CONVENTION BETWEEN THE KINGDOM OF SWEDEN AND THE REPUBLIC OF LITHUANIA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION CONVENTION BETWEEN THE KINGDOM OF SWEDEN AND THE REPUBLIC OF LITHUANIA FO

the provisions of the Convention Where the term "statutory body" appears, it is understood that this term means any legal entity of a public character created by the laws of a Contracting State in which no person other than the State itself, a political subdivision or a local authority thereof, has an interest. 2.

Article 7

, paragraph 3 It is understood that expenses to be allowed as deductions by a Contracting State include only expenses that are deductible under the domestic laws of that State. 3.

Article 8

It is understood that "profits of an enterprise of a Contracting State from the operation of ships in international traffic" shall be interpreted according to paragraphs 7 to 14 of the Commentary on Article 8 of the OECD Model Tax Convention on Income and on Capital

Article 11

, paragraph 3 d) It is understood that a person is related to another person where one person, alone or together with one or more related persons, has, directly or indirectly, an interest of more than 50 per cent in the other person, or where one or more persons, alone or together with one or more related persons, have, directly or indirectly, an interest of more than 50 per cent in the two persons. 5.

Article 12

, paragraph 2 It is understood that the term "royalties" shall be deemed not to include payments for the use of drilling rigs, or similar purpose equipment, used for the exploration for or the extraction of hydrocarbons. 6.

Article 12

, paragraph 3 It is agreed that the income from leasing of industrial, commercial or scientific equipment shall be included in the term "royalties" as defined in Article 12, paragraph 3. 7.

Article 15

, paragraph 2 The provisions of Article 15, paragraph 2, shall not apply to an employee who is hired out. For the purposes of the preceding sentence, an employee who is a resident of a Contracting State shall be deemed to be hired out if he is placed at another person's disposal by a person (the hirer-out) to carry out work in the business of such other person (the principal) in the other Contracting State, provided that the principal is a resident of, or has a permanent establishment in, that other State, and that the hirer-out neither has any responsibility nor bears any risk in respect of the result of the work. In determining whether an employee shall be deemed to be hired out, a comprehensive review shall be carried out, with particular reference to whether: a) the overall supervision of the work rests with the principal; b) the work is carried out in a place of work which is at the disposal of the principal and for which he has responsibility; c) the remuneration to the hirer-out is computed according to the time spent or

any other relationship between the remuneration and the wages received by the employee;

1. d)the main part of the tools and materials are supplied by the principal; and
2. e)the hirer-out does not decide unilaterally on the number of employees or their qualifications. In witness whereof the undersigned, duly authorised thereto, have signed this Protocol. Done in duplicate at Washington D.C. this twentyseventh day of September 1993, in the Swedish, Lithuanian and English languages, all three texts being equally authentic. In the case of divergence of interpretation the English text shall prevail. FOR THE GOVERNMENT OF THE KINGDOM OF SWEDEN: FOR THE GOVERNMENT OF THE REPUBLIC OF LITHUANIA: