either
Contracting Jurisdiction;
b)
if, at any time after a request for arbitration has been made and
before the arbitration panel has delivered its decision to the competent
authorities of the Contracting Jurisdictions, a decision concerning the issue is
rendered by a court or administrative tribunal of one of the Contracting
Jurisdictions, the arbitration process shall terminate.
Article 20 - Appointment of Arbitrators
1. Except to the extent that the competent authorities of the Contracting
Jurisdictions mutually agree on different rules, paragraphs 2 through 4 shall apply
for the purposes of this Part.
2. The following rules shall govern the appointment of the members of an
arbitration panel
a)
The arbitration panel shall consist of three individual members
with expertise or experience in international tax matters.
b)
Each competent authority shall appoint one panel member within
60 days of the date of the request for arbitration under paragraph 1 of Article
19 (Mandatory Binding Arbitration). The two panel members so appointed
shall, within 60 days of the latter of their appointments, appoint a third
member who shall serve as Chair of the arbitration panel. The Chair shall not
be a national or resident of either Contracting Jurisdiction.
c)
Each member appointed to the arbitration panel must be impartial
and independent of the competent authorities, tax administrations, and
ministries of finance of the Contracting Jurisdictions and of all persons
directly affected by the case (as well as their advisors) at the time of
accepting an appointment, maintain his or her impartiality and independence
throughout the proceedings, and avoid any conduct for a reasonable period of
time thereafter which may damage the appearance of impartiality and
independence of the arbitrators with respect to the proceedings.
3. In the event that the competent authority of a Contracting Jurisdiction
fails to appoint a member of the arbitration panel in the manner and within the time
periods specified in paragraph 2 or agreed to by the competent authorities of the
Contracting Jurisdictions, a member shall be appointed on behalf of that competent
authority by the highest ranking official of the Centre for Tax Policy and
Administration of the Organisation for Economic Co-operation and Development
that is not a national of either Contracting Jurisdiction.
4. If the two initial members of the arbitration panel fail to appoint the
Chair in the manner and within the time periods specified in paragraph 2 or agreed
to by the competent authorities of the Contracting Jurisdictions, the Chair shall be
appointed by the highest ranking official of the Centre for Tax Policy and
Administration of the Organisation for Economic Co-operation and Development
that is not a national of either Contracting Jurisdiction.
Article 21 - Confidentiality of Arbitration Proceedings
1. Solely for the purposes of the application of the provisions of this Part
and of the provisions of the relevant Covered Tax Agreement and of the domestic
laws of the Contracting Jurisdictions related to the exchange of information,
confidentiality, and administrative assistance, members of the arbitration panel and
a maximum of three staff per member (and prospective arbitrators solely to the
extent necessary to verify their ability to fulfil the requirements of arbitrators) shall
be considered to be persons or authorities to whom information may be disclosed.
Information received by the arbitration panel or prospective arbitrators and
information that the competent authorities receive from the arbitration panel shall
be considered information that is exchanged under the provisions of the Covered
Tax Agreement related to the exchange of information and administrative
assistance.
2. The competent authorities of the Contracting Jurisdictions shall ensure
that members of the arbitration panel and their staff agree in writing, prior to their
acting in an arbitration proceeding, to treat any information relating to the
arbitration proceeding consistently with the confidentiality and nondisclosure
obligations described in the provisions of the Covered Tax Agreement related to
exchange of information and administrative assistance and under the applicable
laws of the Contracting Jurisdictions.
Article 22 - Resolution of a Case Prior to the Conclusion of the Arbitration
For the purposes of this Part and the provisions of the relevant Covered Tax
Agreement that provide for resolution of cases through mutual agreement, the
mutual agreement procedure, as well as the arbitration proceeding, with respect to
a case shall terminate if, at any time after a request for arbitration has been made
and before the arbitration panel has delivered its decision to the competent
authorities of the Contracting Jurisdictions
a)
the competent authorities of the Contracting Jurisdictions reach a
mutual agreement to resolve the case; or
b)
the person who presented the case withdraws the request for
arbitration or the request for a mutual agreement procedure.
Article 23 - Type of Arbitration Process
1. Except to the extent that the competent authorities of the Contracting
Jurisdictions mutually agree on different rules, the following rules shall apply with
respect to an arbitration proceeding pursuant to this Part
a)
After a case is submitted to arbitration, the competent authority
of each Contracting Jurisdiction shall submit to the arbitration panel, by a
date set by agreement, a proposed resolution which addresses all unresolved
issue(s) in the case (taking into account all agreements previously reached in
that case between the competent authorities of the Contracting Jurisdictions).
