DOUBLE TAXATION RELIEF (TAXES ON INCOME) (UKRAINE) ORDER (ukraine)

(UKRAINE) ORDER

SUBSIDIARY LEGISLATION 123.178

DOUBLE TAXATION RELIEF (TAXES ON INCOME)

(UKRAINE) ORDER

6th December, 2017

LEGAL NOTICE 345 of 2017, as modified by S.L.123.183.

The title of this order is the Double Taxation Relief

(Taxes on Income) (Ukraine) Order.

Article 2

CONVENTION BETWEEN THE GOVERNMENT OF

UKRAINE 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

The Government of Ukraine and the Government of the Republic of

Malta 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, have agreed as follows

Article 1

PERSONAL SCOPE

This Convention shall apply to persons who are residents of one

or both of the Contracting States.

Article 2

TAXES COVERED

This Convention shall apply to taxes on income imposed on

behalf of a Contracting State or of its political subdivisions or local

authorities, irrespective of the manner in which they are levied.

There shall be regarded as taxes on income all taxes imposed

on total income, or on elements of income including taxes on gains

from the alienation of movable or immovable property and taxes on the

total amounts of wages or salaries paid by enterprises.

The existing taxes to which this Convention shall apply are

a)

in the case of Ukraine

(i)

the tax on profits of enterprises; and

(ii)

the personal income tax

(hereinafter referred to as "Ukrainian tax");

b)

in the case of Malta

the income tax

(hereinafter referred to as "Malta tax").

(UKRAINE) ORDER

It is hereby declared:-

(a) that the arrangements specified in the Convention set

out in the schedule to this Order have been made with

the Government of Ukraine with a view to affording

relief from double taxation in relation to the following

taxes imposed by the laws of Ukraine

(i)

the tax on profits of enterprises; and

(ii)

the personal income tax;

(b) that it is expedient that those arrangements should

have effect;

(c) that the Convention has entered into force on 28 th

August 2017.

(UKRAINE) ORDER

It-taxxi eżistenti li dwarhom japplika dan il-Ftehim

huma

a)

fil-każ tal-Ukrajna

(i)

it-taxxa fuq il-profitti tal-impriżi; u

(ii) it-taxxa fuq l-income personali

(hawn iżjed ’il quddiem imsejћa "it-taxxa tal-Ukrajna");

b)

fil-każ ta’ Malta

it-taxxa fuq l-income;

(hawn iżjed ’il quddiem imsejћa "it-taxxa ta’ Malta");

(TAXXI FUQ L-INCOME) (UKRAJNA)

The Convention shall apply also to any identical or

substantially similar taxes which are imposed by either Contracting

State after the date of signature of this Convention in addition to, or in

place of, the existing taxes. The competent authorities of the

Contracting States shall notify each other of any significant changes

which have been made in their respective taxation laws.

Article 3

GENERAL DEFINITIONS

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

otherwise requires

a)

the term "Ukraine", when used in a geographical sense,

means the territory of Ukraine, its continental shelf and its

exclusive (maritime) economic zone, including any area

outside the territorial sea of Ukraine which in accordance

with international law has been or may hereafter be

designated as an area within which the rights of Ukraine

with respect to the sea-bed and sub-soil and their

natural resources may be exercised;

b)

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

used in a geographical sense, means the Island of Malta, the

Island of Gozo and the other islands of the Maltese

archipelago including the territorial waters thereof, and any

area outside the territorial waters of Malta which has been

or may hereafter be designated, in accordance with

international law and under the law of Malta concerning the

continental shelf, as an area within which the rights of

Malta with respect to the sea-bed and sub-soil and

their natural resources may be exercised;

c)

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

State" mean Ukraine or Malta, as the context requires;

d)

the term "national" means

(i)

any individual possessing the nationality of a

Contracting State;

(ii) any legal person, partnership or association deriving

its status as such from the laws in force in a

Contracting State;

e)

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

any other body of persons;

f)

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

which is treated as a body corporate for tax purposes;

g)

the terms "enterprise of a Contracting State" and

"enterprise of the other Contracting State" mean

respectively an enterprise carried on by a resident of a

Contracting State and an enterprise carried on by a

(UKRAINE) ORDER

resident of the other Contracting State;

h)

the term "international traffic" means any transport by

a ship or aircraft operated by an enterprise of a

Contracting State, except when the ship or aircraft is

operated solely between places in the other

Contracting State;

i)

the term "competent authority" means, in the case of

Ukraine, the Ministry of Finance of Ukraine or its

authorized representative, and, in the case of Malta,

the Minister responsible for finance or his authorized

representative;

j)

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

business;

k)

the term "business" includes the performance of

professional services and of other activities of an

independent character.

2. As regards the application of the Convention by a

Contracting State any term not defined therein shall, unless the

context otherwise requires, have the meaning which it has under the law

of that State concerning the taxes to which the Convention applies.

Article 4

RESIDENT

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

of a Contracting State" means any person who, under the laws of that

State, is liable to tax therein by reason of his domicile, residence,

place of management, place of incorporation or any other criterion of

a similar nature. But this term does not include any person who is

liable to tax in that State in respect only of income from sources in that

State.

2. Where by reason of the provisions of paragraph 1 an

individual is a resident of both Contracting States, then his status

shall be determined as follows

a)

he shall be deemed to be a resident of the Contracting

State in which he has a permanent home available to

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

Contracting States, he shall be deemed to be a resident of

the Contracting State with which his personal and

economic relations are closer (centre of vital interests);

b)

if the Contracting State in which he has his centre of vital

interests cannot be determined, or if he has no permanent

home available to him in either Contracting State, he

shall be deemed to be a resident of the Contracting

State in which he has an habitual abode;

c)

if he has an habitual abode in both Contracting States

(UKRAINE) ORDER

or in neither of them, he shall be deemed to be a

resident of the Contracting State of which he is a

national;

d)

if he is a national of both Contracting States or of

neither of them, the competent authorities of the

Contracting States shall settle the question by mutual

agreement.

3. Where by reason of the provisions of paragraph 1, a

person other than an individual is a resident of both Contracting

States, then it shall be deemed to be a resident of the Contracting

State in which its place of effective management is situated.

Article 5

PERMANENT ESTABLISHMENT

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

establishment" means a fixed place of business through which the

business of an enterprise is wholly or partly carried on.

2. The term "permanent establishment" includes especially

a)

a place of management;

b)

a branch

c)

an office;

d)

a factory;

e)

a workshop;

f)

an installation or structure for the exploration of natural

resources;

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

extraction of natural resources; and

h)

a warehouse or other structure used as a sales outlet.

3. The term "permanent establishment" likewise

encompasses a building site, a construction, assembly or an

installation project, or supervisory activities in connection therewith,

but only where such site, project or activities continue for a period of

more than nine months.

4. Notwithstanding the preceding provisions of this Article,

the term "permanent establishment" shall be deemed not to include

a)

the use of facilities solely for the purpose of storage,

display or delivery of goods or merchandise belonging

to the enterprise;

b)

the maintenance of a stock of goods or merchandise

belonging to the enterprise solely for the purpose of

storage, display or delivery;

(UKRAINE) ORDER

c)

the maintenance of a stock of goods or merchandise

belonging to the enterprise solely for the purpose of

processing by another enterprise;

d)

the maintenance of a fixed place of business solely for

the purpose of purchasing goods or merchandise, or of

collecting information, for the enterprise;

e)

the maintenance of a fixed place of business solely for

the purpose of carrying on, for the enterprise, any

other activity of a preparatory or auxiliary character;

f)

the maintenance of a fixed place of business solely for

any combination of activities mentioned in sub-

paragraphs a) to e), provided that the overall activity

of the fixed place of business resulting from this

combination is of a preparatory or auxiliary character.

Notwithstanding the provisions of paragraphs 1 and 2,

where a person other than an agent of an independent status to whom

paragraph 6 applies is acting on behalf of an enterprise and has, and

habitually exercises, in a Contracting State an authority to conclude

contracts in the name of the enterprise, or maintains a stock of goods

or merchandise belonging to the enterprise, from which regular sale

of such goods and merchandise is carried on in the name of the

enterprise, that enterprise shall be deemed to have a permanent

establishment in that State in respect of any activities which that person

undertakes for the enterprise, unless the activities of such person are

limited to those mentioned in paragraph 4 which, if exercised through

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

permanent establishment under the provisions of that paragraph.

An enterprise of a Contracting State shall not be deemed

to have a permanent establishment in the other Contracting State

merely because it carries on business in that other Contracting State

through a broker, general commission agent or any other agent of an

independent status, provided that such persons are acting in the

ordinary course of their business. However, when the activities of

such an agent are devoted wholly or almost wholly on behalf of that

enterprise, he will not be considered an agent of an independent

status within the meaning of this paragraph.

