1 

CONVENTION BETWEEN THE GOVERNMENT OF THE UNITED STATES 

OF AMERICA AND THE GOVERNMENT OF THE PEOPLE’S REPUBLIC 

OF BANGLADESH FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE 

PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME 

The Government of the United States of America and the 

Government of the People’s Republic of Bangladesh, desiring to 

conclude a convention for the avoidance of double taxation and 

the prevention of fiscal evasion with respect to taxes on income, 

have agreed as follows: 

ARTICLE 1 

Personal Scope

1. Except as otherwise provided in this Convention, this 

Convention shall apply to persons who are residents of one or 

both of the Contracting States. 

2. a) Notwithstanding any provision of this Convention 

except paragraph 3 of this Article, a Contracting State may 

tax its residents (as determined under Article 4 (Fiscal 

Domicile)), and by reason of citizenship may tax its 

citizens, as if this Convention had not come into effect. 

b) For this purpose, the term “citizen” shall include a 

former citizen or long-term resident whose loss of such 

status had as one of its principal purposes the avoidance of 

tax (as defined under the laws of the Contracting State of 

which the person was a citizen or long-term resident), but 

only for a period of 10 years following such loss. The term 

“long-term resident” shall mean any individual who is a 

lawful permanent resident of a Contracting State in 8 or 

more income years or taxable years during the preceding 15 

income years or taxable years. In determining whether the 

threshold in the preceding sentence is met, there shall not 

count any year in which the individual is treated as a 
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resident of the other Contracting State under this 

Convention, or as a resident of any country other than the 

first-mentioned Contracting State under the provisions of 

any other tax treaty of that State, and, in either case, the 

individual does not waive the benefits of such treaty 

applicable to residents of the other country. 

3. The provisions of paragraph 2 shall not affect: 

a) the benefits conferred by a Contracting State under 

paragraph 2 of Article 9 (Associated Enterprises), 

paragraphs 2 and 5 of Article 19 (Pensions, Et Cetera), 

Articles 23 (Relief From Double Taxation), 24 

(Nondiscrimination), and 25 (Mutual Agreement Procedure); 

and 

b) the benefits conferred by a Contracting State under 

Articles 20 (Government Service), 21 (Teachers, Students and 

Trainees) and 27 (Effect of Convention on Diplomatic Agents 

and Consular Officers, Domestic Laws, And Other Treaties), 

upon individuals who are neither citizens of, nor have 

immigrant status in, that State. 

ARTICLE 2 

Taxes Covered

1. This Convention shall apply to taxes on income imposed by 

a Contracting State. 

2. The existing taxes to which this Convention shall apply 

are: 

a) In the United States: the Federal income taxes 

imposed by the Internal Revenue Code; 

b) In Bangladesh: the income tax (including surcharges 

calculated by reference to income taxes). 

3. The Convention shall apply also to any identical or 

substantially similar taxes which are imposed by a Contracting 

State after the date of signature of this Convention in addition 
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to, or in place of, the existing taxes. The competent 

authorities of the Contracting States shall notify each other of 

any changes that have been made in their respective taxation or 

other laws that significantly affect their obligations under this 

Convention. 

ARTICLE 3 

General Definitions

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

otherwise requires: 

a) the term “person” includes an individual, a 

partnership, a company, an estate, a trust, and any other 

body of persons; 

b) the term “company” means any body corporate or any 

entity which is treated as a body corporate for tax purposes 

according to the laws of the Contracting State in which it 

is organized or has its place of effective management; 

c) the terms “enterprise of a Contracting State” and 

”enterprise of the other Contracting State” mean 

respectively an enterprise carried on by a resident of a 

Contracting State and an enterprise carried on by a resident 

of the other Contracting State; 

d) the term “international traffic” means any transport 

by a ship or aircraft, except where such transport is solely 

between places in a Contracting State; 

e) the term “competent authority” means: 

i) in the United States: the Secretary of the 

Treasury or his delegate, and 

ii) in Bangladesh: the National Board of Revenue 

or its authorized representative; 

f) the term “United States” means the United States of 

America, and includes the states thereof and the District of 

Columbia; such term also includes the territorial sea 
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thereof and the sea bed and subsoil of the submarine areas 

adjacent to that territorial sea, over which the United 

States exercises sovereign rights in accordance with 

international law; the term, however, does not include 

Puerto Rico, the Virgin Islands, Guam or any other United 

States possession or territory; 

g) the term ”Bangladesh” means the People’s Republic of 

Bangladesh; such term also includes the territorial sea 

thereof and the sea bed and subsoil of the submarine areas 

adjacent to that territorial sea, over which Bangladesh 

exercises sovereign rights in accordance with international 

law; 

h) The term ”national” means: 

i) in relation to the United States, all 

individuals possessing the citizenship of the United 

States of America and all legal persons, partnerships 

and associations deriving their status as such from the 

laws in force in the United States; and 

ii) in relation to Bangladesh, all individuals 

possessing the nationality of Bangladesh and all legal 

persons, partnerships and associations deriving their 

status as such from the laws in force in Bangladesh. 

2. As regards the application of this Convention by a 

Contracting State, any term not defined herein shall, unless the 

context otherwise requires, or the competent authorities agree to 

a common meaning pursuant to the provisions of Article 25 (Mutual 

Agreement Procedure), have the meaning which it has at that time 

under the laws of that State concerning the taxes to which this 

Convention applies, any meaning under the applicable tax laws of 

that State prevailing over a meaning given to the term under 

other laws of that State. 
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ARTICLE 4 

Fiscal Domicile

1. For purposes of this Convention, the term “resident of a 

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

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

residence, citizenship, place of management, place of 

incorporation, or any other criterion of a similar nature, and 

also includes that State and any political subdivision or local 

authority thereof, provided, however, that: 

a) This term does not include any person who is liable 

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

in that State; 

b) An item of income derived through an entity that is 

a partnership, trust or estate under the laws of either 

Contracting State shall be considered to be derived by a 

resident of a Contracting State to the extent that the item 

is treated for purposes of the taxation law of such 

Contracting State as the income of a resident, either in its 

hands or in the hands of its partners or beneficiaries; 

c) A legal person organized under the laws of a 

Contracting State and that is generally exempt from tax in 

that State and is established and maintained in that State 

either: 

i) exclusively for a religious, charitable, 

educational, scientific, or other similar purpose; or 

ii) to provide pensions or other similar benefits 

to employees pursuant to a plan 

is to be treated for purposes of this paragraph as a resident of that Contracting State. 

