prop · GL0330 · 1998-01-01 00:00:00 — 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, deposits, sources and other natural resources; ships, boats 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 per- sonal services. (1) The profits of an enterprise of a be taxable only in that State unless the enterprise on business in the other through a permanent situated therein. If the enterprise 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 . (2) Subject to the provisions of paragraph (3), where an enterprise of a on business in the other through a permanent estab- lishment situated therein, there shall in each be attributed to that permanent the profits which it might be expected to make if it were a distinct and separate enter- prise engaged in the same or similar activities under the same or similar conditions and dealing inde- pendently with the enterprise of which it is a permanent establish- ment. (3) In determining the profits of a permanent , there shall be allowed as deductions expenses which are incurred for the purposes of the permanent estab- lishment, including executive and general administrative expenses so incurred, whether in the State in which the permanent is situated or elsewhere, in accord- ance with the provisions of and subject to the limitations of the tax laws of that State. (4) No profits shall be attributed to a permanent by reason of the mere purchase by that permanent of goods or merchandise for the enterprise. (5) For the purposes of the pre- ceding paragraphs, the profits to be attributed to the permanent estab- lishment shall be determined by the same method year by year unless there is good and sufficient reason to the contrary. (6) 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. (1) Profits of an enterprise of a from the opera- tion of ships or aircraft in inter- national traffic shall be taxable only in that State. (2) Profits derived by a trans- portation enterprise which is a resident of a from the use, maintenance, or rental of containers (including trailers and other equipment for the transport of containers) used for the transport of goods or merchandise in inter- national traffic shall be taxable only in that unless the containers are used solely within the other . (3) With respect to profits derived by the Swedish, Danish and Norwegian air transport consortium () the provisions of paragraph (1) shall apply only to such part of the profits as corresponds to the participation held in that con- sortium by , the Swedish partner of (). (4) The provisions of paragraphs (1) and (2) shall also apply to profits from the participation in a pool, a joint business or an international operating agency. Where: (a) an enterprise of a participates directly or in- directly in the management, control or capital of an enterprise of the other , or (b) the same persons participate directly or indirectly in the manage- ment, control or capital of an enterprise of a and an enterprise of the other , 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. case resulting in double taxation from the application of this Article may be resolved under the mutual agreement procedure. (1) Dividends paid by a company which is a resident of a to a resident of the other may be taxed in that other State. (2) Notwithstanding the pro- visions of paragraph (1), such divi- dends may also be taxed in the 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 , the tax so charged shall not exceed 10 per cent of the gross amount of the dividends. This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid. (3) 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 resi- dent. (4) The provisions of paragraphs (1) and (2) shall not apply if the beneficial owner of the dividends, being a resident of a , on business in the other of which the company paying the dividends is a resident, through a permanent situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the holding in respect of which the dividends are paid is effectively connected with such permanent or fixed base. In such case the provisions of Article 7 or Article 14, as the case may be, shall apply. (5) Where a company which is a resident of a derives profits or income from the other , that other State may not impose any tax on the dividends paid by the company, except insofar as such dividends are paid to a resident of that other State or insofar as the holding in respect of which the dividends are paid is effectively connected with a per- manent or a fixed base 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 or partly of profits or income arising in such other State. (1) Interest arising in a Con- tracting State and paid to a resident of the other may be taxed in that other State. (2) However, such interest may also be taxed in the 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 , the tax so charged shall not exceed 10 per cent of the gross amount of the interest. (3) Notwithstanding the pro- visions of paragraph (2) interest arising in a be exempt from tax in that provided it is derived and beneficially owned by, or derived in connection with a loan or credit extended or endorsed by: (i) the Government, a political subdivision, a statutory bo- dy, or a local authority of the other Contracting State; or (ii) in the case of , , the Industrial Finance Corpora- tion of , , the , the , the and the Industrial Credit and (); and in the case of , the Deve- lopment Authority (SIDA), (livsbistånd), In- ternational AB or (); or (iii) any other institution as may be agreed from time to time between the competent authorities of the Contract- ing States. (4) 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, in- cluding premiums and prizes attaching to such securities, bonds or debentures. Penalty charges for late payment shall not be regarded as interest for the purpose of this Article. (5) The provisions of paragraphs (1), (2) and (3) shall not apply if the beneficial owner of the interest, being a resident of a , on business in the other in which the interest arises, through a permanent situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the debt-claim in respect of which the interest is paid is effectively connected with such permanent or fixed base. In such case the provisions of Article 7 or Article 14, as the case may be, shall apply. (6) Interest shall be deemed to arise in a when the payer is a resident of that State. Where, however, the person paying the interest, whether he is a resident of a or not, has in a a permanent or a fixed base in connection with which the indebt- edness on which the interest is paid