The proposed resolution shall be limited to a disposition of specific monetary
amounts (for example, of income or expense) or, where specified, the
maximum rate of tax charged pursuant to the Covered Tax Agreement, for
each adjustment or similar issue in the case. In a case in which the competent
authorities of the Contracting Jurisdictions have been unable to reach
agreement on an issue regarding the conditions for application of a provision
of the relevant Covered Tax Agreement (hereinafter referred to as a
"threshold question"), such as whether an individual is a resident or whether
a permanent establishment exists, the competent authorities may submit
alternative proposed resolutions with respect to issues the determination of
which is contingent on resolution of such threshold questions.
b)
The competent authority of each Contracting Jurisdiction may
also submit a supporting position paper for consideration by the arbitration
panel. Each competent authority that submits a proposed resolution or
supporting position paper shall provide a copy to the other competent
authority by the date on which the proposed resolution and supporting
position paper were due. Each competent authority may also submit to the
arbitration panel, by a date set by agreement, a reply submission with respect
to the proposed resolution and supporting position paper submitted by the
other competent authority. A copy of any reply submission shall be provided
to the other competent authority by the date on which the reply submission
was due.
c)
The arbitration panel shall select as its decision one of the
proposed resolutions for the case submitted by the competent authorities with
respect to each issue and any threshold questions, and shall not include a
rationale or any other explanation of the decision. The arbitration decision
will be adopted by a simple majority of the panel members. The arbitration
panel shall deliver its decision in writing to the competent authorities of the
Contracting Jurisdictions. The arbitration decision shall have no precedential
value.
2. For the purpose of applying this Article with respect to its Covered Tax
Agreements, a Party may reserve the right for paragraph 1 not to apply to its
Covered Tax Agreements. In such a case, except to the extent that the competent
authorities of the Contracting Jurisdictions mutually agree on different rules, the
following rules shall apply with respect to an arbitration proceeding
a)
After a case is submitted to arbitration, the competent authority
of each Contracting Jurisdiction shall provide any information that may be
necessary for the arbitration decision to all panel members without undue
delay. Unless the competent authorities of the Contracting Jurisdictions agree
otherwise, any information that was not available to both competent
authorities before the request for arbitration was received by both of them
shall not be taken into account for purposes of the decision.
b)
The arbitration panel shall decide the issues submitted to
arbitration in accordance with the applicable provisions of the Covered Tax
Agreement and, subject to these provisions, of those of the domestic laws of
the Contracting Jurisdictions. The panel members shall also consider any
other sources which the competent authorities of the Contracting
Jurisdictions may by mutual agreement expressly identify.
c)
The arbitration decision shall be delivered to the competent
authorities of the Contracting Jurisdictions in writing and shall indicate the
sources of law relied upon and the reasoning which led to its result. The
arbitration decision shall be adopted by a simple majority of the panel
members. The arbitration decision shall have no precedential value.
3. A Party that has not made the reservation described in paragraph 2 may
reserve the right for the preceding paragraphs of this Article not to apply with
respect to its Covered Tax Agreements with Parties that have made such a
reservation. In such a case, the competent authorities of the Contracting
Jurisdictions of each such Covered Tax Agreement shall endeavour to reach
agreement on the type of arbitration process that shall apply with respect to that
Covered Tax Agreement. Until such an agreement is reached, Article 19
(Mandatory Binding Arbitration) shall not apply with respect to such a Covered
Tax Agreement.
4. A Party may also choose to apply paragraph 5 with respect to its
Covered Tax Agreements and shall notify the Depositary accordingly. Paragraph 5
shall apply in relation to two Contracting Jurisdictions with respect to a Covered
Tax Agreement where either of the Contracting Jurisdictions has made such a
notification.
5. Prior to the beginning of arbitration proceedings, the competent
authorities of the Contracting Jurisdictions to a Covered Tax Agreement shall
ensure that each person that presented the case and their advisors agree in writing
not to disclose to any other person any information received during the course of
the arbitration proceedings from either competent authority or the arbitration
panel. The mutual agreement procedure under the Covered Tax Agreement, as well
as the arbitration proceeding under this Part, with respect to the case shall
terminate if, at any time after a request for arbitration has been made and before
the arbitration panel has delivered its decision to the competent authorities of the
Contracting Jurisdictions, a person that presented the case or one of that person’s
advisors materially breaches that agreement.
6. Notwithstanding paragraph 4, a Party that does not choose to apply
paragraph 5 may reserve the right for paragraph 5 not to apply with respect to one
or more identified Covered Tax Agreements or with respect to all of its Covered
Tax Agreements.
7. A Party that chooses to apply paragraph 5 may reserve the right for this
Part not to apply with respect to all Covered Tax Agreements for which the other
Contracting Jurisdiction makes a reservation pursuant to paragraph 6.
Article 24 - Agreement on a Different Resolution
1. For purposes of applying this Part with respect to its Covered Tax
Agreements, a Party may choose to apply paragraph 2 and shall notify the
Depositary accordingly. Paragraph 2 shall apply in relation to two Contracting
Jurisdictions with respect to a Covered Tax Agreement only where both
Contracting Jurisdictions have made such a notification.
2. Notwithstanding paragraph 4 of Article 19 (Mandatory Binding
Arbitration), an arbitration decision pursuant to this Part shall not be binding on
the Contracting Jurisdictions to a Covered Tax Agreement and shall not be
implemented if the competent authorities of the Contracting Jurisdictions agree on
a different resolution of all unresolved issues within three calendar months after
the arbitration decision has been delivered to them.
3. A Party that chooses to apply paragraph 2 may reserve the right for
paragraph 2 to apply only with respect to its Covered Tax Agreements for which
paragraph 2 of Article 23 (Type of Arbitration Process) applies.