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

individual is a resident of both Contracting States, then his 

status shall be determined as follows: 
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a) The individual shall be deemed to be a resident 

of the State in which he has a permanent home available; if 

such individual has a permanent home available in both 

States, or in neither State, he shall be deemed to be a 

resident of the State with which his personal and economic 

relations are closer (center of vital interests); 

b) If the State in which the individual’s center of 

vital interest cannot be determined, he shall be deemed to 

be a resident of the State in which he has an habitual 

abode; 

c) If the individual has an habitual abode in both 

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

resident of the State of which he is a national; or 

d) If the individual is a national of both States or of 

neither of them, the competent authorities of the 

Contracting States shall settle the question by mutual 

agreement. 

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

company is a resident of both Contracting States, then if it is 

created or organized under the laws of a Contracting State or a 

political subdivision thereof, it shall be treated as a resident 

of that State. 

4. Where by reason of the provisions of paragraph 1 a person 

other than an individual or a company is a resident of both 

Contracting States, the competent authorities of the Contracting 

States shall endeavor to settle the question by mutual agreement 

and to determine the mode of application of the Convention to 

such person. 
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ARTICLE 5 

Permanent Establishment

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

establishment” means a fixed place of business through which the 

business of an enterprise is wholly or partly carried on. 

2. The term “permanent establishment” shall include 

especially: 

a) a place of management; 

b) a branch; 

c) an office; 

d) a factory; 

e) a workshop; 

f) a store or other sales outlet; 

g) a warehouse, in relation to a person providing 

storage facilities for others; and 

h) a mine, an oil or gas well, a quarry, or any other 

place of extraction of natural resources. 

3. A building site or construction or installation project, 

or an installation or drilling rig used for the exploration or 

development of natural resources, constitutes a permanent 

establishment only if it lasts more than 183 days. 

4. Notwithstanding the preceding provisions of this Article, 

the term ”permanent establishment” shall be deemed not to 

include: 

a) the use of facilities solely for the purpose of 

storage or display of goods or merchandise belonging to the 

enterprise; 

b) the maintenance of a stock of goods or merchandise 

belonging to the enterprise solely for the purpose of 

storage or display; 

c) the maintenance of a stock of goods or merchandise 

belonging to the enterprise solely for the purpose of 

processing by another enterprise; 
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d) the maintenance of a fixed place of business solely 

for the purpose of purchasing goods or merchandise, or of 

collecting information, for the enterprise; 

e) the maintenance of a fixed place of business solely 

for the purpose of carrying on, for the enterprise, any 

other activity of a preparatory or auxiliary character; 

f) the maintenance of a fixed place of business solely 

for any combination of activities mentioned in subparagraphs 

a) to e), provided that the overall activity of the fixed 

place of business resulting from this combination is of a 

preparatory or auxiliary character. 

5. Notwithstanding the preceding provisions of this Article, 

the term “permanent establishment” shall be deemed not to include 

the use of facilities or the maintenance of a stock of goods or 

merchandise belonging to the enterprise for the purpose of 

occasional delivery of such goods or merchandise. 

6. A person acting in a Contracting State on behalf of an 

enterprise of the other Contracting State--other than an agent of 

an independent status to whom paragraph 7 of this Article 

applies--shall be deemed to be a permanent establishment in the 

first-mentioned State if: 

a) he has, and habitually exercises, in the firstmentioned State, a general authority to conclude contracts 

on behalf of the enterprise, unless his activities are 

limited to those described in either paragraph 4 or 

paragraph 5; or 

b) he has no such authority, but habitually maintains 

in the first-mentioned State a stock of goods or merchandise 

belonging to the enterprise from which he regularly fills 

orders or makes deliveries on behalf of the enterprise, and 

additional activities conducted in that State on behalf of 

the enterprise have contributed to the conclusion of the 

sale of such goods or merchandise. 
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7. An enterprise shall not be deemed to have a permanent 

establishment in a Contracting State merely because it carries on 

business in that State through a broker, general commission agent 

or any other agent of an independent status, provided that such 

persons are acting in the ordinary course of their business. 

8. The fact that a company which is a resident of a 

Contracting State controls or is controlled by a company which is 

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

business in that other State (whether through a permanent 

establishment or otherwise), shall not of itself constitute 

either company a permanent establishment of the other. 

ARTICLE 6 

Income From Immovable Property

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

immovable property (real property), including income from 

agriculture or forestry, situated in the other Contracting State 

may be taxed in that other State. 

2. The term “immovable property” shall have the meaning 

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

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

include property accessory to immovable property, livestock and 

equipment used in agriculture, forestry and fishery, 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, boats and aircraft shall not be regarded as immovable 

property. 

3. The provisions of paragraph 1 shall apply to income 

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

immovable property. 
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4. The provisions of paragraphs 1 and 3 shall also 

apply to the income from immovable property of an enterprise and 

to income from immovable property used for the performance of 

independent personal services. 

ARTICLE 7 

Business Profits

1. The business profits of an enterprise of a Contracting 

State shall be taxable only in that State unless the enterprise 

carries on business in the other Contracting State through a 

permanent establishment situated therein. If the enterprise 

carries on business as aforesaid, the business profits of the 

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

them as is attributable to that permanent establishment. 

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

enterprise of a Contracting State carries on business in the 

other Contracting State through a permanent establishment 

situated therein, there shall in each Contracting State be 

attributed to that permanent establishment the business profits 

which it might be expected to make if it were a distinct and 

independent enterprise engaged in the same or similar activities 

under the same or similar conditions. 

3. In determining the business profits of a permanent 

establishment, there shall be allowed as deductions those 

expenses which are incurred for the purposes of the permanent 

establishment, including a reasonable allocation of executive and 

general administrative expenses, research and development 

expenses, interest, and other expenses incurred for the purposes 

of the enterprise as a whole or the part thereof which includes 

the permanent establishment, whether incurred in the State in 

which the permanent establishment is situated or elsewhere. 
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4. No business profits shall be attributed to a 

permanent establishment by reason of the mere purchase by that 

permanent establishment of goods or merchandise for the 

enterprise. 

5. For the purposes of the preceding paragraphs, the 

business profits to be attributed to the permanent establishment 

shall be determined by the same method year by year unless there 

is good and sufficient reason to the contrary. 

6. Where business profits include items of income which are 

dealt with separately in other Articles of this Convention, then 

the provisions of those Articles shall not be affected by the 

provisions of this Article. 

7. For the purposes of this Convention, “business profits” 

means income derived from any trade or business whether carried 

on by an individual, company, enterprise or any other person, or 

group of persons, including the rental of tangible personal 

(movable) property and performance of personal services by an 

enterprise. 