The fact that a company which is a resident of a

Contracting State controls or is controlled by a company which is a

resident of the other Contracting State, or which carries on business

in that other State (whether through a permanent establishment or

otherwise), shall not of itself constitute either company a permanent

establishment of the other.

(UKRAINE) ORDER

Article 6

INCOME FROM IMMOVABLE PROPERTY

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

immovable property (including income from agriculture or forestry)

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

State.

2. The term "immovable property" shall have the meaning

which it has under the law of the Contracting State in which the

property in question is situated. The term shall in any case include

property accessory to immovable property, livestock and equipment

used in agriculture and forestry, rights to which the provisions of

general law respecting landed property apply, usufruct of immovable

property and rights to variable or fixed payments as consideration for

the working of, or the right to work, mineral deposits, sources and

other natural resources. Ships and aircraft shall not be regarded as

immovable property.

3. The provisions of paragraph 1 shall apply to income

derived from the direct use, letting, or use in any other form of

immovable property.

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

income from immovable property of an enterprise and to income from

immovable property used for the performance of independent personal

services.

Article 7

BUSINESS PROFITS

1. The profits of an enterprise of a Contracting State shall

be taxable only in that State unless the enterprise carries on business in

the other Contracting State through a permanent establishment situated

therein. If the enterprise carries on business as aforesaid, the profits

of the enterprise may be taxed in the other State but only so much of

them as is attributable to that permanent establishment.

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

enterprise of a Contracting State carries on business in the other

Contracting State through a permanent establishment situated therein,

there shall in each Contracting State be attributed to that permanent

establishment the profits which it might be expected to make if it were

a distinct and separate enterprise engaged in the same or similar

activities under the same or similar conditions and dealing wholly

independently with the enterprise of which it is a permanent

establishment.

(UKRAINE) ORDER

3. In determining the profits of a permanent establishment,

there shall be allowed as deductions expenses which are incurred for

the purposes of the permanent establishment, including executive and

general administrative expenses so incurred, whether in the State in

which the permanent establishment is situated or elsewhere. However,

in the case of expenses incurred by a permanent establishment in its

dealings with the enterprise of which it is a permanent establishment,

only those expenses which are allowed as deductions under the

domestic law of each Contracting State shall be taken into account in

determining the profits of a permanent establishment.

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

determine, according to its laws, the profits to be attributed to a

permanent establishment on the basis of an apportionment of the total

profits of the enterprise to its various parts, nothing in paragraph 2

shall preclude that Contracting State from determining the profits to

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

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

accordance with the principles contained in this Article.

5. No profits shall be attributed to a permanent establishment

by reason of the mere purchase by that permanent establishment of

goods or merchandise for the enterprise.

6. For the purposes of the preceding paragraphs, the profits

to be attributed to the permanent establishment shall be determined by

the same method year by year unless there is good and sufficient reason

to the contrary.

7. Where profits include items of income which are dealt

with separately in other Articles of this Convention, then the

provisions of those Articles shall not be affected by the provisions of this

Article.

Article 8

INTERNATIONAL TRANSPORT

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

operation of ships or aircraft in international traffic shall be taxable

only in that State.

2. For the purposes of this Article, profits from the

operation of ships or aircraft in international traffic include

a)

income from the rental on a bareboat basis of ships or

aircraft; and

b)

profits from the use or rental of containers (including

trailers and related equipment for the transport of

containers) used for the transport of goods or

(UKRAINE) ORDER

merchandise,

where such rental, or such use or rental, as the case may be,

is incidental to the operation of ships or aircraft in international

traffic.

3. Where profits within paragraph 1 are derived by an

enterprise of a Contracting State from participation in a pool, a joint

business or an international operating agency, the profits attributable

to that enterprise shall be taxable only in that Contracting State.

Article 9

ASSOCIATED ENTERPRISES

1. Where

a)

an enterprise of a Contracting State participates

directly or indirectly in the management, control or

capital of an enterprise of the other Contracting State;

or

b)

the same persons participate directly or indirectly in the

management, control or capital of an enterprise of a

Contracting State and an enterprise of the other

Contracting State,

and in either case conditions are made or imposed between the

two enterprises in their commercial or financial relations which differ

from those which would be made between independent enterprises, then

any profits which would, but for those conditions, have accrued to one

of the enterprises, but by reason of those conditions, have not so

accrued, may be included in the profits of that enterprise and taxed

accordingly.

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

enterprise of that State - and taxes accordingly - profits on which an

enterprise of the other Contracting State has been charged to tax in

that other State and the profits so included are profits which would have

accrued to the enterprise of the first-mentioned State if the conditions

made between the two enterprises had been those which would have

been made between independent enterprises, then that other State

shall make an appropriate adjustment to the amount of the tax

charged therein on those profits. In determining such adjustment, due

regard shall be had to the other provisions of this Convention and the

competent authorities of the Contracting States shall if necessary consult

each other.

(UKRAINE) ORDER

Article 10

DIVIDENDS

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

Contracting State to a resident of the other Contracting State may be

taxed in that other State.

2. However, such dividends may also be taxed in the

Contracting State of which the company paying the dividends is a

resident and according to the laws of that State, but if the beneficial

owner of the dividends is a resident of the other Contracting State the

tax so charged shall not exceed

a)

5 per cent of the gross amount of the dividends if the

beneficial owner is a company (other than a partnership)

which holds directly at least 20 per cent of the capital

of the company paying the dividends;

b)

15 per cent of the gross amount of the dividends in all other

cases.

This paragraph shall not affect the taxation of the company

in respect of the profits out of which the dividends are

paid.

3. The provisions of paragraph 2 shall not apply as long as

the tax chargeable on the profits of a company in a Contracting State

may be offset against the shareholder’s income tax. In such case the

tax on the gross amount of the dividends paid by a company which is

a resident of a Contracting State to a resident of the other Contracting

State who is the beneficial owner thereof shall not exceed that tax

which is chargeable on the profits out of which the dividends are

paid.

4. The term "dividends" as used in this Article means income

from shares, or other rights, not being debt-claims, participating in

profits, as well as income from other corporate rights which is subjected

to the same taxation treatment as income from shares by the laws of

the State of which the company making the distribution is a resident.

5. The provisions of paragraphs 1 and 2 shall not apply if the

beneficial owner of the dividends, being a resident of a Contracting

State, carries on business in the other Contracting State of which the

company paying the dividends is a resident, through a permanent

establishment situated therein and the holding in respect of which the

dividends are paid is effectively connected with such permanent

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

6. Where a company which is a resident of a Contracting

State derives profits or income from the other Contracting State, that

other State may not impose any tax on the dividends paid by the

(UKRAINE) ORDER

company, except insofar as such dividends are paid to a resident of

that other State or insofar as the holding in respect of which the

dividends are paid is effectively connected with a permanent

establishment situated in that other State, nor subject the company's

undistributed profits to a tax on the company's undistributed profits,

even if the dividends paid or the undistributed profits consist wholly or

partly of profits or income arising in such other State.

Article 11

INTEREST

1. Interest arising in a Contracting State and paid to a

resident of the other Contracting State may be taxed in that other State.

2. However, such interest may also be taxed in the

Contracting State in which it arises and according to the laws of that

State, but if the beneficial owner of the interest is a resident of the other

Contracting State, the tax so charged shall not exceed 10 per cent of the

gross amount of the interest.

3. The term "interest" as used in this Article means income

from debt-claims of every kind, whether or not secured by mortgage

and whether or not carrying a right to participate in the debtor's profits,

and in particular, income from government securities and income

from bonds or debentures, including premiums and prizes attaching

to such securities, bonds or debentures.

4. The provisions of paragraphs 1 and 2 shall not apply if the

beneficial owner of the interest, being a resident of a Contracting State,

carries on business in the other Contracting State in which the interest

arises, through a permanent establishment situated therein and the debt-

claim in respect of which the interest is paid is effectively connected

with such permanent establishment. In such case the provisions of

Article 7 shall apply.

5. Interest shall be deemed to arise in a Contracting State

when the payer is that State itself, a political subdivision, a local

authority or a resident of that State. Where, however, the person paying

the interest, whether he is a resident of a Contracting State or not, has

in a Contracting State a permanent establishment in connection with

which the indebtedness on which the interest is paid was incurred,

and such interest is borne by such permanent establishment, then

such interest shall be deemed to arise in the State in which the

permanent establishment is situated.

6. Where, by reason of a special relationship between the

payer and the beneficial owner or between both of them and some

other person, the amount of the interest, having regard to the debt-

claim for which it is paid, exceeds the amount which would have been

agreed upon by the payer and the beneficial owner in the absence of such

(UKRAINE) ORDER

relationship, the provisions of this Article shall apply only to the last-

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

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

regard being had to the other provisions of this Convention.

7. Notwithstanding the provisions of paragraph 2, interest

arising in a Contracting State shall be exempt from tax in that State if it

is received and held by the Government of the other Contracting State or

its political subdivision, or by the National (Central) Bank of the

other Contracting State, or by a bank wholly owned by the

Government of the other Contracting State. Similarly, interest arising in

a Contracting State shall be exempt from tax in that State if that interest

is paid with respect to a loan guaranteed by the Government of the

other Contracting State.

Article 12

ROYALTIES

1. Royalties arising in a Contracting State and paid to a

resident of the other Contracting State may be taxed in that other State.

2. However, such royalties may also be taxed in the

Contracting State in which they arise and according to the laws of that

State, but if the beneficial owner of the royalties is a resident of the

other Contracting State, the tax so charged shall not exceed 10 per

cent of the gross amount of all payments.

3. The term "royalties" as used in this Article means

payments of any kind received as a consideration for the use of, or the

right to use, any copyright of literary, artistic or scientific work

(including cinematograph films and films or tapes for radio or

television broadcasting), any patent, trade mark, design or model,

plan, secret formula or process, or for information (know-how)

concerning industrial, commercial or scientific experience.

4. The provisions of paragraphs 1 and 2 shall not apply if the

beneficial owner of the royalties, being a resident of a Contracting State,

carries on business in the other Contracting State in which the royalties

arise, through a permanent establishment situated therein and the right

or property in respect of which the royalties are paid is effectively

connected with such permanent establishment. In such case the

provisions of Article 7 shall apply.

5. Where, by reason of a special relationship between the

payer and the beneficial owner or between both of them and some

other person, the amount of the royalties, having regard to the use,

right or information for which they are paid, exceeds, for whatever

reason, the amount which would have been agreed upon by the payer

and the beneficial owner in the absence of such relationship, the

(UKRAINE) ORDER

provisions of this Article shall apply only to the last-mentioned amount.

In such case, the excess part of the payments shall remain taxable

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

to the other provisions of this Convention.

6. Royalties shall be deemed to arise in a Contracting State

when the payer is that State itself, a political subdivision, a local

authority or a resident of that State. Where, however, the person

paying the royalties, whether he is a resident of a Contracting State or

not, has in a Contracting State a permanent establishment in connection

with which the liability to pay the royalties was incurred, and such

royalties are borne by such permanent establishment then such

royalties shall be deemed to arise in the State in which the permanent

establishment is situated.

Article 13

CAPITAL GAINS

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

alienation of immovable property referred to in Article 6 and situated

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

2. Gains from the alienation of movable property forming

part of the business property of a permanent establishment which an

enterprise of a Contracting State has in the other Contracting State,

including such gains from the alienation of such a permanent

establishment (alone or with the whole enterprise), may be taxed in that

other State.

3. Gains from the alienation of ships or aircraft operated in

international traffic, boats engaged in inland waterways transport or

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

boats, shall be taxable only in the Contracting State in which the place of

effective management of the enterprise is situated.

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

alienation of shares deriving more than 50 per cent of their value

directly or indirectly from immovable property situated in the other

Contracting State may be taxed in that other State.

5. Gains from the alienation of any property other than that

referred to in paragraphs 1, 2, 3 and 4, shall be taxable only in the

Contracting State of which the alienator is a resident.

Article 14

INCOME FROM EMPLOYMENT

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

salaries, wages and other similar remuneration derived by a resident of

(UKRAINE) ORDER

a Contracting State in respect of an employment shall be taxable only

in that State unless the employment is exercised in the other

Contracting State. If the employment is so exercised, such

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

2. Notwithstanding the provisions of paragraph 1,

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

an employment exercised in the other Contracting State shall be

taxable only in the first-mentioned State if

a)

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

periods not exceeding in the aggregate 183 days in any

twelve-month period commencing or ending in the fiscal

year concerned; and

b)

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

employer who is not a resident of the other State; and

c)

the remuneration is not borne by a permanent

establishment which the employer has in the other

State.

3. Notwithstanding the preceding provisions of this Article,

remuneration derived in respect of an employment exercised aboard a

ship or aircraft operated in international traffic by an enterprise of a

Contracting State may be taxed in that State.

Article 15

DIRECTORS' FEES

Directors' fees and other similar payments derived by a resident

of a Contracting State in his capacity as a member of the board of

directors of a company which is a resident of the other Contracting State

may be taxed in that other State.

Article 16

ARTISTES AND SPORTSMEN

1. Notwithstanding the provisions of Articles 7 and 14,

income derived by a resident of a Contracting State as an entertainer,

such as a theatre, motion picture, radio or television artiste, or a

musician, or as a sportsman, from his personal activities as such

exercised in the other Contracting State, may be taxed in that other

State.

2. Where income in respect of personal activities exercised

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

the entertainer or sportsman himself but to another person, that income

may, notwithstanding the provisions of Articles 7 and 14, be taxed in the

Contracting State in which the activities of the entertainer or

(UKRAINE) ORDER

sportsman are exercised.

3. Notwithstanding the provisions of paragraphs 1 and 2,

income referred to in this Article shall be exempt from tax in the

Contracting State in which the activities of the entertainer or

sportsman are exercised, if such activities are substantially financed

from the public funds of either or both States, or are carried on under a

cultural cooperation agreement between the Contracting States.

Article 17

PENSIONS AND SOCIAL SECURITY PAYMENTS

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

pensions and other similar remuneration paid to a resident of a

Contracting State in consideration of past employment shall be

taxable only in that State.

2. Notwithstanding the provisions of paragraph 1, pensions

paid and other payments made under the social security legislation of a

Contracting State shall be taxable only in that State.

Article 18

GOVERNMENT SERVICE

1. a)

Remuneration, other than a pension, paid by a

Contracting State or a political subdivision or a local authority thereof

to an individual in respect of services rendered to that State or

subdivision or authority shall be taxable only in that State.

b)

However, such remuneration shall be taxable

only in the other Contracting State if the services are rendered in that

State and the individual is a resident of that State who

(i)

is a national of that State; or

(ii)

did not become a resident of that State solely for

the purpose of rendering the services.

2. a) Any pension paid by, or out of funds created by, a

Contracting State or a political subdivision or a local authority thereof

to an individual in respect of services rendered to that State or

subdivision or authority shall be taxable only in that State.

b)

However, such pension shall be taxable only in the

other Contracting State if the individual is a resident of,

and a national of, that State.

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

remuneration and pensions in respect of services rendered in

connection with a business carried on by a Contracting State or a

(UKRAINE) ORDER

political subdivision or a local authority thereof.

Article 19

STUDENTS AND BUSINESS APPRENTICES

A student or business apprentice who is present in a

Contracting State solely for the purpose of his education or training

and who is, or immediately before being so present was, a resident of the

other Contracting State shall be exempt from tax in the first-

mentioned State on payments received from outside that first-

mentioned State for the purpose of his maintenance, education or

training.

Article 20

OTHER INCOME

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

wherever arising, not dealt with in the foregoing Articles of this

Convention shall be taxable only in that State.

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

other than income from immovable property as defined in paragraph 2

of Article 6, if the recipient of such income, being a resident of a

Contracting State, carries on business in the other Contracting State

through a permanent establishment situated therein and the right or

property in respect of which the income is paid is effectively

connected with such permanent establishment. In such case the

provisions of Article 7 shall apply.

Article 21

Limitation of Benefits

1. Notwithstanding the provisions of any other Article of

this Convention, a resident of a Contracting State shall not receive the

benefit of any reduction in or exemption from tax provided for in the

Convention by the other Contracting State if the main purpose or one

of the main purposes of such resident or a person connected with such

resident was to obtain the benefits of the Convention.

2. The foregoing provision shall not apply where a

company is engaged in substantive business operation in the

Contracting State of which it is a resident and the relief from the

taxation claimed from the other Contracting State is with respect to

income that is connected with such operations.

(UKRAINE) ORDER

Article 22

ELIMINATION OF DOUBLE TAXATION

1. In the case of Ukraine double taxation shall be eliminated

as follows

Subject to the provisions of the law of Ukraine regarding the

elimination of tax paid in a territory outside Ukraine (which shall not

affect the general principle hereof), Malta tax paid under the laws of

Malta and in accordance with this Convention, whether directly or by

deduction, on profits or income from sources within Malta shall be

allowed as a credit against any Ukrainian tax computed by reference to

the same profits or income by reference to which the Malta tax is

computed.

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

follows

Subject to the provisions of the law of Malta regarding the

allowance of a credit against Malta tax in respect of foreign tax, where,

in accordance with the provisions of this Convention, there is

included in a Malta assessment income from sources within Ukraine, the

Ukrainian tax on such income shall be allowed as a credit against the

relative Malta tax payable thereon.

3. Such credits in either case shall not exceed that part of

income tax, as computed before the credit is given, which is attributable

to the income which may be taxed in that other State.

4. Where in accordance with any provision of the

Convention income derived by a resident of a Contracting State is

exempt from tax in that State, such State may nevertheless, in

calculating the amount of tax on the remaining income of such resident,

take into account the exempted income.

5. For the purposes of paragraphs 1 and 2, profits, income

and capital gains derived by a resident of a Contracting State which

may be taxed in the other Contracting State in accordance with this

Convention shall be deemed to arise from sources in that other

Contracting State.

Article 23

NON-DISCRIMINATION

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

the other Contracting State to any taxation or any requirement

connected therewith, which is other or more burdensome than the

taxation and connected requirements to which nationals of that other

State in the same circumstances, in particular with respect to

(UKRAINE) ORDER

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

notwithstanding the provisions of Article 1, also apply to persons

who are not residents of one or both of the Contracting States.

2. Stateless persons who are residents of a Contracting State

shall not be subjected in either Contracting State to any taxation or any

requirement connected therewith, which is other or more burdensome

than the taxation and connected requirements to which nationals of

the State concerned in the same circumstances are or may be

subjected.

3. The taxation on a permanent establishment which an

enterprise of a Contracting State has in the other Contracting State shall

not be less favourably levied in that other State than the taxation

levied on enterprises of that other State carrying on the same

activities.

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

paragraph 6 of Article 11, or paragraph 5 of Article 12 apply, interest,

royalties and other disbursements paid by an enterprise of a Contracting

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

of determining the taxable profits of such enterprise, be deductible

under the same conditions as if they had been paid to a resident of the

first-mentioned State.

5. Enterprises of a Contracting State, the property of which

is wholly or partly owned or controlled, directly or indirectly, by one

or more residents of the other Contracting State, shall not be

subjected in the first-mentioned State to any taxation or any

requirement connected therewith which is other or more burdensome

than the taxation and connected requirements to which other similar

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

6. Nothing contained in this Article shall be construed as

obliging either Contracting State to grant to individuals not resident in

that State any of the personal allowances, reliefs and reductions for

tax purposes which are granted for taxation purposes to resident

individuals on account of civil status or family responsibilities or

which are granted to residents under the criteria not contained in

general tax laws.

7. The provisions of this Article shall apply to taxes covered

by this Convention.

Article 24

MUTUAL AGREEMENT PROCEDURE

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

of the Contracting States result or will result for him in taxation not in

accordance with the provisions of this Convention, he may, irrespective

(UKRAINE) ORDER

of the remedies provided by the domestic law of those States, present

his case to the competent authority of the Contracting State of which

he is a resident or, if his case comes under paragraph 1 of Article 23, to

that of the Contracting State of which he is a national. The case must be

presented within three years from the first notification of the action

resulting in taxation not in accordance with the provisions of the

Convention.

2. The competent authority shall endeavour, if the objection

appears to it to be justified and if it is not itself able to arrive at a

satisfactory solution, to resolve the case by mutual agreement with

the competent authority of the other Contracting State, with a view to

the avoidance of taxation which is not in accordance with the

Convention. Any agreement reached shall be implemented

notwithstanding any time limits in the domestic law of the

Contracting States.

3. The competent authorities of the Contracting States shall

endeavour to resolve by mutual agreement any difficulties or doubts

arising as to the interpretation or the application of the Convention.

4. The competent authorities of the Contracting States may

communicate with each other directly for the purpose of reaching an

agreement in the sense of the preceding paragraphs.

Article 25

EXCHANGE OF INFORMATION

1. The competent authorities of the Contracting States shall

exchange such information as is foreseeably relevant for carrying out

the provisions of this Convention or to the administration or

enforcement of the domestic laws concerning taxes of every kind and

description imposed on behalf of the Contracting States, or of their

political subdivisions or local authorities, insofar as the taxation

thereunder is not contrary to the Convention. The exchange of

information is not restricted by Articles 1 and 2.

2. Any information received under paragraph 1 by a

Contracting State shall be treated as secret in the same manner as

information obtained under the domestic laws of that State and shall

be disclosed only to persons or authorities (including courts and

administrative bodies) concerned with the assessment or collection

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

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

oversight of the above. Such persons or authorities shall use the

information only for such purposes. They may disclose the

information in public court proceedings or in judicial decisions.

3. In no case shall the provisions of paragraphs 1 and 2 be

construed so as to impose on a Contracting State the obligation

(UKRAINE) ORDER

a)

to carry out administrative measures at variance with

the laws and administrative practice of that or of the

other Contracting State;

b)

to supply information which is not obtainable under

the laws or in the normal course of the administration

of that or of the other Contracting State;

c)

to supply information which would disclose any trade,

business, industrial, commercial or professional secret

or trade process, or information the disclosure of

which would be contrary to public policy (ordre

public).

