AGREEMENT BETWEEN THE GOVERNMENT OF JAPANAND THE GOVERNMENT OF GUERNSEYFOR THE EXCHANGE OF INFORMATION RELATINGTO TAX MATTERS AND THE AVOIDANCE OF DOUBLE TAXATIONWITH RESPECT TO TAXES ON INCOME OF INDIVIDUALSThe Government of Japan and the Government of
Guernsey, the Government of Guernsey having the right under
the terms of its Entrustment from the Government of theUnited Kingdom of Great Britain and Northern Ireland tonegotiate and conclude a tax information exchange
agreement,
Desiring to conclude an Agreement for the exchange
of information relating to tax matters and the avoidanceof double taxation with respect to taxes on income ofindividuals,
Have agreed as follows:
Chapter 1
GENERAL PROVISIONS
Article 1
GENERAL DEFINITIONS
1.
For the purposes of this Agreement, unless the context
otherwise requires:(a)the term “Japan”, when used in a geographicalsense, means all the territory of Japan,
including its territorial sea, in which the laws
relating to Japanese tax are in force, and all
the area beyond its territorial sea, including
the seabed and subsoil thereof, over which
Japan has sovereign rights in accordance withinternational law and in which the laws relating
to Japanese tax are in force;(b)

the term “Guernsey”, when used in a geographicalsense, means Guernsey, Alderney and Herm,
including the territorial sea adjacent tothose islands established in accordance withinternational law;

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(c)

the term “collective investment fund or scheme”
means any pooled investment vehicle, irrespectiveof legal form. The term “public collective
investment fund or scheme” means any collective
investment fund or scheme provided the units,
shares or other interests in the fund or scheme
can be readily purchased, sold or redeemed by the
public. Units, shares or other interests in thefund or scheme can be readily purchased, sold orredeemed “by the public” if the purchase, saleor redemption is not implicitly or explicitly
restricted to a limited group of investors;(d)the term “company” means any body corporate or
any entity that is treated as a body corporate
for tax purposes;(e)the term “competent authority” means:(i)in the case of Japan, the Minister ofFinance or his authorised representative;
and

(ii)

in the case of Guernsey, the Director of
Income Tax or his authorised delegate;(f)the term “Contracting Party” means Japan orGuernsey as the context requires;(g)the term “information” means any fact, statement,
document or record in any form whatever;(h)the term “information gathering measures” means
laws and administrative or judicial proceduresthat enable the Requested Party to obtain andprovide the information requested;(i)the term “national” means:(i)in the case of Japan, any individual
possessing the nationality of Japan, any
juridical person created or organised under
the laws of Japan and any organisation
without juridical personality treated forthe purposes of Japanese tax as a juridical
person created or organised under the lawsof Japan; and

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(ii)

in the case of Guernsey, any individual
who is a resident of Guernsey and possesses
British citizenship, any legal person
created or organised under the laws ofGuernsey and any organisation without legal
personality treated for the purposes of
Guernsey tax as a legal person created ororganised under the laws of Guernsey;(j)

the term “person” includes an individual,
a company and any other body of persons;(k)the term “principal class of shares” means
the class or classes of shares representing amajority of the voting power and value of acompany;(l)the term “publicly traded company” means any
company whose principal class of shares is listed
on a recognised stock exchange provided its
listed shares can be readily purchased or sold by
the public. Shares can be readily purchased orsold “by the public” if the purchase or sale ofshares is not implicitly or explicitly restricted
to a limited group of investors;(m)the term “recognised stock exchange” means:(i)any stock exchange established by a
Financial Instruments Exchange or an
approved-type financial instruments firms
association under the Financial Instruments
and Exchange Law (Law No. 25 of 1948) ofJapan;(ii)

the Channel Islands Stock Exchange; and(iii)

any other stock exchange agreed upon by thecompetent authorities of the Contracting
Parties;(n)the term “Requested Party” means the Contracting
Party which is requested to provide informationor which has provided information in response toa request; and(o)the term “Requesting Party” means the Contracting
Party which is requesting information.

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2.
As regards the application of this Agreement at any
time by a Contracting Party, any term not defined thereinshall, unless the context otherwise requires, have themeaning that it has at that time under the laws of thatContracting Party, any meaning under the applicable tax
laws of that Contracting Party prevailing over a meaning
given to the term under other laws of that Contracting
Party.
Chapter 2
EXCHANGE OF INFORMATION
Article 2
OBJECT AND SCOPE
The Contracting Parties, through their competentauthorities, shall provide assistance through exchange of
information that is foreseeably relevant for the carryingout of Chapters 3 and 4 or to the administration or
enforcement of the laws of the Contracting Parties
concerning the taxes referred to in Article 4. Suchinformation shall include information that is foreseeably
relevant to the determination, assessment and collectionof such taxes, the recovery and enforcement of tax claims,
or the investigation or prosecution of tax matters.
Information shall be exchanged in accordance with thisAgreement and shall be treated as confidential in themanner provided in Article 8. When the Requested Party
obtains and provides information under the Agreement, theprocedural rights and safeguards secured to persons by thelaws or administrative practices of the Requested Party
remain applicable, to the extent that they do not unduly
prevent or delay effective exchange of information.
Article 3
JURISDICTION
The Requested Party is not obliged to provide
information which is neither held by its authorities nor
in the possession of or obtainable by persons who arewithin its territorial jurisdiction.
Article 4
TAXES COVERED1.

This Chapter shall apply to the following taxes:(a)in the case of Japan:(i)

the income tax;(ii)

the corporation tax;

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(b)

(iii)

the local inhabitant taxes;(iv)

the inheritance tax;(v)

the gift tax; and(vi)

the consumption tax; andin the case of Guernsey:(i)income tax; and(ii)

dwellings profits tax.

2.
This Chapter shall apply also to any identical or
substantially similar taxes that are imposed after the dateof signature of this Agreement in addition to, or in placeof, those referred to in paragraph 1. The competentauthorities of the Contracting Parties shall notify eachother of any significant changes that have been made in
their respective tax laws, which may affect matters coveredby the Agreement.
Article 5
EXCHANGE OF INFORMATION UPON REQUEST
1.
The competent authority of the Requested Party shallprovide upon request information for the purposes referred
to in Article 2. Such information shall be provided
without regard to whether the Requested Party needs suchinformation for its own tax purposes or the conduct under
examination would constitute a crime under the laws of
the Requested Party if such conduct occurred within the
territorial jurisdiction of the Requested Party.
2.
If the information in the possession of the competentauthority of the Requested Party is not sufficient toenable it to comply with the request for information,
the Requested Party shall use all relevant information
gathering measures necessary to provide the Requesting
Party with the information requested, notwithstanding that
the Requested Party may not need such information for its
own tax purposes.
3.
If specifically requested by the competent authorityof the Requesting Party, the competent authority of theRequested Party shall provide information under this
Article, to the extent allowable under its laws, in theform of authenticated copies of original records.

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4.
Each Contracting Party shall ensure that it has theauthority, for the purposes specified in Article 2 andwithin the constraints of Article 3, to obtain and provide,through its competent authority, upon request:(a)information held by banks, other financial
institutions, and any person, including nominees
and trustees, acting in an agency or fiduciary
capacity; and

(b)

(i)

information regarding the ownership ofcompanies, partnerships and other persons,
including ownership information on all such
persons in an ownership chain;(ii)

in the case of trusts, information on
settlors, trustees, protectors andbeneficiaries; and(iii)

in the case of foundations, information on
founders, members of the foundation council
and beneficiaries.

This Agreement does not create an obligation on
the Contracting Parties to obtain or provide ownership
information with respect to publicly traded companies or
public collective investment funds or schemes unless suchinformation can be obtained without giving rise todisproportionate difficulties.
5.
The competent authority of the Requesting Party shallformulate a request for information under this Agreementwith the greatest detail possible and shall provide thefollowing information in writing to the competent authorityof the Requested Party to demonstrate the foreseeable
relevance of the information sought to the request for the
purposes referred to in Article 2:(a)the identity of the person under examination;(b)

the period of time with respect to which theinformation requested is required for the tax
purposes of the Requesting Party;(c)the nature of the information requested and theform in which the Requesting Party prefers toreceive the information from the Requested Party;(d)the tax purposes for which the information
requested is sought;

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(e)

the reason why the information requested isforeseeably relevant to the request for the
purposes referred to in Article 2;(f)grounds for believing that the information
requested is held by the Requested Party or is in
the possession of or obtainable by a person who
is within the territorial jurisdiction of theRequested Party;(g)to the extent known, the name and address of any
person believed to be in possession of or able toobtain the information requested;(h)a statement that the request is in conformity
with the laws and administrative practices of
the Requesting Party, that if the information
requested was within the territorial jurisdictionof the Requesting Party the competent authorityof the Requesting Party would be able to obtain
the information under the laws or in the normal
course of administrative practices of theRequesting Party and that the request is inconformity with the Agreement; and(i)a statement that the Requesting Party has pursued
all means available within its territorial
jurisdiction to obtain the information requested,
except those that would give rise todisproportionate difficulties.
Article 6
TAX EXAMINATIONS ABROAD