8. For the implementation of paragraphs 1 and 2 of this 

Article, paragraph 5 of Article 10 (Dividends), paragraph 4 of 

Article 11 (Interest), paragraph 4 of Article 12 (Royalties), 

paragraph 2 of Article 13 (Capital Gains), Article 15 

(Independent Personal Services) and paragraph 2 of Article 22 

(Other Income), any income, gain, or expense attributable to a 

permanent establishment or fixed base during its existence is 

taxable or deductible in the Contracting State where such 

permanent establishment is situated, even if the payments are 

deferred until such permanent establishment or fixed base has 

ceased to exist. 
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ARTICLE 8 

Shipping and Air Transport

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

operation in international traffic of ships or aircraft shall be 

taxable only in that State. 

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

in international traffic of ships or aircraft include profits 

derived from the rental on a full or bareboat basis of ships or 

aircraft if operated in international traffic by the lessee or if 

such rental profits are incidental to other profits described in 

paragraph 1. 

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

rental or maintenance of containers (including trailers, barges 

and related equipment for the transport of containers) used in 

international traffic shall be taxable only in that State. 

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

profits derived 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 capital of an enterprise of a 

Contracting State and an enterprise of the other Contracting 

State, 

and in either case conditions are made or imposed between the two 

enterprises in their commercial or financial relations which 

differ from those which would be made between independent 

enterprises, then any profits which would, but for those 
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conditions, have not so accrued, may be included in the profits 

of that enterprise and taxed accordingly. 

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

enterprise of that State, and taxes accordingly, profits on which 

an enterprise of the other Contracting State has been charged to 

tax in that other State, and the profits so included are profits 

which would have accrued to the enterprise of the first-mentioned 

State if the conditions made between the two enterprises had been 

those which would have been made between independent enterprises, 

then that other State shall make an appropriate adjustment to the 

amount of the tax charged therein on those profits. In 

determining such adjustment, due regard shall be had to the other 

provisions of this Convention and the competent authorities of 

the Contracting States shall if necessary consult each other. 

3. The provisions of paragraph 1 shall not limit any 

provisions of the law of either Contracting State which permit 

the distribution, apportionment or allocation of income, 

deductions, credits, or allowances between persons owned or 

controlled directly or indirectly by the same interests when 

necessary in order to prevent evasion of taxes or clearly to 

reflect the income of any of such persons. 

ARTICLE 10 

Dividends

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

Contracting State to a resident of the other Contracting State 

may be taxed by both Contracting States. 

2. However, if the beneficial owner of the dividends is a 

resident of the other Contracting State, the tax charged in the 

first-mentioned Contracting State shall not exceed: 

a) 10 percent of the gross amount of the dividends if 

the beneficial owner is a company which owns, directly or 
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indirectly, at least 10 percent of the voting stock of 

the company paying the dividends; 

b) 15 percent of the gross amount of the dividends in 

all other cases. 

The provisions of this paragraph shall not affect the taxation of 

the company in respect of the profits out of which the dividends 

are paid. 

3. Subparagraph a) of paragraph 2 shall not apply in the 

case of dividends paid by a United States Regulated Investment 

Company (RIC) or a Real Estate Investment Trust (REIT). In the 

case of dividends from a RIC, subparagraph b) of paragraph 2 

shall apply. In the case of dividends paid by a REIT, 

subparagraph b) shall apply instead of the rate of tax applicable 

under domestic law only if: 

a) the beneficial owner of the dividends is an 

individual holding an interest of no more than 10 percent in 

the REIT; 

b) the dividends are paid with respect to a class of 

stock that is publicly traded and the beneficial owner of 

the dividends is a person holding an interest of no more 

than 5 percent in any class of the REIT’s stock; or 

c) the beneficial owner of the dividends is a person 

that holds an interest of no more than 10 percent in the 

REIT and the REIT is diversified. 

4. The term “dividends” as used in this Convention means 

income from shares or other rights, not being debt-claims, 

participating in profits, as well as income from other corporate 

rights which is subjected to the same taxation treatment as 

income from shares by the taxation law of the State of which the 

company making the distribution is a resident, and income from 

arrangements, including debt obligations, carrying the right to 

participate in profits, to the extent so characterized under the 

laws of the Contracting State in which the income arises. 
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5. The provisions of paragraphs 1, 2 and 3 shall not 

apply if the beneficial owner of the dividends, being a resident 

of a Contracting State, carries on business in the other 

Contracting State, of which the company paying the dividends is a 

resident, through a permanent establishment situated therein, or 

performs in that other State independent personal services from a 

fixed base situated therein, and the holding in respect of which 

the dividends are paid is effectively connected with such 

permanent establishment or fixed base. In such a case, the 

provisions of Article 7 (Business Profits) or Article 15 

(Independent Personal Services), as the case may be, shall apply. 

ARTICLE 11 

Interest

1. Interest derived by a resident of one of the Contracting 

States from sources within the other Contracting State may be 

taxed by both Contracting States. 

2. Interest derived and beneficially owned by a resident of 

one of the Contracting States from sources within the other 

Contracting State shall not be taxed by the other Contracting 

State at a rate in excess of 10 percent of the gross amount of 

such interest. 

3. Notwithstanding the provisions of paragraphs 1 and 2: 

a) Interest derived by one of the Contracting States, 

or an instrumentality thereof (including the Bangladesh 

Bank, the Federal Reserve Banks of the United States, the 

Export-Import Bank of the United States, the Overseas 

Private Investment Corporation of the United States, and 

such other institutions of either Contracting State as the 

competent authorities of both Contracting States may 

determine by mutual agreement) from sources in the other 

Contracting State shall be exempt from tax by that other 

Contracting State. Interest on a debt obligation guaranteed 
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or insured by one of the Contracting States, or an 

instrumentality thereof, shall be exempt from tax by that 

State; 

b) Interest derived and beneficially owned by a bank or 

other financial institution (including an insurance company) 

that is a resident of a Contracting State from sources 

within the other Contracting State shall not be taxed by the 

other Contracting State at a rate in excess of 5 percent of 

the gross amount of the interest; and 

c) Interest derived and beneficially owned by a 

resident of a Contracting State from sources within the 

other Contracting State in connection with the sale on 

credit to an enterprise of the other Contracting State of 

any industrial, commercial or scientific equipment or of any 

merchandise, shall not be taxed by the other Contracting 

State at a rate in excess of 5 percent of the gross amount 

of the interest. 

