1. Taxation on Business Profits
Where an enterprise of one of the two countries has in the other country a permanent establishment (such as a branch, including the furnishing of services by an enterprise through personnel over a certain period of time) through which the enterprise carries on business, only the profits attributable to the permanent establishment may be taxed in that other country.
2. Taxation on Investment Income
Taxation on investment income (dividends, interest and royalties) in the source country will be subjected to the reduced maximum rates or exempted as follows:
3. Taxation on Gains from Alienation of Shares
Gains from the alienation of shares representing at least 25 per cent of the capital of a company will be taxed in the source country subjected to the maximum rate at 10 per cent. In other cases, the maximum rate at 15 per cent will apply. However, gains derived from changes of ownership that would directly result from a corporate reorganisation of that company will be exempted from tax in the source country.
4. Prevention of Abuse of the Convention
In order to prevent abuse of benefits under this Convention, any benefit under this Convention will not be granted if it is reasonable to conclude that obtaining such a benefit was one of the principal purposes of any transaction, or if the income is attributable to a permanent establishment in a third country and does not satisfy specified conditions.
5. Mutual Agreement Procedure
Taxation not in accordance with the provisions of this Convention may be resolved by mutual agreement between the tax authorities of the two countries.
6. Exchange of Information and Assistance in Collection of Tax Claims
In order to effectively prevent international tax evasion and tax avoidance, the exchange of information concerning tax matters and the mutual assistance in the collection of tax claims between the two countries are introduced.