PROTOCOLAMENDING THE CONVENTION BETWEEN JAPANAND SWEDEN FOR THE AVOIDANCE OF DOUBLE TAXATION
AND THE PREVENTION OF FISCAL EVASION
WITH RESPECT TO TAXES ON INCOME

PROTOCOLAMENDING THE CONVENTION BETWEEN JAPANAND SWEDEN FOR THE AVOIDANCE OF DOUBLE TAXATION
AND THE PREVENTION OF FISCAL EVASION
WITH RESPECT TO TAXES ON INCOME

The Government of Japan and the Government of Sweden,
Desiring to amend the Convention between Japan and
Sweden for the avoidance of double taxation and theprevention of fiscal evasion with respect to taxes on
income signed at Stockholm on 21 January 1983, as amended
by the Protocol signed at Stockholm on 19 February 1999
(hereinafter referred to as “the Convention”),
Have agreed as follows:
Article I
Paragraph 1 of Article 2 of the Convention shall bedeleted and replaced by the following:“1.
The taxes which are the subject of thisConvention are:(a)

In Japan:(i)

the income tax;(ii)

the corporation tax;(iii)

the special income tax forreconstruction;(iv)

the special corporation tax forreconstruction; and(v)

the local inhabitant taxes(hereinafter referred to as “Japanese tax”);(b)

In Sweden:(i)the national income tax;(ii)

the withholding tax on dividends;- 1 -(iii)

the income tax on non-residents;(iv)

the income tax on non-resident artistes
and athletes; and(v)

the municipal income tax(hereinafter referred to as “Swedish tax”).”
Article II
Sub-paragraphs (i) and (j) of paragraph 1 of Article 3of the Convention shall be deleted and replaced by thefollowing:“(i)the term “international traffic” means any
transport by a ship or aircraft operated byan enterprise of a Contracting State, except
when the ship or aircraft is operated solely
between places in the other Contracting
State;(j)the term “competent authority” means:(i)in Japan, the Minister of Finance or
his authorized representative;(ii)

in Sweden, the Minister of Finance, his
authorized representative or theauthority which is designated as acompetent authority for the purposes ofthis Convention;(k)

the term “enterprise” applies to thecarrying on of any business; and(l)the term “business” includes the performanceof professional services and of otheractivities of an independent character.”
Article III

Article 4 of the Convention shall be deleted andreplaced by the following:- 2 -“Article 4
1.
For the purposes of this Convention, the term
“resident of a Contracting State” means any person
who, under the laws of that Contracting State, isliable to tax therein by reason of his domicile,
residence, place of head or main office, place ofmanagement or any other criterion of a similar nature,
and also includes that Contracting State and any
governmental body or agency, political subdivision or
local authority thereof and a pension fund as referred
to in sub-paragraph (d) of paragraph 7 of Article 21A.
This term, however, does not include any person who isliable to tax in that Contracting State in respect
only of income from sources in that Contracting 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 asfollows:(a)he shall be deemed to be a resident only of
the Contracting State in which he has apermanent home available to him; if he has apermanent home available to him in bothContracting States, he shall be deemed to bea resident only of the Contracting State
with which his personal and economic
relations are closer (centre of vitalinterests);(b)

if the Contracting State in which he has his
centre of vital interests cannot be
determined, or if he has not a permanent
home available to him in either Contracting
State, he shall be deemed to be a resident
only of the Contracting State in which hehas an habitual abode;(c)

if he has an habitual abode in bothContracting States or in neither of them, heshall be deemed to be a resident only of theContracting State of which he is a national;(d)

if he is a national of both Contracting
States or of neither of them, the competentauthorities of the Contracting States shallsettle the question by mutual agreement.

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3.
Where by reason of the provisions of paragraph 1
a person other than an individual is a resident ofboth Contracting States, then the competentauthorities of the Contracting States shall endeavour
to determine by mutual agreement the Contracting Stateof which that person shall be deemed to be a resident
for the purposes of this Convention. In the absenceof such agreement, such person shall not be entitledto any reduction or exemption from tax provided bythis Convention.”
Article IV
1.
Paragraph 2 of Article 6 of the Convention shall bedeleted and replaced by the following:“2.
The term “immovable property” shall have themeaning which it has under the laws 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 inagriculture and forestry, rights to which theprovisions of general law respecting landed property
apply, buildings, usufruct of immovable property andrights to variable or fixed payments as consideration
for the working of, or the right to work, mineraldeposits, sources and other natural resources; ships
and aircraft shall not be regarded as immovable
property.”2.
Paragraph 4 of Article 6 of the Convention shall beamended by deleting the words “and to income from immovable
property used for the performance of independent personal
services”.
Article V
1.
Paragraph 4 of Article 7 of the Convention shall bedeleted.
2.
Paragraphs 5, 6 and 7 of Article 7 of the Convention
shall be renumbered as paragraphs 4, 5 and 6 respectively.
Article VI
1.
Paragraph 2 of Article 10 of the Convention shall bedeleted and replaced by the following:

