Treaty Series Recueil des Traitds - United Nations Treaty Collection

254 United Nations - Treaty Series 1967
blishment, any remittance of such profits by the permanent establishment
to a resident of the first-mentioned territory may be taxed (in addition to
the tax which would be chargeable on those profits if they were the profits of
a company which was a resident of that other territory) in accordance with
the law of the other territory, but the rate of tax so imposed shall not exceed
15 per cent. of the amount of those profits remitted or deemed to be remitted.
Article 9
(1) The tax imposed in one of the territories on interest which arises there
and which is derived and beneficially owned by a resident of the other territory
shall not exceed 15 per cent. of the gross amount of the interest.
(2) Notwithstanding paragraph (1) of this Article interest arising in one
of the territories and received by any agency or instrumentality wholly owned
by the Government of the other territory shall be exempt from tax in the
first-mentioned territory.
(3) The provisions of paragraph (1) of this Article shall not apply if
the person to whom the interest is paid or credited has in the territory in
which the interest arises, a permanent establishment with which the debtclaim
from which the interest arises is effectively connected. In such a case
the provisions of Article 5 shall apply.
(4) Subject to paragraph (5) of this Article the provisions of paragraph (1)
of this Article shall not apply to any payment of interest which under the
law of either territory is treated as a distribution.
(5) Any provision in the law of either of the territories relating only
to interest paid to a non-resident company shall not operate so as to require
such interest paid to a company which is a resident of the other territory to
be treated as a distribution of the company paying such interest. The preceding
sentence shall not apply if :
(a) the interest is paid to a company which is a resident of one of the
territories and more than 25 per cent. of the voting power in that company
is controlled, directly or indirectly, by a person or persons resident in the
other territory, or
(b) the interest is paid by a company of which the long term liabilities
at any time in the year in which the interest was paid exceed the value of
the issued share capital at that time, or
(c) the debt-claim in respect of which the interest is paid was created
mainly for the purpose of taking advantage of this Article and not for bona
fide commercial reasons.
No. 8766