China

AGREEMENT BETWEEN
THE GOVERNMENT OF THE REPUBLIC OF INDONESIA
AND
THE GOVERNMENT OF THE PEOPLE’S REPUBLIC OF CHINA

FOR
THE AVOIDANCE OF DOUBLE
TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME

Article 1
PERSONAL SCOPE

This Agreement shall apply to persons
who are residents of one or both of the Contracting States.

Article 2
TAXES COVERED

1. Agreement shall apply to taxes on
   income imposed on behalf, of a Contracting State or of its local authorities, irrespective of the
   manner in which they are levied.

2. There shall be regarded as taxes
   on income all taxes imposed on total income, or on elements of income, including taxes on gain, from
   the alienation of movable or immovable property.

3. The existing taxes to which the
   Agreement shall apply are :

   1. in Indonesia :
      the income tax imposed tinder the income tax law of 1984 (Undang-Undang Pajak Penghasilan 1984,
      Law Number 7 of 1983 as amended);
      (hereinafter referred to as “Indonesian tax”);

   2. in the People’s Republic of China :

      1. the individual income tax,

      2. the income tax for
         enterprises with foreign investment and foreign enterprises;

      3. the local income tax;
         (hereinafter referred to as “Chinese tax”).

4. This Agreement shall also apply to
   any identical or substantially similar taxes which are imposed after the date of signature of the
   Agreement in addition to, or in place of, the existing taxes referred to in paragraph 3. The competent
   authorities of the Contracting States shall notify each other of any substantial changes which have
   been made in their respective taxation laws within a reasonable period of time after such changes.

Article 3
GENERAL DEFINITIONS

1. For the purposes of this
   Agreement, unless the context otherwise requires :

   a.	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 sovereignty, sovereign rights or jurisdiction in accordance with international law; the term “China” comprises the territory of the People’s Republic of China as defined in its laws and the adjacent areas over which the Peoples Republic of China has sovereignty, sovereign rights or jurisdiction in accordance with international law;
   b.	the terms “a Contracting State” and “the other Contracting State” mean Indonesia or China as the context requires;
   c.	the term “tax” means Indonesian tax or Chinese tax, as the context requires;
   d.	the term “person” includes an individual, a company and any other body of persons;
   e.	the term “company” means any body corporate or any entity which is treated as a body corporate for the tax purposes;
   f.	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;
   g.	the term “international traffic” means any transport by a ship or aircraft operated by an enterprise of a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State;
   h.	the term “nationals” means :
   	any individuals possessing the nationality of a Contracting State, any legal person, partnership and association deriving its status as such from the laws in force in a Contracting State;
   i.	the term “competent authority” means :
   	in Indonesia : the Minister of Finance or his authorized representatives; in China : the State Administration of Taxation or its authorized representatives.

    

2. As regards the application of this
   Agreement by a Contracting State, any term not defined therein shall, unless the context otherwise
   requires, have the meaning which it has under the laws of that Contracting State concerning the taxes
   to which this Agreement applies.

Article 4
RESIDENT

1. For the purposes of this
   Agreement, the term “resident of a Contracting State” means any person who, under the laws of that
   Contracting State, is liable to tax therein by reason of his domicile, residence, place of management,
   place of head office or any other criterion of a similar nature. 

2. Where by reason of the provisions
   of paragraph 1 an individual is a resident of both Contracting States, then his status shall be
   determined as follows: 

   1. he shall be deemed to be a
      resident of 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 of the State with which
      his personal and economic relations are closer (centre of vital interests); 

   2. if the 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 State, he shall be deemed to be a resident of the State in which he has an habitual
      abode; 

   3. if he has an habitual abode in
      both States or in neither of them, the competent authorities of the Contracting States shall
      settle the question by mutual agreement. 

3. 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 States shall settle the question by mutual agreement.

Article 5
PERMANENT ESTABLISHMENT

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

2. The term “permanent establishment”
   includes especially :

   1. a place of management,

   2. a branch;

   3. an office;

   4. a factory;

   5. a workshop;

   6. a warehouse in relation to a
      person providing storage facilities for others;

   7. premises used as sales outlet,

   8. a farm or plantation;

   9. a mine, an oil or gas well, a
      quarry or any other place of extraction of natural resources.

3. The term “permanent establishment”
   likewise encompasses :

   1. a building site, a
      construction, assembly or installation project or supervisory activities in connection therewith,
      but only where such site, project or activities continue in a Contracting State for a period of
      more than six months; 

   2. the furnishing of services,
      including consultancy services, by an enterprise through employees or other personnel engaged by
      the enterprise for such purpose, but only where activities of that nature continue (for the same
      or a connected project) within the country for a period or periods aggregating more than six
      months within any twelve-month period; 

   3. [a] drilling rig or working
      ship used for exploration or exploitation of natural resources which exists or continues for more
      than six months. 

4. Notwithstanding the preceding
   provisions of this Article, the term “permanent establishment” shall be deemed not to include:

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

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

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

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

   5. the maintenance of a fixed
      place of business solely for the purpose of advertising, or for the supply of information;

   6. the maintenance of a fixed
      place of business solely for the purpose of carrying on, for the enterprise, any other activity of
      preparatory or auxiliary character; 

   7. the maintenance of a fixed
      place of business solely for any combination of activities mentioned in subparagraphs (a) to (e),
      provided that the overall activity of the fixed place of business resulting from this combination
      is of a preparatory or auxiliary character. 

5. Notwithstanding the provisions of
   paragraphs 1 and 2, where a person — other than an agent of an independent status to whom paragraph 7
   applies — is acting in a Contracting State on behalf of an enterprise of the other Contracting State,
   that enterprise shall be deemed to have a permanent establishment in the first-mentioned Contracting
   State in respect of any activities which that person undertakes for the enterprise, if such a
   person: 

   1. has and habitually exercises
      in that State an authority to conclude contracts in the name of the enterprise, unless the
      activities of such person are limited to those mentioned in paragraph 4 which, if exercised
      through a fixed place of business, would not make this fixed place of business a permanent
      establishment under the provisions of that paragraph;

   2. has no such authority, but
      habitually maintains in the first-mentioned State a stock of goods or merchandise from which he
      regularly delivers goods or merchandise on behalf of the enterprise. 

6. 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 that other State or insures
   risks situated therein through an employee or through a representative who is not an agent of an
   independent status within the meaning of paragraph 7. 

7. An enterprise of a Contracting
   State shall not be deemed to have a permanent establishment in the other Contracting State merely
   because it carries on business in that other State through a broker, general commission agent or any
   other agent of an independent status, provided that such persons are acting in the ordinary course of
   their business. However, when the activities of such an agent are devoted wholly or almost wholly on
   behalf of that enterprise, he will not be considered an agent of an independent status within the
   meaning of this paragraph. 

8. 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 can 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.

Article 6
INCOME FROM IMMOVABLE PROPERTY

1. Income derived by a resident of 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. 

2. The term “immovable property”
   shall have the meaning which it has under the law of the Contracting State in which the property in
   question is situated. The term shall in any case include property accessory to immovable property,
   livestock and 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 and aircraft shall not be regarded as immovable property. 

3. The provisions of paragraph l
   shall also apply to income derived from the direct use, letting, or use in any other form of immovable
   property.

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

Article 7
BUSINESS PROFITS

1. The profits of an enterprise of a
   Contracting State shall be taxable only in that Contracting State unless the enterprise carries on
   business in the other Contracting State through a permanent establishment situated therein. If the
   enterprise carries on business as aforesaid, the profits of the enterprise may be taxed in the other
   Contracting State but only so much of them as is directly or indirectly attributable to that permanent
   establishment. The provisions of this paragraph shall, however, not apply if the enterprise
   proves that the above activities are not undertaken by the permanent establishment or have no relation
   with the permanent establishment.

2. 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 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 of which it is a permanent
   establishment. 

3. In determining the profits of a
   permanent establishment, there shall be allowed as deductions expenses which are incurred for the
   purposes of the business of the permanent establishment including executive and general administrative
   expenses so incurred, whether in the State in which the permanent establishment is situated or
   elsewhere.

4. Insofar as it has been customary
   in a Contracting State to determine the profits to be attributed to a permanent establishment on the
   basis of an apportionment of the total profits of the enterprise to its various parts, nothing in
   paragraph 2 shall preclude that Contracting State from determining the profits to be taxed by such an
   apportionment as may be customary. The method of apportionment adopted shall, however, be such that
   the result shall be in accordance with the principles contained in this Article. 

5. No profits shall be attributed to
   a permanent establishment by reason of the mere purchase by that permanent establishment of goods or
   merchandise for the enterprise. 

6. For the purposes of paragraphs 1
   to 5, 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. 

7. Where profits include items of
   income which are dealt with separately in other Articles of this Agreement, then the provisions of
   those Articles shall not be affected by the provisions of this Article. 

Article 8
SHIPPING AND AIR TRANSPORT

1. Profits from sources within a
   Contracting State derived by an enterprise of the other Contracting State from the operation of ships
   in international traffic may be taxed in the first-mentioned State, but the tax imposed shall be
   reduced by an amount equal to 50 per cent thereof. 

2. Profits from the operation of
   aircraft in international traffic shall be taxable only in the Contracting State of which the
   enterprise operating the aircraft is a resident. 

3. The provisions of paragraphs 1 and
   2 shall also apply to profits from the participation in a pool, a joint business or an international
   operating agency. 

Article 9
ASSOCIATED ENTERPRISES

1. Where :

   1. 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 

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

   and in either case conditions are made or imposed
   between the two enterprises in their commercial or financial relations which differ from those which
   would be made between independent enterprises, then any profits which would, but for those conditions,
   have accrued to one of the enterprises, but, by reason of those conditions, have not so accrued, may
   be included in the profits of that enterprise and taxed accordingly.

2. Where a Contracting State includes
   in the profits of an enterprise of that Contracting State — and taxes accordingly — profits on which
   an enterprise of the other Contracting State has been charged to tax in that other Contracting State,
   and the profits so included are profits which would have accrued to the enterprise of the
   first-mentioned Contracting 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 of the tax charged therein on those profits. In determining such
   adjustment, due regard shall be had to the other provisions of the Agreement and the competent
   authorities of the Contracting States shall, if necessary, consult each other. 

3. A Contracting State shall not
   change the profits of an enterprise in the circumstances referred to in paragraph 2 after the expiry
   of the time limits provided in its tax laws. 

Article 10
DIVIDENDS

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

2. However, such dividends may also
   be taxed in the Contracting State of which the company paying the dividends is a resident and
   according to the laws of that Contracting State, but if the recipient is the beneficial owner of the
   dividends the tax so charged shall not exceed 10 per cent of the gross amount of the dividends. The
   provisions of this paragraph shall not affect the taxation of the company in respect of the profits
   out of which the dividends are paid. 

3. The term “dividends” as used in
   this Article means income from shares or other rights, not being debt-claims, participating in
   profits, as well as income from other corporate rights which is subjected to the same taxation
   treatment as income from shares by the laws of the State of which the company making the distribution
   is a resident. 

4. The provisions of paragraphs 1 and
   2 shall not apply if the beneficial owner of the dividends, being a resident of a Contracting State,
   carries on business in the other Contracting State of which the company paying the dividends is a
   resident, through a permanent establishment situated therein, or performs in that other State
   independent personal services from a fixed base situated therein, and the holding in respect of which
   the dividends are paid is effectively connected with such permanent establishment or fixed base. In
   such case the provisions of Article 7 or Article 14, as the case may be, shall apply. 

5. Notwithstanding any other
   provisions of this Agreement where a company which is a resident of a Contracting State has a
   permanent establishment in the other Contracting State, the profits of the permanent establishment may
   be subjected to an additional tax in that other State in accordance with its law, but the additional
   tax so charged shall not exceed 10 per cent of the amount of such profits after deducting therefrom
   income tax imposed thereon in that other State. 

6. Where a company which is a
   resident of a Contracting State derives profits or income from the other Contracting State, that 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 Contracting 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 Contracting 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 Contracting State. 

Article 11
INTEREST

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

2. The rate of tax imposed by one of
   [the] Contracting States on interest derived from sources within that Contracting State and
   beneficially owned by [a] resident of the other Contracting State shall not exceed 10 per cent of the
   gross amount of the interest. 

3. Notwithstanding the provisions of
   paragraph 2, interest arising in a Contracting State and derived by the other Contracting State, a
   political subdivision or a local authority thereof, the Central Bank or any financial institution
   controlled by that Government, the capital of which is wholly owned by the Government of the other
   Contracting State, as may be agreed upon from time to time between the competent authorities of the
   Contracting States, shall be exempt from tax in the first-mentioned State. 

4. 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 under
   the taxation law of the States in which the income arises, including interest on deferred payment
   sales. Penalty charges for late payment shall not be regarded as interest for the purpose of this
   Article. 

5. The provisions of paragraphs 1 and
   2 shall not apply if the beneficial owner of the interest, being a resident of a Contracting State,
   carries on business in the other Contracting State in which the interest arises, through a permanent
   establishment situated therein, or performs in that other Contracting State independent personal
   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 case the
   provisions of Article 7 or Article 14, as the case may be, shall apply. 

6. Interest shall be deemed to arise
   in a Contracting State when the payer is that State itself, 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 such interest is borne by such
   permanent establishment or fixed base, then such interest shall be deemed to arise in the State in
   which the permanent establishment or fixed base is situated. 

7. Where, by reason of a special
   relationship between the payer and the beneficial owner or between both of them and some other person,
   the amount of 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 of such
   relationship, the provisions of this Article shall apply only to the last-mentioned amount. In such
   case, the excess part of the payments shall remain taxable according to the laws of each Contracting
   State, due regard being had to the other provisions of this Agreement. 

Article 12
ROYALTIES

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

2. The rate of tax imposed by one of
   Contracting States on royalties derived from sources within that Contracting State and beneficially
   owned by [a] resident of the other Contracting State shall not exceed 10 per cent of the gross amount
   of the royalties. 

3. The term “royalties” as used in
   this Article means payments, whether periodical or not, and in whatever form or name or nomenclature
   to the extent to which they are made as consideration for: 

   1. the use of, or the right to
      use, any copyright, patent, design or model, plan, secret formula or process, trademark or other
      like property or right; or 

   2. the use of, or the right to
      use, any industrial, commercial or scientific equipment; or 

   3. the supply of scientific,
      technical, industrial or commercial knowledge or information; or 

   4. the supply of any assistance
      that is ancillary and subsidiary or enjoyment of, any such property or right as is mentioned in
      subparagraph (a), any such equipment as is mentioned in sub-paragraph (b) or any such knowledge or
      information as is mentioned in subparagraph (c); or 

   5. the use of, or the right to
      use :

      1. motion picture films; or

      2. films or video for use in connection with
         television, or

      3. tapes for use in connection with radio
         broadcasting, or

   6. total or partial forbearance
      in respect of the use or supply of any property or right referred to in this paragraph. 

4. The provisions of paragraphs 1 and
   2 shall not apply if the beneficial owner of the royalties, being a resident of a Contracting State,
   carries on business in the other Contracting State in which the royalties arise, through a permanent
   establishment situated therein, or performs in that other Contracting State independent personal
   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
   case, the provisions of Article 7 or Article 14, as the case may be, shall apply. 

5. Royalties shall be deemed to arise
   in a Contracting State when the payer is that State itself, a local authority thereof 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 a fixed base in connection with
   which the liability to pay the royalties was incurred, and such royalties are borne by such permanent
   establishment or fixed base, then such royalties shall be deemed to arise in the State in which the
   permanent establishment or fixed base is situated. 

6. Where, by reason of a special
   relationship between the payer and the beneficial owner or between both of them and some other person,
   the amount of 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 of such relationship, the provisions of this Article shall apply only to the last-mentioned
   amount. In such case, the excess part of the payment shall remain taxable according to the laws of
   each Contracting State, due regard being had to the other provisions of this Agreement. 

Article 13
CAPITAL GAINS

1. Gains derived by a resident of a
   Contracting State from the alienation of immovable property referred to in Article 6 and situated in
   the other Contracting State may be taxed in that other State.

2. 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 independent personal services, including such gains from the alienation of such
   a permanent establishment (alone or with the whole enterprise) or of such a fixed base, may be taxed
   in that other State. 

3. Gains derived by a resident of a
   Contracting State from the alienation of ships or aircraft operated in international traffic or
   movable property pertaining to the operation of such ships or aircraft shall be taxable only in that
   State. 

4. Gains from the alienation of
   shares of the capital stock of a company the property of which consists directly or indirectly
   principally of immovable property situated in a Contracting State may be taxed in that Contracting
   State. 

5. Gains from the alienation of any
   property other than that referred to in the preceding paragraphs shall be taxable only in the
   Contracting State of which the alienator is a resident. 

Article 14
INDEPENDENT PERSONAL SERVICES

1. Income derived by 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 except in one of the following circumstances, when
   such income may also be taxed in the other Contracting State: 

   1. if he has a fixed base
      regularly available to him in the other Contracting State for the purpose of performing his
      activities; in that case, only so much of the income as is attributable to that fixed base may be
      taxed in that other Contracting State; or 

   2. if he is present in that other
      Contracting State for a period or periods exceeding in the aggregate 183 days within any twelve
      month period; in that case, only so much of the income as is derived from his activities performed
      in that other Contracting State during the aforesaid period or periods may be taxed in that other
      Contracting State.

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

Article 15
DEPENDENT PERSONAL SERVICES

1. Subject to the provisions of
   Articles 16, 18, 19, 20 and 21, 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 Contracting 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 Contracting State. 

2. 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: 

   1. the recipient is present in
      that other Contracting State for a period or periods not exceeding in the aggregate 183 days
      within any twelve month period; and 

   2. the remuneration is paid by,
      or on behalf of, an employer who is not a resident of the other Contracting State; and 

   3. the remuneration is not borne
      by a permanent establishment or a fixed base which the employer has in the other Contracting
      State. 

3. 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. 

Article 16
DIRECTORS’ FEES

Directors’ fees and other similar payments derived by
a resident of a Contracting State in his capacity as a member of the board of directors or any other
similar organ of a company which is a resident of the other Contracting State may be taxed in that other
Contracting State.

Article 17
ARTISTES AND ATHLETES

1. Notwithstanding the provisions of
   Articles 14 and 15, income derived by a resident of a Contracting State as an entertainer, such as a
   theatre, motion picture, radio or television artiste, or a musician, or as an athlete, from his
   personal activities as such exercised in the other Contracting State, may be taxed in that other
   Contracting State. 

2. Where income in respect of
   personal activities exercised by an entertainer or an athlete in his capacity as such accrues not to
   the 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. 

3. Notwithstanding the provisions of
   paragraphs 1 and 2, income derived by entertainers or athletes who are residents of a Contracting
   State from the activities exercised in the other Contracting State under a plan of cultural exchange
   between the Governments of both Contracting States shall be exempt from tax in that other Contracting
   State. 

Article 18
PENSIONS

1. Subject to the provisions of
   paragraph 2 of Article 19, pensions and other similar remuneration paid to a resident of a Contracting
   State in consideration of past employment shall be taxed only in that State. 

2. Notwithstanding the provisions of
   paragraph 1, and subject to the provisions of paragraph 2 of Article 19, pensions paid and other
   similar payments made under a public welfare scheme of the social security system or a special fund of
   a Contracting State, or of the Government or a local authority thereof in accordance with the law of
   that State shall be taxable only in that State. 

Article 19
GOVERNMENT SERVICE

Article 20
TEACHERS AND RESEARCHERS

An individual who visits a Contracting State at the
invitation of that State or of a university, college, school, museum or other cultural institution of that
State or under an official program of cultural exchange for a period not exceeding two years solely for
the purpose of teaching, giving lectures or carrying out research at such institution and who is, or was
immediately before that visit, a resident of the other Contracting State shall be exempt from tax in the
first-mentioned State on his remuneration for such activity.

Article 21
STUDENTS AND TRAINEES

1. Payments which a student,
   apprentice or business trainee who is or was immediately before visiting a Contracting State, a
   resident of the other Contracting State and who is present in the first-mentioned State solely for the
   purpose of his education or training, receives for the purpose of his maintenance, education or
   training, shall not be taxed in that first-mentioned State, provided that such payments are made to
   him from sources outside that State. 

2. In respect of grants, scholarships
   and remuneration not covered by paragraph 1, a student or trainee described in paragraph 1 shall, in
   addition, be entitled during his or her education or training to the same exemptions, reliefs or
   reductions in respect of taxes available to residents of the Contracting State which he or she is
   visiting.

Article 22
OTHER INCOME

1. Items of income of a resident of a
   Contracting State, wherever arising, not dealt with in the foregoing Articles of this Agreement shall
   be taxable only in that Contracting State. However, items of income arising in the other Contracting
   State may also be taxed in that other Contracting State. 

2. The provisions of paragraph 1
   shall not apply to income, other than income from immovable property as defined in paragraph 2 of
   Article 6, if the recipient of such income, being a resident of a Contracting State, carries on
   business in the other Contracting State through a permanent establishment situated therein, or
   performs in that other Contracting State independent personal service from a fixed base situated
   therein, and the right or property in respect of which the income is paid is effectively connected
   with such permanent establishment or fixed base. In such case the provisions of Article 7 or Article
   14, as the case may be, shall apply. 

Article 23
METHODS FOR ELIMINATION OF DOUBLE TAXATION

1. In Indonesia, double taxation
   shall be eliminated as follows :

   Where a resident of Indonesia derives income from
   China, the amount of tax on that income payable in China in accordance with the provisions of this
   Agreement, may be credited against the tax levied in Indonesia imposed on that resident. The amount of
   credit, however, shall not exceed the amount of the tax in Indonesia on that income computed in
   accordance with its taxation laws and regulations.

2. In China, double taxation shall be
   eliminated as follows :

   1. Where a resident of China
      derives income from Indonesia the amount of tax on that income payable in Indonesia in accordance
      with the provisions of this Agreement, may be credited against the Chinese tax imposed on that
      resident. The amount of the credit, however, shall not exceed the amount of the Chinese tax on
      that income computed in accordance with the taxation laws and regulations of China. 

   2. Where the income derived from
      Indonesia is a dividend paid by a company which is a resident of Indonesia to a company which is a
      resident of China and which owns not less than 10 per cent of the shares of the company paying the
      dividend, the credit shall take into account the tax paid to Indonesia by the company paying the
      dividend in respect of its income. 

Article 24
NON-DISCRIMINATION

1. 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 Contracting State in the same circumstances are or may be subjected. The
   provisions of this paragraph shall, notwithstanding the provisions of Article 1, also apply to persons
   who are not residents of one or both of the Contracting States. 

2. The taxation on a permanent
   establishment which an enterprise of a Contracting State has in the other Contracting State shall not
   be less favorably levied in that other Contracting State than the taxation levied on enterprises of
   that other Contracting State carrying on the same activities. The provision of this paragraph shall
   not 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. 

3. Except where the provisions of
   Article 9, paragraph 7 of Article 11, or paragraph 6 of Article 12, apply, interest, royalties and
   other disbursements paid by an enterprise of a Contracting State to a resident of the other
   Contracting State shall, for the purpose of determining the taxable profits of such enterprise, be
   deductible under the same conditions as if they had been paid to a resident of the first-mentioned
   State. 

4. 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 in 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 other similar enterprises of the first-mentioned State
   are or may be subjected. 

5. In this Article the term
   “taxation” means taxes which are the subject of this Agreement.

Article 25
MUTUAL AGREEMENT PROCEDURE

1. Where a person considers that the
   actions of one or both of the Contracting States result or will result for him in taxation not in
   accordance with the provisions of this Agreement, he may, irrespective of the remedies provided by the
   domestic law of those States, present his case to the competent authority of the Contracting State of
   which he is a resident or, if his case comes under paragraph 1 of Article 24, to that of the
   Contracting State of which he is a national. The case must be presented within three years from the
   first notification of the action resulting in taxation not in accordance with the provisions of the
   Agreement. 

2. The competent authority shall
   endeavor, if the objection appears to it to be justified and if it is not itself able to arrive at a
   satisfactory 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 which is not in accordance with this
   Agreement.

3. The competent authorities of the
   Contracting States shall endeavor to resolve by mutual agreement any difficulties or doubts arising as
   to the interpretation or application of the Agreement. They may also consult together for the
   elimination of double taxation in cases not provided for in this Agreement. 

4. The competent authorities of the
   Contracting States may communicate with each other directly for the purpose of reaching an agreement
   in the sense of the paragraphs 2 and 3. When it seems advisable for reaching agreement,
   representatives of the competent authorities of the Contracting States may meet together for an oral
   exchange of opinions. 

Article 26
EXCHANGE OF INFORMATION

1. The competent authorities of the
   Contracting States shall exchange such information as is necessary for carrying out the provisions of
   this Agreement or of the domestic laws of the Contracting States concerning taxes covered by the
   Agreement insofar as the taxation thereunder is not contrary to this Agreement, in particular for the
   prevention of evasion of such taxes. The exchange of information is not restricted by Article 1. Any
   information received by a Contracting State shall be treated as secret and shall be disclosed only to
   persons or authorities (including courts and administrative bodies) involved in the assessment or
   collection of, the enforcement or prosecution in respect of, or the determination of appeals in
   relation to, the taxes covered by the Agreement. 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. 

2. In no case shall the provisions of
   paragraph 1 be construed so as to impose on a Contracting State the obligation :

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

   2. to supply information which is
      not obtainable under the laws or in the normal course of the administration of that or of the
      other Contracting State;

   3. 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).

Article 27
DIPLOMATIC AGENTS AND CONSULAR OFFICERS

Nothing in this Agreement shall affect the fiscal
privileges of diplomatic agents or consular officers under the general rules of international law or under
the provisions of special agreements.

Article 28
ENTRY INTO FORCE

1. This Agreement shall enter into
   force on the later of the date on which the respective Governments may notify each other in writing
   that the formalities constitutionally required in their respective States have been complied
   with. 

2. This Agreement shall have effect :

   1. in respect of tax withheld at
      source to income derived on or after 1st of January in the year next following that in which the
      Agreement enters into force; and 

   2. in respect of other taxes on
      income, for taxable years beginning on or after 1st of January in the year next following that in
      which the Agreement enters into force.

Article 29
TERMINATION

This Agreement shall continue in effect indefinitely
but either of the Contracting States may, on or before the thirtieth day of June in any calendar year
beginning after the expiration of a period of five years from the date of its entry into force, give
written notice of termination to the other Contracting State through the diplomatic channels. In such
event this Agreement shall cease to have effect as respects income derived during the taxable years
beginning on or after the first day of January in the calendar year next following that in which the
notice of termination is given.

In such case, the Agreement shall
cease to have effect :

1. in respect of income tax withheld
   at source to income derived on or after 1st of January in the year next following that in which the
   notice of termination is given;

2. in respect of other taxes on
   income, for taxable years beginning on or after 1st of January in the year next following that in
   which the notice of termination is given.

IN WITNESS WHEREOF the undersigned,
duly authorized thereto by their respective Governments, have signed this Agreement.

Done at Jakarta on the 7th day of November, 2001, in
duplicate in the Chinese, Indonesian and English languages, all texts being equally authentic. In case of
any divergence of interpretation, the English text shall prevail.