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“2.
However, such dividends may also be taxed in theContracting State of which the company paying thedividends is a resident and according to the laws ofthat Contracting State, but if the beneficial owner ofthe dividends is a resident of the other Contracting
State, the tax so charged shall not exceed 10 per centof the gross amount of the dividends.
3.
Notwithstanding the provisions of paragraph 2,
dividends shall not be taxed in the Contracting Stateof which the company paying the dividends is a
resident if the beneficial owner of the dividends is a
resident of the other Contracting State and is acompany (other than a partnership) that has held,
directly or indirectly, at least 10 per cent of thevoting power of the company paying the dividends forthe period of six months ending on the date on which
entitlement to the dividends is determined. For the
purposes of this paragraph, the term “partnership”
does not include any entity that is treated as a body
corporate for tax purposes in a Contracting State andis a resident of that Contracting State.
4.
The provisions of paragraphs 2 and 3 shall notaffect the taxation of the company in respect of the
profits out of which the dividends are paid.
5.
The provisions of paragraph 3 shall not apply inthe case of dividends paid by a company which isentitled to a deduction for dividends paid to its
beneficiaries in computing its taxable income in theContracting State of which the company paying thedividends is a resident.”
2.
Paragraphs 3 and 4 of Article 10 of the Convention
shall be renumbered as paragraphs 6 and 7 respectively.
3.
Paragraph 5 of Article 10 of the Convention shall bedeleted and replaced by the following:“8.
The provisions of paragraphs 1, 2, 3, 4 and 5
shall not apply if the beneficial owner of thedividends, being a resident of a Contracting State,carries on business in the other Contracting State ofwhich the company paying the dividends is a resident
through a permanent establishment situated therein andthe holding in respect of which the dividends are paid
is effectively connected with such permanentestablishment. In such case the provisions of Article
7 shall apply.”

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4.
Paragraph 6 of Article 10 of the Convention shall beamended by deleting the words “or a fixed base” andrenumbered as paragraph 9.
Article VII
Paragraphs 1, 2, 3, 4 and 5 of Article 11 of theConvention shall be deleted and replaced by the following:“1.
Interest arising in a Contracting State andbeneficially owned by a resident of the other
Contracting State shall be taxable only in that other
Contracting State.
2.
Notwithstanding the provisions of paragraph 1,
interest arising in a Contracting State that isdetermined by reference to receipts, sales, income,profits or other cash flow of the debtor or a related
person, to any change in the value of any property ofthe debtor or a related person or to any dividend,
partnership distribution or similar payment made by
the debtor or a related person, or any other interest
similar to such interest arising in a Contracting
State, may be taxed in the Contracting State in which
it arises, and according to the laws of thatContracting State, but if the beneficial owner of theinterest is a resident of the other Contracting State,
the tax so charged shall not exceed 10 per cent of thegross amount of the interest.
3.
The term “interest” as used in this Article means
income from debt-claims of every kind, whether or notsecured by mortgage and whether or not carrying aright to participate in the debtor’s profits, and inparticular, income from government securities andincome from bonds or debentures, including premiums
and prizes attaching to such securities, bonds ordebentures, and all other income that is subjected tothe same taxation treatment as income from money lentby the tax laws of the Contracting State in which theincome arises. Penalty charges for late payment shallnot be regarded as interest for the purposes of this
Article. Income dealt with in Article 10 shall not be
regarded as interest for the purposes of thisConvention.