4. The provisions of paragraphs 2 and 3 shall not apply if 

the beneficial owner of interest from sources within one of the 

Contracting States, being a resident of the other Contracting 

State, carries on business in the first-mentioned Contracting 

State through a permanent establishment situated therein or 

performs in that other State independent personal services from a 

fixed base situated therein, and the debt-claim in respect of 

which the interest is paid is effectively connected with such 

permanent establishment or fixed base. In such a case, the 

provisions of Article 7 (Business Profits) or Article 15 

(Independent Personal Services), as the case may be, shall apply. 

5. Where an amount is paid to a related person and would be 

treated as interest but for the fact that it exceeds an amount 

which would have been paid to an unrelated person, the provisions 

of this Article shall apply only to so much of the amount as 

would have been paid to an unrelated person. In such a case, the 
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excess amount may be taxed by each Contracting State according 

to its own laws, including the provisions of this Convention 

where applicable. 

6. The term “interest” as used in this Convention means 

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

mortgage, and whether or not carrying a right to participate in 

the debtor’s profits, and in particular, income from government 

securities and income from bonds or debentures, including 

premiums and prizes attaching to such securities, bonds or 

debentures, and including an excess inclusion with respect to a 

residual interest in a real estate mortgage investment conduit, 

as well as income assimilated to income from money lent by the 

taxation law of the Contracting State in which the income arises, 

including interest on deferred payment sales. However, the term 

“interest” does not include income dealt with in Article 10 

(Dividends). 

7. The provisions of paragraphs 2 and 3 shall not apply to: 

a) an excess inclusion with respect to a residual 

interest in a real estate mortgage investment conduit; such 

an interest may be taxed in the Contracting State where the 

excess inclusion arises according to the laws of that State; 

or 

b) interest that is contingent interest of a type that 

does not qualify as portfolio interest under United States 

law, and to equivalent amounts under Bangladesh law; such 

interest may be taxed at a rate not exceeding the rate 

prescribed in subparagraph b) of paragraph 2 of Article 10 

(Dividends). 

8. Interest shall be deemed to arise from sources within a 

Contracting State when the payer is a resident of that State. 

Where, however, the person paying the interest, whether he is a 

resident of a Contracting State or not, has in a Contracting 

State a permanent establishment or a fixed base and such interest 
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is borne by such permanent establishment or fixed base, 

then such interest shall be deemed to arise from sources within 

the State in which the permanent establishment or fixed base is 

situated. 

ARTICLE 12 

Royalties

1. Royalties derived by a resident of one of the Contracting 

States from sources within the other Contracting State may be 

taxed by both Contracting States. 

2. Royalties derived and beneficially owned by a resident of 

one of the Contracting States from sources within the other 

Contracting State shall not be taxed by that other Contracting 

State at a rate in excess of 10 percent of the gross amount of 

such royalties. 

3. The term “royalties” as used in this Article means 

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

or the right to use, any copyright of literary, artistic or 

scientific work including cinematographic films or tapes used for 

radio or television broadcasting, and any patent, trademark, 

design or model, plan, secret formula or process, or other like 

right or property, or for information concerning industrial, 

commercial or scientific experience. The term “royalties” also 

includes gains derived from the alienation of any such right or 

property which are contingent on the productivity, use, or 

disposition thereof. However, the term “royalties” does not 

include any payments in consideration for the working of, or the 

right to work, mineral deposits, sources and other natural 

resources. 

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

the recipient of the royalties from sources within one of the 

Contracting States, being a resident of the other Contracting 

State, carries on business in the first-mentioned Contracting 
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State through a permanent establishment situated therein, 

or performs in that other State independent personal services 

from a fixed base situated therein, and the right or property in 

respect of which the royalties are paid is effectively connected 

with such permanent establishment or fixed base. In such a case 

the provisions of Article 7 (Business Profits) or Article 15 

(Independent Personal Services), as the case may be, shall apply. 

5. Where an amount is paid to a related person and would be 

treated as a royalty but for the fact that it exceeds an amount 

which would have been paid to an unrelated person, the provisions 

of this Article shall apply only to so much of the amount as 

would have been paid to an unrelated person. In such case, the 

excess amount may be taxed by each Contracting State according to 

its own laws, including the provisions of this Convention where 

applicable. 

6. Royalties shall be deemed to arise from sources within a 

Contracting State when they are in consideration for the use of, 

or the right to use, in that State, property or information 

concerning industrial, commercial or scientific experience. 

ARTICLE 13 

Capital Gains

1. a) Gains derived by a resident of a Contracting State 

from the alienation of immovable property situated in the 

other Contracting State may be taxed in that other State; 

b) For purposes of this paragraph the term “immovable 

property" means property referred to in Article 6 (Income 

From Immovable Property). When the United States is the 

other Contracting State described in subparagraph a), the 

term includes a United States real property interest. When 

Bangladesh is the other Contracting State described in 

subparagraph a), the term includes shares of the capital 
20 

stock of a company the property of which consists 

principally of immovable property situated in Bangladesh. 

2. Gains from the alienation of movable property forming 

part of the business property of a permanent establishment which 

an enterprise of a Contracting State has in the other Contracting 

State or of movable property pertaining to a fixed base available 

to a resident of a Contracting State in the other Contracting 

State for the purpose of performing independent personal 

services, including such gains from the alienation of such a 

permanent establishment, alone or with the whole enterprise, or 

of such fixed base, may be taxed in that other State. 

3. Gains derived by an enterprise of a Contracting State 

from the alienation of ships, aircraft or containers operated in 

international traffic shall be taxable only in that State, and 

gains described in Article 12 (Royalties) shall be taxable only 

in accordance with the provisions of Article 12. 

4. Gains from the alienation of any property, other than 

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

in the Contracting State of which the alienator is a resident. 

ARTICLE 14 

Branch Tax

1. A company which is a resident of a Contracting State may 

be subject in the other Contracting State to a tax in addition to 

the tax allowable under the other provisions of this Convention. 

2. Such tax, however, may be imposed only on: 

a) in the case of the United States: 

i) the “dividend equivalent amount” of the 

business profits that are effectively connected (or 

treated as effectively connected) with the conduct of a 

trade or business in the United States and are either 

attributable to a permanent establishment in the United 

States or subject to tax in the United States on a net 
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basis under Article 6 (Income From Immovable Property) 

or Article 13 (Capital Gains) of this Convention; and 

ii) the excess, if any, of interest deductible in 

the United States in computing the profits of the 

company that are subject to tax in the United States 

and are either attributable to a permanent 

establishment in the United States or subject to tax in 

the United States on a net basis under Article 6 

(Income From Immovable Property) or Article 13 (Capital 

Gains) of this Convention over the interest paid by or 

from the permanent establishment or trade or business 

in the United States. 

b) in the case of Bangladesh, an amount sufficient to 

provide that a branch in Bangladesh of a United States 

company (or a company of the United States otherwise taxable 

on net income in Bangladesh) is taxed in a manner comparable 

to a similarly situated Bangladesh company and its United 

States shareholder. 