Article 25 - Costs of Arbitration Proceedings
In an arbitration proceeding under this Part, the fees and expenses of the
members of the arbitration panel, as well as any costs incurred in connection with
the arbitration proceedings by the Contracting Jurisdictions, shall be borne by the
Contracting Jurisdictions in a manner to be settled by mutual agreement between
the competent authorities of the Contracting Jurisdictions. In the absence of such
agreement, each Contracting Jurisdiction shall bear its own expenses and those of
its appointed panel member. The cost of the chair of the arbitration panel and other
expenses associated with the conduct of the arbitration proceedings shall be borne
by the Contracting Jurisdictions in equal shares.
Article 26 - Compatibility
1. Subject to Article 18 (Choice to Apply Part VI), the provisions of this
Part shall apply in place of or in the absence of provisions of a Covered Tax
Agreement that provide for arbitration of unresolved issues arising from a mutual
agreement procedure case. Each Party that chooses to apply this Part shall notify
the Depositary of whether each of its Covered Tax Agreements, other than those
that are within the scope of a reservation under paragraph 4, contains such a
provision, and if so, the article and paragraph number of each such provision.
Where two Contracting Jurisdictions have made a notification with respect to a
provision of a Covered Tax Agreement, that provision shall be replaced by the
provisions of this Part as between those Contracting Jurisdictions.
2. Any unresolved issue arising from a mutual agreement procedure case
otherwise within the scope of the arbitration process provided for in this Part shall
not be submitted to arbitration if the issue falls within the scope of a case with
respect to which an arbitration panel or similar body has previously been set up in
accordance with a bilateral or multilateral convention that provides for mandatory
binding arbitration of unresolved issues arising from a mutual agreement
procedure case.
3. Subject to paragraph 1, nothing in this Part shall affect the fulfilment of
wider obligations with respect to the arbitration of unresolved issues arising in the
context of a mutual agreement procedure resulting from other conventions to
which the Contracting Jurisdictions are or will become parties.
4. A Party may reserve the right for this Part not to apply with respect to
one or more identified Covered Tax Agreements (or to all of its Covered Tax
Agreements) that already provide for mandatory binding arbitration of unresolved
issues arising from a mutual agreement procedure case.
PART VII
FINAL PROVISIONS
Article 27 - Signature and Ratification, Acceptance or Approval
1. As of 31 December 2016, this Convention shall be open for signature
all States;
Guernsey (the United Kingdom of Great Britain and Northern
Ireland); Isle of Man (the United Kingdom of Great Britain and Northern
Ireland); Jersey (the United Kingdom of Great Britain and Northern Ireland);
any other jurisdiction authorised to become a Party by means of a
decision by consensus of the Parties and Signatories.
2. This Convention is subject to ratification, acceptance or approval.
Article 28 - Reservations
1. Subject to paragraph 2, no reservations may be made to this Convention
except those expressly permitted by
Paragraph 5 of Article 3 (Transparent Entities);
Paragraph 3 of Article 4 (Dual Resident Entities);
Paragraphs 8 and 9 of Article 5 (Application of Methods for
Elimination of Double Taxation);
Paragraph 4 of Article 6 (Purpose of a Covered Tax Agreement);
Paragraphs 15 and 16 of Article 7 (Prevention of Treaty Abuse);
Paragraph 3 of Article 8 (Dividend Transfer Transactions);
Paragraph 6 of Article 9 (Capital Gains from Alienation of Shares
or Interests of Entities Deriving their Value Principally from Immovable
Property);
Paragraph 5 of Article 10 (Anti-abuse Rule for Permanent
Establishments Situated in Third Jurisdictions);
Paragraph 3 of Article 11 (Application of Tax Agreements to
Restrict a Party’s Right to Tax its Own Residents);
j)
Paragraph 4 of Article 12 (Artificial Avoidance of Permanent
Establishment Status through Commissionnaire Arrangements and Similar
Strategies);
k)
Paragraph 6 of Article 13 (Artificial Avoidance of Permanent
Establishment Status through the Specific Activity Exemptions);
l)
Paragraph 3 of Article 14 (Splitting-up of Contracts);
m)
Paragraph 2 of Article 15 (Definition of a Person Closely Related
to an Enterprise);
n)
Paragraph 5 of Article 16 (Mutual Agreement Procedure);
o)
Paragraph 3 of Article 17 (Corresponding Adjustments);
p)
Paragraphs 11 and 12 of Article 19 (Mandatory Binding
Arbitration);
q)
Paragraphs 2, 3, 6, and 7 of Article 23 (Type of Arbitration
Process);
r)
Paragraph 3 of Article 24 (Agreement on a Different Resolution);
s)
Paragraph 4 of Article 26 (Compatibility);
t)
Paragraphs 6 and 7 of Article 35 (Entry into Effect); and
u)
Paragraph 2 of Article 36 (Entry into Effect of Part VI).