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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 businessin the other Contracting State in which the interest
arises through a permanent establishment situatedtherein and the debt-claim in respect of which theinterest is paid is effectively connected with suchpermanent establishment. In such case the provisionsof Article 7 shall apply.
5.
Interest shall be deemed to arise in aContracting State when the payer is a resident of thatContracting State. Where, however, the person paying
the interest, whether he is a resident of aContracting State or not, has in a Contracting State apermanent establishment in connection with which theindebtedness on which the interest is paid wasincurred, and such interest is borne by such permanentestablishment, then such interest shall be deemed toarise in the Contracting State in which the permanentestablishment is situated.”
Article VIII
1.
Paragraphs 1, 2, 3, 4 and 5 of Article 12 of theConvention shall be deleted and replaced by the following:“1.
Royalties arising in a Contracting State andbeneficially owned by a resident of the other
Contracting State shall be taxable only in that other
Contracting State.
2.
The term “royalties” as used in this Articlemeans payments of any kind received as a consideration
for the use of, or the right to use, any copyright ofliterary, 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, orfor information concerning industrial, commercial orscientific experience.
3.
The provisions of paragraph 1 shall not apply if
the beneficial owner of the royalties, being a
resident of a Contracting State, carries on businessin the other Contracting State in which the royalties
arise through a permanent establishment situatedtherein and the right or property in respect of which
the royalties are paid is effectively connected withsuch permanent establishment. In such case theprovisions of Article 7 shall apply.”

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2.
Paragraph 6 of Article 12 of the Convention shall be
renumbered as paragraph 4.
Article IX
Paragraph 2 of Article 13 of the Convention shall bedeleted and replaced by the following:“2.
Gains from the alienation of any property, otherthan immovable property, forming part of the businessproperty of a permanent establishment which anenterprise of a Contracting State has in the other
Contracting State, including such gains from thealienation of such a permanent establishment (alone or
together with the whole enterprise), may be taxed inthat other Contracting State.”
Article X
Article 14 of the Convention shall be deleted andreplaced by the following:“Article 14 (Deleted)”
Article XI
1.
Sub-paragraph (a) of paragraph 2 of Article 15 of theConvention shall be deleted and replaced by the following:“(a)the recipient is present in that other
Contracting State for a period or periods
not exceeding in the aggregate 183 days in
any twelve month period commencing or ending
in the taxable year concerned; and”

2.
Sub-paragraph (c) of paragraph 2 of Article 15 of theConvention shall be amended by deleting the words “or afixed base”.
Article XII
1.
Paragraph 1 of Article 17 of the Convention shall beamended by deleting the words “Articles 14 and 15” andreplacing them with the words “Articles 7 and 15”.
2.
Paragraph 2 of Article 17 of the Convention shall beamended by deleting the words “Articles 7, 14 and 15” andreplacing them with the words “Articles 7 and 15”.

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Article XIIIParagraph 2 of Article 21 of the Convention shall bedeleted and replaced by the following:“2.
The provisions of paragraph 1 shall not apply toincome, other than income from immovable property as
defined in paragraph 2 of Article 6, if the recipientof such income, being a resident of a Contracting
State, carries on business in the other Contracting
State through a permanent establishment situatedtherein and the right or property in respect of which
the income is paid is effectively connected with suchpermanent establishment. In such case, the provisionsof Article 7 shall apply.”
Article XIV
The following new Articles shall be inserted
immediately after Article 21 of the Convention:“Article 21A
1.
Except as otherwise provided in this Article, aresident of a Contracting State that derives income
described in paragraph 3 of Article 10 or in Article
11 or 12 from the other Contracting State shall beentitled to the benefits granted for a taxable year by
the provisions of that paragraph or those Articles
only if such resident is a qualified person as definedin paragraph 2 and satisfies any other specified
conditions in that paragraph or those Articles for theobtaining of such benefits.
2.
A resident of a Contracting State is a qualified
person for a taxable year only if such resident iseither:(a)an individual;(b)

the Government of that Contracting State,
any statutory body, political subdivision or
local authority of that Contracting State,or the Bank of Japan or the Central Bank ofSweden (Sveriges Riksbank);

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(c)

a company, if its principal class of sharesis listed or registered on a recognizedstock exchange specified in clause (i) or(ii) of sub-paragraph (c) of paragraph 7 andis regularly traded on one or more
recognized stock exchanges;(d)a pension fund, provided that, as of the endof the prior taxable year, more than 50 per
cent of the beneficiaries, members or
participants of that pension fund are
individuals who are residents of either
Contracting State;(e)an organisation established under the lawsof that Contracting State and operated
exclusively for a religious, charitable,
educational, scientific, artistic, culturalor public purpose, only if all or part ofits income may be exempt from tax under thedomestic law of that Contracting State; or(f)a person other than an individual, if
residents of either Contracting State thatare qualified persons by reason of subparagraph (a), (b), (c), (d) or (e) of thisparagraph hold, directly or indirectly, atleast 50 per cent of the voting power orother beneficial interests of that person.