3. The taxes described in the preceding paragraphs shall not 

be imposed at a rate exceeding: 

a) the rate specified in paragraph 2a) of Article 10 

(Dividends) for the taxes described in paragraphs 2a)i) and 

2b) of this Article; and 

b) the appropriate rate specified in paragraphs 2 or 3 

of Article 11 (Interest) for the tax described in 

subparagraph 2(a)(ii). 

ARTICLE 15 

Independent Personal Services

Income derived by an individual who is a resident of a 

Contracting State from the performance of personal services in an 

independent capacity shall be taxable only in that State unless 

such services are performed in the other Contracting State and 
22 

a) the individual is present in that other State for 

a period or periods exceeding in the aggregate 183 days in 

any 12-month period commencing or ending in the income year 

or taxable year concerned; or 

b) the individual has a fixed base regularly available 

to him in that other State for the purpose of performing his 

activities, but only so much of the income as is 

attributable to that fixed base may be taxed in such other 

State. 

ARTICLE 16 

Dependent Personal Services

1. Subject to the provisions of Articles 18 (Entertainers 

and Athletes), 19 (Pensions, Et Cetera), 20 (Government Service) 

and 21 (Teachers, Students and Trainees), salaries, wages and 

other remuneration derived by a resident of a Contracting State 

in respect of an employment shall be taxable only in that State 

unless the employment is exercised in the other Contracting 

State. If the employment is so exercised, such remuneration as 

is derived therefrom may be taxed in that other State. 

2. Notwithstanding the provisions of paragraph 1, 

remuneration derived by a resident of a Contracting State in 

respect of an employment exercised in the other Contracting State 

shall be taxable only in the first-mentioned State if: 

a) the recipient is present in the other State for a 

period or periods not exceeding in the aggregate 183 days in 

any 12-month period commencing or ending in the income year 

or taxable year concerned; 

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

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

c) the remuneration is not borne by a permanent 

establishment or a fixed base which the employer has in the 

other State. 
23 

3. Notwithstanding the preceding provisions of this 

Article, remuneration described in paragraph 1 derived in respect 

of an employment as a member of the regular complement of a ship 

or aircraft operated by an enterprise of a Contracting State in 

international traffic may be taxed only in that Contracting 

State. 

4. Notwithstanding the other provisions of this Article and 

Article 15 (Independent Personal Services), where a director’s 

fee is paid by a company which is a resident of a Contracting 

State to an individual who is a resident of the other Contracting 

State and is a shareholder of the company, and such fee is in 

excess of the amount which would have been paid for such services 

to an individual who is not a shareholder of the company, such 

excess amount may be taxed by the first-mentioned Contracting 

State at a rate not in excess of 15 percent. 

ARTICLE 17 

Limitation on Benefits

1. A person which is a resident of a Contracting State and 

derives income from the other Contracting State shall be 

entitled, in that other Contracting State, to all the benefits of 

this Convention only if such person is: 

a) an individual; 

b) a Contracting State or a political subdivision or 

local authority thereof; 

c) a person, if: 

i) more than 50 percent of the beneficial interest 

in such person (or in the case of a company, more than 

50 percent of the number of shares of each class of the 

company’s shares) is owned, directly or indirectly, by 

persons entitled to benefits of this Convention under 

subparagraphs a), b), d), e) or f) of this paragraph or 
24 

who are citizens of the United States; and 

ii) not more than 50 percent of the gross income 

of such person is used, directly or indirectly, to make 

deductible payments (including payments of interest or 

royalties) to persons who are not entitled to benefits 

of this Convention under subparagraph a), b), d), e) or 

f) of this paragraph and are not citizens of the United 

States; 

d) a company in whose principal class of shares there 

is substantial and regular trading on a recognized stock 

exchange; 

e) a company in which at least 50 percent of each class 

of shares in the company is owned directly or indirectly by 

five or fewer companies entitled to benefits under 

subparagraph d), provided that in the case of indirect 

ownership, each intermediate owner is a person entitled to 

the benefits of the Convention under this paragraph; or 

f) an entity which is a not-for-profit organization as 

described in subparagraph c) of paragraph 1 of Article 4 

(Fiscal Domicile), provided that, with respect to entities 

described in clause ii) of that paragraph, more than half of 

the beneficiaries, members or participants, if any, in such 

organization are persons that are entitled, under this 

Article, to the benefits of the Convention. 

2. a) A resident of a Contracting State will be 

entitled to benefits of the Convention with respect to an 

item of income derived from the other State, regardless of 

whether the resident is qualified for benefits under 

paragraph 1 of this Article, if the resident is engaged in 

the active conduct of a trade or business in the firstmentioned State (other than the business of making or 

managing investments for the resident’s own account, unless 

these activities are banking, insurance or securities 
25 

activities carried on by a bank, insurance company or 

registered securities dealer) and the income derived from 

the other Contracting State is derived in connection with, 

or is incidental to, that trade or business. 

 b) If the resident or any of its associated enterprises 

has an ownership interest in the activity in the other 

Contracting State from which the item of income is derived, 

the rule of subparagraph a) shall apply only if the trade or 

business in the first-mentioned State is substantial in 

relation to the activity in the other State. Whether a 

trade or business is substantial for purposes of this 

paragraph will be determined on the basis of all the facts 

and circumstances. 

 c) Income is derived “in connection with” a trade or 

business when the activity in the other State generating the 

income is a line of business that forms a part of or is 

complementary to the trade or business. Income is 

“incidental to” a trade or business when it facilitates the 

conduct of the trade or business in the other State. 

3. A person that is not entitled to the benefits of the 

Convention pursuant to the provisions of paragraph 1 or 2 may, 

nevertheless, be granted the benefits of the Convention if the 

competent authority of the Contracting State in which the income 

in question arises so determines. 

4. For purposes of subparagraph d) of paragraph 1, the term 

“a recognized stock exchange” means: 

a) the NASDAQ System owned by the National Association 

of Securities Dealers, Inc. and any stock exchange 

registered with the U.S. Securities and Exchange Commission 

as a national securities exchange for purposes of the U.S. 

Securities Exchange Act of 1934; 

b) the stock exchanges regulated by the Bangladesh 

Securities and Exchange Commission; and 
26 

c) any other stock exchange agreed upon by the 

competent authorities of the Contracting States. 