2. a)
Notwithstanding paragraph 1, a Party that chooses under Article
18 (Choice to Apply Part VI) to apply Part VI (Arbitration) may formulate one or
more reservations with respect to the scope of cases that shall be eligible for
arbitration under the provisions of Part VI (Arbitration). For a Party which chooses
under Article 18 (Choice to Apply Part VI) to apply Part VI (Arbitration) after it
has become a Party to this Convention, reservations pursuant to this subparagraph
shall be made at the same time as that Party’s notification to the Depositary
pursuant to Article 18 (Choice to Apply Part VI).
b)
Reservations made under subparagraph a) are subject to
acceptance. A reservation made under subparagraph a) shall be considered to have
been accepted by a Party if it has not notified the Depositary that it objects to the
reservation by the end of a period of twelve calendar months beginning on the date
of notification of the reservation by the Depositary or by the date on which it
deposits its instrument of ratification, acceptance, or approval, whichever is later.
For a Party which chooses under Article 18 (Choice to Apply Part VI) to apply Part
VI (Arbitration) after it has become a Party to this Convention, objections to prior
reservations made by other Parties pursuant to subparagraph a) can be made at the
time of the first-mentioned Party’s notification to the Depositary pursuant to
Article 18 (Choice to Apply Part VI). Where a Party raises an objection to a
reservation made under subparagraph a), the entirety of Part VI (Arbitration) shall
not apply as between the objecting Party and the reserving Party.
3. Unless explicitly provided otherwise in the relevant provisions of this
Convention, a reservation made in accordance with paragraph 1 or 2 shall
a)
modify for the reserving Party in its relations with another Party
the provisions of this Convention to which the reservation relates to the
extent of the reservation; and
b)
modify those provisions to the same extent for the other Party in
its relations with the reserving Party.
4. Reservations applicable to Covered Tax Agreements entered into by or
on behalf of a jurisdiction or territory for whose international relations a Party is
responsible, where that jurisdiction or territory is not a Party to the Convention
pursuant to subparagraph b) or c) of paragraph 1 of Article 27 (Signature and
Ratification, Acceptance or Approval), shall be made by the responsible Party and
can be different from the reservations made by that Party for its own Covered Tax
Agreements.
5. Reservations shall be made at the time of signature or when depositing
the instrument of ratification, acceptance or approval, subject to the provisions of
paragraphs 2, 6 and 9 of this Article, and paragraph 5 of Article 29 (Notifications).
However, for a Party which chooses under Article 18 (Choice to Apply Part VI) to
apply Part VI (Arbitration) after it has become a Party to this Convention,
reservations described in subparagraphs p), q), r) and s) of paragraph 1 of this
Article shall be made at the same time as that Party’s notification to the Depositary
pursuant to Article 18 (Choice to Apply Part VI).
6. If reservations are made at the time of signature, they shall be confirmed
upon deposit of the instrument of ratification, acceptance or approval, unless the
document containing the reservations explicitly specifies that it is to be considered
definitive, subject to the provisions of paragraphs 2, 5 and 9 of this Article, and
paragraph 5 of Article 29 (Notifications).
7. If reservations are not made at the time of signature, a provisional list of
expected reservations shall be provided to the Depositary at that time.
8. For reservations made pursuant to each of the following provisions, a
list of agreements notified pursuant to clause ii) of subparagraph a) of paragraph 1
of Article 2 (Interpretation of Terms) that are within the scope of the reservation as
defined in the relevant provision (and, in the case of a reservation under any of the
following provisions other than those listed in subparagraphs c), d) and n), the
article and paragraph number of each relevant provision) must be provided when
such reservations are made
Subparagraphs b), c), d), e) and g) of paragraph 5 of Article 3
(Transparent Entities);
Subparagraphs b), c) and d) of paragraph 3 of Article 4 (Dual
Resident Entities);
Paragraphs 8 and 9 of Article 5 (Application of Methods for
Elimination of Double Taxation);
Paragraph 4 of Article 6 (Purpose of a Covered Tax Agreement);
Subparagraphs b) and c) of paragraph 15 of Article 7 (Prevention
of Treaty Abuse);
Clauses i), ii), and iii) of subparagraph b) of paragraph 3 of
Article 8 (Dividend Transfer Transactions);
Subparagraphs d), e) and f) of paragraph 6 of Article 9 (Capital
Gains from Alienation of Shares or Interests of Entities Deriving their Value
Principally from Immovable Property);
Subparagraphs b) and c) of paragraph 5 of Article 10 (Anti-abuse
Rule for Permanent Establishments Situated in Third Jurisdictions);
Subparagraph b) of paragraph 3 of Article 11 (Application of Tax
Agreements to Restrict a Party’s Right to Tax its Own Residents);
Subparagraph b) of paragraph 6 of Article 13 (Artificial
Avoidance of Permanent Establishment Status through the Specific Activity
Exemptions);
Subparagraph b) of paragraph 3 of Article 14 (Splitting-up of
Contracts);
Subparagraph b) of paragraph 5 of Article 16 (Mutual Agreement
Procedure);
Subparagraph a) of paragraph 3 of Article 17 (Corresponding
Adjustments);
Paragraph 6 of Article 23 (Type of Arbitration Process); and
Paragraph 4 of Article 26 (Compatibility).
The reservations described in subparagraphs a) through o) above shall not
apply to any Covered Tax Agreement that is not included on the list described in
this paragraph.
9. Any Party which has made a reservation in accordance with paragraph 1
or 2 may at any time withdraw it or replace it with a more limited reservation by
means of a notification addressed to the Depositary. Such Party shall make any
additional notifications pursuant to paragraph 6 of Article 29 (Notifications) which
may be required as a result of the withdrawal or replacement of the reservation.