3.
Notwithstanding that a company that is a residentof a Contracting State may not be a qualified person,that company shall be entitled to the benefits grantedby the provisions of paragraph 3 of Article 10 or of
Article 11 or 12 with respect to an item of income
described in that paragraph or those Articles derived
from the other Contracting State if that company
satisfies any other specified conditions in thatparagraph or those Articles for the obtaining of such
benefits and at least 75 per cent of the voting powerof that company is held, directly or indirectly, by
seven or fewer persons who are equivalentbeneficiaries.
4.
Where the provisions of sub-paragraph (f) ofparagraph 2 and paragraph 3 apply:- 10 -

5.

(a)in respect of taxation by withholding at
source, a resident of a Contracting State
shall be considered to satisfy theconditions described in that sub-paragraphor paragraph for the taxable year in which
payment of an item of income is made if such
resident satisfies those conditions during
the twelve month period preceding the dateof the payment (or, in the case ofdividends, the date on which entitlement to
the dividends is determined);(b)in all other cases, a resident of aContracting State shall be considered tosatisfy the conditions described in that
sub-paragraph or paragraph for a taxable
year if such resident satisfies thoseconditions on at least half the days of thetaxable year.

(a)Notwithstanding that a resident of aContracting State may not be a qualified
person, that resident shall be entitled tothe benefits granted by the provisions ofparagraph 3 of Article 10 or of Article 11
or 12 with respect to an item of income
described in that paragraph or those
Articles derived from the other Contracting
State if:(i)that resident is carrying on businessin the first-mentioned Contracting
State (other than the business ofmaking or managing investments for that
resident’s own account, unless thebusiness is banking, insurance or
securities business carried on by abank, insurance company or securities
dealer);(ii)

the income derived from that other
Contracting State is derived inconnection with, or is incidental to,that business; and(iii)

that resident satisfies any otherspecified conditions in that paragraphor those Articles for the obtaining ofsuch benefits.

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(b)If a resident of a Contracting State derives
an item of income from a business carried onby that resident in the other Contracting
State or derives an item of income arisingin the other Contracting State from a personthat has with that resident a relationshipdescribed in sub-paragraph (a) or (b) ofparagraph 1 of Article 9, the conditions
described in sub-paragraph (a) of thisparagraph shall be considered to besatisfied with respect to such item ofincome only if the business carried on in
the first-mentioned Contracting State is
substantial in relation to the businesscarried on in that other Contracting State.
Whether such business is substantial for the
purposes of this paragraph shall be
determined on the basis of all the facts andcircumstances.

(c)

In determining whether a person is carrying
on business in a Contracting State under
sub-paragraph (a) of this paragraph, thebusiness conducted by a partnership in whichthat person is a partner and the businessconducted by persons connected to such
person shall be deemed to be conducted bysuch person. A person shall be connected toanother if one holds, directly or
indirectly, at least 50 per cent of thebeneficial interests in the other (or, inthe case of a company, at least 50 per centof the voting power of the company) or athird person holds, directly or indirectly,
at least 50 per cent of the beneficial
interests (or, in the case of a company, atleast 50 per cent of the voting power of thecompany) in each person. In any case, aperson shall be considered to be connected
to another if, on the basis of all the facts
and circumstances, one has control of theother or both are under the control of thesame person or persons.

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6.
A resident of a Contracting State that is neither
a qualified person nor entitled under paragraph 3 or 5
to the benefits granted by the provisions of paragraph
3 of Article 10 or of Article 11 or 12 with respect toan item of income described in that paragraph or those
Articles shall, nevertheless, be granted such benefits
if the competent authority of the other Contracting
State determines, in accordance with its domestic law
or administrative practice, that the establishment,
acquisition or maintenance of such resident and the
conduct of its operations are considered as not having
the obtaining of such benefits as one of the principal
purposes.
7.

For the purposes of this Article:(a)the term “shares” shall include depository
receipts thereof;(b)

the term “principal class of shares” means
the class or classes of shares of a company
which represent a majority of the voting
power of the company;(c)the term “recognized stock exchange” means:(i)any stock exchange established under
the terms of the Financial Instruments
and Exchange Law (Law No. 25 of 1948)
of Japan;(ii)

the OMX NASDAQ Stockholm Stock Exchange(Stockholmsbörsen), the Nordic GrowthMarket, and any other stock exchange
subject to regulation by the Swedish
Financial Supervisory Authority;(iii)

the Irish Stock Exchange and the stock
exchanges of Amsterdam, Brussels,
Copenhagen, Dusseldorf, Frankfurt,
Hamburg, Helsinki, Hong Kong, London,
Madrid, Milan, New York, Oslo, Paris,
Reykjavik, Riga, Seoul, Shanghai,
Singapore, Sydney, Tallinn, Toronto,
Vienna, Vilnius, and Zurich, and the
NASDAQ System; and- 13 -

