Document ID: chunk:federal_register_of_legislation:C2004A00987:schedule:2a:p9
Version: federal_register_of_legislation:C2004A00987
Segment Type: schedule
Provision Reference: sch 2A (pt 9/14)
Character Range: 73934–76618

to be a resident of one of the Contracting States, is treated under the taxation law of that State as having alienated any property and is taxed in that State by reason thereof, the individual may elect to be treated for the purposes of taxation in the other Contracting State as if the individual had, immediately before ceasing to be a resident of the first‑mentioned State, alienated and re‑acquired the property for an amount equal to its fair market value at that time.
    (6) An individual who elects, under the taxation law of a Contracting State, to defer taxation on income or gains relating to property which would otherwise be taxed in that State upon the individual ceasing to be a resident of that State for the purposes of its tax, shall, if the individual is a resident of the other State, be taxable on income or gains from the subsequent alienation of that property only in that other State.
    (7) Except as provided in the preceding paragraphs of this Article, each Contracting State may tax capital gains in accordance with the provisions of its domestic law."; and
(b) renumbering paragraph (4) as paragraph (8).

ARTICLE 10
Article 16 of the Convention is omitted and the following Article is substituted:
"ARTICLE 16
Limitation on Benefits
(1) Except as otherwise provided in this Article, a resident of one of the Contracting States that derives income from the other Contracting State shall not be entitled to the benefits of this Convention otherwise accorded to residents of one of the Contracting States unless such resident is a "qualified person" as defined in paragraph (2).
(2) A resident of one of the Contracting States shall be a qualified person for a taxable year if the resident is:
    (a) an individual;
    (b) that State, any political subdivision or local authority thereof or any agency or instrumentality of such State;
    (c) a company, if:
        (i) the principal class of its shares is listed on a recognized stock exchange specified in sub‑paragraph (a) or (b) of paragraph (6) of this Article and is regularly traded on one or more recognized stock exchanges; or
        (ii) at least 50 percent of the aggregate vote and value of the shares in the company is owned directly or indirectly by five or fewer companies entitled to benefits under clause (i) of this sub‑paragraph, provided that, in the case of indirect ownership, each intermediate owner is a resident of either Contracting State;
    (d) a person other than an individual or a company, if:
        (i) the principal class of units in that person is listed or admitted to dealings on a recognized stock exchange specified in sub‑paragraph (a) or (b) of paragraph (6)