1.
At the request of the competent authority of theRequesting Party, the competent authority of the Requested
Party may allow, to the extent permitted under the laws of
the Requested Party, representatives of the competentauthority of the Requesting Party to be present at theappropriate part of a tax examination in the Requested
Party.
2.
If the request referred to in paragraph 1 is acceded
to, the competent authority of the Requested Party
conducting the examination shall, as soon as possible,
notify the competent authority of the Requesting Party
about the time and place of the examination, the authority
or official designated to carry out the examination and theprocedures and conditions required by the Requested Party
for the conduct of the examination. All decisions withrespect to the conduct of the examination shall be made by
the Requested Party conducting the examination.

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Article 7
POSSIBILITY OF DECLINING A REQUEST
1.
The Requested Party shall not be required to obtain orprovide information that if the information requested waswithin the territorial jurisdiction of the Requesting Party
the competent authority of the Requesting Party would not
be able to obtain under the laws or in the normal course ofadministrative practices of the Requesting Party.
2.
The competent authority of the Requested Party may
decline to assist:(a)where the request of the Requesting Party is notmade in conformity with this Agreement;(b)where the Requesting Party has not pursued
all means available within its territorial
jurisdiction to obtain the information requested,
except where recourse to such means would giverise to disproportionate difficulties; and(c)where the disclosure of the information requested
would be contrary to public policy (ordre public)of the Requested Party.

3.
This Agreement shall not impose on a Contracting
Party the obligation to supply information which would
disclose any trade, business, industrial, commercial or
professional secret or trade process. Such information
includes information relating to communications between
advocates, attorneys, solicitors or other admitted legal
representatives in their role as such and their clientsto the extent that the communications are protected fromdisclosure under the laws of each Contracting Party.
Notwithstanding the foregoing sentences, information of thetype referred to in paragraph 4 of Article 5 shall not betreated as such a secret or trade process merely because it
meets the criteria in that paragraph.
4.
A request for information shall not be refused on the
ground that the tax claim giving rise to the request is
disputed.
5.
The Requested Party may decline a request for
information if the information is requested by the
Requesting Party to administer or enforce any provision of
the tax laws of the Requesting Party, or any requirement
connected therewith, which discriminates against a nationalof the Requested Party as compared with a national of theRequesting Party in the same circumstances.

8Article 8
CONFIDENTIALITY
1.
All information provided and received by the competentauthorities of the Contracting Parties under this Agreement
shall be kept confidential.
2.
The information referred to in paragraph 1 shall be
disclosed only to persons or authorities (including courts
and administrative bodies) in the Contracting Parties
concerned with the purposes referred to in Article 2, andused by such persons or authorities only for such purposes,
including the determination of any appeal. For these
purposes, the information may be disclosed in public court
proceedings or in judicial decisions.
3.
The information referred to in paragraph 1 may not be
used for any purpose other than for the purposes referred
to in Article 2 without the express written consent of thecompetent authority of the Requested Party.
4.
The information referred to in paragraph 1 may not be
disclosed to persons or authorities in non-Contracting
Parties.
Article 9
COSTS
Incidence of costs incurred in providing assistanceshall be agreed by the competent authorities of theContracting Parties.
Chapter 3
AVOIDANCE OF DOUBLE TAXATION
Article 10
PERSONS COVEREDThis Chapter shall apply to individuals who areresidents of one or both of the Contracting Parties.
Article 11
TAXES COVERED1.

This Chapter shall apply to the following taxes:(a)in the case of Japan:(i)

the income tax; and

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(ii)

the local inhabitant taxes(in this Chapter referred to as “Japanese tax”);
and(b)

in the case of Guernsey, income tax(in this Chapter referred to as “Guernsey tax”).

