CHAPTER III
TAXATION OF INCOME
ARTICLE 6
INCOME FROM IMMOVABLE PROPERTY 1. Income from immovable property (including income from agriculture of forestry) may be taxed in the Contracting State in which such property is situated. 2. The term "immovable property" shall have the meaning which it has under the law of the Contracting State in which the property in question is situated. The term shall in any case include property accessory to immovable property, livestock and equipement used in agriculture and forestry, rights to which the provisions of gereral law respecting landed property apply, usufruct of immovable property and rights to variable or fixed payments as consideration for the working of, or the right to work, mineral deposits, sources and other natural resources; ships, boats and aircraft shall not be regarded as immovable property. 3. The provisons of paragraph 1 shall apply to income derived from the direct use, letting or use in any other form of immovable property. 4. The provisions of paragraphs 1 and 3 shall also apply to the income from immovable property of an enterprise and to income from immovable property used for the performance of independent personal services. ARTICLE 7
BUSINESS PROFITS 1. The income or profits of an enterprise of a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the income or profits of the enterprise may be taxed in the other State but only so much of them as is attributable to; (a) that permanent establishment; (b) sales in that other State of goods or merchandise of the same or similar kind as those sold through that permanent establishment or (c) other business activities carried on in that other State of the same or similar kind as those effected through that permanent establishment. 2. Where an enterprise of a Contracting State carries on business in the other Contracting State through a permanent establishment situated therein, there shall in each contracting State be attributed to that permanent establishment the income or profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which it is a permanent establishment. 3. In the determination of the income or profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the business of the permanent establishment including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere. 4. Insofar as it has been customary in a Contracting State to determine the income or profits to be attributed to a permanent establishment on the basis of a certain percentage of the gross receipts of the enterprise or on the basis of an apportionment of the total income or profits of the enterprise to its various parts, nothing in paragraph 2 of this Article shall preclude that Contracting State from determining the income or profits to be taxed by such an apportionment as may be customary; the method of apportionment adopted shall, however, be such that the result shall be in accordance with the principles contained in this Article. 5. No income or profits shall be attributed to a permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise. 6. For the purposes of the preceding paragraphs, the income or profits to be attributed to the permanent establishment shall be determined by the same method year by year unless there is good and sufficient reason to the contrary. 7. where income or profits include items of income which are dealt with separately in other Articles of this Convention, then the provisions of those Articles shall not be affected by the provisions of this Article. ARTICLE 8
SHIPPING AND AIR TRANSPORT 1. Income derived by an enterprise of a Contracting State from operation of aircraft in international traffic shall be taxable only in that Contracting State. 2. Income derived by an enterprise of a Contracting State from the operation of ship in international traffic may be taxed in the other Contracting State, but the tax imposed in that other Contracting State shall be reduced by an amount equal to 50 percent thereof. 3. The provisions of paragraphs 1 and 2 of this Article shall also apply to income from the participation in a pool, a joint business or an international operating agency engaged in the operation of aircraft or ships. 4. For the purposes of paragraphs 1 and 2 interest on funds connected with the operation of ships or aircraft in international traffic shall be regarded as income from the operation of such ships or aircraft. 5. The term operation of ships or aircraft shall mean business of transportation of persons, mail, livestock or goods by the ships or aircraft, including the incidental lease of ships or aircraft and any other activity directly connected with such transportation. ARTICLE 9
ASSOCIATED ENTERPRISE Where: (a) an enterprise of a Contracting State participates directly or indirectly in the management, control or capital of an enterprise of the other Contracting State, or (b) the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Contracting State and an enterprise of the other Contracting State,and in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprise, then any profits which would, but for those conditions, have accrued to one of the enterprises, but by reason of those conditions, have not so accrued, may be included in the profits of that enterprise and taxed accordingly. ARTICLE 10
DIVIDENDS 1. Dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State. 2. However, such dividends may also be taxed in the Contracting State of which the company paying the dividends is a resident, and according to the laws of that State, but if the beneficial owner of the dividends is a company which is a resident of the other Contracting State, the tax shall not exceed. (a) 15 percent of the gross amount of dividends, in a case where the compnay paying the dividends is engaged n an industrial undertaking and the beneficial owner of the dividends is a company of the other Contracting State owing at least 10 percent of the voting shares of the voting shares of the company paying the dividends; (b) in the case not covered by sub-paragraph (a) above, 20 per cent of the gross amount of dividends if the company paying the dividends is engaged in an industrial undertaking or if the beneficial owner of the dividends is a company of the other Contracting State owning at least 25 percent of the voting shares of the company paying the dividends. 3. (a) The term "dividends" as used in this Article means income from shares or other rights,not being debt claims, participating in profits, as well as income from other corporate rights assimilated to income from sharesaccording to the taxation laws of the Contracting State ofwhich the company making the distribution is a resident. (b). In this Article, the term industrial undertaking means an undertaking falling under any of the classes mentioned below; (i) manufacturing assembling and processing; (ii) construction, civil engineering and ship building; (iii) production of electricity, hydraulic power or gas or the supply of water; (iv) agriculture, forestry and fishery and the carrying on of a plantation; (v) any other undertaking entitled to the privileges accorded under the laws of either Contracting State 3 on the promotion of industrial investment; and (iv) any other undertaking which may be declared to be an industrial undertaking for the purposes of this Article by the competent authority of the Contracting State in which the undertaking is situated. 4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends, being a resident of a Contracting State, carries on business in the other Contracting State of which the company paying the dividends is a resident, throguht a permanent establishment situated therein or performs in that other State independent personal services from a fixed base situated therin and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14, as the case may be, shall apply. 5. Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not impose any tax on the dividends paid by the company, except in so far as such dividends are paid to a resident of that other State or in so far as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment or a fixed base situated in that other State, nor subject the company's undistributed profits to a tax on the company's undistributed profits, even if the dividends paid or the undistributed profits consists wholly or partly of profits or income arising in such other State. | 
