REPUBLICA DE CHILE

MINISTERIO DE RELACIONES EXTERIORES

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REPUBLICA DE CHILE

MINISTERIO DE RELACIONES EXTERIORES

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El Ministerio de Relaciones Exteriores presenta sus atentos saludos a la Embajada de
Estados Unidos de América en Chile, y tiene el honor de referirse a su Nota No. 523-2023
de 28 de septiembre de 2023, que sefiala lo siguiente:

“The Embassy of the United States of America presents its compliments to the
Ministry of Foreign Affairs of the Republic of Chile and has the honor to refer to the
Convention between the Government of the United States of America and the Government of
the Republic of Chile for the Avoidance of Double Taxation and the Prevention of Fiscal
Evasion with Respect to Taxes on Income and Capital, with Protocol and related agreement,
done at Washington February 4, 2010, and to the exchanges of notes dated February 23 and
25, 2011, and February 10 and 21, 2012, which effected textual corrections to the Convention
and Protocol (the aforementioned instruments together constituting “the Convention”).

The United States Senate on June 22, 2023, gave its advice and consent to ratification
of the Convention subject to two reservations, which the United States seeks the Republic of
Chiles agreement to effect through amendments to the Convention as described below. In
particular, Section 2 of the Senate s Resolution of Ratification reads as follows:

The advice and consent of the Senate under Section 1 is subject to the following
reservations, which shall be included in the instrument of ratification:

() Nothing in the Convention shall be construed as preventing the United States from
imposing a tax under section 59A, entitled the “Tax on Base Erosion Payments of
Taxpayers with Substantial Gross Receipts,” of the Internal Revenue Code (as it may
be amended from time to time) on a company that is a resident of the United States
or the profits of a company that is a resident of Chile that are attributable to a
permanent establishment in the United States.

(2) Paragraph 1 of Article 23 (Relief from Double Taxation) of the Convention shall be
deleted and replaced by the following:

“L. 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 thereof);

a the United States shall allow to a resident or citizen of the United
States as a credit against the United States tax on income applicable
to residents and citizens the income tax paid or accrued to Chile by or
on behalf of such citizen or resident. For the purposes of this
subparagraph, the taxes referred to in subparagraph b) of paragraph
3 and paragraph 4 of Article 2 (Taxes Covered), excluding taxes on
capital, shall be considered income taxes; and


REPUBLICA DE CHILE

MINISTERIO DE RELACIONES EXTERIORES

b) in the case of a United States company owning at least 10 percent of
the aggregate vote or value of the shares of a company that is a
resident of Chile and from which the United States company receives
dividends, the United States shall allow a deduction in the amount of
such dividends in computing the taxable income of the United States
company.”

Consistent with the Senate's Resolution, ratification of the Convention by the
Government of the United States of America shall be subject to the above reservations, which
shall be included in the United States instrument of ratification of the Convention.

Accordingly, in order to confirm that the above reservations are acceptable to the
Government of Chile, the Embassy on behalf of the Government of the United States proposes
that the two governments agree to amend the Convention by deleting paragraph 1 of Article
23 of the Convention (Relief from Double Taxation) and replacing it with the following text:

“I. 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 thereof):

a the United States shall allow to a resident or citizen of the United
States as a credit against the United States tax on income applicable
to residents and citizens the income tax paid or accrued to Chile by or
on behalf of such citizen or resident. For the purposes of this
subparagraph, the taxes referred to in subparagraph b) of paragraph
3 and paragraph 4 of Article 2 (Taxes Covered), excluding taxes on
capital, shall be considered income taxes; and

b) in the case of a United States company owning at least 10 percent of
the aggregate vote or value of the shares of a company that is a
resident of Chile and from which the United States company receives
dividends, the United States shall allow a deduction in the amount of
such dividends in computing the taxable income of the United States
company.”

The Government of the United States further proposes that paragraph I of Article 23
of the Spanish language text of the Convention be deleted and replaced with the following
text:

“1. De acuerdo con las disposiciones y sujeto a las limitaciones de la legislacion
de los Estados Unidos (aun cuando fuere eventualmente enmendada sin alterar el
principio general de la misma):

a) los Estados Unidos permitiran a un residente o ciudadano de los
Estados Unidos acreditar contra el impuesto sobre la renta
estadounidense aplicable a residentes y ciudadanos el impuesto sobre


REPUBLICA DE CHILE

MINISTERIO DE RELACIONES EXTERIORES

la renta pagado o devengado en Chile por 0 a cuenta del ciudadano o
residente. Para los efectos de este subparrafo, los impuestos referidos
en el subparrafo b) del parrafo 3 y en el parrafo 4 del articulo 2
(Impuestos Comprendidos), excluyendo los impuestos sobre el
patrimonio, se consideraran impuestos sobre la renta; y

b) en el caso de una sociedad estadounidense que posea a lo menos el 10
por ciento del total del derecho a voto o del valor de las acciones de
una sociedad residente de Chile y respecto de la cual la sociedad
estadounidense recibe dividendos, los Estados Unidos permitirdn una
deduccion en el monto de tales dividendos al computar la renta
imponible de la sociedad estadounidense."

In addition, the Government of the United States of America proposes that the two
governments agree that nothing in the Convention shall be construed as preventing the
United States from imposing a tax under section 59A, entitled the “Tax on Base Erosion
Payments of Taxpayers with Substantial Gross Receipts,” of the U.S. Internal Revenue Code
(as it may be amended from time to time) on a company that is a resident of the United States
or the profits of a company that is a resident of Chile that are attributable to a permanent
establishment in the United States, and that the Convention be amended accordingly.

If the foregoing proposals are acceptable to the Government of the Republic of Chile,
the Embassy further proposes that this diplomatic note and the ministry’ affirmative
diplomatic note in reply constitute an agreement between the two governments to amend the
Convention, which agreement shall enter into force on the date the Convention enters into
force in accordance with Article 29 of the Convention.”

Al respecto, el Ministerio de Relaciones Exteriores tiene el honor de comunicar a la
Embajada de Estados Unidos de América que el Gobierno de la Reptblica de Chile acepta
las propuestas anteriores, y confirma que su Nota No. 523-2023 de 28 de septiembre de 2023
y esta Nota en respuesta constituyen un acuerdo entre ambos gobiernos para enmendar el
Convenio, el cual entrara en vigor en la fecha en que el Convenio entre en vigor de
conformidad con el Articulo 29 del Convenio.

El Ministerio de Relaciones Exteriores de la Reptblica de Chile se vale de esta

oportunidad para reiterar a la Embajada de Estados Unidos de América en Chile las
seguridades de su mas alta consideracién.

SANTIAGO, 9 6 OCT. 2122

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Mun —

ALA HONORABLE
EMBAJADA DE ESTADOS
PRESENTE

JNIDOS DE AMERICA