2.
This Chapter shall apply also to any identical or
substantially similar taxes that are imposed after the dateof signature of this Agreement in addition to, or in placeof, those referred to in paragraph 1. The competentauthorities of the Contracting Parties shall notify eachother of any significant changes that have been made in
their respective tax laws, which may affect matters coveredby the Agreement.
Article 12
RESIDENT1.
For the purposes of this Chapter, the term “residentof a Contracting Party” means any individual who, under thelaws of that Contracting Party, is liable to tax therein byreason of his domicile, residence or any other criterion ofa similar nature. This term, however, does not include any
individual who is liable to tax in that Contracting Partyin respect only of income from sources in that Contracting
Party.
2.
Where by reason of paragraph 1 an individual is a
resident of both Contracting Parties, then his status shallbe determined as follows:(a)he shall be deemed to be a resident only of theContracting Party in which he has a permanent
home available to him; if he has a permanent homeavailable to him in both Contracting Parties, heshall be deemed to be a resident only of theContracting Party with which his personal andeconomic relations are closer (centre of vitalinterests);(b)

if the Contracting Party in which he has his
centre of vital interests cannot be determined,
or if he has not a permanent home available tohim in either Contracting Party, he shall bedeemed to be a resident only of the Contracting
Party in which he has an habitual abode;

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(c)

if he has an habitual abode in both Contracting
Parties or in neither of them, the competentauthorities of the Contracting Parties shallsettle the question by mutual agreement.
Article 13
GOVERNMENT SERVICE

1.
Salaries, wages and other similar remuneration paid by
a Contracting Party or a political subdivision or local
authority thereof to an individual in respect of services
rendered to that Contracting Party or political subdivisionor local authority, in the discharge of functions of agovernmental nature, shall be taxable only in thatContracting Party. However, such salaries, wages and othersimilar remuneration shall be taxable only in the other
Contracting Party if the services are rendered in that
other Contracting Party and the individual is a resident ofthat other Contracting Party who did not become a residentof that other Contracting Party solely for the purpose of
rendering the services.
2.
Notwithstanding paragraph 1, pensions and othersimilar remuneration paid by, or out of funds to which
contributions are made or created by, a Contracting Partyor a political subdivision or local authority thereof toan individual in respect of services rendered to thatContracting Party or political subdivision or local
authority shall be taxable only in that Contracting Party.
3.
Paragraphs 1 and 2 shall not apply to salaries, wages,
pensions, and other similar remuneration in respect ofservices rendered in connection with a business carried on
by a Contracting Party or a political subdivision or local
authority thereof.
Article 14
STUDENTS
Payments which a student or business apprentice who isor was immediately before visiting a Contracting Party a
resident of the other Contracting Party and who is present
in the first-mentioned Contracting Party solely for the
purpose of his education or training receives for the
purpose of his maintenance, education or training shall not
be taxed in the first-mentioned Contracting Party, provided
that such payments arise from sources outside the firstmentioned Contracting Party. The exemption provided bythis Article shall apply to a business apprentice only fora period not exceeding one year from the date on which hefirst begins his training in the first-mentioned
Contracting Party.

11Article 15
ELIMINATION OF DOUBLE TAXATION
1.
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 aresident of Japan derives income from Guernsey which may betaxed in Guernsey in accordance with this Chapter, theamount of Guernsey 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 that part of the Japanese tax, as computed
before the credit is given, which is appropriate to that
income.
2.
Subject to the provisions of the laws of Guernsey
regarding the allowance as a credit against Guernsey tax oftax payable in a territory outside Guernsey (which shallnot affect the general principle hereof):(a)subject to the provisions of sub-paragraph (c),where a resident of Guernsey derives income which
may be taxed in Japan in accordance with this
Chapter, Guernsey shall allow as a credit against
the tax payable in respect of that income, anamount equal to the income tax paid in Japan;(b)such credit shall not, however, exceed that partof the income tax, as computed before the credit
is given, which is attributable to the income
which may be taxed in Japan;(c)where a resident of Guernsey derives income whichshall be taxable only in Japan in accordance withthis Chapter, Guernsey may include this income incalculating the amount of tax on the remaining
income of such resident.

12Chapter 4
SPECIAL PROVISIONS
Article 16
MUTUAL AGREEMENT PROCEDURES
1.
Where a person considers that the actions of one orboth of the Contracting Parties result or will result for
him in taxation not in accordance with Chapter 3, he may,irrespective of the remedies provided by the laws of thoseContracting Parties, present his case to the competentauthority of the Contracting Party of which he is a
resident as determined pursuant to Article 12. The casemust be presented within three years from the first
notification of the action resulting in taxation not inaccordance with that Chapter.
2.
The competent authority of a Contracting Party shallendeavour, 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 withthe competent authority of the other Contracting Party,
with a view to the avoidance of taxation which is not inaccordance with Chapter 3. Any agreement reached shall be
implemented notwithstanding any time limits in the laws of
the Contracting Parties.
3.
The competent authorities of the Contracting Parties
shall endeavour to resolve by mutual agreement any
difficulties or doubts arising as to the interpretation
or application of this Agreement.
4.
In addition to the agreements referred to inparagraph 3, the competent authorities of the Contracting
Parties may mutually agree on the procedures to be used
for the purposes of Chapter 2.
5.
The competent authorities of the Contracting Parties
may communicate with each other directly for the purposeof reaching an agreement in the sense of the preceding
paragraphs of this Article.
Chapter 5
FINAL PROVISIONS
Article 17
HEADINGS
The headings of the Chapters and the Articles of thisAgreement are inserted for convenience of reference onlyand shall not affect the interpretation of the Agreement.

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Article 18
ENTRY INTO FORCE
1.
The Governments of the Contracting Parties shallnotify each other, in writing, of the completion of theirrespective internal procedures necessary for the entry into
force of this Agreement. The Agreement shall enter into
force on the thirtieth day after the latter of the datesof receipt of the notifications.
2.

This Agreement shall have effect:(a)with respect to taxes levied on the basis of ataxable year, as regards taxes for any taxable
years beginning on or after the date on which theAgreement enters into force; and(b)with respect to taxes not levied on the basis ofa taxable year, as regards taxes levied on orafter the date on which the Agreement enters into
force.

3.
Notwithstanding paragraph 2, Chapter 3 shall haveeffect:(a)with respect to taxes withheld at source, foramounts taxable on or after 1 January in thecalendar year next following that in which thisAgreement enters into force; and(b)with respect to taxes on income which are notwithheld at source, as regards income for any
taxable year beginning on or after 1 January inthe calendar year next following that in which
this Agreement enters into force.
Article 19
TERMINATION

1.
This Agreement shall remain in force until terminatedby a Contracting Party. Either Contracting Party may
terminate the Agreement by giving written notice oftermination at least six months before the end of any
calendar year beginning after the expiry of five years fromthe date of entry into force of the Agreement. In such
event, the Agreement shall cease to have effect:(a)with respect to taxes withheld at source, foramounts taxable on or after 1 January in thecalendar year next following that in which thenotice is given;

14

(b)

with respect to taxes on income which are notwithheld at source, as regards income for any
taxable year beginning on or after 1 January inthe calendar year next following that in which
the notice is given; and(c)with respect to other taxes, as regards taxes
levied on or after 1 January in the calendar year
next following that in which the notice is given.

2.
Notwithstanding paragraph 1, each Contracting Party
shall remain bound by Article 8 with respect to any
information provided and received by the competentauthority of the Contracting Party under this Agreement.
IN WITNESS WHEREOF the undersigned, being duly
authorised thereto by their respective Governments, havesigned this Agreement.
DONE in duplicate at London this sixth day ofDecember, 2011, in the Japanese and English languages, eachtext being equally authentic.

For the Governmentof Japan:

For the Governmentof Guernsey:

Keiichi Hayashi

Lyndon Trott

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PROTOCOLAt the signing of the Agreement between the Governmentof Japan and the Government of Guernsey for the exchange
of information relating to tax matters and the avoidanceof double taxation with respect to taxes on income ofindividuals (hereinafter referred to as “the Agreement”),
the Government of Japan and the Government of Guernsey, theGovernment of Guernsey having the right under the terms of
its Entrustment from the Government of the United Kingdomof Great Britain and Northern Ireland to negotiate andconclude a tax information exchange agreement, have agreed
upon the following provisions, which shall form an integral
part of the Agreement.
With reference to Article 5 of the Agreement, thecompetent authority of the Requested Party shall forward
the information requested as promptly as possible to theRequesting Party. To ensure a prompt response, thecompetent authority of the Requested Party shall:(a)confirm receipt of a request in writing to thecompetent authority of the Requesting Party andshall notify the competent authority of theRequesting Party of deficiencies in the request,
if any, within sixty days of the receipt of therequest; and(b)

if the competent authority of the Requested
Party has been unable to obtain and provide theinformation within ninety days of the receipt of
the request, including if it encounters obstacles
in furnishing the information or it refuses tofurnish the information, immediately inform thecompetent authority of the Requesting Party,
explaining the reason for its inability, thenature of the obstacles or the reasons for its
refusal.

IN WITNESS WHEREOF the undersigned, being duly
authorised thereto by their respective Governments, havesigned this Protocol.

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DONE in duplicate at London this sixth day ofDecember, 2011, in the Japanese and English languages, eachtext being equally authentic.

For the Governmentof Japan:

For the Governmentof Guernsey:

Keiichi Hayashi

Lyndon Trott17