CONVENTION BETWEENJAPAN AND THE REPUBLIC OF COLOMBIAFOR THE ELIMINATION OF DOUBLE TAXATIONWITH RESPECT TO TAXES ON INCOME
AND THE PREVENTION OF TAX EVASION AND AVOIDANCECONVENTION BETWEENJAPAN AND THE REPUBLIC OF COLOMBIAFOR THE ELIMINATION OF DOUBLE TAXATIONWITH RESPECT TO TAXES ON INCOME
AND THE PREVENTION OF TAX EVASION AND AVOIDANCEJapan and the Republic of Colombia,
Desiring to further develop their economic
relationship and to enhance their co-operation in tax
matters,
Intending to conclude a Convention for the eliminationof double taxation with respect to taxes on income without
creating opportunities for non-taxation or reduced taxation
through tax evasion or avoidance (including through treatyshopping arrangements aimed at obtaining reliefs provided
in this Convention for the indirect benefit of residents ofthird States),
Have agreed as follows:
Article 1
Persons Covered
1.
This Convention shall apply to persons who areresidents of one or both of the Contracting States.
2.
For the purposes of this Convention, income derived byor through an entity or arrangement that is treated aswholly or partly fiscally transparent under the tax law ofeither Contracting State shall be considered to be incomeof a resident of a Contracting State but only to the extent
that the income is treated, for purposes of taxation bythat Contracting State, as the income of a resident of thatContracting State.
3.
This Convention shall not affect the taxation, by aContracting State, of its residents except with respect tothe benefits granted under paragraph 3 of Article 7,paragraph 2 of Article 9 and Articles 18, 19, 22, 23, 24
and 27.
Article 2
Taxes Covered
1.
This Convention shall apply to taxes on income imposedon behalf of a Contracting State, irrespective of themanner in which they are levied.

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2.
There shall be regarded as taxes on income all taxes
imposed on total income or on elements of income, including
taxes on gains from the alienation of any property, taxes
on the total amounts of wages or salaries paid byenterprises, as well as taxes on capital appreciation.
3.
The existing taxes to which this Convention shallapply are:(a)in the case of Colombia:
the income tax and its complementary taxes(impuesto sobre la renta y complementarios)(hereinafter referred to as “Colombian tax”); and(b)in the case of Japan:(i)

the income tax;(ii)

the corporation tax;(iii)

the special income tax for reconstruction;
and

(iv)

the local corporation tax(hereinafter referred to as “Japanese tax”).
4.
This Convention shall apply also to any identical or
substantially similar taxes that are imposed after the dateof signature of the Convention in addition to, or in placeof, the existing taxes. The competent authorities of theContracting States shall notify each other of any
significant changes that have been made in their taxation
laws.
Article 3
General Definitions
1.
For the purposes of this Convention, unless thecontext otherwise requires:- 2 -コロンビア_英文【本文】.indd

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(a)the term “Colombia” means the Republic ofColombia and, when used in a geographical sense,
includes its land territory, both continental andinsular, as well as its airspace, sea andsubmarine areas, and other elements over which it
exercises sovereignty, sovereign rights or
jurisdiction under the Colombian Constitution of1991 and its laws, and in accordance withinternational law, including applicableinternational treaties;(b)

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;(c)the terms “a Contracting State” and “the other
Contracting State” mean Japan or Colombia, as thecontext requires;(d)the term “person” includes an individual, acompany and any other body of persons;(e)the term “company” means any body corporate or
any entity that is treated as a body corporate
for tax purposes;(f)the term “enterprise” applies to the carrying onof any business;(g)

the terms “enterprise of a Contracting State” and“enterprise of the other Contracting State” mean
respectively an enterprise carried on by aresident of a Contracting State and an enterprise
carried on by a resident of the other Contracting
State;(h)the term “international traffic” means any
transport by a ship or aircraft except when theship or aircraft is operated solely between
places in a Contracting State and the enterprisethat operates the ship or aircraft is not anenterprise of that Contracting State;- 3 -コロンビア_英文【本文】.indd

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(i)

(j)

the term “competent authority” means:(i)in Colombia, the Minister of Finance andPublic Credit or his authorised
representative; and(ii)

in Japan, the Minister of Finance or his
authorised representative;

the term “national”, in relation to a Contracting
State, means:(i)

any individual possessing the nationality or
citizenship of that Contracting State; and(ii)

any legal person, partnership or association
deriving its status as such from the laws inforce in that Contracting State;(k)the term “business” includes the performance ofprofessional services and of other activities ofan independent character;(l)the term “recognised pension fund” of aContracting State means an entity or arrangement
established under the law of that Contracting
State that is treated as a separate person under
the taxation laws of that Contracting State and:(i)that is established and operated exclusively
or almost exclusively to administer orprovide retirement benefits and ancillary or
incidental benefits or other similar
remuneration to individuals and that isregulated as such by that Contracting Stateor one of its political subdivisions or
local authorities; or(ii)that is established and operated exclusively
or almost exclusively to invest funds forthe benefit of other recognised pension
funds of that Contracting State.

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Where an entity or arrangement established under
the law of a Contracting State would constitute arecognised pension fund under clause (i) or (ii)
if it were treated as a separate person under the
taxation laws of that Contracting State, it shallbe considered, for the purposes of theConvention, as a separate person treated as such
under the taxation laws of that Contracting Stateand all the assets and income of the entity or
arrangement shall be treated as assets held andincome derived by that separate person and not byanother person.
2.
As regards the application of this Convention at any
time by a Contracting State, any term not defined thereinshall, unless the context otherwise requires or thecompetent authorities agree to a different meaning pursuant
to the provisions of Article 24, have the meaning that it
has at that time under the law of that Contracting Statefor the purposes of the taxes to which the Convention
applies, any meaning under the applicable tax laws of thatContracting State prevailing over a meaning given to theterm under other laws of that Contracting State.
Article 4
Resident
1.
For the purposes of this Convention, the term
“resident of a Contracting State” means any person who,
under the laws of that Contracting State, is liable to tax
therein by reason of his domicile, residence, place ofincorporation or organisation, place of head or main
office, place of management or any other criterion of asimilar nature, and also includes that Contracting Stateand any political subdivision or local authority thereof as
well as a recognised pension fund of that Contracting
State. This term, however, does not include any person who
is liable to tax in that Contracting State in respect onlyof 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, thenhis status shall be determined as follows:(a)he shall be deemed to be a resident only of theContracting State in which he has a permanent
home available to him; if he has a permanent homeavailable to him in both Contracting States, heshall be deemed to be a resident only of theContracting State with which his personal andeconomic relations are closer (centre of vitalinterests);- 5 -コロンビア_英文【本文】.indd

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16:44:11(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 tohim in either Contracting State, he shall bedeemed to be a resident only of the Contracting
State in which he has an habitual abode;(c)

if he has an habitual abode in both Contracting
States or in neither of them, he shall be deemed
to be a resident only of the Contracting State ofwhich he is a national;(d)

if he is a national of both Contracting States orof neither of them, the competent authorities of
the Contracting States shall settle the question
by mutual agreement.

