Canada

This Convention shall apply to taxes on income imposed on behalf of each Contracting State,
irrespective of the manner in which they are levied.

There shall be regarded as taxes on income all taxes imposed on total income, or on elements of
income, including taxes on gains from the alienation of movable or immovable property, taxes on
the total amount of wages or salaries paid by enterprises, as well as taxes on capital
appreciation.

The existing taxes to which the Convention shall apply are, in particular :

in the case of Canada :
the income taxes imposed by the Government of Canada,
(hereinafter referred to as ” Canadian tax”)

The Convention shall also apply to any identical or substantially similar taxes on income which
are imposed by either Contracting State after the date of signature of this Convention in addition
to, or in place of, the existing taxes. The competent authorities of the Contracting States shall
notify each other of any substantial changes which have been made to their respective taxation
laws.

In this Convention, unless the context otherwise requires :

the term “Canada”, used in a geographical sense, means the territory of Canada, including: 

the term “Indonesia” comprises the territory of the Republic of Indonesia as defined in its laws
and the adjacent areas over which the Republic of Indonesia has sovereign rights or jurisdiction
in accordance with international law;

the terms “a Contracting State” and “the other Contracting State” mean, as the context requires,
Canada or Indonesia;

the term “person” includes an individual, a company, a partnership, an estate, a trust or any
other body of persons;

the term “company” means any body corporate or any other entity which is treated as a body
corporate for tax purposes; in French, the term “societe” also means a “corporation” within the
meaning of Canadian law;

the terms “enterprise of a Contracting State” and “enterprise of the other Contracting State” mean
respectively an enterprise carried on by a resident of a Contracting State and an enterprise
carried on by a resident of the other Contracting State;

the term “competent authority” means:

in the case of Canada, the Minister of National Revenue or his duly authorized representative;

in the case of Indonesia, the Minister of Finance or his duly authorized representative;

the term “tax” means Canadian or Indonesian tax, as the context requires;

the term “national” means:

any individual possessing the nationality of a Contracting State;

any legal person, partnership and association deriving its status as such from the law in force in
a Contracting State.

As regards the application of the Convention by a Contracting State any term not otherwise defined
shall, unless the context otherwise requires, have the meaning which it has under the laws of that
Contracting State relating to the taxes which are the subject of the Convention.

For the purposes of this Convention, the term “resident of a Contracting State” means:

Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting
States, his status shall be determined in accordance with the following rules:

he shall be deemed to be a resident of the Contracting State in which he has a permanent home
available to him. If he has a permanent home available to him in both Contracting States, he shall
be deemed to be a resident of the Contracting State with which his personal and economic relations
are closest (hereinafter referred to as his “centre of vital interests”);

if the Contracting State in which he has his centre of vital interests cannot be determined or if
he has not a permanent home available to him in either Contracting State, he shall be deemed to be
a resident of the Contracting State in which he has an habitual abode;

if he has an habitual abode in both Contracting States or in neither of them, he shall be deemed
to be a resident of the Contracting State of which he is a national;

if he is a national of both Contracting States or of neither of them, the competent authorities of
the Contracting States shall settle the question by mutual agreement.

Where by reason of the provisions of paragraph 1 a person other than an individual is a resident
of both Contracting States, the competent authorities of the Contracting States shall by mutual
agreement endeavour to settle the question and to determine the mode of application of the
Convention to such person.

For the purposes of this Convention, the term “permanent establishment” means a fixed place of
business in which the business of the enterprise is wholly or partly carried on.

The term “permanent Establishment” shall include especially :

a mine, an oil well, a quarry or any other place of extraction of natural resources;

a building site, a construction, installation or assembly project or supervisory activities in
connection therewith, where such site, project or activity continues for a period of more than 120
days;

the furnishing of services, including consultancy services, by an enterprise through an employee
or other person (other than an agent of an independent status within the meaning of paragraph 6)
where the activities continue within a Contracting State for more than 120 days within any twelve
month period.

The term “permanent establishment “shall not be deemed to include :

the use of facilities solely for the purpose of storage or display of goods or merchandise
belonging to the enterprise;

the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the
purpose of storage or display;

the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the
purpose of processing by another enterprise;

the maintenance of a fixed place of business solely for the purpose of purchasing goods or
merchandise, or for collecting information, for the enterprise;

the maintenance of a fixed place of business solely for the purpose of advertising, for the supply
of information, for scientific research, or for similar activities which have a preparatory or
auxiliary character, for the enterprise.

A person — other than an agent of independent status to whom paragraph 6 applies — acting in a
Contracting State on behalf of an enterprise of the other Contracting State shall be deemed to be
a permanent establishment in the first-mentioned State if:

he has, and habitually exercises in that State, an authority to conclude contracts in the name of
the enterprise, unless his activities are limited to the purchase of goods or merchandise for the
enterprise; or

he maintains in the first-mentioned State a stock of goods or merchandise belonging to the
enterprise from which he regularly fills orders on behalf of the enterprise.

An insurance enterprise of a Contracting State shall, except with regard to reinsurance, be deemed
to have a permanent establishment in the other Contracting State if it collects premiums in the
territory of that other State or insures risks situated there through an employee or through a
representative who is not an agent of an independent status within the meaning of paragraph 6.

An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the
other Contracting State through a broker, general commission agent or any other agent of an
independent status, or merely because it maintains in that other State a stock of goods with an
agent of an independent status from which deliveries are made by that agent, where such broker or
agent is acting in the ordinary course of his business. However, when the activities of such an
agent are devoted wholly or almost wholly to the business of that enterprise, he shall not be
considered an agent of an independent status within the meaning of this paragraph.

The fact that a company which is a resident of a Contracting State controls or is controlled by a
company which is a resident of the other Contracting State, or which carries on business in that
other State (whether through a permanent establishment or otherwise), shall not of itself
constitute either company a permanent establishment of the other.

Income from immovable property including income from agriculture or forestry may be taxed in the
Contracting State in which such property is situated.

For the purposes of this Convention, the term “immovable property” shall be defined in accordance
with the law of the Contracting State in which the property in question is situated. The term
shall in any case include property accessory to immovable property, livestock and equipment used
in agriculture and forestry, rights to which the provisions of general law respecting landed
property apply, usufruct of immovable property and rights to variable or fixed payments as
consideration for the working of, or the right to work, mineral deposits, sources and other
natural resources; ships, boats and aircraft shall not be regarded as immovable property.

The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use
in any other form of immovable property and to profits from the alienation of such property.

The provisions of paragraphs 1 and 3 shall also apply to the income from immovable property of an
enterprise and to income from immovable property used for the performance of professional
services.

The profits of an enterprise of a Contracting State shall be taxable only in that State unless the
enterprise carries on business in the other Contracting State through a permanent establishment
situated therein. If the enterprise carries on or has carried on business as aforesaid, the
profits of the enterprise may be taxed in the other State but only so much of them as is
attributable to that permanent establishment or are derived within such other State from sales of
goods or merchandise of the same kind as those sold or from other business transactions of the
same kind as those effected, through the permanent establishment.

Subject to the provisions of paragraph 3, where an enterprise of a Contracting State carries on
business in the other Contracting State through a permanent establishment situated therein, there
shall 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 of which it is a
permanent establishment.

In the determination of the profits of a permanent establishment, there shall be allowed those
deductible expenses which are incurred for the purposes of the permanent establishment including
executive and general administrative expenses, whether incurred in the State in which the
permanent establishment is situated or elsewhere.

Profits derived by an enterprise from the operation of ships or aircraft in international traffic
shall be taxable only in the Contracting State of which the enterprise is a resident.

Notwithstanding the provisions of paragraph 1 and of Article 7, profits derived from the operation
of ships or aircraft used principally to transport passengers or goods between places in a
Contracting State may be taxed in that State.

an enterprise of a Contracting State participates directly or indirectly in the management,
control or capital of an enterprise of the other Contracting State, or

the same persons participate directly or indirectly in the management, control or capital of an
enterprise of a Contracting State and an enterprise of the other Contracting State,

A Contracting State shall not change the profits of an enterprise in the circumstances referred to
in paragraph 1 after the expiry of the time limits provided in its national laws and, in any case,
after five years from the end of the year in which the profits which would be subject to such
change would have accrued to an enterprise of that State. This paragraph shall not apply in case
of fraud, wilful default or neglect.

Dividends paid by a company which is a resident of a Contracting State to a resident of the other
Contracting State may be taxed in that other State.

However, such dividends may also be taxed in the Contracting State of which the company paying the
dividends is a resident and according to the laws of that State, but if the beneficial owner of
the dividends is a resident of the other State, the tax so charged shall not exceed:

The term “dividends” as used in this Article means income from shares, “jouissance” shares or
“jouissance” rights, mining shares, founders’ shares or other rights, not being debt-claims,
participating in profits, as well as income assimilated to income from shares or treated in the
same way as dividends by the taxation law of the State of which the company making the
distribution is a resident.

The provisions of paragraph 2 shall not apply if the recipient of the dividends, being a resident
of a Contracting State, carries on business in the other Contracting State of which the company
paying the dividends is a resident, a trade or business through a permanent establishment situated
therein, or performs in that other State professional services from a fixed base situated therein,
and the holding by virtue of which the dividends are paid is effectively connected with such
permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14,
as the case may be, shall apply.

Where a company is a resident of only one Contracting State, the other Contracting State may not
impose any tax on the dividends paid by the company except insofar as such dividends are paid to a
resident of that other State, or insofar as the holding in respect of which the dividends are paid
is effectively connected with a permanent establishment or a fixed base situated in that other
State, nor subject the company’s undistributed profits to a tax on the company’s undistributed
profits, even if the dividends paid or the undistributed profits consist wholly or partly of
profits or income arising in such other State.

Where a company which is a resident of a Contracting State has a permanent establishment in the
other Contracting State, the profits attributable to the permanent establishment may be subject to
an additional tax in that other State in accordance with its law but the additional tax so charged
shall not exceed 15 percent of the amount of such profits after deducting therefrom the company
tax and other taxes on income imposed thereon in that other State.

Interest arising in a Contracting State and paid to a resident of the other Contracting State may
be taxed in that other State.

However, such interest may also be taxed in the Contracting State in which it arises and according
to the laws of that State, but if the beneficial owner of the interest is a resident of the other
State, the tax so charged shall not exceed 10 per cent of the gross amount of the interest.

The term “interest” as used in this Article means income from debt-claims of 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, as well as income
assimilated to income from money lent by the taxation law of the State in which the income arises.
However, the term “interest” does not include income dealt with in Article 10.

The provisions of paragraph 2 shall not apply if the recipient of the interest, being a resident
of a Contracting State, carries on in the other Contracting State in which the interest arises, a
trade or business through a permanent establishment situated therein, or performs in that other
State professional services from a fixed base situated therein, and the debt-claim in respect of
which the interest is paid is effectively connected with such permanent establishment or fixed
base. In such a case, the provisions of Article 7 or Article 14, as the case may be, shall apply.

Interest shall be deemed to arise in a Contracting State when the payer is that State itself, a
political subdivision, a local authority or a resident of that State. Where, however, the person
paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting
State a permanent establishment or a fixed base in connection with which the indebtedness on which
the interest is paid was incurred, and that interest is borne by that permanent establishment or
fixed base, then such interest shall be deemed to arise in the Contracting State in which the
permanent establishment or fixed base is situated.

Where, owing to a special relationship between the payer and the recipient or between both of them
and some other person, the amount of the interest paid, 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 recipient in
the absence of such relationship, the provisions of this Article shall apply only to the
last-mentioned amount. In that case, the excess part of the payments shall remain taxable
according to the law of each Contracting State, due regard being had to the other provisions of
this Convention.

Notwithstanding the provisions of paragraph 2, interest arising in Canada shall be taxable only in
Indonesia if it is paid to :

the government of Indonesia or a political subdivision thereof;

a statutory body of the government of Canada performing functions of a governmental nature;

such financial public institution of Indonesia as is specified and agreed in letters exchanged
between the competent authorities of the two Contracting States;

an enterprise of Indonesia on loans or credits granted with the participation of a financing
public institution of Indonesia with the approval of the competent authority of Canada.

Notwithstanding the provisions of paragraph 2, interest arising in Indonesia shall be taxable only
in Canada if it is paid to :

the government of Canada or a political subdivision thereof;

a statutory body of the government of Canada performing functions of a governmental nature;

the Export Development Corporation; or

an enterprise of Canada on loans or credit granted with the participation of the Export
Development Corporation with the consent of the Minister in charge of financial affairs or of
planning in Indonesia, in connection with the sale of any industrial or scientific equipment or
with the survey, the installation or the supply of industrial or scientific premises or of public
works.

Royalties arising in a Contracting State and paid to a resident of the other Contracting State may
be taxed in that other State.

However, such royalties may also be taxed in the Contracting State in which they arise and
according to the laws of that State, but if the beneficial owner of the royalties is a resident of
the other State, the tax so charged shall not exceed 10 per cent of the gross amount of the
royalties.

The term “royalties” as used in this Article means payments of any kind received as a
consideration for the use of, or the right to use, any copyright of literary, artistic or
scientific work including cinematograph films, any patent, trademark, design or model, plan,
secret formula or process, or for the use of, or the right to use, industrial, commercial or
scientific equipment, or for information concerning industrial, commercial or scientific
experience. However, the term does not include payments for the furnishing of technical services
(such as studies or surveys of a scientific, geological or technical nature, engineering contracts
including blueprints related thereto, and consultancy and supervisory services).

The provisions of paragraph 2 shall not apply if the recipient of the royalties, being a resident
of a Contracting State, carries on in the other Contracting State in which the royalties arise a
trade or business through a permanent establishment situated therein, or performs in that other
State professional services from a fixed base situated therein, and the right or property in
respect of which the royalties are paid is effectively connected with such permanent establishment
or fixed base. In such a case, the provisions of Article 7 or Article 14, as the case may be,
shall apply.

Royalties shall be deemed to arise in a Contracting State when the payer is that State itself, a
political subdivision, a local authority or a resident of that State. Where, however, the person
paying the royalties, whether he is a resident of a Contracting State or not, has in a Contracting
State a permanent establishment or fixed base in connection with which the obligation to pay the
royalties was incurred, and those royalties are borne by that permanent establishment or fixed
base, then such royalties shall be deemed to arise in the Contracting State in which the permanent
establishment or fixed base is situated.

Where, owing to a special relationship between the payer and the recipient or between both of them
and some other person, the amount of the royalties paid, 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 recipient in the absence of such relationship, the provisions of this Article shall
apply only to the last-mentioned amount. In that case, the excess part of the payments shall
remain taxable according to the law of each Contracting State, due regard being had to the other
provisions of this Convention.

Gains from the alienation of immovable property may be taxed in the Contracting State in which
such property is situated.

Gains from the alienation of movable property forming part of the business property of a permanent
establishment which an enterprise of a Contracting State has in the other Contracting State or of
movable property pertaining to a fixed base available to a resident of a Contracting State in the
other Contracting State for the purpose of performing professional services, including such gains
from the alienation of such a permanent establishment (alone or with the whole enterprise) or of
such a fixed base my be taxed in that other State. However, gains from the alienation of ships or
aircraft operated by an enterprise of a Contracting State in international traffic or movable
property pertaining to the operation of such ships or aircraft, shall be taxable only in that
Contracting State.

Gains derived by a resident of a Contracting State from the alienation of:

Gains from the alienation of any property, other than those mentioned in paragraphs 1, 2 and 3
shall be taxable only in the Contracting State of which the alienator is a resident.

The provisions of paragraph 4 shall not affect the right of either of the Contracting States to
levy, according to its domestic law, a tax on gains from the alienation of any property derived by
an individual who is a resident of the other Contracting State and has been a resident of the
first-mentioned State at any time during the six years immediately preceding the alienation of the
property.

Income derived by an individual who is a resident of a Contracting State in respect of
professional services or other activities of an independent character shall be taxable only in
that Contracting State unless he has a fixed base regularly available to him in the other
Contracting State for the purpose of performing his activities or he is present in that other
Contracting State for a period or periods exceeding in the aggregate 120 days in any twelve month
period. If he has or had such a fixed base or remains in that other Contracting State for the
aforesaid period or periods, the income may be taxed in that other Contracting State but only so
much of it as is attributable to that fixed base or is derived in that other Contracting State
during the aforesaid period or periods.

The term “professional services” includes especially independent scientific, literary, artistic,
educational or teaching activities as well as the independent activities of physicians, lawyers,
engineers, architects, dentists and accountants.

Subject to the provisions of Articles 16, 18 and 19, salaries, wages and other similar
remuneration derived by a resident of a Contracting State in respect of 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
other State.

Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting
State in respect of an employment exercised in the other Contracting State shall be taxable only
in the first-mentioned State if the recipient is present in the other Contracting State for a
period or periods not exceeding in the aggregate 120 days within any twelve month period, and
either:

the remuneration earned in the other Contracting State within the twelve month period does not
exceed five thousand Canadian dollars ($5,000) or its equivalent in rupiah, or such other amount
as is specified and agreed in letters exchanged between the competent authorities of the
Contracting States; or

the remuneration is paid by, or on behalf of, an employer who is not a resident of the other
State, and such remuneration is not borne by a permanent establishment or a fixed base which the
employer has in the other State.

Notwithstanding the preceding provisions of this Article, remuneration derived in respect of an
employment exercised aboard a ship or aircraft operated in international traffic by an enterprise
of a Contracting State, shall be taxable only in that State unless the remuneration is derived by
a resident of the other Contracting State.

Notwithstanding the provisions of Articles 7, 14 and 15, income derived by entertainers, such as
theatre, motion picture, radio or television artistes, and musicians, and by athletes, from their
personal activities as such may be taxed in the Contracting State in which these activities are
exercised.

Where income in respect of personal activities as such of an entertainer or athlete accrues not to
that entertainer or athlete himself but to another person, that income may, notwithstanding the
provisions of Articles 7, 14 and 15, be taxed in the Contracting State in which the activities of
the entertainer or athlete are exercised.

The provisions of paragraphs 1 and 2 shall apply :

to income derived from activities performed in a Contracting State by entertainers or athletes if
the visit to that Contracting State is substantially supported by public funds of the other
Contracting State, including any political subdivision, local authority or statutory body thereof;

to income derived in a Contracting State by a non-profit organization of the other Contracting
State which is substantially supported by public funds of that other State, including any
political subdivision, local authority or statutory body thereof.

Pensions and annuities arising in a Contracting State and paid to a resident of the other
Contracting State may be taxed in that State.

Pensions arising in a Contracting State and paid to a resident of the other Contracting State may
be taxed in the State in which they arise, and according to the law of that State. However, in the
case of periodic pension payments, other than payments under the social security legislation in a
Contracting State, the tax so charged shall not exceed 15 per cent of the gross amount of the
payment.

Annuities arising in a Contracting State and paid to a resident of the other Contracting State may
be taxed in the State in which they arise, and according to the law of that State; but the tax so
charged shall not exceed 15 percent of the gross amount of the payment. However, this limitation
does not apply to lumpsum payments arising on the surrender, cancellation, redemption, sale or
other alienation of an annuity, or to payments of any kind under an income-averaging annuity
contract.

Notwithstanding anything in this Convention :

pensions and allowances received from Canada under the Pension Act, the Civilian War Pensions and
Allowances Act or the War Veterans Allowances Act and compensation received under section 7 of the
Aeronautics Act shall not be taxable in Indonesia so long as they are not subject to Canadian tax;

pensions and allowances paid by, or out of funds created by Indonesia or a political subdivision
or a local authority thereof, shall be taxable only in Indonesia;

alimony and other similar payments arising in a Contracting State and paid to a resident of the
other Contracting State who is subject to tax therein in respect thereof, shall be taxable only in
that other State.

Remuneration, other than a pension, paid by a Contracting State or a political subdivision or a
local authority thereof to any individual in respect of services rendered to that State or
subdivision or local authority thereof shall be taxable only in that State. However, such
remuneration shall be taxable only in the other Contracting State if the recipient did not become
a resident of that other State solely for the purpose of performing the services therein.

The provisions of paragraph 1 shall not apply to the remuneration in respect of services rendered
in connection with any trade or business carried on by one of the Contracting States or a
political subdivision or a local authority thereof.

In the case of Canada, double taxation shall be avoided as follows :

Subject to the existing provisions of the law of Canada regarding the deduction from tax payable
in Canada of tax paid in a territory outside Canada and to any subsequent modification of those
provisions — which shall not affect the general principle hereof –, and unless a greater
deduction or relief is provided under the laws of Canada, tax payable under the law of Indonesia
and in accordance with this Convention on profits, income or gains arising in Indonesia shall be
deducted from any Canadian tax payable in respect of such profits, income or gains.

Subject to the existing provisions of the law of Canada regarding the determination of the exempt
surplus of a foreign affiliate and to any subsequent modification of those provisions — which
shall not affect the general principle hereof — for the purpose of computing Canadian tax a
company resident in Canada shall be allowed to deduct in computing its taxable income any dividend
received by it out of the exempt surplus of a foreign affiliate resident in Indonesia.

Where in accordance with any provision of this Convention income derived by a resident of Canada
is exempt from tax in Canada, Canada may nevertheless, in calculating the amount of tax on other
income, take into account the exempted income.

In the case of Indonesia, double taxation shall be avoided as follows :

Indonesia, when imposing tax on residents of Indonesia, may include in the basis upon which such
taxes are imposed the items of income which according to the provisions of this Convention may be
taxed in Canada.

Subject to the provisions of subparagraph (c), Indonesia shall allow as a deduction from the tax
computed in conformity with subparagraph (a) an amount equal to such proportion of that tax that
the income which is included in the basis of that tax and may be taxed in Canada according to the
provisions of this Convention bears to the total income which forms the basis for Indonesian tax.

Where a resident of Indonesia derives income which, in accordance with paragraph 2 of Article 10,
paragraph 2 of Article 11, and paragraph 2 of Article 12 may be taxed in Canada, Indonesia shall
allow as a deduction from the Indonesian tax on the income of that person an amount equal to the
tax paid in Canada on that income. Such deduction shall not, however, exceed that part of the
Indonesian tax computed in conformity with subparagraph (a) which is appropriate to the income
derived from Canada.

For the purposes of this Article, profits, income or gains of a resident of a Contracting State
which are taxed in the other Contracting State in accordance with this Convention shall be deemed
to arise from sources in that other State.

The nationals of 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 of that other State in the same
circumstances are or may be subjected.

The taxation on a permanent establishment which an enterprise of 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 of that other State carrying on the same activities.

Nothing in this Article shall be construed as obliging a Contracting State to grant to residents
of the other Contracting State any personal allowances, reliefs and reductions for taxation
purposes on account of civil status or family responsibilities which it grants to its own
residents.

Enterprises of a Contracting State, the capital of which is wholly or partly owned or controlled,
directly or indirectly, by one or more residents of the other Contracting State, shall not be
subjected under the law of the first-mentioned State to any taxation or any requirement connected
therewith which is other or more burdensome than the taxation and connected requirements to which,
in substantially similar circumstances, enterprises of the first-mentioned State, the capital of
which is wholly or partly owned or controlled, directly or indirectly, by one or more residents of
a third State, are or may be subjected.

Nothing in this Article shall be construed so as to prevent Indonesia from limiting to its
nationals the enjoyment of tax incentives granted under the Law of 1968 regarding Domestic Capital
Investment, so far as it was in force on, and has not been modified since, the date of signature
of this Convention, or has been modified only in minor respects so as not to affect its general
character.

In this Article, the term “taxation” means taxes which are the subject of this Convention.

Where a resident of a Contracting State considers that the actions of one or both of the
Contracting States result or will result for him in taxation not in accordance with this
Convention, he may, without prejudice to the remedies provided by the national laws of those
States, address to the competent authority of the Contracting State of which he is a resident an
application in writing stating the grounds for claiming the revision of such taxation. To be
admissible, the said application must be submitted within two years from the first notification of
the action which gives rise to taxation not in accordance with the Convention.

The competent authority referred to in paragraph 1 shall endeavour, if the objection appears to it
to be justified and if it is not itself able to arrive at an appropriate solution, to resolve the
case by mutual agreement with the competent authority of the other Contracting State, with a view
to the avoidance of taxation not in accordance with the Convention.

A Contracting State shall not, after the expiry of the time limits provided in its national laws
and, in any case, after five years from the end of the taxable period in which the income
concerned has accrued, increase the tax base of a resident of either of the Contracting States by
including therein items of income which have also been charged to tax in the other Contracting
State. This paragraph shall not apply in case of fraud, wilful default or neglect.

The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement
any difficulties or doubts arising as to the interpretation or application of the Convention. In
particular, the competent authorities of the Contracting States may consult together to endeavour
to agree:

to the same attribution of profits to a resident of a Contracting State and its permanent
establishment situated in the other Contracting State;

to the same allocation of income between a resident of a Contracting State and any associated
person provided for in Article 9.

The competent authorities of the Contracting States shall exchange such information as is
necessary for the carrying out of this Convention or of the domestic laws of the Contracting
States, and for the prevention of fiscal evasion, concerning taxes covered by this Convention
insofar as the taxation thereunder is in accordance with this Convention. Any information so
exchanged shall be treated as secret and shall not be disclosed to any persons or authorities
other than those concerned with the assessment or collection of the taxes which are the subject of
this Convention.

The exchange of information may be either on a routine basis or on request with reference to
particular cases. The competent authorities of the Contracting States may agree on the list of
information which shall be furnished on a routine basis.

In no case shall the provisions of paragraph 1 be construed so as to impose on one of the
Contracting States the obligation :

to carry out administrative measures at variance with the laws or the administrative practice of
that or of the other Contracting State;

to supply particulars which are not obtainable under the laws or in the normal course of the
administration of that or of the other Contracting State;

to supply information which would disclose any trade, business, industrial, commercial or
professional secret or trade process, or information, the disclosure of which would be contrary to
public policy (ordre public).

Nothing in this Convention shall affect the fiscal privileges of members of diplomatic or consular
missions under the general rules of international law or under the provisions of special
agreements.

Notwithstanding Article 4, an individual who is a member of a diplomatic, consular or permanent
mission of a Contracting State which is situated in the other Contracting State or in a third
State shall be deemed for the purposes of this Convention to be a resident of the sending State if
he is liable in the sending State to the same obligations in relation to tax on his total world
income as are residents of that sending State.

This Convention shall not apply to International Organizations, to officials or organs thereof and
to persons who are members of a diplomatic, consular or permanent mission of a third State, being
present in a Contracting State and who are not liable in either Contracting State to the same
obligations in relation to tax on their total world income as are residents thereof.

The provisions of this Convention shall not be construed to restrict in any manner any exclusion,
exemption, deduction, credit, or other allowance now or hereafter accorded:

by the laws of one of the Contracting States in the determination of the tax imposed by that
Contracting State, or

by any other agreement entered into by one of the Contracting States.

The competent authorities of the Contracting States may communicate with each other directly for
the purpose of applying this Convention.

This Convention shall be ratified and the instruments of ratification shall be exchanged at
Ottawa.

The Convention shall enter into force upon the exchange of the instruments of ratification and its
provisions shall have effect:

in respect of tax withheld at the source on amounts paid or credited to non-residents on or after
the first day of January in the calendar year in which the exchange of instruments of ratification
takes place; and

in respect of other taxes for taxable periods beginning on or after the first day of January in
the calendar year in which the exchange of instruments of ratification takes place.

in respect of tax withheld at the source on amounts paid or credited to non-residents on or after
the first day of January in the calendar year next following that in which the notice is given;
and

in respect of other taxes for taxable periods beginning on or after the first day of January in
the calendar year next following that in which the notice is given.