was incurred, and such interest is borne by such permanent estab- lishment or fixed base, then such interest shall be deemed to arise in the State in which the permanent or fixed base is situated. (7) Where by reason of a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the interest, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned amount. In such case, the excess part of the payments shall remain taxable according to the laws of each , due regard being had to the other provisions of this Convention. Royalties and fees for technical services (1) Royalties and fees for technical services arising in a and paid to a resident of the other may be taxed in that other State. (2) Notwithstanding the pro- visions of paragraph (1) such royalties and fees for technical services may also be taxed in the in which they arise, and according to the laws of that State, but if the recipient is the beneficial owner of the royalties or fees for technical services, the tax so charged shall not exceed 10 per cent of the gross amount of the royalties or fees for technical services. (3) (a) The term "royalties" as used in this Article means payments of any kind received as a consideration for the use of, or the right to use, any copyright of literary, artistic or scientific work including cinematograph films, any patent, trade mark, design or model, plan, secret formula or process, or for information concerning in- dustrial, commercial or scientific experience. (b) The term "fees for technical services" means payment of any kind in consideration for the rendering of any managerial, technical or consultancy services including the provision of services by technical or other personnel but does not include payments for services mentioned in Articles 14 and 15 of this Convention. (4) The provisions of paragraphs (1) and (2) shall not apply if the beneficial owner of the royalties or fees for technical services, being a resident of a , on business in the other in which the royalties or fees for technical services arise, through a permanent situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right or property in respect of which the royalties or fees for technical services are paid is effectively connected with such permanent or fixed base. In such case the provisions of Article 7 or Article 14, as the case may be, shall apply. (5) Royalties or fees for technical services shall be deemed to arise in a when the payer is a resident of that State. Where, however, the person paying the royalties or fees for technical services, whether he is a resident of a or not, has in a a permanent or a fixed base in connection with which the liability to pay the royalties or fees for technical services was incurred, and such royalties or fees for technical services are borne by such permanent or fixed base, then such royalties or fees for technical services shall be deemed to arise in the State in which the permanent or fixed base 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 royalties or fees for technical services, having regard to the use, right or information for which they are paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned amount. In such case, the excess part of the payments shall remain taxable according to the laws of each , due regard being had to the other provisions of this Convention. (1) Gains derived by a resident of a from the alienation of immovable property referred to in Article 6 and situated in the other may be taxed in that other State. (2) Gains from alienation of movable property forming part of the business property of a perma- nent which an enter- prise of a has in the other or of movable property pertaining to a fixed base available to a resident of a in the other for the purpose of performing independent personal services, including such gains from the alienation of such a permanent (alone or with the whole enterprise) or of such fixed base, may be taxed in that other State. (3) Gains derived by a resident of a from the alienation of ships or aircraft operated in international traffic or movable property pertaining to the operation of such ships or aircraft, shall be taxable only in that State. With respect to gains derived by the Swedish, Danish and Nor- wegian air transport consortium (), the provisions of this paragraph shall apply only to such portion of the gains as corresponds to the participation held in that consortium by , the Swedish partner of Scandi- navian (). (4) Gains from the alienation of shares of the capital stock of a company the property of which consists directly or indirectly prin- cipally of immovable property situ- ated in a may be taxed in that 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 of which the alienator is a resident, provided that such resident is subject to tax thereon in that State. If the resident is not subject to tax thereon, then such gains may be taxed in the other . (6) Notwithstanding the provi- sions of paragraph (5), gains from the alienation of any property derived by an individual who has been a resident of a and who has become a resident of the other , may be taxed in the first- mentioned State if the alienation of the property occurs at any time during the four years next following the date on which the individual has ceased to be a resident of the first-mentioned State. (1) Income derived by a resident of a in respect of professional services or other activities of an independent charac- ter shall be taxable only in that State except in the following circumstances, when such income may be taxed in the other Contracting State: (a) if he has a fixed base regu- larly available to him in the other for the purpose of performing his activities; in that case only so much of the income as is attributable to that fixed base may be taxed in the other State; or (b) if his stay in the other State is for a period or periods aggregating 183 days or more in any twelve month period commencing or ending in the fiscal year concerned; in that case, only so much of the income as is derived from his activities performed in that other State may be taxed in that other State. (2) The term "professional services" includes especially inde- pendent scientific, literary, artistic, educational or teaching activities as well as the independent activities of physicians, lawyers, engineers, architects, surgeons, dentists and accountants. (1) Subject to the provisions of Articles 16, 18 and 19, salaries, wages and other similar remu- neration derived by a resident of a in respect of an employment shall be taxable only in that State unless the employment is