Obsah (9)

Article 7Article 19Article 6Article 1Article 9Article 11Article 12Article 13Article 27

loi portant approbation de l'« Agreement between the Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana for the elimination

double taxation with respect to taxes on income and on capital and the prevention

tax evasion and avoidance », et le Protocole y relatif, faits à Luxembourg, le 19 septembre 2018 I. Texte du projet de loi p. 2 II. Exposé des motifs p. 3 III. Commentaire des articles de la convention p. 4 IV. Fiche d'évaluation d'impact p. 12 V. Fiche financière p. 16 VI. Texte de la convention p. 17 l. Texte du projet de loi Projet de loi portant approbation de I'« Agreement between the Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana for the elimination

double taxation with respect to taxes on income and on capital and the prevention

tax evasion and avoidance », et le Protocole y relatif, faits à Luxembourg, le 19 septembre 2018 Article unique Sont approuvés l'« Agreement between the Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana for the elimination

double taxation with respect to taxes on income and on capital and the prevention

tax evasion and avoidance », et le Protocole y relatif, faits à Luxembourg, le 19 septembre 2018. 2 11. Exposé des motifs L'objet du présent projet de loi est d'approuver la Convention fiscale avec la République du Botswana. Les conventions contre les doubles impositions constituent un élément essentiel de la politique fiscale du Luxembourg. L'objet d'une telle convention fiscale est l'élimination de la double imposition juridique et la conclusion d'un tel accord est indispensable au bon développement des relations économiques bilatérales et favorise l'échange de biens et de services ainsi que les mouvements de capitaux, de technologies et de personnes. La convention prévoit une répartition claire des compétences fiscales pour l'imposition des personnes physiques et des personnes morales. Le projet de loi confirme les efforts effectués ces dernières années par le Gouvernement luxembourgeois en vue de compléter et d'améliorer progressivement son réseau de conventions fiscales particulièrement avec les pays d'Afrique. La Convention entre le Luxembourg et le Botswana a pour vocation de promouvoir les relations économiques par l'élimination de la double imposition juridique, tout en limitant les pratiques de chalandage fiscal. Cette volonté est expressément énoncée dans le préambule de la Convention, lequel répond ainsi aux exigences du nouveau standard issu des travaux sur les problèmes de l'érosion de la base d'imposition et le transfert de bénéfices de l'OCDE. 3 III. Commentaires des articles de la convention La Convention retient le titre et le préambule préconisés par l'Action 6 des travaux BEPS. L'objectif est de mettre en évidence, dans le titre de la Convention, le rôle des conventions dans la prévention de l'utilisation abusive des conventions fiscales. Au préambule, il est précisé qu'il s'agit d'éliminer la double imposition, et ce, sans créer des possibilités de double non-imposition ou d'imposition réduite par l'évasion ou la fraude fiscales, en particulier par des mécanismes de chalandage fiscal. L'article l er dispose que la Convention s'applique aux personnes qui sont des résidents de l'un des États contractants ou de ces deux États. L'article 2 énumère les impôts couverts par la Convention. Du côté luxembourgeois, la Convention vise l'impôt sur le revenu des personnes physiques, l'impôt sur le revenu des collectivités, l'impôt sur la fortune et l'impôt commercial communal. Le paragraphe 4 dispose qu'aucune disposition de la présente Convention ne limite le droit des États contractants de prélever sur les bénéfices des exploitations minières un impôt à un taux effectif autre que celui qui est à charge d'une quelconque autre entreprise. L'article 3 énonce les définitions nécessaires à l'interprétation des termes et expressions utilisés dans la Convention. L'expression « trafic international » englobe, complémentairement au modèle de l'OCDE, les véhicules routiers ainsi que le trafic ferroviaire. Il est précisé au paragraphe 2 que le droit fiscal prévaut sur les autres branches du droit pour l'interprétation des termes et expressions non définis par ailleurs dans la Convention. L'article 4 définit la notion de résidence. En donnant une définition de l'expression « résident d'un État contractant », l'article 4 permet de résoudre les cas de double résidence et constitue le critère essentiel de répartition du droit d'imposer entre les deux États. er vise en principe les personnes qui sont assujetties à l'impôt dans un État Le paragraphe l contractant en vertu de la législation interne de cet État. Il précise donc que sont des résidents les personnes assujetties à l'impôt en raison de leur domicile, de leur résidence, de leur siège de direction ou de tout autre critère de nature analogue. Le paragraphe 2 clarifie les règles applicables aux personnes physiques en cas de double résidence. Conformément au modèle de l'OCDE, il reprend les critères habituels de foyer 4 d'habitation permanent, de centre des intérêts vitaux, de séjour habituel et de nationalité. En dernier lieu, les autorités compétentes doivent trancher la question d'un commun accord. Le paragraphe 3 retient le siège de direction effective comme critère de préférence pour les personnes autres que les personnes physiques afin de déterminer l'État de résidence de ces personnes. Le point l. du Protocole de la Convention relatif à l'article 4 prévoit entre autres qu'un organisme de placement collectif qui est établi dans un État contractant est considéré comme un résident de l'État contractant dans lequel il est établi et comme le bénéficiaire effectif des revenus qu'il reçoit. L'article 5 adopte une définition plus large de la notion d'établissement stable que celle retenue au modèle de l'OCDE. Ainsi, le paragraphe 2 (

1. g)complète la liste d'exemples de l'expression « établissement stable » qui peuvent être considérés comme constituant un établissement stable dans les conditions du paragraphe 1 en ajoutant une installation ou une structure utilisée pour l'extraction de ressources naturelles, à condition que l'installation ou la structure se poursuive pendant une période ou des périodes de plus de 183 jours au cours d'une période quelconque de douze mois commençant ou se terminant durant l'année fiscale concernée. Le paragraphe 3 (
2. a)considère comme établissement stable un chantier de construction, de montage ou d'installation, ou des activités de surveillance s'y rattachant lorsque ce chantier ou ces activités ont une durée supérieure à six mois. Par ailleurs, le paragraphe 3 (
3. b)prévoit que la fourniture de services, y compris les services de consultants, par une entreprise agissant par l'intermédiaire de salariés ou d'autre personnel engagé à cette fin constitue un établissement stable mais seulement lorsque ces activités se poursuivent (pour le même projet ou un projet connexe) sur le territoire d'un État contractant pendant une période ou des périodes représentant un total de plus de 183 jours pendant une période quelconque de douze mois commençant ou se terminant durant l'année fiscale concernée. Le paragraphe 7 étend le champ d'application de l'établissement stable aux entreprises d'assurance. Une telle disposition ne figure pas dans le modèle de l'OCDE mais elle est reprise dans certaines de nos conventions. En vertu de cette disposition, les entreprises d'assurance d'un État contractant sont considérées comme ayant un établissement stable dans l'autre État contractant, dès lors que, 5 par l'intermédiaire d'une personne autre qu'un agent jouissant du statut indépendant, elles perçoivent des primes ou assurent des risques situés dans cet autre État. Ne sont pas visées par cette mesure les opérations de réassurance. L'article 6 qui traite de l'imposition des revenus immobiliers reprend le principe général que le revenu des biens immobiliers est attribué à l'État dans lequel est situé le bien immobilier qui produit le revenu. L'article 7 qui concerne l'imposition des bénéfices des entreprises suit l'approche du modèle de l'OCDE dans sa version de l'année 2008 à l'exception du paragraphe 3 qui est repris du modèle de l'ONU. L'article 8 concerne l'imposition des bénéfices d'une entreprise d'un État contractant provenant de l'exploitation en trafic international de navires, d'aéronefs, de véhicules ferroviaires ou routiers ainsi que de l'exploitation de bateaux servant à la navigation intérieure. Il attribue le droit d'imposition de ces bénéfices à l'État où se trouve le siège de direction effective de l'entreprise. L'article 9 correspond au modèle de l'OCDE. Il permet à un État d'opérer des ajustements de bénéfices à des fins fiscales lorsque des transactions ont été conclues entre des entreprises associées dans des conditions autres que celles de pleine concurrence. La rectification de la comptabilité des transactions entre entreprises associées peut entraîner une double imposition économique. Le paragraphe 2 vise à supprimer ces doubles impositions. L'article 10 réglemente le droit d'imposition des dividendes. Il partage le droit d'imposition des dividendes entre l'État de la source et l'État de résidence du bénéficiaire. Le paragraphe 2 traitant de l'impôt pouvant être perçu par l'État de la source, prévoit que l'impôt établi dans cet État ne peut excéder 5 pour cent du montant brut des dividendes, si le bénéficiaire effectif est une société qui détient directement au moins 25 pour cent du capital de la société qui paie les dividendes. Dans les autres cas, la retenue maximale s'élève à 10 pour cent du montant brut des dividendes. L'article // réserve un droit d'imposition des intérêts à l'État de la source, mais il limite l'exercice de ce droit en fixant un plafond à l'imposition qui ne peut pas dépasser 7,5 pour cent du montant brut des intérêts. 6 Le paragraphe 3 prévoit sous certaines conditions une exemption de la retenue à la source. Il s'agit des intérêts qui ne sont imposables que dans l'État contractant dont la personne qui reçoit les intérêts est un résident si le bénéficiaire effectif de ces intérêts est un résident de cet État, et: - est cet État ou sa banque centrale ou l'une ses collectivités locales; - si les intérêts sont versés par l'État dans lequel ils sont générés ou par l'une de ses collectivités locales ou l'un de ses établissements publics; si l'intérêt est versé au titre d'un prêt, d'une créance ou d'un crédit qui est dû à cet État ou consenti, accordé, garanti ou assuré par lui ou par l'une de ses collectivités locales ou agences de financement des exportations. L'article 12 dispose que la Convention partage le droit d'imposition des redevances entre l'État de la source et l'État de résidence du bénéficiaire, contrairement à la disposition du modèle de l'OCDE qui ne prévoit qu'une imposition dans l'État de résidence du bénéficiaire des redevances. L'imposition dans l'État de la source ne peut excéder 7,5 pour cent du montant brut des redevances. Le paragraphe 3 qui définit le terme « redevances » a été repris du modèle de l'ONU. Contrairement au modèle de l'OCDE, l'article 13 prévoit un article particulier pour le traitement des rémunérations pour des services techniques et retient une imposition dans l'État de la source qui ne peut excéder 7,5 pour cent du montant brut de ces rémunérations. L'article 14 traite les gains en capital et ne contient pas de disposition concernant l'aliénation d'actions de sociétés à prépondérance immobilière. L'article 15 réglemente le droit d'imposition en matière de revenus d'emploi. Il suit l'approche adoptée au modèle de l'OCDE. L'article 16 traite de manière classique les rémunérations des administrateurs de sociétés. L'article 17 relatif aux artistes et aux sportifs, attribue à l'État où se produisent les intéressés le droit d'imposer les revenus provenant des services rendus dans cet État. Cet article est complété par rapport à l'article 17 du modèle de l'OCDE par un paragraphe 3 spécifiant que les revenus des artistes ou sportifs sont exempts d'impôt dans l'État de l'exercice lorsque ces activités y sont exercées et que le séjour dans cet État est supporté entièrement ou substantiellement par des fonds publics. 7 L'article 18 réglemente le droit d'imposition des pensions. En ce qui concerne les pensions du secteur privé, payées en vertu d'un emploi antérieur, visées au paragraphe ler de l'article 18, un droit d'imposition exclusif est attribué à l'État de résidence du bénéficiaire. Le paragraphe 2 de l'article 18 déroge à cette règle prévue au paragraphe l er en stipulant que les pensions et autres sommes payées en application de la législation sur la sécurité sociale ne sont imposables que dans l'État de la source. Par ailleurs, le paragraphe 3 dispose que les pensions et autres rémunérations similaires provenant d'un État contractant et payées à un résident de l'autre État contractant en vertu d'un régime de pension complémentaire ou résultant de dotations faites par l'employeur à un régime interne, ne sont imposables que dans le premier État contractant dans la mesure où les cotisations, allocations, primes d'assurances ou dotations dont découlent les pensions et autres rémunérations visées sous rubrique, ont été soumises à une imposition « à l'entrée » dans le premier État. Cette disposition permet d'éviter que les cotisations, allocations, primes d'assurances ou dotations ayant été soumises à une imposition forfaitaire lors de la constitution au GrandDuché ne soient imposées une seconde fois lors du versement de la pension. L'article 19 reprend les dispositions relatives aux rémunérations concernant les fonctions publiques. L'article 20 complète la Convention par rapport au modèle de l'OCDE en prévoyant un article relatif à l'imposition des professeurs, enseignants et chercheurs. Celui-ci prévoit sous certaines conditions l'exemption dans l'État hôte pour une période n'excédant pas deux années sur la rémunération touchée pour cet enseignement ou ces recherches. Les dispositions précitées ne s'appliquent pas aux revenus reçus au titre de recherches, si ces recherches sont principalement entreprises dans l'intérêt privé d'une personne ou de plusieurs personnes déterminées. L'article 21 permet, conformément au modèle de l'OCDE, d'exonérer les étudiants, les stagiaires et apprentis dans l'État où ils séjournent sous certaines conditions. L'article 22 détermine le régime fiscal des revenus non expressément visés dans les autres articles de la Convention. À l'instar du modèle de l'OCDE, il prévoit l'imposition exclusive de ces revenus dans l'État de résidence de leur bénéficiaire effectif, à moins qu'ils ne puissent être rattachés à un établissement stable dont celui-ci dispose dans l'autre État. 8 L'article 23 fixe les modalités d'imposition de la fortune. L'article 24 traite des modalités de l'élimination des doubles impositions par les deux États. Le Luxembourg a choisi la méthode de l'exemption avec réserve de progressivité pour éviter la double imposition. Cette méthode consiste à exonérer de l'impôt luxembourgeois les revenus et la fortune imposables au Botswana, mais à en tenir compte pour calculer le taux d'impôt applicable aux revenus et à la fortune qui sont imposables au Luxembourg. En ce qui concerne les dividendes, les intérêts, les redevances et les rémunérations pour services techniques dont le droit d'imposition est, aux termes des articles 10, 11, 12 et 13, partagé entre l'État d'où proviennent les revenus et l'État dont le bénéficiaire est un résident, le Luxembourg applique pour ces catégories de revenus la méthode de l'imputation. Il en est de même pour les revenus des artistes et sportifs visés à l'article 17. Cette méthode consiste à intégrer ces revenus de source étrangère dans la base d'imposition luxembourgeoise, mais à déduire de l'impôt luxembourgeois l'impôt payé sur ces revenus au Botswana. La déduction ne peut toutefois pas dépasser l'impôt luxembourgeois relatif à ces revenus. Le sous-paragraphe (
4. c)du paragraphe 2 est conforme au modèle de l'OCDE. La disposition proposée par l'OCDE a pour objet d'éviter l'absence d'imposition qui résulterait de désaccords entre l'État de résidence et l'État de la source sur les faits d'un cas spécifique ou sur l'interprétation des dispositions de la Convention. Cette disposition permet ainsi d'éviter une double exonération, de sorte à ne pas aboutir à un résultat qui est contraire à l'objet d'une Convention tendant à éviter les doubles impositions. Le sous-paragraphe (
5. d)du paragraphe 2 prévoit la prise en compte, pour les besoins de l'imputation, lors de l'imposition au Luxembourg des dividendes, intérêts, redevances et rémunérations pour services techniques provenant de source botswanaise, d'un impôt fictif botswanais. Ainsi, le Luxembourg considère que le montant de l'impôt botswanais sur les dividendes, intérêts, redevances et rémunérations pour services techniques est perçu aux taux prévus aux articles 10, 11, 12 et 13, même si le Botswana accorde une réduction sur ces taux afin d'encciurager des investissements. Le point II. du Protocole de la Convention relatif à l'article 24 prévoit que la disposition relative au sous-paragraphe (
6. d)du paragraphe 2 est applicable pour une période de 10 ans et peut être prorogée d'un commun accord entre les autorités compétentes des deux États. 9 Le Botswana a opté d'une manière générale pour la méthode de l'imputation. Les articles 25 à 32 contiennent certaines dispositions spéciales ainsi que les dispositions finales de la Convention. L'article 25 traite de l'élimination de la discrimination fiscale dans certaines situations précises. L'article 26 règle les cas où une procédure amiable peut être engagée entre les autorités compétentes des deux États tout en prévoyant que les autorités compétentes doivent s'efforcer de régler par voie d'accord amiable la situation des contribuables qui ont fait l'objet d'une imposition non conforme aux dispositions de la Convention. Le paragraphe ler dispose qu'une personne peut soumettre son cas à l'autorité compétente de l'un ou l'autre État contractant. L'article 27 réglemente l'échange de renseignements entre les États contractants. L'article suit l'approche adoptée au modèle de l'OCDE. Le point III. du Protocole de la Convention relatif à l'article 27 détermine les modalités à respecter lors d'une demande d'information provenant d'un État contractant et transmise à l'autre État contractant. Ceci a pour but d'évaluer l'importance et la pertinence de la demande et de pouvoir y répondre efficacement de manière précise. L'article 28 prévoit l'assistance en matière de recouvrement des impôts. Cet article énonce les règles suivant lesquelles les États contractants peuvent se prêter mutuellement assistance dans le cadre du recouvrement de l'impôt. L'assistance au recouvrement est limitée aux impôts visés par la Convention. L'article 29 reprend les règles applicables aux membres des missions diplomatiques et des postes consulaires. Il suit l'approche adoptée au modèle de l'OCDE. L'article 30 reprend une disposition sur le droit aux avantages de la Convention. La disposition reprise est la règle des objets principaux stipulant qu'un avantage prévu par la Convention n'est pas accordé s'il est raisonnable de conclure que l'octroi de cet avantage était un des objets principaux d'un montage ou d'une transaction ayant permis, directement ou indirectement, de l'obtenir. Le paragraphe 2 reprend une disposition optionnelle figurant aux commentaires du modèle de l'OCDE dans sa version 2017 qui met en place un processus de consultation entre les 10 autorités compétentes. Ainsi, l'autorité compétente à laquelle la demande a été adressée consulte l'autorité compétente de l'autre État avant de rejeter une demande présentée par un résident de cet autre État. L'article 31 établit les règles relatives à l'entrée en vigueur de la Convention dans les deux États contractants. L'article 32 arrête les modalités selon lesquelles la Convention pourra être dénoncée. La Convention est complétée par un Protocole dont les principales dispositions ont été commentées avec les articles auxquels il se réfère. Le Protocole forme partie intégrante de la Convention. 11 IV. Fiche d'évaluation d'impact Mesures législatives et réglementaires Intitulé du projet: Projet de loi portant approbation de l'« Agreement between the Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana for the elimination

double taxation with respect to taxes on income and on capital and the prevention

tax evasion and avoidance», et le Protocole y relatif, faits à Luxembourg, le 19 septembre 2018 Ministère initiateur: Ministère des Finances Auteur: Yoann Le Dorze Tél. : 247-52361 Courriel: yoann.ledorze@co.etat.lu Objectif(

1. s)du projet: Approbation d'un traité international en matière fiscale Autre(
2. s)Ministère(s)/Organisme(s)/Commune(
3. s)impliqué(e)(s): / Date: 14 mai 2020 Mieux légiférer 1. Partie(
4. s)prenante(
5. s)(organismes divers, citoyens,...) consultée(s): Oui: Non: VI Si oui, laquelle/lesquelles: Remarques/Observations: 2. 3. Destinataires du projet: - Entreprises/Professions libérales: Oui: - Citoyens: Oui: Non: - Administrations: Oui: Le principe « Think small first » est-il respecté? Non: Non: Oui: IP Non: l l N.a.:2E (c.àd. des exemptions ou dérogations sont-elles prévues Suivant la taille de l'entreprise et/ou son secteur d'activité?) Remarques/Observations: 4. Le projet est-il lisible et compréhensible pour le destinataire? Oui: E Non: El Existe-il un texte coordonné ou un guide pratique, mis à jour et publié d'une façon régulière? Oui: Non: Remarques/Observations: 5. Le projet a-t-il saisi l'opportunité pour supprimer ou simplifier des régimes d'autorisation et de déclaration existants, ou pour améliorer la qualité des procédures? Oui:1 1 Non: E Remarques/Observations : 2 Double-click sur la case pour ouvrir la fenêtre permettant de l'activer N.a.: non applicable 12 6. Le projet contient-il une charge administrative3 pour le(
6. s)destinataire(s)? (un coût imposé pour satisfaire à une oui: n Non: E] obligation d'information émanant du projet?) Si oui, quel est le coût administratif approximatif total? (nombre de destinataires x coût administratif' par destinataire) 7.
7. a)Le projet prend-il recours à un échange de données interadministratif (national ou international) plutôt que de demander l'information au destinataire? Oui: n Non: E N.a.: D si oui, de quelle(
8. s)donnée(
9. s)et/ou administration(
10. s)s'agit-il?
11. b)Le projet en question contient-il des dispositions spécifiques concernant la protection des personnes à l'égard du traitement des données à caractère personnel? oui: D Non: D N.a.: E Si oui, de quelle(
12. s)donnée(
13. s)et/ou administration(
14. s)s'agit-il? 8. Le projet prévoit-il: - une autorisation tacite en cas de non réponse de l'administration? - des délais de réponse à respecter par l'administration? - oui: D Non: E] N.a.: n le principe que l'administration ne pourra demander des informations supplémentaires qu'une seule fois? 9. Oui: D Non: E N.a.: D Oui: D Non: E N.a.: D Y a-t-il une possibilité de regroupement de formalités et/ou de procédures (p. ex. prévues le cas échant par un autre texte)? Oui: E Non: n N.a.:151 Si oui, laquelle: 10. En cas de transposition de directives européennes, le principe « la directive, rien que la directive » est-il respecté? Oui: n Non: n N.a.: Fi Si non, pourquoi? 11. Le projet contribue-t-il en général à une: n Non: E a. simplification administrative, et/ou à une Oui: b. amélioration de qualité règlementaire? Oui: D Non: E Remarques/Observations: II s'agit d'obligations et de formalités administratives imposées aux entreprises et aux citoyens, liées à l'exécution, l'application ou la mise en œuvre d'une loi, d'un règlement grand-ducal, d'une application administrative, d'un règlement ministériel, d'une circulaire, d'une directive, d'un règlement UE ou d'un accord international prévoyant un droit, une interdiction ou une obligation. 4 Coût auquel un destinataire est confronté lorsqu'il répond à une obligation d'information inscrite dans une loi ou un texte d'application de celle-ci (exemple: taxe, coût de salaire, perte de temps ou de congé, coût de déplacement physique, achat de matériel, etc...). 3 13 12. Des heures d'ouverture de guichet, favorables et adaptées Oui: D Non: D N.a.: E aux besoins du/des destinataire(s), seront-elles introduites? Remarques/Observations: 13. Y a-t-il une nécessité d'adapter un système informatique auprès de l'État (e-Government ou application back-

fice)? Oui: D Non: E si oui, quel est le délai pour disposer du nouveau système:

1. Y a-t-il un besoin en formation du personnel Oui: D Non: E N.a.: D de l'administration concernée? si oui, lequel? Remarques/Observations: Egalité des chances
2. Le projet est-il: - principalement centré sur l'égalité des femmes et des hommes? Oui: D Non: E - positif en matière d'égalité des femmes et des hommes? oui: D Non: E Si oui, expliquez de quelle manière: oui: D Non: E neutre en matière d'égalité des femmes et des hommes? Si oui, expliquez pourquoi: Les questions d'égalité des femmes et des hommes ne sont pas touchées par l'échange et la protection réciproque d'informations classifiées. Oui: D Non: E négatif en matière d'égalité des femmes et des hommes? si oui, expliquez de quelle manière:
3. Y a-t-il un impact financier différent sur Oui: El Non: E N.a.: D les femmes et les hommes ? Si oui, expliquez de quelle manière: Directive « services »
4. Le projet introduit-il une exigence relative à la liberté d'établissement soumise à évaluations ? Oui: n Non: D N.a.: [S] Si oui, veuillez annexer le formulaire A, disponible au site Internet du Ministère de l'Economie: http://www.eco.public.lu/attributions/dg2/d consommation/d march int rieur/Services/i ndex.html 5 Article 15, paragraphe 2, de la directive « services » (cf. Note explicative p. 10-11) 14
5. Le projet introduit-il une exigence relative à la libre prestation de services transfrontaliers6 ? Oui: III Non: E N.a.: [s] si oui, veuillez annexer le formulaire B, disponible au site Internet du Ministère de l'Economie: http://www.eco.publiciulattributions/dg2/d consommation/d march int rieur/Services/i ndex.html 6 Article 16, paragraphe I, troisième alinéa et paragraphe 3, première phrase de la directive « services » (cf. Note explicative, p.10-11) 15 V. Fiche financière (art. 79 de la loi du 8 juin 1999 sur le Budget, la Comptabilité et la Trésorerie de l'État) Le Projet de loi portant approbation de l'« Agreement between the Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana for the elimination

double taxation with respect to taxes on income and on capital and the prevention

tax evasion and avoidance », et le Protocole y relatif, faits à Luxembourg, le 19 septembre 2018, ne comporte pas de dispositions dont l'application est susceptible de grever le budget de l'Etat. 16 vil. Texte de la convention AGREEMENT between the Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana for the elimination

double taxation with respect to taxes on income and on capital and the prevention

tax evasion and avoidance The Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana Desiring to further develop their economic relationship and to enhance their cooperation in tax matters, lntending to conclude an Agreement for the elimination

double taxation with respect to taxes on income and on capital without creating opportunities for non-taxation or reduced taxation through tax evasion or avoidance (including through treaty-shopping arrangements aimed at obtaining reliefs provided in this Agreement for the indirect benefit

residents

third States) Have agreed as follows: Article 1 PERSONS COVERED This Agreement shall apply to persons who are residents

one or both

the Contracting States. Article 2 TAXES COVERED

a Contracting State or

its local authorities, irrespective

the manner in which they are levied.

income or

capital, including taxes on gains from the alienation

movable or immovable property, taxes on the total amounts

wages or salaries paid by enterprises, as well as taxes on capital appreciation. 17

either Contracting State to charge tax on the profits

a mineral enterprise at an effective rate different from that charged on the profits

any other enterprise. The term "a mineral enterprise" means an enterprise carrying on the business

mining.

signature

the Agreement in addition to, or in place

, the existing taxes. The competent authorities

the Contracting States shall notify each other

any significant changes that have been made in their taxation laws. Article 3 GENERAL DEFINITIONS

this Agreement, unless the context otherwise requires: (a) the term "Botswana" means the Republic

Botswana; (b) the term "Luxembourg" means the Grand Duchy

Luxembourg and, when used in a geographical sense, means the territory

the Grand Duchy

Luxembourg; (

1. c)the terms "Contracting State" and "the other Contracting State" mean Botswana or Luxembourg as the context requires; (
2. d)the term "person" includes an individual, a company, a trust, an estate, a collective investment vehicle or undertaking and any other body

persons; (

1. e)the term "company" means any body corporate or any entity that is treated as a body corporate for tax purposes; (
2. f)the term "enterprise" applies to the carrying on

any business; 18 (g) the terms "enterprise

a Contracting State" and "enterprise

the other Contracting State" mean respectively an enterprise carried on by a resident

a Contracting State and an enterprise carried on by a resident

the other Contracting State; (h) the term "international traffic" means any transport by a ship, aircraft, rail or road vehicle operated by an enterprise that has its place

effective management in a Contracting State, except when the ship, aircraft, rail or road vehicle is operated solely between places in the other Contracting State; (

1. i)the term "competent authority" means: (
2. i)in Botswana, the Minister responsible for finance, represented by the Commissioner General

the Botswana Unified Revenue Service or a representative

the Commissioner General; (

1. ii)(
2. j)in Luxembourg, the Minister

Finance or his authorised representative; the term "national" means: (0 any individual possessing the nationality

a Contracting State; (

1. ii)any legal person, partnership or association deriving its status as such from the laws in force in a Contracting State; (
2. k)the term "business" includes the performance

professional services and

other activities

an independent character.

the Agreement at any time by a Contracting State, any term not defined therein shall, unless the context otherwise requires, have the meaning that it has at that time under the law

that State for the purposes

the taxes to which the Agreement applies, any meaning under the applicable tax laws

that State prevailing over a meaning given to the term under other laws

that State. Article 4 RESIDENT

this Agreement, the term "resident

a Contracting State" means any person who, under the laws

that State, is liable to tax therein by reason

his domicile, residence, place

management or any other criterion

a similar nature, and also includes that State and any local authority thereof. This term, however, does not include any person who is liable to tax in that State in respect only

income from sources in that State or capital situated therein.

the provisions

paragraph

both Contracting States, then his status shall be determined as follows: 19 (a) he shall be deemed to be a resident only

the State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident only

the State with which his personal and economic relations are closer (centre

vital interests); (b) if the State in which he has his centre

vital interests cannot be determined, or if he has not a permanent home available to him in either State, he shall be deemed to be a resident only

the State in which he has an habitual abode; (c) if he has an habitual abode in both States or in neither

them, he shall be deemed to be a resident only

the State

which he is a national; (d) if he is a national

both States or

neither

them, the competent authorities

the Contracting States shall settle the question by mutual agreement.

the provisions

paragraph

both Contracting States, then it shall be deemed to be a resident only

the State in which its place

effective management is situated. Article 5 PERMANENT ESTABLISHMENT

this Agreement, the term "permanent establishment" means a fixed place

business through which the business

an enterprise is wholly or partly carried on.

management; (

1. b)a branch; (
2. c)an

fice; (

1. d)a factory; (
2. e)a workshop; (
3. f)a mine, an oil or gas well, a quarry or any other place

extraction or exploitation

natural resources; and (g) an installation or structure used for the exploration

natural resources, provided that the installation or structure continues for a period or periods aggregating more than 183 days in any twelve-month period commencing or ending in the fiscal year concerned.

more than six months; 20 (b) the furnishing

services, including consultancy services, by an enterprise through employees or other personnel engaged by the enterprise for such purpose, but only where activities

that nature continue (for the same or connected project) within a Contracting State for a period or periods aggregating more than 183 days in any twelve-month period commencing or ending in the fiscal year concerned.

this Article, the term "permanent establishment" shall be deemed not to include: (a) the use

facilities solely for the purpose

storage, display or delivery

goods or merchandise belonging to the enterprise; (b) the maintenance

a stock

goods or merchandise belonging to the enterprise solely for the purpose

storage, display or delivery; (c) the maintenance

a stock

goods or merchandise belonging to the enterprise solely for the purpose

processing by another enterprise; (d) the maintenance

a fixed place

business solely for the purpose

purchasing goods or merchandise or

collecting information for the enterprise; (e) the maintenance

a fixed place

business solely for the purpose

carrying on, for the enterprise, any other activity

a preparatory or auxiliary character; (f) the maintenance

a fixed place

business solely for any combination

activities mentioned in sub-paragraphs (a) fo (e), provided that the overall activity

the fixed place

business resulting from this combination is

a preparatory or auxiliary character.

paragraphs

an independent status to whom paragraph

an enterprise and has, and habitually exercises, in a Contracting State an authority to conclude contracts in the name

the enterprise, that enterprise shall be deemed to have a permanent establishment in that State in respect

any activities which that person undertakes for the enterprise, unless the activities

such person are limited to those mentioned in paragraph

business, would not make this fixed place

business a permanent establishment under the provisions

that paragraph.

an independent status, provided that such persons are acting in the ordinary course

their business.

this Article, an insurance enterprise

a Contracting State shall, except in regard to reinsurance, be deemed to have a permanent 21 establishment in the other Contracting State if it collects premiums in the territory

that other State or insures risks situated therein through a person other than an agent

an independent status to who paragraph

a Contracting State controls or is controlled by a company which is a resident

the other Contracting State, or which carries on business in that other State (whether through a permanent establishment or otherwise), shall not

itself constitute either company a permanent establishment

the other. Article 6 INCOME FROM IMMOVABLE PROPERTY

a Contracting State from immovable property (including income from agriculture or forestry) situated in the other Contracting State may be taxed in that other State.

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 equipment used in agriculture and forestry, rights to which the provisions

general law respecting landed property apply, usufruct

immovable property and rights to variable or fixed payments as consideration for the working

, or the right to work, minerai deposits, sources and other natural resources; ships, boats and aircraft shall not be regarded as immovable property.

paragraph

immovable property.

paragraphs

an enterprise. Article 7 BUSINESS PROFITS

an enterprise

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. lf the enterprise carries on business as aforesaid, the profits

the enterprise may be taxed in the other State but only so much

them as is attributable to that permanent establishment. 22

paragraph

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 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

which it is a permanent establishment.

a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes

the permanent establishment, including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere. However, no such deduction shall be allowed in respect

amounts, if any, paid (otherwise than towards reimbursement

actual expenses) by the permanent establishment to the head

fice

the enterprise or any

its other

fices, by way

royalties, fees or other similar payments in return for the use

patents or other rights, or by way

commission, for specific services performed or for management, or, except in the case

a banking enterprise by way

interest on moneys lent to the permanent establishment. Likewise, no account shall be taken, in the determination

the profits

a permanent establishment, for amounts charged (otherwise than towards reimbursement

actual expenses), by the permanent establishment to the head

fice

the enterprise or any

its other

fices, by way

royalties, fees or other similar payments in return for the use

patents or other rights, or by way

commission for specific services performed or for management, or, except in the case

a banking enterprise by way

interest on moneys lent to the head

fice

the enterprise or any

its other

fices.

the mere purchase by that permanent establishment

goods or merchandise for the enterprise.

the preceding paragraphs, the 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.

income which are dealt with separately in other Articles

this Agreement, then the provisions

those Articles shall not be affected by the provisions

this Article. 23 Article 8 INTERNATIONAL TRANSPORT

ships, aircraft, rail or road vehicle in international traffic shall be taxable only in the Contracting State in which the place

effective management

the enterprise is situated.

boats engaged in inland waterways transport shall be taxable only in the Contracting State in which the place

effective management

the enterprise is situated.

effective management

a shipping enterprise or

an inland waterways transport enterprise is aboard a ship or boat, then it shall be deemed to be situated in the Contracting State in which the home harbour

the ship or boat is situated, or, if there is no such home harbour, in the Contracting State

which the operator

the ship or boat is a resident.

paragraph

a Contracting State participates directly or indirectly in the management, control or capital

an enterprise

the other Contracting State, or (b) the same persons participate directly or indirectly in the management, control or capital

an enterprise

a Contracting State and an enterprise

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 enterprises, then any profits which would, but for those conditions, have accrued to one

the enterprises, but, by reason

those conditions, have not so accrued, may be included in the profits

that enterprise and taxed accordingly.

an enterprise

that State - and taxes accordingly - profits on which an enterprise

the other Contracting State has been 24 charged to tax in that other State and the profits so included are profits which would have accrued to the enterprise

the first-mentioned State if the conditions made between the two enterprises had been those which would have been made between independent enterprises, then that other State shall make an appropriate adjustment to the amount

the tax charged therein on those profits. ln determining such adjustment, due regard shall be had to the other provisions

this Agreement and the competent authorities

the Contracting States shall if necessary consult each other. Article 10 DIVIDENDS

a Contracting State to a resident

the other Contracting State may be taxed in that other State.

which the company paying the dividends is a resident and according to the laws

that State, but if the beneficial owner

the dividends is a resident

the other Contracting State, the tax so charged shall not exceed: (a) 5 per cent

the gross amount

the dividends if the beneficial owner is a company (other than a partnership) which holds directly at least 25 per cent

the capital

the company paying the dividends; (b) 10 per cent

the gross amount

the dividends in all other cases. This paragraph shall not affect the taxation

the company in respect

the profits out

which the dividends are paid.

the State

which the company making the distribution is a resident.

paragraphs

the dividends, being a resident

a Contracting State, carries on business in the other Contracting State

which the company paying the dividends is a resident, through a permanent establishment situated therein, and the holding in respect

which the dividends are paid is effectively connected with such permanent establishment. ln such case the provisions

Article 7shall apply. 25

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 insofar as such dividends are paid to a resident

that other State or insofar as the holding in respect

which the dividends are paid is effectively connected with a permanent establishment 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 consist wholly or partly

profits or income arising in such other State. Article 11 INTEREST

the other Contracting State may be taxed in that other State.

that State, but if the beneficial owner

the interest is a resident

the other Contracting State, the tax so charged shall not exceed 7.5 per cent

the gross amount

the interest. Notwithstanding the provisions

paragraph

which the recipient is a resident if the beneficial owner

the interest is a resident

that State, and: (

1. a)is that State or the Central Bank or a local authority thereof; (
2. b)if the interest is paid by the State in which the interest arises or by a local authority or statutory body thereof; (
3. c)if the interest is paid in respect

a loan, debt-claim or credit that is owed to, or made, provided, guaranteed or insured by, that State or a local authority or export financing agency thereof.

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, income from government securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures. Penalty charges for late payment shall not be regarded as interest for the purpose

this Article.

paragraph

the interest, being a resident

a Contracting State, carries on business in the other 26 Contracting State in which the interest arises, through a permanent establishment situated therein, and the debt-claim in respect

which the interest is paid is effectively connected with such permanent establishment. In such case the provisions

Article 7shall apply.

that State. Where, however, the person paying the interest, whether he is a resident

a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment, then such interest shall be deemed to arise in the State in which the permanent establishment is situated.

a special relationship between the payer and the beneficial owner or between both

them and some other person, the amount

the interest, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence

such relationship, the provisions

this Article shall apply only to the last-mentioned amount. ln such case, the excess part

the payments shall remain taxable according to the laws

each Contracting State, due regard being had to the other provisions

this Agreement. Article 12 ROYALTIES

the other Contracting State may be taxed in that other State.

that State, but if the beneficial owner

the royalties is a resident

the other Contracting State, the tax so charged shall not exceed 7.5 per cent

the gross amount

the royalties.

any kind received as a consideration for the use

, or the right to use, any copyright

literary, artistic or scientific work including cinematograph films and films, tapes or discs for radio or television broadcasting, any patent, trade mark, design or model, plan, secret formula or process, or for the use

or the right to use industrial, commercial or scientific equipment or for information concerning industrial, commercial or scientific experience.

paragraphs

the royalties, being a resident

a Contracting State, carries on business in the other Contracting 27 State in which the royalties arise, through a permanent establishment situated therein, and the right or property in respect

which the royalties are paid is effectively connected with such permanent establishment. ln such case the provisions

Article 7shall apply.

that State. Where, however, the person paying the royalties, whether he is a resident

a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the liability to pay the royalties was incurred, and such royalties are borne by such permanent establishment, then such royalties shall be deemed to arise in the Contracting State in which the permanent establishment is situated.

a special relationship between the payer and the beneficial owner or between bath

them and some other person, the amount

the royalties, having regard to the use, right or information for which they are paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence

such relationship, the provisions

this Article shall apply only to the last-mentioned amount. ln such case, the excess part

the payments shall remain taxable according to the laws

each Contracting State, due regard being had to the other provisions

this Agreement. Article 13 FEES FOR TECHNICAL SERVICES

the other Contracting State may be taxed in that other State.

that State, but where the beneficial owner

the fees for technical services is a resident

the other Contracting State, the tax so charged shall not exceed 7.5 per cent

the gross amount

the fees for technical services.

any kind to any person, other than to an employee

the person making the payments, in consideration for any services

a technical, managerial or consultancy nature.

paragraphs

the fees for technical services, being a resident

a Contracting State, carries on business in the other Contracting State in which the fees for technical services arise through a permanent establishment situated therein, and the fees for technical services are effectively connected with such permanent establishment. ln such case, the provisions

Article 7shall apply. 28

that State. Where, however, the person paying the fees for technical services, whether he is a resident

a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the obligation to pay the fees for technical services was incurred, and such fees for technical services are borne by such permanent establishment, then such fees for technical services shall be deemed to arise in the Contracting State in which the permanent establishment is situated.

a special relationship between the payer and the beneficial owner or between both

them and some other person, the amount

the fees for technical services paid exceeds, for whatever reason, the amount which would have been agreed upon by the payer and the beneficial owner in the absence

such a relationship, the provisions

this Article shall apply only to the last-mentioned amount. ln such case, the excess part

the payments shall remain taxable according to the laws

each Contracting State, due regard being had to the other provisions

this Agreement. Article 14 CAPITAL GAINS

a Contracting State from the alienation

immovable property referred to in Article 6 and situated in the other Contracting State may be taxed in that other State.

movable property forming part

the business property

a permanent establishment which an enterprise

a Contracting State has in the other Contracting State, including such gains from the alienation

such a permanent establishment (alone or with the whole enterprise), may be taxed in that other State.

ships, aircraft, rail or road vehicles operated in international traffic, boats engaged in inland waterways transport or movable property pertaining to the operation

such ships, aircraft, rail or road vehicles, or boats, shall be taxable only in the Contracting State in which the place

effective management

the enterprise is situated.

any property other than that referred to in paragraphs

which the alienator is a resident. 29 Article 15 INCOME FROM EMPLOYMENT

Articles 16, 18, 19 and 20, salaries, wages and other similar remuneration derived by a resident

a Contracting State in respect

an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. lf the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other State.

paragraph

a Contracting State in respect

an employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if: (

1. a)the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in any twelve month period commencing or ending in the fiscal year concerned; and (
2. b)the remuneration is paid by, or on behalf

, an employer who is not a resident

the other State; and (c) the remuneration is not borne by a permanent establishment which the employer has in the other State.

this Article, remuneration derived in respect

an employment exercised aboard a ship, aircraft, rail or road vehicles operated in international traffic, or aboard a boat engaged in inland waterways transport, may be taxed in the Contracting State in which the place

effective management

the enterprise is situated. Article 16 DIRECTORS' FEES Directors' fees and other similar payments derived by a resident

a Contracting State in his capacity as a member

the board

directors

a company which is a resident

the other Contracting State may be taxed in that other State. Article 17 ARTISTES AND SPORTSPERSONS

Articles 7 and 15, income derived by a resident

a Contracting State as an entertainer, such as a theatre, motion picture, radio or television 30 artiste, or a musician, or as a sportsperson, from his personal activities as such exercised in the other Contracting State, may be taxed in that other State.

personal activities exercised by an entertainer or a sportsperson in his capacity as such accrues not to the entertainer or sportsperson himself but to another person, that income may, notwithstanding the provisions

Articles 7 and 15, be taxed in the Contracting State in which the activities

the entertainer or sportsperson are exercised.

paragraphs

this Article shall not apply to income derived from activities performed in a Contracting State by entertainers or sportspersons if the visit to that State is wholly or substantially supported by public funds. ln such case, the income shall be taxable only in the Contracting State

which the entertainer or sportsperson is a resident. Article 18 PENSIONS

paragraph

Article 19

, pensions and other similar remuneration and annuities arising in a Contracting State and paid to a resident

the other Contracting State may be taxed in the first-mentioned Contracting State.

paragraph

a Contracting State shall be taxable only in that State.

paragraph

the other Contracting State shall be taxable only in the first-mentioned State, provided that such payments derive from contributions paid to or from provisions made under a pension scheme by the recipient or on his behalf and that these contributions, provisions or the pensions or other similar remuneration have been subjected to tax in the first-mentioned State under the ordinary rules

its tax laws.

time under an obligation to make the payments in return for adequate and full consideration in money or money's worth. 31 Article 19 GOVERNMENT SERVICE

services rendered to that State or authority shall be taxable only in that State. (b) However, such salaries, wages and other similar remuneration shall be taxable only in the other Contracting State if the services are rendered in that State and the individual is a resident

that State who: (i) is a national

that State; or (ii) did not become a resident

that State solely for the purpose

rendering the services.

paragraph

funds created by, a Contracting State or a local authority thereof to an individual in respect

services rendered to that State or authority shall be taxable only in that State. (b) However, such pensions and other similar remuneration shall be taxable only in the other Contracting State if the individual is a resident

, and a national

, that State.

Articles 15, 16, 17 and 18 shall apply to salaries, wages, pensions, and other similar remuneration in respect

services rendered in connection with a business carried on by a Contracting State or a local authority thereof. Article 20 PROFESSORS, TEACHERS AND RESEARCHERS

one

the Contracting States immediately before visiting the other Contracting State for the purpose

teaching or engaging in research, or both, at a university, college or other similar institution in that other Contracting State, shall be exempt from tax in that other State on any remuneration for such teaching or research for a period not exceedingtwo years from the date

his first arrivai in that other State.

some private person or persons. 32 Article 21 STUDENTS Payments which a student, apprentice or business trainee who is or was immediately before visiting a Contracting State a resident

the other Contracting State and who is present in the first-mentioned State solely for the purpose

his education or training receives for the purpose

his maintenance, education or training shall not be taxed in that State, provided that such payments arise from sources outside that State. Article 22 OTHER INCOME Items

income

a resident

a Contracting State, wherever arising, not dealt with in

this Agreement shall be taxable only in that State.

paragraph

Article 6

, if the recipient

such income, being a resident

a Contracting State, carries on business in the other Contracting State through a permanent establishment situated therein, and the right or property in respect

which the income is paid is effectively connected with such permanent establishment. ln such case the provisions

Article 7shall apply. Article 23 CAPITAL

a Contracting State and situated in the other Contracting State, may be taxed in that other State.

the business property

a permanent establishment which an enterprise

a Contracting State has in the other Contracting State may be taxed in that other State.

such ships, aircraft, rail or road vehicles and boats, shall be taxable only in the Contracting State in which the place

effective management

the enterprise is situated. 33

capital

a resident

a Contracting State shall be taxable only in that State. Article 24 ELIMINATION

DOUBLE TAXATION Double taxation shall be eliminated as follows:

the law

Botswana regarding the allowance

a credit against Botswana tax

tax payable under the laws

a country outside Botswana, Luxembourg tax payable under the laws

Luxembourg and in accordance with this Agreement, whether directly or by deduction, on profits or income liable to tax in Luxembourg shall be allowed as a credit against any Botswana tax payable in respect

the same profits or income by reference to which the Luxembourg tax is computed. However, the amount

such credit shall not exceed the amount

the Botswana tax payable on that income in accordance with the laws

Botswana.

the law

Luxembourg regarding the elimination

double taxation which shall not affect the general principle hereof, double taxation shall be eliminated as follows: (a) Where a resident

Luxembourg derives income or owns capital which, in accordance with the provisions

this Agreement, may be taxed in Botswana, Luxembourg shall, subject to the provisions

sub-paragraphs (b) and (c), exempt such income or capital from tax, but may, in order to calculate the amount

tax on the remaining income or capital

the resident, apply the same rates

tax as if the income or capital had not been exempted. (b) Where a resident

Luxembourg derives income which, in accordance with the provisions

Articles 10, 11, 12, 13 and 17 may be taxed in Botswana, Luxembourg shall allow as a deduction from the income tax on individuals or from the corporation tax

that resident an amount equal to the tax paid in Botswana. Such deduction shall not, however, exceed that part

the tax, as computed before the deduction is given, which is attributable to such items

income derived from Botswana. (c) The provisions

sub-paragraph (a) shall not apply to income derived or capital owned by a resident

Luxembourg where Botswana applies the provisions

34 this Agreement to exempt such income or capital from tax or applies the provisions

paragraph

Articles 10, 11, 12 or 13 to such income. (d) Where by reason

the relief given under the provisions

Botswana laws for the purpose

encouraging investment in Botswana, the Botswana tax actually levied on dividends, interest, royalties or fees for technical services arising in Botswana is lower than the respective rate referred to in Articles 10, 11, 12 and 13, then the amount

the tax paid in Botswana on such dividends, interest, royalties and fees for technical services shall be deemed to have been paid at the respective rates referred to in Articles 10, 11, 12 and 13. Article 25 NON-DISCRIMINATION

a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith, which is other or more burdensome than the taxation and connected requirements to which nationals

that other State in the same circumstances, in particular with respect to residence, are or may be subjected. This provision shall, notwithstanding the provisions

Article 1

, also apply to persons who are not residents

one or both

the Contracting States.

a Contracting State has in the other Contracting State shall not be less favourably levied in that other State than the taxation levied on enterprises

that other State carrying on the same activities.

paragraph

Article 9, paragraph

Article 11, paragraph

Article 12, or paragraph

Article 13

, apply, interest, royalties, fees for technical services and other disbursements paid by an enterprise

a Contracting State to a resident

the other Contracting State shall, for the purpose

determining the taxable profits

such enterprise, be deductible under the same conditions as if they had been paid to a resident

the first-mentioned State. Similarly, any debts

an enterprise

a Contracting State to a resident

the other Contracting State shall, for the purpose

determining the taxable capital

such enterprise, be deductible under the same conditions as if they had been contracted to a resident

the first-mentioned State.

a Contracting State, the capital

which is wholly or partly owned or controlled, directly or indirectly, by one or more residents

the other Contracting State, shall not be subjected in the first-mentioned State to any taxation or any requirement connected 35 therewith which is other or more burdensome than the taxation and connected requirements to which other similar enterprises

the first-mentioned State are or may be subjected.

this Article shall not be construed as obliging a Contracting State to grant to residents

the other Contracting State any personal allowances, reliefs and reductions for taxation purposes on account

civil status or family responsibilities which it grants to its own residents.

this Article shall apply to taxes covered by this Agreement. Article 26 MUTUAL AGREEMENT PROCEDURE

one or both

the Contracting States result or will result for him in taxation not in accordance with the provisions

this Agreement, he may, irrespective

the remedies provided by the domestic law

those States, present his case to the competent authority

either Contracting State. The case must be presented within three years from the first notification

the action resulting in taxation not in accordance with the provisions

the Agreement.

the other Contracting State, with a view to the avoidance

taxation which is not in accordance with the Agreement. Any agreement reached shall be implemented notwithstanding any time limits in the domestic law

the Contracting States.

the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application

the Agreement. They may also consult together for the elimination

double taxation in cases not provided for in the Agreement.

the Contracting States may communicate with each other directly, including through a joint commission consisting

themselves or their representatives, for the purpose

reaching an agreement in the sense

the preceding paragraphs. 36 Article 27 EXCHANGE

INFORMATION

the Contracting States shall exchange such information as is foreseeably relevant for carrying out the provisions

this Agreement or to the administration or enforcement

the domestic laws concerning taxes

every kind and description imposed on behalf

the Contracting States, or local authorities, insofar as the taxation thereunder is not contrary to the Agreement. The exchange

information is not restricted by Articles 1 and 2.

that State and shall be disclosed only to persons or authorities (including courts and administrative bodies) concerned with the assessment or collection

, the enforcement or prosecution in respect

, or the determination

appeals in relation to the taxes referred to in paragraph

the above. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions.

paragraphs

that or

the other Contracting State; (b) to supply information which is not obtainable under the laws or in the normal course

the administration

that or

the other Contracting State; (c) to supply information which would disclose any trade, business, industrial, commercial, or professional secret or trade process, or information the disclosure

which would be contrary to public policy (ordre public).

paragraph

paragraph

the taxes to which this Agreement relates, together with the interest, costs, and additions to the taxes and fines not being

a penal character.

the State making the application to establish that the taxes being collected are due.

the competent authority

a Contracting State, the competent authority

the other Contracting State will ensure, according to the provisions

laws and regulations applied to collection

the above-mentioned taxes in the last State, collection

fiscal claims covered by the first paragraph, which are recoverable in the first State. These claims shall not enjoy any privilege in the requested State and the latter is not obliged to apply means

execution which are not authorised by the provisions

laws and regulations

the requested State.

paragraph

Article 27

, shall apply equally to all information brought, for the application

the preceding paragraphs

the present Article, to the knowledge

the competent authority

the requested State. Article 29 MEMBERS

DIPLOMATIC MISSIONS AND CONSULAR POSTS Nothing in this Agreement shall affect the fiscal privileges

members

diplomatic missions or consular posts under the general rules

international law or under the provisions

special agreements. Article 30 ENTITLEMENT TO BENEFITS

this Agreement, a benefit under this Agreement shall not be granted in respect

an item

income or capital if it is reasonable to conclude, having regard to all relevant facts and circumstances, that obtaining that benefit was one

the principal purposes

any arrangement or transaction that resulted directly or 38 indirectly in that benefit, unless it is established that granting that benefit in these circumstances would be in accordance with the object and purpose

the relevant provisions

this Agreement.

the Contracting State that would otherwise have granted this benefit shall nevertheless treat that person as being entitled to this benefit, or to different benefits with respect to a specific item

income or capital, if such competent authority, upon request from that person and after consideration

the relevant facts and circumstances, determines that such benefits would have been granted to that person in the absence

the transaction or arrangement referred to in paragraph 1. The competent authority

the Contracting State to which the request has been made will consult with the competent authority

the other State before rejecting a request made under this paragraph by a resident

that other State. Article 31 ENTRY INTO FORCE

this Agreement have been satisfied. The Agreement shall enter into force on the date

receipt

the last notification.

the Agreement shall have effect: (

1. a)in Botswana; (
2. i)with regard to taxes withheld at source, in respect

amounts paid or credited on or after the thirtieth day following the date upon which the Agreement enters into force; and (ii) with regard to other taxes, in respect

tax years or years

assessment beginning on or after the thirtieth day following the date upon which the Agreement enters into force; (b) in Luxembourg: (i) in respect

taxes withheld at source, to income derived on or after 1 January

the calendar year next following the year in which the Agreement enters into force; and (ii) in respect

other taxes on income, and taxes on capital, to taxes chargeable for any taxable year beginning on or after 1 January

the calendar year next following the year in which the Agreement enters into force. 39 Article 32 TERMINATION

termination at least six months before the end

any calendar year beginning after the expiration

a period

five years from the date

its entry into force.

amounts paid or credited on or after the end

the calendar year in which such notice is given; and (ii) with regard to other taxes, in respect

tax years or years

assessment beginning after the end

the calendar year in which such notice is given; (b) in Luxembourg: (i) in respect

taxes withheld at source, to income derived on or after 1 January

the calendar year next following the year in which the notice is given; and (ii) in respect

other taxes on income, and taxes on capital, to taxes chargeable for any taxable year beginning on or after 1 January

the calendar year next following the year in which the notice is given. ln witness whereof the undersigned, duly authorised thereto, have signed this Agreement. Done in duplicate at Luxembourg, this 19th day

September 2018, in the English language. For the Government

the For the Government

the Grand Duchy

Luxembourg Republic

Botswana Pierre GRAMEGNA Samuel O. OUTLULE Minister

Finance Ambassador

the Republic

Botswana to the Grand Duchy

Luxembourg 40 PROTOCOL At the moment

the signing

the Agreement between the Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana for the elimination

double taxation with respect to taxes on income and on capital and the prevention

tax evasion and avoidance, both sides have agreed upon the following provisions, which shall form an integral part

the Agreement: I. With reference to Article 4: A trust, an estate, a collective investment vehicle or undertaking which is established in a Contracting State shall be considered as a resident

the Contracting State in which it is established and as the beneficial owner

the income it receives. II. With reference to Article 24: The provisions

paragraph

10 years beginning on 1 January

the calendar year next following the year in which the Agreement enters into force. This period may be extended by mutual agreement between the competent authorities. III. With reference to Article 27: The competent authority

the requesting State shall provide the following information to the competent authority

the requested State when making a request for information under the Agreement to demonstrate the foreseeable relevance

the information to the request: (a) the identity

the person under examination or investigation; (b) a statement

the information sought including its nature and the form in which the requesting State wishes to receive the information from the requested State; (

1. c)the tax purpose for which the information is sought; (
2. d)grounds for believing that the information requested is held in the requested State or is in the possession or control

a person within the jurisdiction

the requested State; (e) to the extent known, the name and address

any person believed to be in possession

the requested information; (f) a statement that the requesting State has pursued all means available in its own territory to obtain the information, except those that would give rise to disproportionate difficulties. 41 ln witness whereof the undersigned, duly authorised thereto, have signed this Protocol. Done in duplicate at Luxembourg, this 19th day

September 201.8, in the English language. For the Government

the For the Government

the Grand Duchy

Luxembourg Republic

Botswana Pierre GRAMEGNA Samuel O. OUTLULE Minister

Finance Ambassador

the Republic

Botswana to the Grand Duchy

Luxembourg 42 AGREEMENT between the Government

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana for the elimination

double taxation with respect to taxes on income and on capital and the prevention

tax evasion and avoidance The Govemment

the Grand Duchy

Luxembourg and the Government

the Republic

Botswana Desiring to further develop their economic relationship and to enhance their cooperation in tax matters, Intending to conclude an Agreement for the elimination

double taxation with respect to taxes on income and on capital without creating opportunities for non-taxation or reduced taxation through tax evasion or avoidance (including through treaty-shopping arrangements aimed at obtaining reliefs provided in this Agreement for the indirect benefit

residents

third States) Have agreed as follows: Article 1 PERSONS COVERED This Agreement shall apply to persons who are residents

one or both

the Contracting States. Article 2 TAXES COVERED (I) This Agreement shall apply to taxes on income and on capital imposed on behalf

a Contracting State or

its local authorities, irrespective

the manner in which they are levied.

income or

capital, including taxes on gains from the alienation

movable or immovable property, taxes on the total amounts

wages or salaries paid by enterprises, as well as taxes on capital appreciation.

either Contracting State to charge tax on the profits

a minerai enterprise at an effective rate different from that charged on the profits

any other enterprise. The terni "a minerai enterprise" means an enterprise carrying on the business

mining.

signature

the Agreement in addition to, or in place

, the existing taxes. The competent authorities

the Contracting States shall notify each other

any significant changes that have been made in their taxation laws. 2 Article 3 GENERAL DEFINITIONS

this Agreement, unless the context otherwise requires: (a) the term "Botswana" means the Republic

Botswana; (b) the term "Luxembourg" means the Grand Duchy

Luxembourg and, when used in a geograpbical sense, means the territory

the Grand Duchy

Luxembourg; (

1. c)the tennis "Contracting State" and "the other Contracting State" mean Botswana or Luxembourg as the context requires; (
2. d)the term "person" includes an individual, a company, a trust, an estate, a collective investment vehicle or undertaking and any other body

persons; (

1. e)the term "company" means any body corporate or any entity that is treated as a body corporate for tax purposes; (
2. f)the term "enterprise" applies to the carrying on

any business; (g) the terms "enterprise

a Contracting State" and "enterprise

the other Contracting State" mean respectively an enterprise carried on by a resident

a Contracting State and an enterprise carried on by a resident

the other Contracting State; (h) the term "international traffic" means any transport by a ship, aircraft, rail or road vehicle operated by an enterprise that hos its place

effective management in a Contracting State, except when the ship, aircraft, rail or road vehicle is operated solely between places in the other Contracting State; (

1. i)the term "competent authority" means: (
2. i)in Botswana, the Minister responsible for finance, represented by the Commissioner General

the Botswana Unified Revenue Service or a representative

the Commissioner General; (

1. ii)(
2. j)in Luxembourg, the Minister

Finance or his authorised representative; the term "national" means: (i) any individual possessing the nationality

a Contracting State; (

1. ii)any legal person, partnership or association deriving its status as such from the laws in force in a Contracting State; (
2. k)the term "business" includes the performance

professional services and

other activities

an independent character.

the Agreement at any time by a Contracting State, any term not defined therein shall, unless the context otherwise requires, have the meaning that it has at that time under the law

that State for the purposes

the taxes to which the Agreement applies, any meaning under the applicable tax laws

that State prevailing over a meaning given to the term under other laws

th it State. 3 Article 4 RESIDENT

this Agreement, the term "resident

a Contracting State" means any person who, under the laws

that State, is liable to tax therein by reason

his domicile, residence, place cf management or any other criterion

a similar nature, and also includes that State and any local authority thereof. This term, however, does not include any person who is liable to tax in that State in respect only

income from sources in that State or capital situated therein.

the provisions

paragraph

both Contrazting States, then his status shall be determined as follows: (a) he shall be deemed to be a resident only

the State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident only

the State with which his personal and economic relations are closer (centre

vital interests); (b) d. the State in which he has his centre

vital interests cannot be determined, or if he has not a permanent home available to him in either State, he shall be deemed to be a resident only

the State in which he has an habitual abode; (c) if he has an habitual abode in both States or in neither

them, he shall be deemed to be a resident only

the State

which he is a national; (d) if he is a national

both States or

neither

them, the competent authorities

the Contracting States shall settle the question by mutual agreement.

the provisions

paragraph

both Contracting States, then it shall be deemed to be a resident only

the State in which its place

effective management is situated. Article 5 PERMANENT ESTABLISHMENT

this Agreement, the term "permanent establishment" means a fixed place

business through which the business

an enterprise is wholly or partly carried on.

management; (

1. b)a branch; (
2. c)an

fice; (

1. d)a factory; (
2. e)a workshep; 4 - (0 a mine, an oil or gas well, a quarry or any other place

extraction or exploitation

natural resources; and (g) an installation or structure used for the exploration

natural resources, provided that the installation or structure continues for a period or periods aggregating more than 183 days in any twelve-month period commencing or ending in the fiscal year concerned.

more than six months; (b) the furnishing

services, including consultancy services, by an enterprise through employees or other personnel engaged by the enterprise for such purpose, but only where activities

that nature continue (for the same or connected project) within a Contracting State for a period or periods aggregating more than 183 days in any twelvemonth period commencing or ending in the fiscal year concerned.

this Article, the term "permanent establishment" shall be deerned not to include: (a) the use

facilities solely for the purpose

storage, display or delivery

goods or merchandise belonging to the enterprise; (b) the maintenance

a stock

goods or merchandise belonging to the enterprise solely for the purpose

storage, display or delivery; (c) the maintenance

a stock

goods or merchandise belonging to the enterprise solely for the purpose

processing by another enterprise; (d) the maintenance

a fixed place

business solely for the purpose

purchasing goods or merchandise or

collecting information for the enterprise; (e) the maintenance

a fixed place

business solely for the purpose

carrying on, for the enterprise, any other activity

a preparatory or auxiliary character; (f) the maintenance

a fixed place

business solely for any combination

activities rnentioned in sub-paragraphs (a) to (e), provided that the overall activity

the fixed place

business resulting from this combination is

a preparatory or auxiliary character.

paragraphs

an independent status to whom paragraph

an enterprise and has, and habitually exercises, in a Contracting State an authority to conclude contracts in the name

the enterprise, that enterprise shall be deemed to have a permanent establishment in that State in respect

any activities which that person undertakes for the enterprise, unless the activities 5

such person are limited to those mentioned in paragraph

business, would not make this fixed place

business a permanent establishment under the provisions

that paragraph.

an independent status, provided that such persons are acting in the ordinary course

their business.

this Article, an insurance enterprise

a Contracting State shall, except in regard to reinsurance, be deemed to have a permanent establishment in the other Contracting State if it collects premiums in the territory

that other State or insures risks situated therein through a person other than an agent

an independent status to who paragraph

a Contracting State controls or is controlled by a company which is a resident

the other Contracting State, or which carries on business in that other State (whether through a permanent establishment or otherwise), shall not

itself constitute either company a permanent establishment

the other. Article 6 INCOME FROM IMMOVABLE PROPERTY (I) Income derived by a resident

a Contracting State from immovable property (including income from agriculture or forestry) situated in the other Contracting State may be taxed in that other

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 equipment used in agriculture and forestry, rights to which the provisions

generai law respecting landed property apply, usufruct

immovable property and rights to variable or fixed payments as consideration for the working

, or the right to work, minerai deposits, sources and other natural resources; ships, boats and aircraft shall not be regarded as immovable property.

paragraph

imrnovable property. 6

paragraphs

an enterprise. Article 7 BUSINESS PROFITS

an enterprise

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. lf the enterprise cardes on business as aforesaid, the profits

the enterprise may be taxed in the other State but only so much

them as is attributable to that permanent establishment.

paragraph

a Contracting State carries on busless in the other Contracting State through a permanent establishment situated therein, there shall in each Contrading State be attributed to that permanent establishment the profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or sitnilar activities under the same or similar conditions and dealing wholly independently with the enterptise

which it is a permanent establishment.

a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes

the permanent establishment, including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere. However, no such deduction shall be allowed in respect

amounts, if any, paid (otherwise than towards reimbursement

actual expenses) by the permanent establishment to the head

fice

the entemrise or any

its other

fices, by way

royalties, fees or other similar payments in return for the use

patents or other rights, or by way

commission, for specific services performed or for management, or, except in the case

a banking enterprise by way

interest on moneys lent to the permanent establishment. Likewise, no account shall be taken, in the determination

the profits

a permanent establishment, for amounts charged (otherwise than towards reimbursement

actual expenses), by the permanent establishment to the head

fice

the enterprise or any

its other

fices, by way

royalties, fees or other similar payments in return for the use

patents or other rights, or by way

commission for specific services performed or for management, or, except in the case

a banking enterprise by way

interest on moneys lent to the head

fice

the enterprise or any

its other

fices.

the mere purchase by that permanent establishment

goods or merchandise for the enterprise. 7

the preceding paragraphs, the 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.

income which are dealt with separately in other Articles

this Agreement, then the provisions

those Articles shall not be affected by the provisions

this Article. Article 8 INTERNATIONAL TRANSPORT

ships, aircraft, rail or road vehicle in international traffic shall be taxable only in the Contracting State in which the place

effective management

the enterprise is situated.

boats engaged in inland waterways transport shall be taxable oniy in the Contracting State in which the place

effective management

the enterprise is situated.

effective management

a shipping enterprise or

an inland waterways transport enterprise is aboard a ship or boat, then it shall be deemed to be situated in the Contracting State in which the home harbour

the ship or boat is situated, or, if there is no such home harbour, in the Contracting State

which the operator

the ship or boat is a resident.

paragraph

a Contracting State participates directly or indirectly in the management, control or capitai

an enterpnse

the other Contracting State, or (b) the same persons participate directly or indirectly in the management, control or capital

an enterprise

a Contracting State and an enterprise

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 enterprises, then any profits which would, but for those conditions, have accrued to one

the enterprises, but, by reason

those conditions, have not so accrued, may be included in the profits

that enterpri se and taxed accordingly.

an enterprise

that State - and taxes accordingly - profits on which an enterprise

the other Contracting State has been charged to tax in that other State and the profits so included are profits which would have accrued to the enterprise

the first-mentioned State if the conditions made between the two enterprises had been those which would have been made between independent enterprises, then that other State shall make an appropriate adjustment to the amount

the tax charged therein on those profits. En determining such adjustment, due regard shall be had to the other provisions

this Agreement and the competent authorities

the Contracting States shall if necessary consult each other. Article 10 D1VIDENDS

a Contracting State to a resident

the other Contracting State may be taxed in that other State.

which the company paying the dividends is a resident and according to the laws

that State, but if the beneficial owner

the dividends is a resident

the other Contracting State, the tax so charged shall not exceed: (a) 5 per cent

the gross amount

the dividends if the beneficial owner is a company (other than a partnership) which holds directly at least 25 per cent

the capital

the company paying the dividends; (b) 10 per cent

the gross amount

the dividends in all other cases. This paragraph shall not affect the taxation

the company in respect

the profits out

which the dividends are paid.

the State

which the company making the distribution is a resident.

paragaphs

the dividends, being a resident

a Contracting State, carries on business in the other Contracting State

which the company paying the dividends is a resident, through a permanent establishment 9 situated therein, and the holding in respect

which the dividends are paid is effectively connected with such permanent establishment. In such case the provisions

Article 7shall apply.

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 insofar as such dividends are paid to a resident

that other State or insofar as the holding in respect

which the dividends are paid is effectively connected with a permanent establishment situated in that other State, nor subject the company's undistributed profits to a tax on the cornpany's undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly

profits or income arising in such other State. Article 11 INTEREST

the other Contracting State may be taxed in that other State.

that State, but if the beneficial owner

the interest is a resident

the other Confacting State, the tax so charged shall not exceed 7.5 per cent

the gross amount

the interest.

paragraph

which the recipient is a resident if the beneficial owner

the interest is a resident

that State, and: (

1. a)is that State or the Central Bank or a local authority thereof; (
2. b)if the interest is paid by the State in which the interest arises or by a local authority or statutory body thereof; (
3. c)if the interest is paid in respect

a loan, debt-claim or credit that is owed to, or made, provided, guaranteed or insured by, that State or a local authority or export fmancing agency thcreof.

every kind, whether or not secured by mortgage and whether or not carrying a right to participate in the debtor's profits, and in particuiar, income from government securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures. Penalty charges for late payment shalI not be regarded as interest for the purpose

this Article.

paragraph

the interest, being a resident

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-claim in respect

which the interest is paid is effectively connected with such permanent establishment. In such case the provisions

Article 7shall apply,

that State. Where, however, the person paying the interest, whether he is a resident

a Contracting State cr not, has in a Contracting State a permanent establishment in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment, then such interest shall be deemed to arise in the State in which the permanent establishment is situated.

a special relationship between the payer and the beneficial owner or between both

them and some other person, the amount

the interest, having regard to the debtclaim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence

such relationship, the provisions

this Article shall apply only te the last-mentioned amount. In such case, the excess part

the payments shall remain taxable according to the laws

each Contracting State, due regard being had to the other provisions

this Agreement. Article 12 ROYALTIES

the other Contracting State may be taxed in that other State.

that State, but if the beneficial owner

the royalties is a resident

the other Contracting State, the tax so charged shall not exceed 7.5 per cent

the gross arnount

the royalties.

any kind received as LI consideration for the use

, or the right to use, any copyright

literary, artistic or scientific work including cinematograph films and films, tapes or dises for radio or television broadcasting, any patent, trade mark, &sign or model, plan, secret formula or process, or for the use

or the right to use industrial, comrnercial or scientific equipment or for information concerning industrial, commercial or scientific experience. II

paragraphs

the royalties, being a resident

a Contracting State, carries on business in the other Contracting State in which the royalties arise, through a pennanent establishment situated therein, and the right or property in respect

which the royalties are paid is effectively connected with such permanent establishment. ln such case the provisions

Article 7shall apply.

that State. Where, however, the person paying the royalties, whether he is a resident

a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the liability to pay the royalties was incurred, and such royalties are borne by such permanent establishment, then such royalties shall be deemed to arise in the Contracting State in which the permanent establishment is situated.

a special relationship between the payer and the beneficial owner or between both

them and some other person, the amount

the royalties, having regard to the use, right or information for which they are paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence

such relationship, the provisions

this Article shall apply only to the last-mentioned amount. In such case, the excess part

the payments shall remain taxable according to the laws

each Contracting State, due regard being had to the other provisions

this Agreement. Article 13 FEES FOR TECHNICAL SERVICES

the other Contracting State may be taxed in that other State.

that State, but where the beneficial owner

the fees for technical services is a resident

the other Contracting State, the tax so charged shall not exceed 7.5 per cent

the gross amount

the fees for technical services.

any kind to any person, other thal to an employee

the persor. making the payments, in consideration for any services

a technical, managerial or consultancy nature. 12

paragraphs

the fees for technical services, being a resident

a Contracting State, carries on business in the other Contracting State in which the fees for technical services arise through a permanent establishment situated therein, and the fees for technical services are effectively connected with such permanent establishment. ln such case, the provisions

Article 7shall apply.

that State. Where, however, the person paying the fees for technical services, whether he is a resident

a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the obligation to pay the fees for technical services was incurred, and such fees for technical services are borne by such permanent establishment, then such fees for technical services shall be deemed to arise in the Contracting State in which the permanent establishment is situated.

a special relationship between the payer and the beneficial owner or between both

them and some other person, the amount

the fees for technical services paid exceeds, for whatever reason, the arnount which would have been agreed upon by the payer and the beneficial owner in the absence

such a relationship, the provisions

this Article shall apply only to the last-mentioned atnount. In such case, the excess part

the payments shall remain taxable according to the laws

each Contracting State, due regard being had to the other provisions

this Agreement. Artiche 14 CAPITAL GAINS

a Contracting State from the alienation

immovable property referred to in Article 6 and situated in the other Contracting State may be taxed in that other State.

movable property forming part

the business property

a pennanent establishment which an enterprise

a Contracting State has in the other Contracting State, including such gains from the alienation

such a permanent establishment (alone or with the whole enterprise), may be taxed in that other State.

ships, aircraft, rail or road vehicles operated in international traffic, boats engaged in inland waterways transport or movable property pertaining to the operation

such ships, aircraft, rail or road vehicles, or boats, shall be taxable only in the Contracting State in which the place

cffective management

the enterprise is situated. 13 Gains from the alienation

any property other than that referred to in paragraphs

which the alienator is a resident. Article 15 INCOME FROM EIVPLOYMENT

Articles 16, 18, 19 and 20, salaries, wages and other similar remuneration derived by a resident

a Contracting State in respect

an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that eller State.

paragraph

a Contracting State in respect

an employment exercised in the other Contracting State shall be taxable only in the first-tnentioned State if: (

1. a)the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in any twelve month period commencing or ending in the fiscal year concerned; and (
2. b)the remuneration is paid by, or on behalf

, an employer who is not a resident

the other State; and (c) the remuneration is not borne by a permanent establishment which the employer has in the other State.

thic Article, remuneration derived in respect

an employment exercised aboard a ship, aircraft, rail or road vehicles operated in international traffic, or aboard a boat engaged in inland waterways transport, may be taxed in the Contracting State in which the place

effective management

the enterprise is situated. Article 16 DIRECTORS' FEES Directors' fees and other similar payments derived by a resident

a Contracting State in his capacity as a member

the board

directors

a company which is a resident

the other Contracting State may be taxed in that other State. 14 Article 17 ARTISTES AND SPORTSPERSONS

Articles 7 and 15, income derived by a resident

a Contracting State as an entertainer, such as a theatre, motion picture, radio or television artiste, or a musician, or as a sportsperson, from his personal activities as such exercised in the other Contracting State, may be taxed in that other State.

personal activities exercised by an entertainer or a sportsperson in his capecity as such accrues not to the entertainer or sportsperson himself but to another person, that income may, notwithstanding the provisions

Articles 7 and 15, be taxed in the Contracting State in which the activâtes

the entertainer or sportsperson are exercised.

paragraphs

this Article shall not apply to income derived from activities performed in a Contracting State by entertainers or sportspersons if the visit to that State is wholly or substantially supported by public funds. In such case, the income shall be taxable only in the Contracting State

which the entertainer or sportsperson is a resident. Article 18 PENSIONS

paragraph

Article 19

, pensions and other similar remuneration and annuities arising in a Contracting State and paid to a resident

the other Contracting State may be taxed in the first-mentioned Contracting State.

paragraph

a Contracting State shall be taxable only in that State.

paragraph

the other Contracting State shall be taxable only in the first-mentioned State, provided that such payments derive from contributions paid to or from provisions made under a pension scheme by the recipient or on his behalf ar.d that these contributions, provisions or the pensions or other similar remuneration have buil subjected to tax in the first-mentioned State under the ordinary rules

its tax laws. 15

time under an obligation to make the payments in return for adequate and full consideration in money or money's worth. Article 19 GOVERNMENT SERVICE

that State who: (i) is a national

that State; or (ii) did not become a resident

that State solely for the purpose

rendering the services.

paragraph

funds created by, a Contracting State or a local authority thereof to an individu2.1 in respect

services rendered to that State or authority shall be taxable only in that State.

, and a national

, that State.

Articles 15, 16, 17 and 18 shall apply to salaries, wages, pensions, and other similar remuneration in respect

services rendered in connection with a business carried on by a Contracting State or a local authority thereof. Article 20 PROFESSORS, TEACHERS AND RESEARCHERS

one

the Contracting States immediately before visiting the other Contracting State for the purpose

teaching or engaging in research, or both, at a university, college or other similar institution in that other Contracting State, shall be exempt from tax in that other State on any remuneration for such teaching or research for a period not exceeding two years from the date

his first anival in that other State.

some private person or persons. 16 Article 21 STUDENTS Payments which a student, apprentice or business trainee who is or was immediately before visiting a Contracting State a resident

the other Contracting State and who is present in the firstmentioned State solely for the purpose

his education or training receives for the purpose

his maintenance, education or training shall not be taxed in that State, provided that such payments arise from sources outside that State. Article 22 OTHER INCOME

income

a resident

a Contracting State, wherever arising, not dealt with in the foregoing Ardcles

this Agreement shall be taxable only in that State.