3.
Where by reason of the provisions of paragraph 1 aperson other than an individual is a resident of bothContracting States, the competent authorities of theContracting States shall endeavour to determine by mutual
agreement the Contracting State of which such person shallbe deemed to be a resident for the purposes of thisConvention, having regard to its place of head or main
office, its place of effective management, the place where
it is incorporated or otherwise constituted and any otherrelevant factors. In the absence of such agreement, such
person shall not be entitled to any relief or exemption
from tax provided by the Convention.
Article 5
Permanent Establishment
1.
For the purposes of this Convention, the term
“permanent establishment” means a fixed place of businessthrough which the business of an enterprise is wholly or
partly carried on.
2.
The term “permanent establishment” includes
especially:(a)a place of management;(b)a branch;(c)an office;(d)a factory;(e)a workshop; and- 6 -コロンビア_英文【本文】.indd

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(f)3.

a mine, an oil or gas well, a quarry or any otherplace of exploration, exploitation or extractionof natural resources.

The term “permanent establishment” also encompasses:(a)a building site, a construction, assembly or
installation project or supervisory activities inconnection therewith, but only if such site,
project or activities last more than 183 days;(b)

the furnishing of services, including consultancy
services, by an enterprise through employees orother personnel engaged by the enterprise forsuch purpose, but only if activities of thatnature continue (for the same or a connected
project) within a Contracting State for a period
or periods aggregating more than 183 days in any
twelve month period commencing or ending in the
taxable year concerned.

The duration of activities under subparagraphs (a) and(b) shall be determined by aggregating the periods during
which activities are carried on in a Contracting State byclosely related enterprises, provided that the activities
of such a closely related enterprise in that Contracting
State are connected with the activities carried on in thatContracting State by its closely related enterprises. The
period during which two or more closely related enterprises
are carrying on concurrent activities shall be counted only
once for the purpose of determining the duration ofactivities.
4.
Notwithstanding the preceding provisions of this
Article, the term “permanent establishment” shall be deemed
not to include:(a)the use of facilities solely for the purpose ofstorage, display or delivery of goods ormerchandise belonging to the enterprise;(b)

the maintenance of a stock of goods ormerchandise belonging to the enterprise solely
for the purpose of storage, display or delivery;(c)the maintenance of a stock of goods ormerchandise belonging to the enterprise solely
for the purpose of processing by anotherenterprise;- 7 -コロンビア_英文【本文】.indd

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(d)the maintenance of a fixed place of businesssolely for the purpose of purchasing goods ormerchandise or of collecting information, for theenterprise;(e)the maintenance of a fixed place of businesssolely for the purpose of carrying on, for theenterprise, any other activity; or(f)the maintenance of a fixed place of businesssolely for any combination of activities
mentioned in subparagraphs (a) to (e),provided that such activity or, in the case of subparagraph(f), the overall activity of the fixed place of business,is of a preparatory or auxiliary character.
5.
Paragraph 4 shall not apply to a fixed place ofbusiness that is used or maintained by an enterprise if thesame enterprise or a closely related enterprise carries on
business activities at the same place or at another placein the same Contracting State and:(a)that place or other place constitutes a permanentestablishment for the enterprise or the closely
related enterprise under the provisions of this
Article; or(b)the overall activity resulting from the
combination of the activities carried on by thetwo enterprises at the same place, or by the same
enterprise or closely related enterprises at thetwo places, is not of a preparatory or auxiliary
character,provided that the business activities carried on by the twoenterprises at the same place, or by the same enterprise or
closely related enterprises at the two places, constitutecomplementary functions that are part of a cohesive
business operation.
6.
Notwithstanding the provisions of paragraphs 1 and 2
but subject to the provisions of paragraph 7, where aperson is acting in a Contracting State on behalf of anenterprise and, in doing so, habitually concludes
contracts, or habitually plays the principal role leading
to the conclusion of contracts that are routinely concluded
without material modification by the enterprise, and thesecontracts are:(a)in the name of the enterprise; or- 8 -コロンビア_英文【本文】.indd

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(b)for the transfer of the ownership of, or for the
granting of the right to use, property owned bythat enterprise or that the enterprise has theright to use; or(c)for the provision of services by that enterprise,that enterprise shall be deemed to have a permanentestablishment in that Contracting State in respect of any
activities which that person undertakes for the enterprise,
unless the activities of such person are limited to thosementioned in paragraph 4 which, if exercised through afixed place of business (other than a fixed place ofbusiness to which paragraph 5 would apply), would not makethis fixed place of business a permanent establishment
under the provisions of paragraph 4.
7.
Paragraph 6 shall not apply where the person acting ina Contracting State on behalf of an enterprise of the other
Contracting State carries on business in the firstmentioned Contracting State as an independent agent andacts for the enterprise in the ordinary course of thatbusiness. Where, however, a person acts exclusively or
almost exclusively on behalf of one or more enterprises towhich it is closely related, that person shall not be
considered to be an independent agent within the meaning of
this paragraph with respect to any such enterprise.
8.
The fact that a company which is a resident of aContracting State controls or is controlled by a company
which is a resident of the other Contracting State, or
which carries on business in that other Contracting State(whether through a permanent establishment or otherwise),shall not of itself constitute either company a permanentestablishment of the other.
9.
For the purposes of this Article, a person orenterprise is closely related to an enterprise if, based on
all the relevant facts and circumstances, one has controlof the other or both are under the control of the same
persons or enterprises. In any case, a person orenterprise shall be considered to be closely related to an
enterprise if one possesses directly or indirectly morethan 50 per cent of the beneficial interest in the other(or, in the case of a company, more than 50 per cent of theaggregate vote and value of the company’s shares or of thebeneficial equity interest in the company) or if anotherperson or enterprise possesses directly or indirectly morethan 50 per cent of the beneficial interest (or, in thecase of a company, more than 50 per cent of the aggregate
vote and value of the company’s shares or of the beneficial
equity interest in the company) in the person and theenterprise or in the two enterprises.

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Article 6
Income from Immovable Property
1.
Income derived by a resident of a Contracting State
from immovable property (including income from agriculture
or forestry) situated in the other Contracting State may betaxed in that other Contracting State.
2.
The term “immovable property” shall have the meaning
which it has under the law of the Contracting State inwhich the property in question is situated. The term shallin any case include property accessory to immovable
property, livestock and equipment used in agriculture andforestry, rights to which the provisions of general law
respecting landed property apply, usufruct of immovable
property and rights to variable or fixed payments as
consideration for the working of, or the right to work,
mineral deposits, sources and other natural resources;
ships and aircraft shall not be regarded as immovable
property.
3.
The provisions of paragraph 1 shall apply to income
derived from the direct use, letting, or use in any otherform of immovable property.
4.
The provisions of paragraphs 1 and 3 shall also apply
to the income from immovable property of an enterprise.
Article 7
Business Profits
1.
Profits of an enterprise of a Contracting State shallbe taxable only in that Contracting State unless theenterprise carries on business in the other Contracting
State through a permanent establishment situated therein.
If the enterprise carries on business as aforesaid, theprofits that are attributable to the permanentestablishment in accordance with the provisions ofparagraph 2 may be taxed in that other Contracting State.
2.
For the purposes of this Article and Article 22, theprofits that are attributable in each Contracting State to
the permanent establishment referred to in paragraph 1 are
the profits it might be expected to make, in particular inits dealings with other parts of the enterprise, if it werea separate and independent enterprise engaged in the sameor similar activities under the same or similar conditions,taking into account the functions performed, assets used
and risks assumed by the enterprise through the permanentestablishment and through the other parts of theenterprise.