exercised in the other . If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other State. (2) Notwithstanding the pro- visions of paragraph (1), remu- neration derived by a resident of a in respect of an employment exercised in the other 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 or a fixed base which the employer has in the other State. (3) Notwithstanding the pre- ceding provisions of this Article, remuneration derived in respect of an employment exercised aboard a ship or aircraft operated in inter- national traffic by an enterprise of a may be taxed in that State. Where a resident of derives remuneration in respect of an employment exercised aboard an aircraft operated in international traffic by the Swedish, Danish and Norwegian air transport consortium (), such remuneration shall be taxable only in . Directors'''' fees Directors'''' fees and other similar payments derived by a resident of a in his capacity as a member of the board of directors of a company which is a resident of the other may be taxed in that other State. (1) Notwithstanding the provi- sions of Articles 14 and 15, income derived by a resident of a as an artiste, such as a theatre, motion picture, radio or television artiste, or a musician, or as a sportsperson, from his personal activities as such exercised in the other , may be taxed in that other State. (2) Where income in respect of personal activities exercised by an artiste or a sportsperson in his capacity as such accrues not to the artiste or sportsperson himself but to another person, that income may, notwithstanding the provisions of Articles 7, 14 and 15, be taxed in the in which the activities of the artiste or sports- person are exercised. (3) The provisions of paragraphs (1) and (2), shall not apply to income from activities performed in a by artistes or sportspersons if the visit to that State is substantially supported by public funds of the other Con- tracting State or of a political sub- division or local authority thereof. In such a case, the income shall be taxable only in the of which the artiste or sports- person is a resident. Pensions, social security payments and annuities (1) Subject to the provisions of paragraph 2 of Article 19, pensions and other similar remuneration in consideration of past employment, annuities and payments under the legislation arising in a and paid to a resident of the other may be taxed in the first- mentioned . (2) The term "annuity" means a stated sum payable periodically at stated times during life or during a specified or ascertainable period of time under an obligation to make the payments in return for adequate and full consideration in money or money''''s worth. (1)(a) Remuneration, other than a pension, paid by a or a political subdivision or a local authority thereof to an indi- vidual in respect of services rende- red 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 if the services are rendered in that other 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 pur- pose of rendering the servi- ces. (2) (a) pension paid by, or out of funds created by, a Con- tracting State or a political sub- division 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 if the individual is a resident of, and a national of, that State. (3) The provisions of Articles 15, 16 and 18 shall apply to remu- neration and to pensions in respect of services rendered in connection with a business carried on by a or a political sub- division or a local authority thereof. (1) A student or business appren- tice who is or was immediately be- fore visiting a a resident of the other and who is present in the first- mentioned State solely for the purpose of his education or training shall, besides loans on preferential conditions provided by the Govern- ment or any other organisation or institution of the first-mentioned State and tax exempt grants and scholarships, be exempt from tax in the first-mentioned State on: (a) payments made to him by persons residing outside the first- mentioned State for the purpose of his maintenance, education or train- ing; and (b) remuneration from employ- ment in the first-mentioned State, in an amount not exceeding 10,000 (ten thousand) Swedish Kronor or its equivalent amount during any fiscal year, as the case may be, provided that such employment is directly related to his studies or is undertaken for the purpose of his maintenance and that his stay in the first-mentioned State lasts for six months or more. (2) The benefit of this Article shall extend only for such period of time as may be reasonable or customarily required to complete the education or training under- taken, but in no event shall any individual have the benefits of this Article for more than five con- secutive years from the date of his first arrival in the first-mentioned State. Professors, teachers and research scholars (1) A professor, teacher or re- search scholar who visits a Con- tracting State at the invitation of that State or of a university, college, school or other such institution of that State not ex- ceeding three years solely for the purpose of teaching, giving lectures or carrying out research at such institution and who is, or was immediately before that visit, a resident of the other be exempt from tax in the first-mentioned State, provided that the institution in question receives approval from the com- petent authority of that , on his remuneration for such activity during the period of the first year from the date of his arrival and in the subsequent years the exemption will be only in re- spect of remuneration derived by him from outside that State. (2) This Article shall not apply to income from research, if such re- search is undertaken primarily for the private benefit of a specific person or persons. (1) Items of income of a resident of a , wherever arising, not dealt with in the fore- going 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 Con- tracting State, on business in the other through a permanent situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right or property in respect of which the income is paid is effectively connected with such permanent or fixed base. In such case the provisions of Article 7 or Article 14, as the case may be, shall apply. (3) Notwithstanding the provi- sions of paragraph (1), if a resident of a derives in- come from sources within the other in the form of lotteries, crossword puzzles, races including horse races, card games and other games of any sort or gambling or betting of any form or nature whatsoever, such income may be taxed in the other Con- tracting State.