Document ID: chunk:federal_register_of_legislation:C2004A01066:schedule:3a:p5
Version: federal_register_of_legislation:C2004A01066
Segment Type: schedule
Provision Reference: sch 3A (pt 5/10)
Character Range: 14438–17055

on the earnings of a company that is a resident of Canada, except that any branch tax so imposed shall not exceed 5 per cent of the amount of such earnings that have not been subjected to such branch tax in previous taxation years. For the purposes of this provision, the term "earnings" means the earnings attributable to the alienation of such real property situated in Canada as may be taxed by Canada under the provisions of Article 6 or paragraph (1) of Article 13, and the profits, including any gains, attributable to a permanent establishment in Canada in a year and previous years after deducting therefrom all other taxes, other than the branch tax referred to herein, imposed on such profits in Canada.".

2. The reference in paragraph (7) of Article 10 of the Convention to "15 per cent" shall be deleted and replaced by a reference to "5 per cent".

ARTICLE 9

 The reference in paragraph (2) of Article 11 of the Convention to "15 per cent" shall be deleted and replaced by a reference to "10 per cent".

ARTICLE 10

1. Paragraph (3) of Article 12 of the Convention shall be deleted and replaced by the following:

 "(3) The term "royalties" as used in this Article means payments or credits, whether periodical or not, and however described or computed, to the extent to which they are made as consideration for:

(a) the use of, or the right to use, any copyright, patent, design or model, plan, secret formula or process, trade mark or other like property or right; or

(b) the use of, or the right to use, any industrial, commercial or scientific equipment; or

(c) the supply of scientific, technical, industrial or commercial knowledge or information; or

(d) the supply of any assistance that is ancillary and subsidiary to, and is furnished as a means of enabling the application or enjoyment of, any such property or right as is mentioned in subparagraph (a), any such equipment as is mentioned in subparagraph (b) or any such knowledge or information as is mentioned in subparagraph (c); or

(e) the use of, or the right to use:

 (i) motion picture films; or

               (ii) films or videotapes or other means of reproduction for use in connection with television; or

 (iii) tapes for use in connection with radio broadcasting; or

(f) total or partial forbearance in respect of the use or supply of any property or right referred to in this paragraph.".

2. A new paragraph (7) shall be added to Article 12 of the Convention as follows:

 "(7) Without prejudice to whether or not such payments would be dealt with as royalties under this Article in the absence of this