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3.
Where, in accordance with paragraph 2, a Contracting
State adjusts the profits that are attributable to apermanent establishment of an enterprise of one of theContracting States and taxes accordingly profits of theenterprise that have been charged to tax in the other
Contracting State, that other Contracting State shall, tothe extent necessary to eliminate double taxation on these
profits, make an appropriate adjustment to the amount of
the tax charged therein on those profits. In determining
such adjustment, the competent authorities of theContracting States shall if necessary consult each other.
4.
Where profits include items of income which are dealt
with separately in other Articles of this Convention, thenthe provisions of those Articles shall not be affected by
the provisions of this Article.
5.
Nothing in this Convention shall be construed as
preventing Colombia from imposing a tax on profits
attributable to a permanent establishment of an enterpriseof Japan situated in Colombia upon their transfer to otherparts of the enterprise out of Colombia where the profits
so transferred are treated as income from shares by thetaxation laws of Colombia. The tax so charged, however,shall not exceed:(a)15 per cent of the amount of the profits sotransferred if the profits so transferred havenot been subject to tax on income according to
the law of Colombia before such transfer; or(b)

5 per cent of the amount of the profits sotransferred in all other cases.
Article 8
International Shipping and Air Transport

1.
Profits of an enterprise of a Contracting State fromthe operation of ships or aircraft in international traffic
shall be taxable only in that Contracting State.
2.
Notwithstanding the provisions of Article 2, anenterprise of Colombia shall be exempt in Japan from thelocal inhabitant taxes on its profits from the operation ofships or aircraft in international traffic or theenterprise tax in respect of its carrying on the operationof ships or aircraft in international traffic, provided
that:- 11 -

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16:44:12(a)in the case of the local inhabitant taxes, noneof a political subdivision or local authority ofColombia levies a tax similar to the local
inhabitant taxes on profits of an enterprise ofJapan from the operation of ships or aircraft ininternational traffic; and(b)in the case of the enterprise tax, none ofColombia or a political subdivision or local
authority thereof levies a tax similar to theenterprise tax in respect of the carrying on theoperation of ships or aircraft in internationaltraffic by an enterprise of Japan.

3.
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.
Article 9
Associated Enterprises
1.

Where
(a)

an enterprise of a Contracting State participates
directly or indirectly in the management, control
or capital of an enterprise of the other
Contracting State, or(b)

the same persons participate directly or
indirectly in the management, control or capitalof an enterprise of a Contracting State and an
enterprise of the other Contracting State,

and in either case conditions are made or imposed between
the two enterprises in their commercial or financial
relations which differ from those which would be madebetween independent enterprises, then any profits which
would, but for those conditions, have accrued to one of theenterprises, but, by reason of those conditions, have notso accrued, may be included in the profits of thatenterprise and taxed accordingly.

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2.
Where a Contracting State includes in the profits ofan enterprise of that Contracting State - and taxes
accordingly - profits on which an enterprise of the other
Contracting State has been charged to tax in that other
Contracting State and the profits so included are profits
which would have accrued to the enterprise of the firstmentioned Contracting State if the conditions made between
the two enterprises had been those which would have been
made between independent enterprises, then that other
Contracting State shall make an appropriate adjustment tothe amount of the tax charged therein on those profits. In
determining such adjustment, due regard shall be had to theother provisions of this Convention and the competentauthorities of the Contracting States shall if necessary
consult each other.
Article 10
Dividends
1.
Dividends paid by a company which is a resident of aContracting State to a resident of the other Contracting
State may be taxed in that other Contracting State.
2.
However, dividends paid by a company which is a
resident of a Contracting State may also be taxed in thatContracting State according to the laws of that Contracting
State, but if the beneficial owner of the dividends is a
resident of the other Contracting State, the tax so charged
shall not exceed:(a)5 per cent of the gross amount of the dividends
if the beneficial owner is a company which has
owned directly or indirectly at least 20 per centof the voting power of the company paying thedividends throughout a six month period that
includes the date on which entitlement to thedividends is determined (for the purpose ofcomputing that period, no account shall be takenof changes of ownership that would directly
result from a corporate reorganisation, such as amerger or divisive reorganisation, of the company
that is the beneficial owner of the dividends orthat pays the dividends);(b)

10 per cent of the gross amount of the dividends
in all other cases.

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3.
Notwithstanding the provisions of paragraph 2,
dividends paid by a company which is a resident of aContracting State shall be taxable only in the other
Contracting State if the beneficial owner of the dividends
is a recognised pension fund of that other Contracting
State (which, in the case of Colombia, is a mandatory
pension fund), provided that such dividends are derived
from the activities referred to in clause (i) or (ii) of
subparagraph (l) of paragraph 1 of Article 3.
4.
Notwithstanding the provisions of paragraphs 2 and 3,
dividends which:(a)in the case of the dividends paid by a company
that is a resident of Colombia, are paid out of
profits that have not been subject to tax onincome at the level of that company in Colombia;or(b)in the case of the dividends paid by a company
that is a resident of Japan, are deductible incomputing the taxable income of that company inJapan,

may be taxed in the Contracting State of which the company
paying the dividends is a resident according to the laws ofthat Contracting State, but if the beneficial owner of thedividends is a resident of the other Contracting State, thetax so charged shall not exceed 15 per cent of the grossamount of the dividends.
5.
The provisions of paragraphs 2, 3 and 4 shall notaffect the taxation of the company in respect of the
profits out of which the dividends are paid.
6.
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 otherrights which is subjected to the same taxation treatment asincome from shares by the laws of the Contracting State ofwhich the company making the distribution is a resident.
7.
The provisions of paragraphs 1, 2, 3 and 4 shall not
apply if the beneficial owner of the dividends, being a
resident of a Contracting State, carries on business in theother Contracting State of which the company paying thedividends is a resident through a permanent establishment
situated therein and the holding in respect of which thedividends are paid is effectively connected with suchpermanent establishment. In such case the provisions ofArticle 7 shall apply.

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8.
Where a company which is a resident of a Contracting
State derives profits or income from the other Contracting
State, that other Contracting 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
Contracting State or insofar as the holding in respect ofwhich the dividends are paid is effectively connected witha permanent establishment situated in that other
Contracting State, nor subject the company’s undistributed
profits to a tax on the company’s undistributed profits,even if the dividends paid or the undistributed profits
consist wholly or partly of profits or income arising insuch other Contracting State.
Article 11
Interest
1.
Interest arising in a Contracting State and paid to aresident of the other Contracting State may be taxed inthat other Contracting State.
2.
However, interest arising in a Contracting State may
also be taxed in that Contracting State according to thelaws of that Contracting State, but if the beneficial ownerof the interest is a resident of the other Contracting
State, the tax so charged shall not exceed 10 per cent of
the gross amount of the interest.
3.
Notwithstanding the provisions of paragraph 2,interest arising in a Contracting State shall be taxable
only in the other Contracting State if:(a)the interest is beneficially owned by that other
Contracting State, a political subdivision or
local authority thereof, the central bank of that
other Contracting State or any institution wholly
owned by that other Contracting State or apolitical subdivision or local authority thereof;(b)

the interest is beneficially owned by a residentof that other Contracting State with respect to
debt-claims guaranteed, insured or indirectly
financed by that other Contracting State, apolitical subdivision or local authority thereof,
the central bank of that other Contracting Stateor any institution wholly owned by that other
Contracting State or a political subdivision or
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16:44:12(c)the interest is beneficially owned by a residentof that other Contracting State that is:(i)a financial institution, provided that suchinterest is paid by a financial institutionthat is a resident of the first-mentioned
Contracting State; or(ii)

a bank, in respect of debt-claims granted
for a period of at least three years;(d)the interest is beneficially owned by arecognised pension fund of that other Contracting
State (which, in the case of Colombia, is amandatory pension fund), provided that suchinterest is derived from the activities referred
to in clause (i) or (ii) of subparagraph (l) of
paragraph 1 of Article 3; or(e)the interest is beneficially owned by a residentof that other Contracting State and paid withrespect to debt-claims arising as a part of thesale on credit by a resident of that other
Contracting State of equipment or merchandise.

4.
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 a right toparticipate in the debtor’s profits, and in particular,
income from government securities and income from bonds ordebentures, including premiums and prizes attaching to suchsecurities, bonds or debentures as well as other incomethat is subjected to the same taxation treatment as income
from money lent by the laws of the Contracting State inwhich the income arises. Income dealt with in Article 10
and penalty charges for late payment shall not, however, beregarded as interest for the purposes 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 Contracting State, carries on business in theother Contracting State in which the interest arises
through a permanent establishment situated therein and thedebt-claim in respect of which the interest is paid iseffectively connected with such permanent establishment.
In such case the provisions of Article 7 shall apply.

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6.
Interest shall be deemed to arise in a Contracting
State when the payer is a resident of that Contracting
State. Where, however, the person paying the interest,
whether he is a resident of a Contracting State or not, hasin a Contracting State a permanent establishment inconnection with which the indebtedness on which theinterest is paid was incurred, and such interest is borneby such permanent establishment, then such interest shallbe deemed to arise in the Contracting State in which thepermanent establishment is situated.
7.
Where, by reason of a special relationship between thepayer and the beneficial owner or between both of them andsome other person, the amount of the interest exceeds, forwhatever reason, the amount which would have been agreed
upon by the payer and the beneficial owner in the absenceof such relationship, the provisions of this Article shallapply only to the last-mentioned amount. In such case, theexcess part of the payments shall remain taxable according
to the laws of each Contracting State, due regard being had
to the other provisions of this Convention.
Article 12
Royalties
1.
Royalties arising in a Contracting State and paid to aresident of the other Contracting State may be taxed inthat other Contracting State.
2.
However, royalties arising in a Contracting State may
also be taxed in that Contracting State according to thelaws of that Contracting State, but if the beneficial ownerof the royalties is a resident of the other Contracting
State, the tax so charged shall not exceed:(a)2 per cent of the gross amount of the royalties
for the use of, or the right to use, industrial,commercial or scientific equipment;(b)

10 per cent of the gross amount of the royalties
in all other cases.

3.
The term “royalties” as used in this Article means
payments of any kind received as a consideration for theuse 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, or secretformula or process, or any industrial, commercial orscientific equipment, or for information concerningindustrial, commercial or scientific experience.

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4.
The provisions of paragraphs 1 and 2 shall not apply
if the beneficial owner of the royalties, being a residentof a Contracting State, carries on business in the other
Contracting State in which the royalties arise through apermanent establishment situated therein and the right orproperty in respect of which the royalties are paid iseffectively connected with such permanent establishment.
In such case the provisions of Article 7 shall apply.
5.
Royalties shall be deemed to arise in a Contracting
State when the payer is a resident of that Contracting
State. Where, however, the person paying the royalties,
whether he is a resident of a Contracting State or not, hasin a Contracting State a permanent establishment inconnection with which the liability to pay the royalties
was incurred, and such royalties are borne by suchpermanent establishment, then such royalties shall bedeemed to arise in the Contracting State in which thepermanent establishment is situated.
6.
Where, by reason of a special relationship between thepayer and the beneficial owner or between both of them andsome other person, the amount of the royalties exceeds, forwhatever reason, the amount which would have been agreed
upon by the payer and the beneficial owner in the absenceof such relationship, the provisions of this Article shallapply only to the last-mentioned amount. In such case, theexcess part of the payments shall remain taxable according
to the laws of each Contracting State, due regard being had
to the other provisions of this Convention.
Article 13
Capital Gains
1.
Gains derived by a resident of a Contracting State
from the alienation of immovable property referred to in
Article 6 and situated in the other Contracting State may
be taxed in that other Contracting State.
2.
Gains from the alienation of any property, other thanimmovable property referred to in Article 6, forming partof the business property of a permanent establishment which
an enterprise of a Contracting State has in the other
Contracting State, including such gains from the alienationof such a permanent establishment (alone or with the wholeenterprise), may be taxed in that other Contracting State.

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3.
Gains that an enterprise of a Contracting State that
operates ships or aircraft in international traffic derives
from the alienation of such ships or aircraft, or of any
property, other than immovable property referred to in
Article 6, pertaining to the operation of such ships oraircraft, shall be taxable only in that Contracting State.
4.
Gains derived by a resident of a Contracting State
from the alienation of shares of a company or comparable
interests, such as interests in a partnership or trust, may
be taxed in the other Contracting State if, at any time
during the 365 days preceding the alienation, these sharesor comparable interests derived at least 50 per cent of
their value directly or indirectly from immovable property,
as defined in Article 6, situated in that other Contracting
State, unless such shares or comparable interests aretraded on a recognised stock exchange specified insubparagraph (c) of paragraph 6 of Article 28 and theresident and persons related to that resident own in theaggregate 5 per cent or less of the class of such shares orcomparable interests.
5.
Subject to the provisions of paragraphs 2 and 4, gains
derived by a resident of a Contracting State from thealienation of shares, comparable interests or other rights
may be taxed in the other Contracting State if thealienator at any time during the 365 days preceding suchalienation owned, directly or indirectly, shares,
comparable interests or other rights representing 10 per
cent or more of the capital of a company that is a residentof that other Contracting State, but the tax so charged
shall not exceed 10 per cent of the amount of the gains.
However, this paragraph does not apply to:(a)gains derived from changes of ownership thatwould directly result from a corporate
reorganisation, such as a merger or divisive
reorganisation, of that company; or(b)gains derived by a recognised pension fund of thefirst-mentioned Contracting State (which, in thecase of Colombia, is a mandatory pension fund).

6.
Gains from the alienation of any property, other thanthat referred to in paragraphs 1, 2, 3, 4 and 5, shall betaxable only in the Contracting State of which thealienator is a resident.

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Article 14
Income from Employment
1.
Subject to the provisions of Articles 15, 17 and 18,
salaries, wages and other similar remuneration derived by aresident of a Contracting State in respect of an employment
shall be taxable only in that Contracting State unless theemployment is exercised in the other Contracting State. If
the employment is so exercised, such remuneration as isderived therefrom may be taxed in that other Contracting
State.
2.
Notwithstanding the provisions of paragraph 1,
remuneration derived by a resident of a Contracting Statein respect of an employment exercised in the other
Contracting State shall be taxable only in the firstmentioned Contracting State if:(a)the recipient is present in the 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(b)

the remuneration is paid by, or on behalf of, anemployer who is not a resident of the other
Contracting State, and(c)the remuneration is not borne by a permanentestablishment which the employer has in the other
Contracting State.

3.
Notwithstanding the preceding provisions of this
Article, remuneration derived by a resident of aContracting State in respect of an employment, as a memberof the regular complement of a ship or aircraft, that is
exercised aboard a ship or aircraft operated ininternational traffic, other than aboard a ship or aircraft
operated solely within the other Contracting State, shallbe taxable only in the first-mentioned Contracting State.
Article 15
Directors’ Fees
Directors’ fees and other similar payments derived bya resident of a Contracting State in his capacity as amember of the board of directors, or of a similar organ, of
a company which is a resident of the other Contracting
State may be taxed in that other Contracting State.

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Article 16
Entertainers and Sportspersons
1.
Notwithstanding the provisions of Article 14, income
derived by a resident of a Contracting State as anentertainer, such as a theatre, motion picture, radio or
television artiste, or a musician, or as a sportsperson,from that resident’s personal activities as such exercisedin the other Contracting State, may be taxed in that other
Contracting State.
2.
Where income in respect of personal activities
exercised by an entertainer or a sportsperson acting as
such accrues not to the entertainer or sportsperson but toanother person, that income may, notwithstanding theprovisions of Article 14, be taxed in the Contracting Statein which the activities of the entertainer or sportsperson
are exercised.
Article 17
Pensions
Pensions and other similar remuneration beneficiallyowned by a resident of a Contracting State shall be taxable
only in that Contracting State.
Article 18
Government Service
1.

(a)Subject to the provisions of Article 17,
salaries, wages and other similar remuneration
paid by a Contracting State or a politicalsubdivision or local authority thereof to anindividual in respect of services rendered tothat Contracting State or political subdivisionor local authority shall be taxable only in thatContracting State.

(b)

However, such salaries, wages and other similar
remuneration shall be taxable only in the other
Contracting State if the services are rendered inthat other Contracting State and the individual
is a resident of that other Contracting State
who:
(i)

is a national of that other Contracting
State; or(ii)

did not become a resident of that other
Contracting State solely for the purpose of
rendering the services.

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2.
The provisions of Articles 14, 15 and 16 shall apply
to salaries, wages and other similar remuneration in
respect of services rendered in connection with a businesscarried on by a Contracting State or a politicalsubdivision or local authority thereof.
Article 19Students
Payments which a student or business apprentice who isor was immediately before visiting a Contracting State aresident of the other Contracting State and who is present
in the first-mentioned Contracting State solely for the
purpose of his education or training receives for the
purpose of his maintenance, education or training shall not
be taxed in that Contracting State, provided that suchpayments arise from sources outside that Contracting State.
The exemption provided by this Article shall apply to abusiness apprentice only for a period not exceeding one
year from the date on which he first begins his training inthat Contracting State.
Article 20
Silent Partnership
Notwithstanding any other provisions of thisConvention, any income derived by a silent partner who is a
resident of a Contracting State in respect of a silent
partnership (in the case of Japan, Tokumei Kumiai) contract
or another similar contract may be taxed in the other
Contracting State according to the laws of that other
Contracting State, provided that such income arises in that
other Contracting State and is deductible in computing thetaxable income of the payer in that other Contracting
State.
Article 21
Other Income
1.
Items of income beneficially owned by a resident of aContracting State, wherever arising, not dealt with in theforegoing Articles of this Convention shall be taxable onlyin that Contracting State.

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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 beneficial
owner of such income, being a resident of a Contracting
State, carries on business in the other Contracting Statethrough a permanent establishment situated therein and theright or property in respect of which the income is paid iseffectively connected with such permanent establishment.
In such case the provisions of Article 7 shall apply.
3.
Notwithstanding the provisions of paragraphs 1 and 2,
items of income of a resident of a Contracting State notdealt with in the foregoing Articles of this Convention andarising in the other Contracting State may also be taxed inthat other Contracting State.
Article 22
Elimination of Double Taxation
1.

(a)Where a resident of Colombia derives income
which, in accordance with the provisions of thisConvention, may be taxed in Japan, Colombia shallallow as a deduction from Colombian tax of that
resident, an amount equal to Japanese tax paid,
due regard being had to the limitations provided
by and the requirements set under the tax laws ofColombia. Such deduction shall not, however,exceed that part of the Colombian tax, as
computed before the deduction is given, which is
attributable to the income which may be taxed inJapan.

(b)

Where in accordance with any provision of theConvention income derived by a resident ofColombia is exempt from tax in Colombia, Colombia
may nevertheless, in calculating the amount of
tax on the remaining income of such resident,
take into account the exempted income.

2.
Subject to the provisions of the laws of Japan
regarding the allowance as a credit against Japanese tax oftax payable in any country other than Japan, where aresident of Japan derives income from Colombia which may betaxed in Colombia in accordance with the provisions of thisConvention, the amount of Colombian tax payable in respectof that income shall be allowed as a credit against theJapanese tax imposed on that resident. The amount ofcredit, however, shall not exceed the amount of theJapanese tax which is appropriate to that income.

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Article 23
Non-discrimination
1.
Nationals of a Contracting State shall not be
subjected in the other Contracting State to any taxation or
any requirement connected therewith, which is other or moreburdensome than the taxation and connected requirements towhich nationals of that other Contracting State in the same
circumstances, in particular with respect to residence, areor may be subjected. The provisions of this paragraphshall, notwithstanding the provisions of Article 1, also
apply to persons who are not residents of one or both of
the Contracting States.
2.
The taxation on a permanent establishment which anenterprise of a Contracting State has in the other
Contracting State shall not be less favourably levied inthat other Contracting State than the taxation levied onenterprises of that other Contracting State carrying on thesame activities. The provisions of this paragraph shallnot be construed as obliging a Contracting State to grant
to residents of the other Contracting State any personal
allowances, reliefs and reductions for taxation purposes on
account of civil status or family responsibilities which it
grants to its own residents.
3.
Except where the provisions of paragraph 1 of Article
9, paragraph 7 of Article 11 or paragraph 6 of Article 12
apply, interest, royalties and other disbursements paid byan enterprise of a Contracting State to a resident of theother Contracting State shall, for the purpose ofdetermining the taxable profits of such enterprise, be
deductible under the same conditions as if they had been
paid to a resident of the first-mentioned Contracting
State.
4.
Enterprises of a Contracting State, the capital ofwhich is wholly or partly owned or controlled, directly or
indirectly, by one or more residents of the other
Contracting State, shall not be subjected in the firstmentioned Contracting State to any taxation or any
requirement connected therewith which is other or moreburdensome than the taxation and connected requirements towhich other similar enterprises of the first-mentioned
Contracting State are or may be subjected.
5.
The provisions of this Article shall, notwithstanding
the provisions of Article 2, apply to taxes of every kindand description imposed on behalf of a Contracting State orof its political subdivisions or local authorities.

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Article 24
Mutual Agreement Procedure
1.
Where a person considers that the actions of one orboth of the Contracting States result or will result for
him in taxation not in accordance with the provisions of
this Convention, he may, irrespective of the remedies
provided by the domestic law of those Contracting States,
present his case to the competent authority of theContracting State of which he is a resident or, if his casecomes under paragraph 1 of Article 23, to that of theContracting State of which he is a national. The case must
be presented within three years from the first notificationof the action resulting in taxation not in accordance withthe provisions of the Convention.
2.
The competent authority shall endeavour, if theobjection appears to it to be justified and if it is notitself able to arrive at a satisfactory solution, toresolve the case by mutual agreement with the competentauthority of the other Contracting State, with a view tothe avoidance of taxation which is not in accordance withthe provisions of this Convention. Any agreement reachedshall be implemented notwithstanding any time limits in thedomestic law of the Contracting States.
3.
The competent authorities of the Contracting Statesshall endeavour to resolve by mutual agreement any
difficulties or doubts arising as to the interpretation orapplication of this Convention. They may also consult
together for the elimination of double taxation in cases
not provided for in the Convention.
4.
The competent authorities of the Contracting States
may communicate with each other directly, including througha joint commission consisting of themselves or theirrepresentatives, for the purpose of reaching an agreementin the sense of the preceding paragraphs of this Article.
Article 25
Exchange of Information
1.
The competent authorities of the Contracting Statesshall exchange such information as is foreseeably relevant
for carrying out the provisions of this Convention or to
the administration or enforcement of the domestic laws
concerning taxes of every kind and description imposed onbehalf of the Contracting States, or of their politicalsubdivisions or local authorities, insofar as the taxation
thereunder is not contrary to the Convention. The exchange
of information is not restricted by Articles 1 and 2.

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2.
Any information received under paragraph 1 by aContracting State shall be treated as secret in the samemanner as information obtained under the domestic laws ofthat Contracting State and shall be disclosed only topersons or authorities (including courts and administrative
bodies) concerned with the assessment or collection of, theenforcement or prosecution in respect of, the determinationof appeals in relation to the taxes referred to inparagraph 1, or the oversight of the above. Such persons
or authorities shall use the information only for such
purposes. They may disclose the information in public
court proceedings or in judicial decisions.
Notwithstanding the foregoing, information received by aContracting State may be used for other purposes when suchinformation may be used for such other purposes under thelaws of both Contracting States and the competent authorityof the Contracting State supplying the information
authorises such use.
3.
In no case shall the provisions of paragraphs 1 and 2
be construed so as to impose on a Contracting State theobligation:(a)

to carry out administrative measures at variancewith the laws and administrative practice of thator of the other Contracting State;(b)to supply information which is not obtainable
under the laws or in the normal course of theadministration of that or of the other
Contracting State;(c)to supply information which would disclose any
trade, business, industrial, commercial or
professional secret or trade process, orinformation the disclosure of which would becontrary to public policy.

4.
If information is requested by a Contracting State inaccordance with this Article, the other Contracting State
shall use its information gathering measures to obtain therequested information, even though that other Contracting
State may not need such information for its own tax
purposes. The obligation contained in the preceding
sentence is subject to the limitations of paragraph 3 but
in no case shall such limitations be construed to permit aContracting State to decline to supply information solely
because it has no domestic interest in such information.

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5.
In no case shall the provisions of paragraph 3 beconstrued to permit a Contracting State to decline tosupply information solely because the information is heldby a bank, other financial institution, nominee or person
acting in an agency or a fiduciary capacity or because it
relates to ownership interests in a person.
Article 26
Assistance in the Collection of Taxes
1.
The Contracting States shall lend assistance to eachother in the collection of revenue claims. This assistanceis not restricted by Articles 1 and 2. The competentauthorities of the Contracting States may by mutual
agreement settle the mode of application of this Article.
2.
The term “revenue claim” as used in this Article means
an amount owed in respect of the following taxes, insofar
as the taxation thereunder is not contrary to thisConvention or any other instrument to which the Contracting
States are parties, as well as interest, administrative
penalties and costs of collection or conservancy related tosuch amount:
(a)

(b)

in the case of Colombia:(i)the taxes referred to in subparagraph (a) ofparagraph 3 of Article 2;(ii)

the value added tax (Impuesto sobre lasventas);(iii)

the national excise tax (Impuesto Nacional
al Consumo); and(iv)

the industry and commerce tax (Impuesto deIndustria y Comercio);in the case of Japan:(i)the taxes referred to in subparagraph (b) ofparagraph 3 of Article 2;(ii)

the special corporation tax forreconstruction;(iii)

the consumption tax;(iv)

the local consumption tax;

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(v)the inheritance tax; and(vi)

the gift tax;(c)

any other tax as may be agreed upon from time totime between the Governments of the Contracting
States through an exchange of diplomatic notes;(d)any identical or substantially similar taxes thatare imposed after the date of signature of theConvention in addition to, or in place of, thetaxes covered by subparagraph (a), (b) or (c).

3.
When a revenue claim of a Contracting State isenforceable under the laws of that Contracting State and is
owed by a person who, at that time, cannot, under the lawsof that Contracting State, prevent its collection, thatrevenue claim shall, at the request of the competentauthority of that Contracting State, be accepted for
purposes of collection by the competent authority of theother Contracting State. That revenue claim shall becollected by that other Contracting State in accordancewith the provisions of its laws applicable to theenforcement and collection of its own taxes as if therevenue claim were a revenue claim of that other
Contracting State that met the conditions allowing that
other Contracting State to make a request under thisparagraph.
4.
When a revenue claim of a Contracting State is a claim
in respect of which that Contracting State may, under its
law, take measures of conservancy with a view to ensure its
collection, that revenue claim shall, at the request of thecompetent authority of that Contracting State, be acceptedfor purposes of taking measures of conservancy by thecompetent authority of the other Contracting State. Thatother Contracting State shall take measures of conservancy
in respect of that revenue claim in accordance with theprovisions of its laws as if the revenue claim were arevenue claim of that other Contracting State even if, at
the time when such measures are applied, the revenue claim
is not enforceable in the first-mentioned Contracting Stateor is owed by a person who has a right to prevent its
collection.

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5.
Notwithstanding the provisions of paragraphs 3 and 4,
a revenue claim accepted by the competent authority of aContracting State for purposes of paragraph 3 or 4 shallnot, in that Contracting 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 acceptedby the competent authority of a Contracting State for the
purposes of paragraph 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.
Acts carried out by a Contracting State in thecollection of a revenue claim accepted by the competentauthority of that Contracting State for purposes ofparagraph 3 or 4 which if they were carried out by theother Contracting State would have the effect of suspending
or interrupting the time limits applicable to the revenue
claim in accordance with the laws of that other Contracting
State shall have such effect under the laws of that other
Contracting State. The competent authority of the firstmentioned Contracting State shall inform the competentauthority of the other Contracting State of having carriedout such acts.
7.
Proceedings with respect to the existence, validity or
the amount of a revenue claim of a Contracting State shallnot be brought before the courts or administrative bodiesof the other Contracting State.
8.
Where, at any time after a request has been made by
the competent authority of a Contracting State underparagraph 3 or 4 and before the other Contracting State hascollected and remitted the relevant revenue claim to thefirst-mentioned Contracting State, the relevant revenue
claim ceases to be(a)in the case of a request under paragraph 3, arevenue claim of the first-mentioned Contracting
State that is enforceable under the laws of thatContracting State and is owed by a person who, atthat time, cannot, under the laws of thatContracting State, prevent its collection, or(b)

in the case of a request under paragraph 4, arevenue claim of the first-mentioned Contracting
State in respect of which that Contracting State
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the competent authority of the first-mentioned Contracting
State shall promptly notify the competent authority of theother Contracting State of that fact and, at the option of
the competent authority of the other Contracting State, thecompetent authority of the first-mentioned Contracting
State shall either suspend or withdraw its request.
9.
In no case shall the provisions of this Article beconstrued so as to impose on a Contracting State theobligation:(a)

to carry out administrative measures at variancewith the laws and administrative practice of thator of the other Contracting State;(b)

to carry out measures which would be contrary to
public policy;(c)

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

Article 27
Members of Diplomatic Missions and Consular Posts
Nothing in this Convention shall affect the fiscal
privileges of members of diplomatic missions or consular
posts under the general rules of international law or under
the provisions of special agreements.
Article 28
Entitlement to Benefits
1.
Except as otherwise provided in this Article, aresident of a Contracting State shall not be entitled to abenefit that would otherwise be accorded under theprovisions of paragraph 5 of Article 7 or Article 10, 11,
12 or 13 unless such resident is a qualified person, as
defined in paragraph 2, at the time when the benefit would
otherwise be accorded.

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2.
A resident of a Contracting State shall be a qualified
person at a time when a benefit would otherwise be accorded
under the provisions of paragraph 5 of Article 7 or Article
10, 11, 12 or 13 if, at that time, the resident is:

3.

(a)

an individual;(b)that Contracting State, a political subdivisionor local authority thereof, the central bank ofthat Contracting State, or an agency or
instrumentality of that Contracting State orpolitical subdivision or local authority;(c)a company or other entity, if the principal classof its shares is regularly traded on one or more
recognised stock exchanges;(d)a recognised pension fund, if, at the beginningof the taxable year for which the claim to thebenefit is made, at least 50 per cent of its
beneficiaries, members or participants areindividuals who are residents of either
Contracting State; or(e)a person other than an individual, if, at thattime and on at least half of the days of a twelve
month period that includes that time, persons
that are residents of that Contracting State andthat are qualified persons under subparagraph(a), (b), (c) or (d) own, directly or indirectly,
at least 50 per cent of the shares of the person.

(a)

A resident of a Contracting State shall beentitled to a benefit that would otherwise beaccorded under the provisions of paragraph 5 of
Article 7 or Article 10, 11, 12 or 13 withrespect to an item of income described in therespective paragraph or Article that is derived
from the other Contracting State, regardless ofwhether the resident is a qualified person, if
the resident is engaged in the active conduct ofa business in the first-mentioned Contracting
State, and the income derived from the other
Contracting State emanates from, or is incidental
to, that business. For purposes of thisparagraph, the term “active conduct of abusiness” shall not include the following
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(i)operating as a holding company;(ii)

providing overall supervision oradministration of a group of companies;(iii)

providing group financing (including cash
pooling);(iv)

making or managing investments, unless these
activities are carried on by a bank,insurance enterprise or registeredsecurities dealer in the ordinary course ofits business as such; or(v)

holding or managing intangible property
without producing or developing it.

(b)

If a resident of a Contracting State derives anitem of income from a business activity conductedby that resident in the other Contracting State,or derives an item of income arising in the other
Contracting State from a connected person, theconditions described in subparagraph (a) shall beconsidered to be satisfied with respect to suchitem of income only if the business activity
carried on by the resident in the first-mentioned
Contracting State to which the item of income isrelated is substantial in relation to the same orcomplementary business activity carried on by theresident or such connected person in the other
Contracting State. Whether a business activity
is substantial for the purposes of this paragraphshall be determined based on all the facts andcircumstances.

(c)

For purposes of applying this paragraph, businessactivities conducted by connected persons withrespect to a resident of a Contracting State
shall be deemed to be conducted by such resident.

4.
A resident of a Contracting State that is not aqualified person shall nevertheless be entitled to abenefit that would otherwise be accorded under theprovisions of paragraph 5 of Article 7 or Article 10, 11,
12 or 13 with respect to an item of income described in therespective paragraph or Article if:(a)in the case of a recognised pension fund, at the
beginning of the taxable year for which the claim
to the benefit is made, at least 75 per cent of
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(b)in all other cases, at the time when the benefit
would otherwise be accorded and on at least halfof the days of a twelve month period that
includes that time, persons that are equivalentbeneficiaries own, directly or indirectly, atleast 75 per cent of the shares of the resident.

5.
If a resident of a Contracting State is neither aqualified person, nor entitled to a benefit under paragraph
3 or 4, the competent authority of the Contracting State inwhich a benefit is denied under the preceding paragraphs ofthis Article may, nevertheless, grant a benefit that would
otherwise be accorded under the provisions of paragraph 5of Article 7 or Article 10, 11, 12 or 13 with respect to an
item of income described in the respective paragraph or
Article, taking into account the object and purpose of thisConvention, but only if such resident demonstrates to thesatisfaction of such competent authority that neither its
establishment, acquisition or maintenance, nor the conductof its operations, had as one of its principal purposes theobtaining of such benefit. The competent authority of theContracting State to which a request has been made under
this paragraph by a resident of the other Contracting State
shall consult with the competent authority of that other
Contracting State before either granting or denying therequest.
6.

For the purposes of this Article:(a)the term “principal class of shares” means theclass or classes of shares of a company or entity
which represents the majority of the aggregate
vote and value of the company or entity;(b)with respect to entities that are not companies,
the term “shares” means interests that arecomparable to shares;(c)

the term “recognised stock exchange” means:(i)any stock exchange established and regulated
as such under the laws of either Contracting
State; and(ii)

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7.

(d)two persons shall be “connected persons” if one
owns, directly or indirectly, at least 50 per
cent of the beneficial interest in the other (or,in the case of a company, at least 50 per cent of
the aggregate vote and value of the company’s
shares) or another person owns, directly or
indirectly, at least 50 per cent of thebeneficial interest (or, in the case of acompany, at least 50 per cent of the aggregate
vote and value of the company’s shares) in each
person; in any case, a person shall be connected
to another if, based on all the relevant facts
and circumstances, one has control of the otheror both are under the control of the same person
or persons; and(e)the term “equivalent beneficiary” means any
person who would be entitled to a benefit withrespect to an item of income accorded by aContracting State under the domestic law of thatContracting State, this Convention or any otherinternational agreement which is equivalent to,or more favourable than, the benefit to beaccorded to that item of income under theprovisions of paragraph 5 of Article 7 or Article
10, 11, 12 or 13; for the purposes of determining
whether a person is an equivalent beneficiarywith respect to dividends received by a company,
the person shall be deemed to be a company and to
hold the same voting power of the company paying
the dividends as such voting power which thecompany claiming the benefit with respect to thedividends holds.

(a)Where:(i)an enterprise of a Contracting State derives
income from the other Contracting State andthe first-mentioned Contracting State treatssuch income as attributable to a permanentestablishment of the enterprise situated ina third jurisdiction; and(ii)

the profits attributable to that permanentestablishment are exempt from tax in thefirst-mentioned Contracting State,- 34 -

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the benefits under this Convention shall not
apply to any item of income on which the tax inthe third jurisdiction is less than 60 per centof the tax that would be imposed in the firstmentioned Contracting State on that item ofincome if that permanent establishment weresituated in the first-mentioned Contracting
State. In such a case, any income to which theprovisions of this paragraph apply shall remaintaxable according to the domestic law of theother Contracting State, notwithstanding anyother provisions of the Convention.
(b)

The provisions of subparagraph (a) shall not
apply if the income derived from the other
Contracting State described in that subparagraphis derived in connection with or is incidental tothe active conduct of a business carried on
through the permanent establishment (other thanthe business of making, managing or simply
holding investments for the enterprise’s own
account, unless these activities are banking,insurance or securities activities carried on bya bank, insurance enterprise or registeredsecurities dealer, respectively).

(c)

If the benefits under the Convention are denied
pursuant to the provisions of subparagraph (a)with respect to an item of income derived by aresident of a Contracting State, the competentauthority of the other Contracting State may,nevertheless, grant these benefits with respect
to that item of income if, in response to arequest by such resident, such competentauthority determines that granting such benefits
is justified in light of the reasons such
resident did not satisfy the requirements of
subparagraphs (a) and (b). The competentauthority of the Contracting State to which arequest has been made under the preceding
sentence by a resident of the other Contracting
State shall consult with the competent authorityof that other Contracting State before either
granting or denying the request.

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8.
Notwithstanding the other provisions of thisConvention, a benefit under the Convention shall not be
granted in respect of an item of income if it is reasonable
to conclude, having regard to all relevant facts andcircumstances, that obtaining that benefit was one of theprincipal purposes of any arrangement or transaction that
resulted directly or indirectly in that benefit, unless it
is established that granting that benefit in thesecircumstances would be in accordance with the object andpurpose of the relevant provisions of the Convention.
Article 29
Headings
The headings of the Articles of this Convention are
inserted for convenience of reference only and shall notaffect the interpretation of the Convention.
Article 30
Entry into Force1.
This Convention shall be approved in accordance withthe legal procedures of each of the Contracting States andshall enter into force on the thirtieth day after the dateof exchange of diplomatic notes indicating such approval.
2.

This Convention shall have effect:
(a)

(b)

in Colombia:(i)with respect to taxes withheld at source,
for amounts paid or credited on or after 1
January of the calendar year following thatin which the Convention enters into force;
and

(ii)

with respect to all other taxes, for taxable
years beginning on or after 1 January of thecalendar year following that in which theConvention enters into force; andin Japan:(i)with respect to taxes levied on the basis ofa taxable year, for taxes for any taxable
years beginning on or after 1 January in thecalendar year next following that in which
the Convention enters into force; and- 36 -

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(ii)with respect to taxes levied not on thebasis of a taxable year, for taxes levied on
or after 1 January in the calendar year next
following that in which the Convention
enters into force.

3.
Notwithstanding the provisions of paragraph 2, theprovisions of Articles 25 and 26 shall have effect from thedate of entry into force of this Convention without regard
to the date on which the taxes are levied or the taxable
year to which the taxes relate.
Article 31
Termination
1.
This Convention shall remain in force until terminatedby a Contracting State. Either Contracting State may
terminate the Convention by giving written notice oftermination through diplomatic channels to the other
Contracting State at least six months before the end of any
calendar year beginning after expiry of three years fromthe date of entry into force of the Convention. In such
event, the Convention shall cease to have effect:
(a)

(b)

in Colombia:(i)with respect to taxes withheld at source,
for amounts paid or credited after the endof the calendar year in which the notice oftermination is given; and(ii)

with respect to all other taxes, for taxable
years beginning after the end of thecalendar year in which the notice oftermination is given; andin Japan:(i)with respect to taxes levied on the basis ofa taxable year, for taxes for any taxable
years beginning on or after 1 January in thecalendar year next following that in which
the notice is given; and(ii)

with respect to taxes levied not on thebasis of a taxable year, for taxes levied on
or after 1 January in the calendar year next
following that in which the notice is given.

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2.
In the event of termination, the Contracting Statesshall remain bound by the provisions of paragraph 2 ofArticle 25 with respect to any information obtained under
this Convention.
IN WITNESS WHEREOF the undersigned, being duly
authorised thereto by their respective Governments, havesigned this Convention.
DONE in duplicate at Tokyo this nineteenth day ofDecember, 2018 in the Japanese, Spanish, and English
languages, each text being equally authentic. In case ofany divergence of interpretation, the English text shallprevail.

For Japan:

For the Republic of Colombia:
Carlos Holmes Trujillo

河野太郎- 38 -

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PROTOCOLAt the signing of the Convention between Japan and theRepublic of Colombia for the Elimination of Double Taxation
with respect to Taxes on Income and the Prevention of Tax
Evasion and Avoidance (hereinafter referred to as “theConvention”), Japan and the Republic of Colombia haveagreed upon the following provisions which shall form an
integral part of the Convention.
1.

For the purposes of the Convention and this Protocol:(a)the term “mandatory pension fund” of Colombia
means a fund which is regulated by Law 100 of
1993 and the provisions that modify or substitute
it, administered or managed by the Pension and
Severance Fund Administrators (Sociedades
Administradoras de Fondos de Pensiones y
Cesantía) who are subject to the surveillance of
the Financial Superintendence of Colombia(Superintendencia Financiera de Colombia) andsubject to the rules provided for in Part 2 ofDecree 2555 of 2010;(b)

the term “severance fund” of Colombia means afund which is:(i)regulated by Law 100 of 1993 and theprovisions that modify or substitute it;(ii)administered or managed by the Pension and
Severance Fund Administrators (Sociedades
Administradoras de Fondos de Pensiones y
Cesantía) who are subject to thesurveillance of the Financial
Superintendence of Colombia(Superintendencia Financiera de Colombia)
and subject to the rules provided for inPart 2 of Decree 2555 of 2010;(iii)

created for the purposes of Article 99 of
Law 50 of 1990; and(iv)

regulated in Chapter VIII of Part I of theOrganic Statute of the Financial System(Estatuto Orgánico del Sistema Financiero).

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2.
Notwithstanding the provisions of paragraph 2 ofArticle 1 of the Convention, for the purposes of theConvention, income derived by or through a recognised
pension fund or a severance fund of a Contracting State
that is not liable to tax therein shall be considered to beincome of a resident of that Contracting State.
3.
For the purposes of the provisions of paragraph 1 of
Article 4 of the Convention, the term “a resident of aContracting State” includes a severance fund of Colombia.
4.

With reference to Article 5 of the Convention:

It is understood that each of the places of businesslisted in paragraph 2 of that Article constitutes apermanent establishment as defined in paragraph 1 of that
Article only if it meets the requirements of paragraph 1 ofthat Article.
5.
For the purposes of clause (i) of subparagraph (c) of
paragraph 3 of Article 11 of the Convention, the term
“financial institution” means:(a)a bank;(b)

an insurance company;(c)an enterprise substantially deriving its grossincome from the active and regular conduct of alending or finance business involving
transactions with unrelated persons, where theenterprise is unrelated to the payer of theinterest. For the purposes of this subparagraph,
the term “lending or finance business” includes
the business of issuing letters of credit,
providing guarantees or providing credit card
services.

6.
With reference to paragraph 1 of Article 24 of theConvention:
If the competent authority of the Contracting State towhich a case is presented in accordance with the provisionsof that paragraph does not consider the objection to bejustified, the competent authority of that Contracting
State shall notify the competent authority of the other
Contracting State of that presentation. Such notification
shall not be construed as the presentation of the case to
the competent authority of the other Contracting State forresolving the case by mutual agreement.

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7.
With reference to paragraph 3 of Article 25 of theConvention:
It is understood that in no case shall the provisionsof paragraphs 1 and 2 of that Article be construed so as toimpose on a Contracting State the obligation to obtain orprovide information that would reveal confidential
communications between a client and an attorney, solicitor
or other admitted legal representative where such
communications are:(a)

produced for the purposes of seeking or providing
legal advice; or(b)produced for the purposes of use in existing orcontemplated legal proceedings.

IN WITNESS WHEREOF the undersigned, being duly
authorised thereto by their respective Governments, havesigned this Protocol.
DONE in duplicate at Tokyo this nineteenth day ofDecember, 2018 in the Japanese, Spanish, and English
languages, each text being equally authentic. In case ofany divergence of interpretation, the English text shallprevail.

For Japan:

For the Republic of Colombia:
Carlos Holmes Trujillo

河野太郎- 41 -

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