(iv)

(d)

(e)

any other stock exchange which thecompetent authorities of theContracting States agree to recognize
for the purposes of this Article;

the term “pension fund” means any person
that:
(i)

is established under the laws of aContracting State;(ii)

is operated principally to administeror provide pensions, retirement
benefits or other similar remunerationor to earn income for the benefit ofother pension funds; and(iii)

is exempt from tax in that Contracting
State with respect to income derived
from the activities described in clause(ii); andthe term “equivalent beneficiary” means:(i)a resident of a state that has aconvention for the avoidance of double
taxation and the prevention of fiscal
evasion between that state and theContracting State from which thebenefits of this Convention are claimed
such that:(aa) that convention contains
provisions for effective exchange
of information;(bb) that resident is a qualified
person under the limitation on
benefits provisions in thatconvention or, when there are nosuch provisions in thatconvention, would be a qualified
person when that convention isread as including provisions
corresponding to paragraph 2; and- 14 -

(cc) with respect to an item of income
referred to in paragraph 3 ofArticle 10 or in Article 11 or 12that resident would be entitledunder that convention to a rateof tax with respect to theparticular class of income forwhich the benefits are being
claimed under this Convention
that is at least as low as therate applicable under thisConvention; or(ii)

a qualified person by reason of subparagraph (a), (b), (c), (d) or (e) of
paragraph 2.
Article 21B

Notwithstanding any other provisions of thisConvention, where
(a)

(b)

a company that is a resident of aContracting State derives its income
primarily from other states(i)from financial or shipping activities,
or

(ii)

from being the headquarters or co-ordination centre in relation to, or anentity providing administrative
services or other support to, a groupof companies which carry on businessprimarily in other states; andsuch income would bear a significantly lower
tax under the laws of that Contracting State
than income from financial or shipping
activities carried out within thatContracting State or from being theheadquarters or co-ordination centre in
relation to, or an entity providing
administrative services or other support to,a group of companies which carry on businessin that Contracting State, as the case maybe,- 15 -

any provisions of this Convention conferring an exemption or a reduction of tax shall not apply to theincome of such company and to the dividends paid bysuch company.
Article 21C
No relief shall be available under thisConvention if it was the main purpose of any person
concerned with the creation or assignment of any rightor property in respect of which the income is paid orderived to take advantage of this Convention by meansof that creation or assignment.”
Article XV
Article 22 of the Convention shall be deleted andreplaced by the following:“Article 221.
Subject to the provisions of the laws of Japan
regarding the allowance as a credit against Japanese
tax of tax payable in any country other than Japan,
where a resident of Japan derives income from Sweden
which may be taxed in Sweden in accordance with theprovisions of this Convention, the amount of Swedish
tax payable in respect of that income shall be allowed
as a credit against the Japanese tax imposed on that
resident. The amount of credit, however, shall not
exceed the amount of the Japanese tax which isappropriate to that income.
2.

(a)Subject to the provisions of sub-paragraph(b) of this paragraph and of paragraph 6 of
Article 10, where a resident of Sweden
derives income which may be taxed in Japanin accordance with the provisions of thisConvention, Sweden shall allow - subject tothe provisions of the laws of Sweden
concerning credit for foreign tax (as they
may be amended from time to time withoutchanging the general principle hereof) - asa deduction from the tax on such income, anamount equal to the Japanese tax paid inrespect of such income.

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(b)Where a resident of Sweden derives income
which, in accordance with the provisions of
this Convention, shall be taxable only inJapan, Sweden may, when determining thegraduated rate of Swedish tax, take into
account the income which shall be taxable
only in Japan.”
Article XVI

1.
Paragraph 2 of Article 23 of the Convention shall bedeleted and replaced by the following:“2.
The taxation on a permanent establishment which
an enterprise of a Contracting State has in the other
Contracting State shall not be less favourably leviedin that other Contracting State than the taxation
levied on enterprises of that other Contracting State
carrying on the same activities. This provision shallnot be construed as obliging a Contracting State to
grant to residents of the other Contracting State any
personal allowances, reliefs and reductions fortaxation purposes on account of civil status or family
responsibilities which it grants to its own
residents.”
2.
Paragraph 3 of Article 23 of the Convention shall beamended by deleting the words “Article 9, paragraph 6 of
Article 11, or paragraph 6 of Article 12,” and replacing
them with the words “paragraph 1 of Article 9, paragraph 6of Article 11 or paragraph 4 of Article 12”.
Article XVIIArticle 24 of the Convention shall be amended byadding the following after paragraph 4:“5.