4. If information is requested by a Contracting State in

accordance with this Article, the other Contracting State shall use its

information gathering measures to obtain the requested information,

even though that other State may not need such information for its

own tax purposes. The obligation contained in the preceding sentence

is subject to the limitations of paragraph 3 but in no case shall such

limitations be construed to permit a Contracting State to decline to

supply information solely because it has no domestic interest in such

information.

5. In no case shall the provisions of paragraph 3 be

construed to permit a Contracting State to decline to supply

information solely because the information is held by a bank, other

financial institution, nominee or person acting in an agency or a

fiduciary capacity or because it relates to ownership interests in a

person.

Article 26

MEMBERS OF DIPLOMATIC MISSIONS AND CONSULAR

POSTS

Nothing in this Convention shall affect the fiscal privileges

accorded to members of diplomatic missions or consular posts under

the general rules of international law or under the provisions of

special agreements.

Article 27

ENTRY INTO FORCE

1. Each of the Contracting States shall notify to the other,

through the diplomatic channel, the completion of the procedures

required by its domestic law for the bringing into force of this

Convention. This Convention shall enter into force on the date of the

later of these notifications and shall thereupon have effect

a)

in Ukraine

(i)

in respect of taxes withheld at source on amounts

paid on or after 1 January in the calendar year next

following that in which the Convention enters into

(UKRAINE) ORDER

force; and

(ii) in respect of other taxes for taxable years or periods

beginning on or after 1 January in the calendar year

next following that in which the Convention enters

into force;

b)

in Malta

in respect of taxes on income derived during any calendar year or

accounting period, as the case may be, beginning on or after 1 January

immediately following the date on which the Convention enters into

force.

Article 28

TERMINATION

This Convention shall remain in force until terminated by one

of the Contracting States. Either Contracting State may terminate the

Convention, through the diplomatic channel, by giving notice of

termination at least six months before the end of any calendar year

beginning after the expiry of five years from the date of entry into

force of the Convention.

In such event, the Convention shall cease to have effect

a)

in Ukraine

(i) in respect of taxes withheld at source on amounts

paid on or after 1 January in the calendar year next

following that in which the notice of termination is

given; and

(ii) in respect of other taxes for taxable years or periods

beginning on or after 1 January in the calendar year

next following that in which the notice of termination

is given;

b) in Malta

in respect of taxes on income derived during any calendar year or

accounting period, as the case may be, beginning on or after 1 January

immediately following the date on which the notice of termination is

given.

In witness whereof the undersigned, duly authorized thereto,

have signed this Convention.

Done in duplicate at Kiev this 4 of September 2013 in the

English and Ukrainian languages, both texts being equally authentic.

For the Government

For the Government

of the Republic of Malta

of Ukraine

(UKRAINE) ORDER

PROTOCOL

At the moment of signature of the Convention between the

Government of Ukraine 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, both parties have

agreed upon the following provisions, which form an integral part of

the Convention

1. For the purpose of Article 8 this Convention shall not

apply to persons who are entitled to an exemption or any other

special tax benefit under the provisions of the law in force in Malta

regulating merchant shipping. However, this does not apply to the

income of such persons that is subject to the normal Malta income

tax.

2. In connection with Article 10 (Dividends) paragraph 3

a)

it is understood that the expression "the gross amount of

the dividends" means the dividends in the shareholders'

hands being grossed up, for the purposes of taxation

according to the law of a Contracting State, with the

tax paid by the company on the profits out of which

such dividend is paid. The amount of tax with which

dividends are grossed up is in the same proportion to the

tax on the company's profits as the dividends in

question, as grossed up, bear to the whole amount of the

company's profits out of which the distribution is being

made;

b)

where the laws of a Contracting State provide for the

availability of underlying tax relief, the provisions of

Article 22 (Elimination of Double Taxation) shall be

applicable in that Contracting State where the other

Contracting State makes use of the offset mentioned in

that paragraph. Where underlying tax relief is not so

available, the provisions of Article 22 (Elimination of

Double Taxation) may not be applied.

In witness whereof the undersigned, duly authorized thereto,

have signed this Protocol.

Done in duplicate at Kiev this 4 th day of September 2013 in the

English and Ukrainian languages, both texts being equally authentic.

For the Government

For the Government

of the Republic of Malta

of Ukraine