Subject to paragraph 7 of Article 35 (Entry into Effect), the withdrawal or
replacement shall take effect
a)
with respect to a Covered Tax Agreement solely with States or
jurisdictions that are Parties to the Convention when the notification of
withdrawal or replacement of the reservation is received by the Depositary
i)
for reservations in respect of provisions relating to taxes
withheld at source, where the event giving rise to such taxes occurs on
or after 1 January of the year next following the expiration of a period
of six calendar months beginning on the date of the communication by
the Depositary of the notification of withdrawal or replacement of the
reservation; and
ii) for reservations in respect of all other provisions, for taxes
levied with respect to taxable periods beginning on or after 1 January of
the year next following the expiration of a period of six calendar months
beginning on the date of the communication by the Depositary of the
notification of withdrawal or replacement of the reservation; and
b)
with respect to a Covered Tax Agreement for which one or more
Contracting Jurisdictions becomes a Party to this Convention after the date of
receipt by the Depositary of the notification of withdrawal or replacement
on the latest of the dates on which the Convention enters into force for those
Contracting Jurisdictions.
Article 29 - Notifications
1. Subject to paragraphs 5 and 6 of this Article, and paragraph 7 of Article
35 (Entry into Effect), notifications pursuant to the following provisions shall be
made at the time of signature or when depositing the instrument of ratification,
acceptance or approval
a)
Clause ii) of subparagraph a) of paragraph 1 of Article 2
(Interpretation of Terms);
b)
Paragraph 6 of Article 3 (Transparent Entities);
c)
Paragraph 4 of Article 4 (Dual Resident Entities);
d)
Paragraph 10 of Article 5 (Application of Methods for
Elimination of Double Taxation);
Paragraphs 5 and 6 of Article 6 (Purpose of a Covered Tax
Agreement);
Paragraph 17 of Article 7 (Prevention of Treaty Abuse);
Paragraph 4 of Article 8 (Dividend Transfer Transactions);
Paragraphs 7 and 8 of Article 9 (Capital Gains from Alienation of
Shares or Interests of Entities Deriving their Value Principally from
Immovable Property);
Paragraph 6 of Article 10 (Anti-abuse Rule for Permanent
Establishments Situated in Third Jurisdictions);
Paragraph 4 of Article 11 (Application of Tax Agreements to
Restrict a Party’s Right to Tax its Own Residents);
Paragraphs 5 and 6 of Article 12 (Artificial Avoidance of
Permanent Establishment Status through Commissionnaire Arrangements
and Similar Strategies);
Paragraphs 7 and 8 of Article 13 (Artificial Avoidance of
Permanent Establishment Status through the Specific Activity Exemptions);
Paragraph 4 of Article 14 (Splitting-up of Contracts);
Paragraph 6 of Article 16 (Mutual Agreement Procedure);
Paragraph 4 of Article 17 (Corresponding Adjustments);
Article 18 (Choice to Apply Part VI);
Paragraph 4 of Article 23 (Type of Arbitration Process);
Paragraph 1 of Article 24 (Agreement on a Different Resolution);
Paragraph 1 of Article 26 (Compatibility); and
Paragraphs 1, 2, 3, 5 and 7 of Article 35 (Entry into Effect).
2. Notifications in respect of Covered Tax Agreements entered into by or
on behalf of a jurisdiction or territory for whose international relations a Party is
responsible, where that jurisdiction or territory is not a Party to the Convention
pursuant to subparagraph b) or c) of paragraph 1 of Article 27 (Signature and
Ratification, Acceptance or Approval), shall be made by the responsible Party and
can be different from the notifications made by that Party for its own Covered Tax
3. If notifications are made at the time of signature, they shall be
confirmed upon deposit of the instrument of ratification, acceptance or approval,
unless the document containing the notifications explicitly specifies that it is to be
considered definitive, subject to the provisions of paragraphs 5 and 6 of this
Article, and paragraph 7 of Article 35 (Entry into Effect).
4. If notifications are not made at the time of signature, a provisional list
of expected notifications shall be provided at that time.
5. A Party may extend at any time the list of agreements notified under
clause ii) of subparagraph a) of paragraph 1 of Article 2 (Interpretation of Terms)
by means of a notification addressed to the Depositary. The Party shall specify in
this notification whether the agreement falls within the scope of any of the
reservations made by the Party which are listed in paragraph 8 of Article 28
(Reservations). The Party may also make a new reservation described in paragraph
8 of Article 28 (Reservations) if the additional agreement would be the first to fall
within the scope of such a reservation. The Party shall also specify any additional
notifications that may be required under subparagraphs b) through s) of paragraph
1 to reflect the inclusion of the additional agreements. In addition, if the extension
results for the first time in the inclusion of a tax agreement entered into by or on
behalf of a jurisdiction or territory for whose international relations a Party is
responsible, the Party shall specify any reservations (pursuant to paragraph 4 of
Article 28 (Reservations)) or notifications (pursuant to paragraph 2 of this Article)
applicable to Covered Tax Agreements entered into by or on behalf of that
jurisdiction or territory. On the date on which the added agreement(s) notified
under clause ii) of subparagraph a) of paragraph 1 of Article 2 (Interpretation of
Terms) become Covered Tax Agreements, the provisions of Article 35 (Entry into
Effect) shall govern the date on which the modifications to the Covered Tax
Agreement shall have effect.