Where,(a)under paragraph 1, a person has presented acase to the competent authority of aContracting State on the basis that theactions of one or both of the Contracting
States have resulted for that person intaxation not in accordance with theprovisions of this Convention, and- 17 -

(b)the competent authorities are unable toreach an agreement to resolve that casepursuant to paragraph 2 within three years
from the presentation of the case to thecompetent authority of the other Contracting
State,

any unresolved issues arising from the case shall be
submitted to arbitration if the person so requests.
These unresolved issues shall not, however, be
submitted to arbitration if a decision on these issues
has already been rendered by a court or administrative
tribunal of either Contracting State. Unless a person
directly affected by the case does not accept themutual agreement that implements the arbitration
decision, that decision shall be binding on bothContracting States and shall be implemented
notwithstanding any time limits in the domestic lawsof these Contracting States. The competentauthorities of the Contracting States shall by mutual
agreement settle the mode of application of thisparagraph.
6.
For the purposes of applying the provisions ofparagraph 5:(a)

The competent authorities shall by mutual
agreement establish a procedure in order toensure that an arbitration decision will be
implemented within two years from a request
for arbitration as referred to in paragraph
5 unless actions or inaction of a person
directly affected by the case presented
pursuant to that paragraph hinder the
resolution of the case or unless thecompetent authorities and that person agree
otherwise.

(b)

An arbitration panel shall be established inaccordance with the following rules:(i)

An arbitration panel shall consist of
three arbitrators with expertise or
experience in international tax
matters.

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(ii)Each competent authority shall appoint
one arbitrator who may be its national.
The two arbitrators appointed by thecompetent authorities shall appoint thethird arbitrator who serves as thechair of the arbitration panel inaccordance with the procedures agreed
by the competent authorities.

(iii)

All arbitrators shall not be employeesof the tax authorities of theContracting States, nor have had dealt
with the case presented pursuant toparagraph 1 in any capacity. Unlessotherwise agreed by the competentauthorities of the Contracting States,
the third arbitrator shall not be anational of either Contracting State.

(iv)

The competent authorities shall ensurethat all arbitrators and their staff
agree, in statements sent to eachcompetent authority, prior to theiracting in an arbitration proceeding, toabide by and be subject to the same
confidentiality and non-disclosure
obligations described in paragraph 2 ofArticle 25 and under the applicable
domestic laws of the Contracting
States.

(v)

Each competent authority shall bear thecosts of its appointed arbitrator andits own expenses. The costs of thechair of an arbitration panel and otherexpenses associated with the conduct ofthe proceedings shall be borne by thecompetent authorities in equal shares.

(c)

The competent authorities shall provide theinformation necessary for the arbitration
decision to all arbitrators and their staff
without undue delay.

(d)An arbitration decision shall be treated asfollows:- 19 -

7.

(i)

An arbitration decision has no formal
precedential value.

(ii)

An arbitration decision shall be final,
unless that decision is found to be
unenforceable by the courts of one of
the Contracting States due to aviolation of paragraph 5, of thisparagraph or of any procedural rule
determined in accordance with subparagraph (a) of this paragraph that
may reasonably have affected thedecision. If the decision is found to
be unenforceable due to the violation,
the decision shall be considered not tohave been made.

(e)

Where, at any time after a request forarbitration has been made and before thearbitration panel has delivered a decision
to the competent authorities and the person
who made the request for arbitration, thecompetent authorities have solved all theunresolved issues submitted to thearbitration, the case shall be considered assolved pursuant to paragraph 2 and no
arbitration decision shall be provided.

(a)

The provisions of paragraphs 5 and 6 shallnot apply to cases falling within paragraph
3 of Article 4 or to cases concerning theattribution of capital to a permanentestablishment under Article 7.

(b)

Notwithstanding the provisions of paragraph
5, a case shall not be submitted toarbitration if the competent authorities ofboth Contracting States have agreed that thecase is not suitable for resolution througharbitration.”
Article XVIII

Article 25 of the Convention shall be deleted andreplaced by the following:- 20 -

“Article 25
1.
The competent authorities of the Contracting
States shall exchange such information as isforeseeably relevant for carrying out the provisionsof this Convention or to the administration or
enforcement of the domestic laws concerning taxes ofevery kind and description imposed on behalf of theContracting States, or of their political subdivisions
or local authorities, insofar as the taxation
thereunder is not contrary to this Convention. The
exchange of information is not restricted by Articles
1 and 2.
2.
Any information received under paragraph 1 by aContracting State shall be treated as secret in thesame manner as information obtained under the domestic
laws of that Contracting State and shall be disclosed
only to persons or authorities (including courts andadministrative 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 theoversight 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. Notwithstanding
the foregoing, information received by a Contracting
State may be used for other purposes when suchinformation may be used for such other purposes under
the laws of both Contracting States and the competentauthority of the Contracting State supplying theinformation authorizes such use.
3.
In no case shall the provisions of paragraphs 1
and 2 be construed so as to impose on a Contracting
State the obligation:(a)

to carry out administrative measures atvariance 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;- 21 -

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

to obtain or provide information that would
reveal confidential communications between aclient and an attorney, solicitor or otheradmitted legal representative where such
communications are:(i)

produced for the purposes of seeking orproviding legal advice; or(ii)produced for the purposes of use inexisting or contemplated legal
proceedings.

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, eventhough that other Contracting State may not need suchinformation for its own tax purposes. The obligation
contained in the preceding sentence is subject to thelimitations of paragraph 3 but in no case shall such
limitations be construed to permit a Contracting Stateto decline to supply information solely because it has
no domestic interest in such information.
5.
In no case shall the provisions of paragraph 3 beconstrued to permit a Contracting State to decline tosupply information solely because the information isheld 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 aperson.”Article XIX
Article 25A of the Convention shall be deleted andreplaced by the following:“Article 25A
1.
The Contracting States shall lend assistance toeach other in the collection of revenue claims. This
assistance is not restricted by Articles 1 and 2.

- 22 -

2.
The term “revenue claim” as used in this Articlemeans an amount owed in respect of the following
taxes, insofar as the taxation thereunder is notcontrary to this Convention or any other instrument towhich the Contracting States are parties, as well asinterest, administrative penalties, surcharges andcosts of collection or conservancy related to suchamount:(a)(b)

in the case of Japan:(i)

the income tax;(ii)

the corporation tax;(iii)

the special income tax forreconstruction;(iv)

the special corporation tax forreconstruction;(v)

the consumption tax;(vi)

the inheritance tax; and(vii)

the gift tax;

in the case of Sweden:(i)the national income tax;(ii)

the withholding tax on dividends;(iii)

the income tax on non-residents;(iv)

the income tax on non-resident artistes
and athletes;(v)

the municipal income tax;(vi)

the value added tax;(vii)

the real estate tax;

(viii)

the net wealth tax;(ix)

the inheritance tax; and(x)

the gift tax;

- 23 -

(c)any identical or substantially similar taxes
that are imposed after the date of signatureof the Protocol signed at Stockholm on 5
December 2013 amending this Convention as
amended by the Protocol signed at Stockholm
on 19 February 1999 in addition to, or inplace of, the taxes covered by subparagraphs (a) and (b).

The competent authorities of the Contracting
States shall notify each other of any significant
changes that have been made in their taxation laws.
3.
When a revenue claim of a Contracting State isenforceable under the laws of that Contracting Stateand is owed by a person who, at that time, cannot,
under the laws of that Contracting State, prevent its
collection, that revenue claim shall, at the requestof the competent authority of that Contracting State,
be accepted for purposes of collection by thecompetent authority of the other Contracting State.
That revenue claim shall be collected by that other
Contracting State in accordance with the provisions of
its laws applicable to the enforcement and collectionof its own taxes as if the revenue claim were arevenue claim of that other Contracting State that met
the conditions allowing that other Contracting Stateto make a request under this paragraph.
4.
When a revenue claim of a Contracting State is aclaim in respect of which that Contracting State may,under its law, take measures of conservancy with aview to ensure its collection, that revenue claim
shall, at the request of the competent authority ofthat Contracting State, be accepted for purposes oftaking measures of conservancy by the competentauthority of the other Contracting State. That other
Contracting State shall take measures of conservancy
in respect of that revenue claim in accordance withthe provisions of its laws as if the revenue claim
were a revenue claim of that other Contracting Stateeven if, at the time when such measures are applied,
the revenue claim is not enforceable in the firstmentioned Contracting State or is owed by a person who
has a right to prevent its collection.