5. The competent authorities of the Contracting States may 

consult together with a view to developing procedures for the 

application of the provisions of this Article. The competent 

authorities shall, in accordance with the provisions of Article 

26 (Exchange of Information and Administrative Assistance), 

exchange such information as is necessary for carrying out the 

provisions of this Article and safeguarding, in cases envisioned 

therein, the application of their domestic law.

ARTICLE 18 

Entertainers and Athletes

1. Notwithstanding the provisions of Articles 15 

(Independent Personal Services) and 16 (Dependent Personal 

Services), income derived by public entertainers such as theater, 

motion picture, radio or television artistes, and musicians, and 

by athletes, from their personal activities as such may be taxed 

in the Contracting State in which these activities are exercised 

provided that such income exceeds in the aggregate 10,000 United 

States dollars or its equivalent in Bangladesh taka during the 

income year or taxable year. However, such income shall not be 

taxable in such Contracting State if the income is derived from 

activities exercised in that Contracting State by a resident of 

the other Contracting State as an entertainer or athlete and the 

visit to the first-mentioned State is wholly or mainly supported 

by public funds of the other State or a political subdivision or 

local authority thereof. 

2. Where income in respect of activities exercised by an 

entertainer or an athlete in his capacity as such accrues not to 

that entertainer or athlete but to another person, that income 

may, notwithstanding the provisions of Articles 7 (Business 

Profits), 15 (Independent Personal Services), and 16 (Dependent 
27 

Personal Services), be taxed in the Contracting State in which 

the activities of the entertainer or athlete are exercised. For 

purposes of the preceding sentence, income of an entertainer or 

athlete shall be deemed not to accrue to another person if it is 

established that neither the entertainer or athlete, nor persons 

related thereto, participate directly or indirectly in the 

profits of such other person in any manner, including the receipt 

of deferred remuneration, bonuses, fees, dividends, partnership 

distributions or other distributions. 

ARTICLE 19 

Pensions, Et Cetera

1. Subject to the provisions of paragraph 2 of Article 20 

(Government Service), pensions and other similar remuneration 

beneficially derived by a resident of a Contracting State, 

whether paid periodically or as a single sum, in consideration of 

past employment shall be taxable only in that State. 

2. Social security payments and other public pensions paid 

by a Contracting State to an individual who is a resident of the 

other Contracting State or a citizen of the United States shall 

be taxable only in the first-mentioned Contracting State. 

3. Annuities beneficially derived by a resident of a 

Contracting State shall be taxable only in that State. The term 

“annuities” as used in this paragraph means a stated sum paid 

periodically at stated times during life or during a specified 

number of years, under an obligation to make the payments in 

return for adequate and full consideration (other than services 

rendered). 

4. Alimony paid to a resident of a Contracting State by a 

resident of the other Contracting State shall be exempt from tax 

in the other Contracting State. The term “alimony” as used in 

this paragraph means periodic payments made pursuant to a written 

separation agreement or a decree of divorce, separate 
28 

maintenance, or compulsory support, which payments are 

taxable to the recipient under the laws of the State of which he 

is a resident. 

5. Periodic payments not dealt with in paragraph 4 for the 

support of a minor child made pursuant to a written separation 

agreement or a decree of divorce, separate maintenance, or 

compulsory support, paid by a resident of one of the Contracting 

States to a resident of the other Contracting State, shall be 

exempt from tax in both Contracting States. 

ARTICLE 20 

Government Service

1. a) Remuneration, other than a pension, paid by a 

Contracting State or a political subdivision or a local 

authority thereof to any individual in respect of services 

rendered to that State or subdivision or authority shall be 

taxable only in that State. 

b) However, such remuneration shall be taxable only in 

the other Contracting State if the services are rendered in 

that other State and the individual is a resident of that 

State who: 

i) is a national of that State; or 

ii) did not become a resident of that State solely 

for the purpose of rendering the services. 

2. Subject to the provisions of paragraph 2 of Article 19 

(Pensions, Et Cetera): 

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

Contracting State or a political subdivision or local 

authority thereof to an individual in respect of services 

rendered to that State or subdivision or authority shall be 

taxable only in that State. 
29 

b) However, such pension shall be taxable only in 

the other Contracting State if the individual is a resident 

of, and a national of, that State. 

3. The provisions of Articles 15 (Independent Personal 

Services), 16 (Dependent Personal Services), 18 (Entertainers and 

Athletes), and 19 (Pensions, Et Cetera), as the case may be, 

shall apply to remuneration and pensions in respect of services 

rendered in connection with a business carried on by a 

Contracting State or a political subdivision or a local authority 

thereof. 

ARTICLE 21 

Teachers, Students and Trainees

1. An individual who visits temporarily one of the 

Contracting States for the purpose of teaching or engaging in 

research at a university, college or other recognized educational 

institution in that Contracting State, and who was immediately 

before that visit a resident of the other Contracting State, 

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

on any remuneration for such teaching or research for a period 

not exceeding two years from the date he first visits that State 

for such purpose. 

2. An individual who was a resident of a Contracting State 

immediately before visiting the other Contracting State and is 

temporarily present in that other State for the primary purpose 

of: 

a) studying at a university, college, school or other 

recognized educational institution in that other State; 

b) securing training as a business or technical 

apprentice; or 

c) studying or doing research as a recipient of a grant 

allowance or award from a governmental, religious, 

charitable, or educational organization; 
30 

shall, from the date of his first arrival in that other 

State in connection with that visit, be exempt from tax in 

that other State with respect to: 

i) all remittances from abroad for purposes of his 

maintenance, education or training; 

ii) the grant, allowance, or award; and 

iii) any remuneration for personal services 

rendered in that other Contracting State with a view to 

supplementing the resources available to him for such 

purposes in an amount not in excess of 8,000 United 

States dollars or its equivalent in Bangladesh taka for 

any taxable year. 

In the case of an individual described in subparagraph b), this 

exemption from tax shall apply for a period not exceeding two 

years from the date of the individual’s first arrival in the 

other State. 

3. This Article shall not apply to income from research if 

such research is undertaken not in the public interest but 

primarily for the private benefit of a specific person or 

persons. 

ARTICLE 22 

Other Income

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

wherever arising, not dealt with in the foregoing Articles of 

this Convention shall be taxable only in that State. 

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

other than income from immovable property as defined in paragraph 

2 of Article 6 (Income From Immovable Property) if the recipient 

of such income, being a resident of a Contracting State, carries 

on business in the other Contracting State through a permanent 

establishment situated therein, or performs in that other State 

independent personal services from a fixed base situated therein, 
31 

and the right or property in respect of which the income is 

paid is effectively connected with such permanent establishment 

or fixed base. In such case the provisions of Article 7 

(Business Profits) or Article 15 (Independent Personal Services), 

as the case may be, shall apply. 