6. A Party may make additional notifications pursuant to subparagraphs b)
through s) of paragraph 1 by means of a notification addressed to the Depositary.
These notifications shall take effect
a)
with respect to Covered Tax Agreements solely with States or
jurisdictions that are Parties to the Convention when the additional
notification is received by the Depositary
i)
for notifications in respect of provisions relating to taxes
withheld at source, where the event giving rise to such taxes occurs on
or after 1 January of the year next following the expiration of a period
of six calendar months beginning on the date of the communication by
the Depositary of the additional notification; and
ii) for notifications in respect of all other provisions, for taxes
levied with respect to taxable periods beginning on or after 1 January of
the year next following the expiration of a period of six calendar months
beginning on the date of the communication by the Depositary of the
additional notification; and
b)
with respect to a Covered Tax Agreement for which one or more
Contracting Jurisdictions becomes a Party to this Convention after the date of
receipt by the Depositary of the additional notification: on the latest of the
dates on which the Convention enters into force for those Contracting
Jurisdictions.
Article 30 - Subsequent Modifications of Covered Tax Agreements
The provisions in this Convention are without prejudice to subsequent
modifications to a Covered Tax Agreement which may be agreed between the
Contracting Jurisdictions of the Covered Tax Agreement.
Article 31 - Conference of the Parties
1. The Parties may convene a Conference of the Parties for the purposes of
taking any decisions or exercising any functions as may be required or appropriate
under the provisions of this Convention.
2. The Conference of the Parties shall be served by the Depositary.
3. Any Party may request a Conference of the Parties by communicating a
request to the Depositary. The Depositary shall inform all Parties of any request.
Thereafter, the Depositary shall convene a Conference of the Parties, provided that
the request is supported by one-third of the Parties within six calendar months of
the communication by the Depositary of the request.
Article 32 - Interpretation and Implementation
1. Any question arising as to the interpretation or implementation of
provisions of a Covered Tax Agreement as they are modified by this Convention
shall be determined in accordance with the provision(s) of the Covered Tax
Agreement relating to the resolution by mutual agreement of questions of
interpretation or application of the Covered Tax Agreement (as those provisions
may be modified by this Convention).
2. Any question arising as to the interpretation or implementation of this
Convention may be addressed by a Conference of the Parties convened in
accordance with paragraph 3 of Article 31 (Conference of the Parties).
Article 33 - Amendment
1. Any Party may propose an amendment to this Convention by submitting
the proposed amendment to the Depositary.
2. A Conference of the Parties may be convened to consider the proposed
amendment in accordance with paragraph 3 of Article 31 (Conference of the
Parties).
Article 34 - Entry into Force
1. This Convention shall enter into force on the first day of the month
following the expiration of a period of three calendar months beginning on the date
of deposit of the fifth instrument of ratification, acceptance or approval.
2. For each Signatory ratifying, accepting, or approving this Convention
after the deposit of the fifth instrument of ratification, acceptance or approval, the
Convention shall enter into force on the first day of the month following the
expiration of a period of three calendar months beginning on the date of the
deposit by such Signatory of its instrument of ratification, acceptance or approval.
Article 35 - Entry into Effect
1. The provisions of this Convention shall have effect in each Contracting
Jurisdiction with respect to a Covered Tax Agreement
a)
with respect to taxes withheld at source on amounts paid or
credited to non-residents, where the event giving rise to such taxes occurs on
or after the first day of the next calendar year that begins on or after the latest
of the dates on which this Convention enters into force for each of the
Contracting Jurisdictions to the Covered Tax Agreement; and
b)
with respect to all other taxes levied by that Contracting
Jurisdiction, for taxes levied with respect to taxable periods beginning on or
after the expiration of a period of six calendar months (or a shorter period, if
all Contracting Jurisdictions notify the Depositary that they intend to apply
such shorter period) from the latest of the dates on which this Convention
enters into force for each of the Contracting Jurisdictions to the Covered Tax
Agreement.
2. Solely for the purpose of its own application of subparagraph a) of
paragraph 1 and subparagraph a) of paragraph 5, a Party may choose to substitute
"taxable period" for "calendar year", and shall notify the Depositary accordingly.
3. Solely for the purpose of its own application of subparagraph b) of
paragraph 1 and subparagraph b) of paragraph 5, a Party may choose to replace the
reference to "taxable periods beginning on or after the expiration of a period" with
a reference to "taxable periods beginning on or after 1 January of the next year
beginning on or after the expiration of a period", and shall notify the Depositary
accordingly.
4. Notwithstanding the preceding provisions of this Article, Article 16
(Mutual Agreement Procedure) shall have effect with respect to a Covered Tax
Agreement for a case presented to the competent authority of a Contracting
Jurisdiction on or after the latest of the dates on which this Convention enters into
force for each of the Contracting Jurisdictions to the Covered Tax Agreement,
except for cases that were not eligible to be presented as of that date under the
Covered Tax Agreement prior to its modification by the Convention, without
regard to the taxable period to which the case relates.
5. For a new Covered Tax Agreement resulting from an extension pursuant
to paragraph 5 of Article 29 (Notifications) of the list of agreements notified under
clause ii) of subparagraph a) of paragraph 1 of Article 2 (Interpretation of Terms),
the provisions of this Convention shall have effect in each Contracting
Jurisdiction
a)
with respect to taxes withheld at source on amounts paid or
credited to non-residents, where the event giving rise to such taxes occurs on
or after the first day of the next calendar year that begins on or after 30 days
after the date of the communication by the Depositary of the notification of
the extension of the list of agreements; and
b)
with respect to all other taxes levied by that Contracting
Jurisdiction, for taxes levied with respect to taxable periods beginning on or
after the expiration of a period of nine calendar months (or a shorter period,
if all Contracting Jurisdictions notify the Depositary that they intend to apply
such shorter period) from the date of the communication by the Depositary of
the notification of the extension of the list of agreements.
6. A Party may reserve the right for paragraph 4 not to apply with respect
to its Covered Tax Agreements.
7. a)
A Party may reserve the right to replace
i)
the references in paragraphs 1 and 4 to "the latest of the dates on
which this Convention enters into force for each of the Contracting
Jurisdictions to the Covered Tax Agreement"; and
ii)
the references in paragraph 5 to "the date of the communication
by the Depositary of the notification of the extension of the list of
agreements";
with references to "30 days after the date of receipt by the Depositary of the
latest notification by each Contracting Jurisdiction making the reservation
described in paragraph 7 of Article 35 (Entry into Effect) that it has
completed its internal procedures for the entry into effect of the provisions of
this Convention with respect to that specific Covered Tax Agreement";
iii) the references in subparagraph a) of paragraph 9 of Article 28
(Reservations) to "on the date of the communication by the Depositary of the
notification of withdrawal or replacement of the reservation"; and
iv)
the reference in subparagraph b) of paragraph 9 of Article 28
(Reservations) to "on the latest of the dates on which the Convention enters
into force for those Contracting Jurisdictions";
with references to "30 days after the date of receipt by the Depositary of the
latest notification by each Contracting Jurisdiction making the reservation
described in paragraph 7 of Article 35 (Entry into Effect) that it has
completed its internal procedures for the entry into effect of the withdrawal
or replacement of the reservation with respect to that specific Covered Tax
Agreement";
v)
the references in subparagraph a) of paragraph 6 of Article 29
(Notifications) to "on the date of the communication by the Depositary of the
additional notification"; and
vi)
the reference in subparagraph b) of paragraph 6 of Article 29
(Notifications) to "on the latest of the dates on which the Convention enters
into force for those Contracting Jurisdictions";
with references to "30 days after the date of receipt by the Depositary of the
latest notification by each Contracting Jurisdiction making the reservation
described in paragraph 7 of Article 35 (Entry into Effect) that it has
completed its internal procedures for the entry into effect of the additional
notification with respect to that specific Covered Tax Agreement";
vii) the references in paragraphs 1 and 2 of Article 36 (Entry into
Effect of Part VI) to "the later of the dates on which this Convention enters
into force for each of the Contracting Jurisdictions to the Covered Tax
Agreement";
with references to "30 days after the date of receipt by the Depositary of the
latest notification by each Contracting Jurisdiction making the reservation
described in paragraph 7 of Article 35 (Entry into Effect) that it has
completed its internal procedures for the entry into effect of the provisions of
this Convention with respect to that specific Covered Tax Agreement"; and
viii) the reference in paragraph 3 of Article 36 (Entry into Effect of
Part VI) to "the date of the communication by the Depositary of the
notification of the extension of the list of agreements";
ix)
the references in paragraph 4 of Article 36 (Entry into Effect of
Part VI) to "the date of the communication by the Depositary of the
notification of withdrawal of the reservation", "the date of the
communication by the Depositary of the notification of replacement of the
reservation" and "the date of the communication by the Depositary of the
notification of withdrawal of the objection to the reservation"; and
x)
the reference in paragraph 5 of Article 36 (Entry into Effect of
Part VI) to "the date of the communication by the Depositary of the
additional notification";
with references to "30 days after the date of receipt by the Depositary of the
latest notification by each Contracting Jurisdiction making the reservation
described in paragraph 7 of Article 35 (Entry into Effect) that it has
completed its internal procedures for the entry into effect of the provisions of
Part VI (Arbitration) with respect to that specific Covered Tax Agreement".
b)
A Party making a reservation in accordance with subparagraph a)
shall notify the confirmation of the completion of its internal procedures
simultaneously to the Depositary and the other Contracting Jurisdiction(s).
c)
If one or more Contracting Jurisdictions to a Covered Tax
Agreement makes a reservation under this paragraph, the date of entry into effect
of the provisions of the Convention, of the withdrawal or replacement of a
reservation, of an additional notification with respect to that Covered Tax
Agreement, or of Part VI (Arbitration) shall be governed by this paragraph for all
Contracting Jurisdictions to the Covered Tax Agreement.
Article 36 - Entry into Effect of Part VI
1. Notwithstanding paragraph 9 of Article 28 (Reservations), paragraph 6
of Article 29 (Notifications), and paragraphs 1 through 6 of Article 35 (Entry into
Effect), with respect to two Contracting Jurisdictions to a Covered Tax Agreement,
the provisions of Part VI (Arbitration) shall have effect
a)
with respect to cases presented to the competent authority of a
Contracting Jurisdiction (as described in subparagraph a) of paragraph 1 of
Article 19 (Mandatory Binding Arbitration)), on or after the later of the dates
on which this Convention enters into force for each of the Contracting
Jurisdictions to the Covered Tax Agreement; and
b)
with respect to cases presented to the competent authority of a
Contracting Jurisdiction prior to the later of the dates on which this
Convention enters into force for each of the Contracting Jurisdictions to the
Covered Tax Agreement, on the date when both Contracting Jurisdictions
have notified the Depositary that they have reached mutual agreement
pursuant to paragraph 10 of Article 19 (Mandatory Binding Arbitration),
along with information regarding the date or dates on which such cases shall
be considered to have been presented to the competent authority of a
Contracting Jurisdiction (as described in subparagraph a) of paragraph 1 of
Article 19 (Mandatory Binding Arbitration)) according to the terms of that
mutual agreement.
2. A Party may reserve the right for Part VI (Arbitration) to apply to a case
presented to the competent authority of a Contracting Jurisdiction prior to the later
of the dates on which this Convention enters into force for each of the Contracting
Jurisdictions to the Covered Tax Agreement only to the extent that the competent
authorities of both Contracting Jurisdictions agree that it will apply to that specific
case.
3. In the case of a new Covered Tax Agreement resulting from an
extension pursuant to paragraph 5 of Article 29 (Notifications) of the list of
agreements notified under clause ii) of subparagraph a) of paragraph 1 of Article 2
(Interpretation of Terms), the references in paragraphs 1 and 2 of this Article to
"the later of the dates on which this Convention enters into force for each of the
Contracting Jurisdictions to the Covered Tax Agreement" shall be replaced with
references to "the date of the communication by the Depositary of the notification
of the extension of the list of agreements".
4. A withdrawal or replacement of a reservation made under paragraph 4
of Article 26 (Compatibility) pursuant to paragraph 9 of Article 28 (Reservations),
or the withdrawal of an objection to a reservation made under paragraph 2 of
Article 28 (Reservations) which results in the application of Part VI 47
(Arbitration) between two Contracting Jurisdictions to a Covered Tax Agreement,
shall have effect according to subparagraphs a) and b) of paragraph 1 of this
Article, except that the references to "the later of the dates on which this
Convention enters into force for each of the Contracting Jurisdictions to the
Covered Tax Agreement" shall be replaced with references to "the date of the
communication by the Depositary of the notification of withdrawal of the
reservation", "the date of the communication by the Depositary of the notification
of replacement of the reservation" or "the date of the communication by the
Depositary of the notification of withdrawal of the objection to the reservation",
respectively.
5. An additional notification made pursuant to subparagraph p) of
paragraph 1 of Article 29 (Notifications) shall have effect according to
subparagraphs a) and b) of paragraph 1, except that the references in paragraphs 1
and 2 of this Article to "the later of the dates on which this Convention enters into
force for each of the Contracting Jurisdictions to the Covered Tax Agreement"
shall be replaced with references to "the date of the communication by the
Depositary of the additional notification".
Article 37 - Withdrawal
1. Any Party may, at any time, withdraw from this Convention by means
of a notification addressed to the Depositary.
2. Withdrawal pursuant to paragraph 1 shall become effective on the date
of receipt of the notification by the Depositary. In cases where this Convention has
entered into force with respect to all Contracting Jurisdictions to a Covered Tax
Agreement before the date on which a Party’s withdrawal becomes effective, that
Covered Tax Agreement shall remain as modified by this Convention.
Article 38 - Relation with Protocols
1. This Convention may be supplemented by one or more protocols.
2. In order to become a party to a protocol, a State or jurisdiction must also
be a Party to this Convention.
3. A Party to this Convention is not bound by a protocol unless it becomes
a party to the protocol in accordance with its provisions.
Article 39 - Depositary
1. The Secretary-General of the Organisation for Economic Co-operation
and Development shall be the Depositary of this Convention and any protocols
pursuant to Article 38 (Relation with Protocols).
2. The Depositary shall notify the Parties and Signatories within one
calendar month of
any signature pursuant to Article 27 (Signature and Ratification,
Acceptance or Approval);
the deposit of any instrument of ratification, acceptance or
approval pursuant to Article 27 (Signature and Ratification, Acceptance or
Approval);
any reservation or withdrawal or replacement of a reservation
pursuant to Article 28 (Reservations);
any notification or additional notification pursuant to Article 29
(Notifications);
any proposed amendment to this Convention pursuant to Article
33 (Amendment);
any withdrawal from this Convention pursuant to Article 37
(Withdrawal); and
any other communication related to this Convention.
3. The Depositary shall maintain publicly available lists of
Covered Tax Agreements;
reservations made by the Parties; and
notifications made by the Parties.
In witness whereof the undersigned, being duly authorised thereto, have
signed this Convention.
Done at Paris, the 24th day of November 2016, in English and French, both
texts being equally authentic, in a single copy which shall be deposited in the
archives of the Organisation for Economic Co-operation and Development.