- 24 -

5.
Notwithstanding the provisions of paragraphs 3
and 4, a revenue claim accepted by a Contracting Statefor purposes of paragraph 3 or 4 shall not, in thatContracting State, be subject to the time limits or
accorded any priority applicable to a revenue claim
under the laws of that Contracting State by reason of
its nature as such. In addition, a revenue claim
accepted by a Contracting State for the purposes ofparagraph 3 or 4 shall not, in that Contracting State,
have any priority applicable to that revenue claim
under the laws of the other Contracting State.
6.
Notwithstanding the provisions of paragraph 5,
acts carried out by a Contracting State in thecollection of a revenue claim accepted by thatContracting State for purposes of paragraph 3 or 4,
which, if they were carried out by the other
Contracting State, would have the effect ofsuspending, prolonging or interrupting the time limits
applicable to the revenue claim according to the lawsof that other Contracting State, shall have such
effect under the laws of that other Contracting State.
The first-mentioned Contracting State shall inform theother Contracting State about such acts.
7.
Proceedings with respect to the existence,
validity or the amount of a revenue claim of aContracting State shall not be brought before thecourts or administrative bodies of the other
Contracting State.
8.
Where, at any time after a request has been madeby a Contracting State under paragraph 3 or 4 andbefore the other Contracting State has collected andremitted the relevant revenue claim to the firstmentioned Contracting State, the relevant revenue
claim ceases to be(a)in the case of a request under paragraph 3,
a revenue claim of the first-mentioned
Contracting State that is enforceable under
the laws of that Contracting State and is
owed by a person who, at that time, cannot,
under the laws of that Contracting State,prevent its collection, or- 25 -

(b)in the case of a request under paragraph 4,
a revenue claim of the first-mentioned
Contracting State in respect of which thatContracting State may, under its laws, takemeasures of conservancy with a view toensure its collection

the competent authority of the first-mentioned
Contracting State shall promptly notify the competentauthority of the other Contracting State of that factand, at the option of the other Contracting State, thefirst-mentioned Contracting State shall either suspend
or withdraw its request.
9.
In no case shall the provisions of this Article
be construed so as to impose on a Contracting Statethe obligation:(a)

to carry out administrative measures atvariance with the laws and administrative
practice of that or of the other Contracting
State;(b)

to carry out measures which would becontrary to public policy (ordre public);(c)

to provide assistance if the other
Contracting State has not pursued all
reasonable measures of collection orconservancy, as the case may be, available
under its laws or administrative practice;(d)to provide assistance in those cases where
the administrative burden for thatContracting State is clearly
disproportionate to the benefit to be
derived by the other Contracting State.

10. Before assistance is lent under the provisions of
this Article, the competent authorities of bothContracting States shall agree upon the mode ofapplication of this Article, including an agreement toensure comparable levels of assistance to each of theContracting States. In particular, the competentauthorities of both Contracting States shall agree on
a limit to the number of applications for assistancethat a Contracting State may make in a particular year
and a minimum monetary threshold for a revenue claim
for which assistance is sought.”- 26 -

Article XX
1.
Each of the Contracting States shall send in writing
and through diplomatic channels to the other the
notification confirming that its internal procedures
necessary for the entry into force of this Protocol havebeen completed. The Protocol shall enter into force on thethirtieth day after the date of receipt of the latter
notification.
2.

This Protocol shall have effect:(a)in respect of taxes withheld at source, foramounts paid or credited on or after the firstday of January of the year next following thedate on which the Protocol enters into force;(b)

in respect of other taxes on income, as regards
income for taxable years beginning on or after
the first day of January of the year next
following the date on which the Protocol enters
into force.

3.
Notwithstanding the provisions of paragraph 2, theprovisions of paragraphs 5, 6 and 7 of Article 24 of theConvention, as added by Article XVII of this Protocol,
shall have effect from the date of entry into force of theProtocol, with respect to:(a)cases that are under consideration by thecompetent authorities of the Contracting Stateson the date on which the Protocol enters into
force. For such cases, no unresolved issues
arising therefrom shall be submitted toarbitration earlier than three years after thedate on which the Protocol enters into force;(b)cases that come under consideration by thecompetent authorities of the Contracting States
after the date on which the Protocol enters into
force.

4.
Notwithstanding the provisions of paragraph 2, theprovisions of Article 25 of the Convention, as amended by
Article XVIII of this Protocol, and Article 25A of theConvention, as amended by Article XIX of the Protocol,
shall have effect from the date of entry into force of theProtocol, without regard to the taxable year to which thematter or revenue claim relates.

- 27 -

5.
This Protocol shall remain in effect as long as theConvention remains in force.
IN WITNESS WHEREOF the undersigned, duly authorized
thereto by their respective Governments, have signed thisProtocol.
DONE in duplicate at Stockholm, this fifth day ofDecember 2013, in the English language.

For the Governmentof Japan:

For the Governmentof Sweden:

Seiji Morimoto

Mikael Lundholm- 28 -