3. Notwithstanding paragraphs 1 and 2, items of income of a 

resident of a Contracting State not dealt with in the foregoing 

Articles of this Convention and arising in the other Contracting 

State may be taxed in that other State. 

ARTICLE 23 

Relief From Double Taxation

1. In accordance with the provisions and subject to the 

limitations of the law of the United States (as it may be amended 

from time to time without changing the general principle hereof), 

the United States shall allow to a resident or citizen of the 

United States as a credit against the United States tax on income 

the appropriate amount of tax paid or accrued to Bangladesh by or 

on behalf of such citizen or resident; and, in the case of a 

United States company owning at least 10 percent of the voting 

stock of a company which is a resident of Bangladesh from which 

the United States company receives a dividend in any taxable 

year, the United States shall allow a credit for the appropriate 

amount of tax paid or accrued to Bangladesh by or on behalf of 

the payor with respect to the profits out of which such dividends 

are paid. Such appropriate amount shall be based upon the amount 

of tax paid or accrued to Bangladesh, but the credit shall not 

exceed the limitations (for the purpose of limiting the credit to 

the United States tax on income from sources outside the United 

States) provided by United States law for the taxable year. For 

purposes of applying the United States credit in relation to tax 

paid to Bangladesh, the taxes referred to in paragraphs 2(b) and 
32 

3 of Article 2 (Taxes Covered) shall be considered to be income 

taxes. 

2. In accordance with the provisions and subject to the 

limitations of the law of Bangladesh (as it may be amended from 

time to time without changing the general principle hereof), 

Bangladesh shall allow a resident of Bangladesh as a credit 

against the Bangladesh tax the appropriate amount of tax paid or 

accrued to the United States by or on behalf of such resident or 

citizen; and, in the case of a Bangladesh company owning at least 

10 percent of the voting stock of a company which is a resident 

of the United States from which it receives a dividend in any 

income year, Bangladesh shall allow a credit for the appropriate 

amount of tax paid or accrued to the United States by that 

company with respect to the profits out of which such dividends 

are paid. Such appropriate amount shall be based upon the amount 

of tax paid or accrued to the United States, but the credit shall 

not exceed the limitations (for the purpose of limiting the 

credit to the Bangladesh tax on income from sources outside of 

Bangladesh) provided by Bangladesh law for the income year. For 

purposes of applying the Bangladesh credit in relation to tax 

paid to the United States, the taxes referred to in paragraphs 

2(a) and 3 of Article 2 (Taxes Covered) shall be considered to be 

income taxes. 

3. Where a United States citizen is a resident of 

Bangladesh: 

a) with respect to items of income that under the 

provisions of this Convention are exempt from United States 

tax or that are subject to a reduced rate of United States 

tax when derived by a resident of Bangladesh who is not a 

United States citizen, Bangladesh shall allow as a credit 

against Bangladesh tax only the tax paid, if any, that the 

United States may impose under the provisions of this 

Convention, other than taxes that may be imposed solely by 
33 

reason of citizenship under the saving clause of paragraph 2 

of Article 1 (Personal Scope); 

b) for purposes of computing United States tax on those 

items of income referred to in subparagraph a), the United 

States shall allow as a credit against United States tax the 

income tax paid to Bangladesh after the credit referred to 

in subparagraph a); the credit so allowed shall not reduce 

the portion of the United States tax that is creditable 

against the Bangladesh tax in accordance with subparagraph 

a); and 

c) for the exclusive purpose of relieving double 

taxation in the United States under subparagraph b), items 

referred to in subparagraph a) shall be deemed to arise in 

Bangladesh to the extent necessary to avoid double taxation 

of such income under subparagraph b). 

ARTICLE 24 

Nondiscrimination

1. Nationals of a Contracting State shall not be subjected 

in the other State to any taxation or any requirement connected 

therewith which is other or more burdensome than the taxation and 

connected requirements to which nationals of that other State in 

the same circumstances are or may be subjected. For purposes of 

United States taxation, United States nationals who are not 

resident in the United States are not in the same circumstances 

as Bangladesh nationals who are not resident in the United 

States. This provision shall, notwithstanding the provisions of 

Article 1 (Personal Scope), also apply to persons who are not 

residents of either Contracting State. 

2. The taxation on a permanent establishment or a fixed base 

which a resident or enterprise of a Contracting State has in the 

other Contracting State shall not be less favorably levied in 
34 

that other State than the taxation levied on residents or 

enterprises of that other State carrying on the same activities. 

3. Except where the provisions of paragraph 1 of Article 9 

(Associated Enterprises), paragraph 5 of Article 11 (Interest), 

or paragraph 5 of Article 12 (Royalties) apply, interest, 

royalties and other disbursements paid by an enterprise of a 

Contracting State to a resident of the other Contracting State 

shall, for the purpose of determining the taxable profits of such 

enterprise, be deductible under the same conditions as if they 

had been paid to a resident of the first-mentioned State. The 

provisions of this paragraph shall not affect the application of 

the law of Bangladesh requiring the deduction of tax at source, 

from interest, royalties and other disbursements as a condition 

for deduction. Any debts of a resident of a Contracting State to 

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

of determining the taxable capital of the first-mentioned 

resident, be deductible under the same conditions as if they had 

been contracted to a resident of the first-mentioned State. 

4. Enterprises of a Contracting State, the capital of which 

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

by one or more residents of the other Contracting State, shall 

not be subjected in the first-mentioned State to any taxation or 

any requirement connected therewith which is other or more 

burdensome than the taxation and connected requirements to which 

other similar enterprises of the first-mentioned State are or may 

be subjected. 

5. Nothing in this Article shall 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 which it grants to its own residents. 

6. Nothing in this Article shall be construed as preventing 

either Contracting State from imposing the tax described in 

Article 14 (Branch Tax). 
35 

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

every kind and description imposed by a Contracting State or a 

political subdivision or local authority thereof. 
36 

ARTICLE 25 

Mutual Agreement Procedure

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

of the Contracting States result or will result for him in 

taxation not in accordance with the provisions of this 

Convention, he may, irrespective of the remedies provided by the 

domestic law of those States, and the time limits prescribed in 

such laws for presenting claims for a refund, present his case to 

the competent authority of either Contracting State. 

2. The competent authority shall endeavor, if the objection 

appears to it to be justified and if it is not itself able to 

arrive at a satisfactory solution, to resolve the case by mutual 

agreement with the competent authority of the other Contracting 

State, with a view to the avoidance of taxation which is not in 

accordance with the Convention. If an agreement is reached, it 

shall be implemented notwithstanding any time limits in the 

domestic law of the Contracting States. Assessment and 

collection procedures shall be suspended during the pendency of 

any mutual agreement proceeding. 

3. The competent authorities of the Contracting States shall 

endeavor to resolve by mutual agreement any difficulties or 

doubts arising as to the interpretation or application of the 

Convention. In particular the competent authorities of the 

Contracting States may agree: 

a) to the same attribution of income, deductions, 

credits, or allowances of an enterprise of a Contracting 

State to its permanent establishment situated in the other 

Contracting State; 

b) to the same allocation of income, deductions, 

credits, or allowances between persons, including a uniform 

position on the application of the requirements of paragraph 

2 of Article 24 (Nondiscrimination); 
37 

c) to the same characterization of particular 

items of income; 

d) to the same application of source rules with respect 

to particular items of income; and 

e) to a common meaning of a term. 

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 for the purpose of reaching 

an agreement in the sense of the preceding paragraphs. 

5. In cases where this Convention specifies a dollar amount, 

the competent authorities may agree to a higher dollar amount. 

ARTICLE 26 

Exchange of Information and 

Administrative Assistance

1. The competent authorities of the Contracting States shall 

exchange such information as is necessary for carrying out the 

provisions of this Convention or of the domestic laws of the 

Contracting States concerning taxes covered by the Convention 

insofar as the taxation thereunder is not contrary to the 

Convention. The exchange of information is not restricted by 

Article 1 (Personal Scope). Any information received by a 

Contracting State shall be treated as secret in the same manner 

as information obtained under the domestic laws of that State and 

shall be disclosed only to persons or authorities, including 

court and administrative bodies, involved in the assessment, 

collection or administration of, the enforcement or prosecution 

in respect of, or the determination of appeals in relation to, 

the taxes covered by the Convention, or the oversight of the 

above. Such persons or authorities shall use the information 

only for the purposes described above. They may disclose the 
38 

information for such purposes in public court proceedings or in 

judicial decisions. 

2. In no case shall the provisions of paragraph 1 be 

construed so as to impose on a Contracting State the obligation: 

a) to carry out administrative measures at variance 

with the laws and administrative practice of that or of the 

other Contracting State; 

b) to supply information which is not obtainable under 

the laws or in the normal course of the administration of 

that or of the other Contracting State; 

c) to supply information which would disclose any 

trade, business, industrial, commercial or professional 

secret or trade process, or information the disclosure of 

which would be contrary to public policy (ordre public). 

3. Notwithstanding paragraph 2, the competent authority of 

the requested State shall, in accordance with paragraph 1, 

a) obtain and provide information held by financial 

institutions, nominees or persons acting in an agency or 

fiduciary capacity (not including information that would 

reveal confidential communications between a client and an 

attorney, solicitor or other legal representative, where the 

client seeks legal advice), or respecting interests in a 

person; and 

b) obtain and provide information requested by a 

Contracting State in accordance with this Article even if it 

does not need, for its own tax purposes, the information 

requested. 

4. If specifically requested by the competent authority of a 

Contracting State, the competent authority of the other 

Contracting State shall provide information under this Article in 

the form of depositions of witnesses and authenticated copies of 

unedited original documents (including books, papers, statements, 

records, accounts and writings), to the extent such depositions 
39 

and documents can be obtained under the laws and 

administrative practices of that other State with respect to its 

own taxes. 

ARTICLE 27 

Effect of Convention on Diplomatic Agents and Consular

Officers, Domestic Laws, And Other Treaties

1. Nothing in this Convention shall affect the fiscal 

privileges of diplomatic agents or consular officers under the 

general rules of international law or under the provisions of 

special agreements. 

2. This Convention shall not restrict in any manner any 

exclusion, exemption, deduction, credit, or other allowance now 

or hereafter accorded: 

a) by the laws of either Contracting State, or 

b) by any other agreement between the Contracting 

States. 

3. a) Notwithstanding the provisions of subparagraph 2b): 

i) the provisions of Article 25 (Mutual Agreement 

Procedure) of this Convention exclusively shall apply 

to any dispute concerning whether a measure is within 

the scope of this Convention, and the procedures under 

this Convention exclusively shall apply to that 

dispute; and 

ii) unless the competent authorities determine 

that a taxation measure is not within the scope of this 

Convention, the nondiscrimination obligations of this 

Convention exclusively shall apply with respect to that 

measure, except for such national treatment or mostfavored-nation obligations as may apply to trade in 

goods under the General Agreement on Tariffs and Trade. 

 No national treatment or most-favored-nation 

obligation under any other agreement shall apply with 
40 

respect to that measure. 

b) For the purpose of this paragraph, a “measure” is a 

law, regulation, rule, procedure, decision, administrative 

action, or any similar provision or action. 

ARTICLE 28 

Entry Into Force

1. This Convention shall be subject to ratification in 

accordance with the applicable procedures of each Contracting 

State and instruments of ratification shall be exchanged as soon 

as possible. 

2. The Convention shall enter into force upon the exchange 

of instruments of ratification and its provisions shall have 

effect: 

a) in respect of taxes withheld at source, to amounts 

paid or credited on or after the first day of the second 

month next following the date on which this Convention 

enters into force; and 

b) in respect of other taxes, to taxable periods in the 

United States and income years in Bangladesh beginning on or 

after the first day of January next following the date on 

which this Convention enters into force. 

ARTICLE 29 

Termination

This Convention shall remain in force until terminated by 

one of the Contracting States. Either Contracting State may 

terminate the Convention at any time after 5 years from the date 

on which this Convention enters into force, provided that at 

least 6 months’ prior notice of termination has been given to the 

other Contracting State through diplomatic channels. In such 

event, the Convention shall cease to have effect: 
41 

a) in respect of taxes withheld at source, to amounts 

paid or credited on or after the first day of January next 

following the expiration of the 6 month period; and 

b) in respect of other taxes, to taxable periods in the 

United States and income years in Bangladesh beginning on or 

after the first day of January next following the expiration 

of the 6 month period. 

 IN WITNESS WHEREOF the undersigned, being duly authorized by 

their respective Governments, have signed this Convention. 

DONE at Dhaka, in duplicate, this 26th day of September, 

2004. 

FOR THE GOVERNMENT OF THE FOR THE GOVERNMENT OF THE 

UNITED STATES OF AMERICA: PEOPLE’S REPUBLIC OF BANGLADESH: