Document ID: chunk:federal_register_of_legislation:C2008A00102:schedule:6:p15
Version: federal_register_of_legislation:C2008A00102
Segment Type: schedule
Provision Reference: sch 6 (pt 15/39)
Character Range: 38263–41001

business of providing finance; or

c)  the interest is derived by:

(i) in the case of Japan, the Japan Bank for International Cooperation, or the Nippon Export and Investment Insurance;

(ii) in the case of Australia, the Export Finance and Insurance Corporation, or a public authority that manages the investments of the Future Fund; and

(iii) any similar institution as may be agreed upon from time to time between the Governments of the Contracting States through an exchange of diplomatic notes.

4.  Notwithstanding the provisions of paragraph 3, interest referred to in subparagraph b) of that paragraph may be taxed in the Contracting State in which it arises at a rate not exceeding 10 per cent of the gross amount of the interest if the interest is paid as part of an arrangement involving back‑to‑back loans or other arrangement that is economically equivalent and intended to have a similar effect to an arrangement involving back‑to‑back loans.

5.  The term "interest" as used in this Article 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, interest from government securities and interest from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures, and all other income that is subjected to the same taxation treatment as income from money lent by the tax law of the Contracting State in which the income arises.  Income dealt with in Article 10 shall not be regarded as interest for the purposes of this Convention.

6.  The provisions of paragraphs 1 and 2, subparagraph b) of paragraph 3 and paragraph 4 shall not apply if the beneficial owner of the interest, being a resident of a Contracting State, carries on business in the other Contracting State in which the interest arises through a permanent establishment situated therein and the debt‑claims or other rights in respect of which the interest is paid is effectively connected with such permanent establishment.  In such case the provisions of Article 7 shall apply.

7.  Interest shall be deemed to arise in a Contracting State when the payer is a resident of that Contracting State for the purposes of its tax.  Where, however, the person paying interest, whether such person is a resident of a Contracting State or not, has in a Contracting State or a state other than the Contracting States a permanent establishment in connection with which the indebtedness on which the interest is paid were incurred, and such interest is borne by such permanent establishment, then:

a)  if the permanent establishment is situated in a Contracting State, such interest shall be deemed to arise in