Denmark

CONVENTION BETWEEN
THE GOVERNMENT OF THE REPUBLIC OF INDONESIA
AND
THE GOVERNMENT OF THE KINGDOM OF DENMARK

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

Article 1
PERSONAL SCOPE

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

Article 2
TAXES COVERED

1. This Convention shall apply to
   taxes on income imposed on behalf of each Contracting State or of its political subdivisions or 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 gains from
   the alienation of movable property and taxes on the total amounts of wages or salaries paid by
   enterprises, as well as taxes on capital appreciation.

3. The existing taxes to which the
   Convention shall apply are in particular;

   (a)	In the case of Indonesia the income tax imposed under the Undang-undang Pajak Penghasilan 1984 (Law No. 7 of 1983) and to the extent provided in such income tax law, the company tax imposed under the Ordonansi Pajak Perseroan 1925 (State Gazette No. 319 of 1925 as lastly amended by Law No. 8 of 1970) and the tax imposed under the Undang-undang Pajak atas Bunga, Dividen dan Royalti 1970 (Law No. 10 of 1970); (hereinafter referred to as “Indonesian tax”).
   (b)	In Denmark
   	(i)	the income tax to the state (indkomstskatten til staten);
   	(ii)	the municipal income tax (den kommunale ind- komstskat);
   	(iii)	the income tax to the county municipalities (den amtskommunale indkomstskat);
   	(iv)	the old age pension contribution (folkepensionsbidraget);
   	(v)	the seamen’s tax (somandsskatten);
   	(vi)	the special income tax (den saerlige indkomstskat);
   	(vii)	the church tax (kirkeskatten);
   	(viii)	the tax on dividends (udbytteskatten);
   	(ix)	the contribution to the sickness “per diem” fund (bidrag til dagpengefonden);
   	(x)	taxes imposed under the Hydrocarbon Tax Act (skatter i henhold til kulbrinteskatteloven);
   	(hereinafter referred to as “Danish tax”).

4. The Convention shall apply also to
   any identical or substantially similar taxes which are imposed 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 to each other any substantial changes which have been made in their
   respective taxation laws.

Article 3
GENERAL DEFINITIONS

1. In this Convention, unless the
   context otherwise requires :

   (a)	the terms “a Contracting State” and “the other Contracting State” mean Denmark or Indonesia as the context requires;
   (b)	the term “Denmark” means the Kingdom of Denmark including any area outside the territorial sea of Denmark which in accordance with international law has been designated under Danish laws as an area within which Denmark may exercise sovereign rights with respect to exploration and exploitation of the natural resources of the sea-bed or its subsoil; the term does not comprise the Faroe Islands and Greenland;
   (c)	the term “Indonesia” comprises the territory of the Republic of Indonesia as defined in its laws and such parts of the continental shelf and adjacent seas, over which the Republic of Indonesia has sovereignty, sovereign rights or other rights in accordance with international law;
   (d)	the term “person” comprises 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 tax purposes;
   (f)	the term “tax” means Danish tax or Indonesian tax as the context requires;
   (g)	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 the other Contracting State;
   (h)	the term “nationals” means :
   	(1)	all individuals possessing the nationality of a Contracting State;
   	(2)	all legal persons, partnerships and associations deriving their status as such from the law in force in a Contracting State;
   (i)	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;
   (i)	the term “competent authority” means :
   	(1)	in the case of Denmark, the Minister for Inland Revenue, Customs and Excise or his authorized representative;
   	(2)	in the case of Indonesia, the Minister of Finance or his authorized representative.

2. 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. 

Article 4
FISCAL DOMICILE

1. For the purpose of this
   Convention, the term “resident of a Contracting State” means any person who, under the law of that
   State, is liable to taxation therein by reason of his domicile, residence, place of management or any
   other criterion of a similar nature. But this term does not include any person who is liable to tax in
   that Contracting State in respect only of income from sources therein or capital situated in that
   State. 

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 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 closer (centre of vital
      interests); 

   2. 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;

   3. if he has an habitual abode in
      both Contracting States or in neither of them, the competent authorities of the two 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, then it
   shall be deemed to be a resident of the Contracting State in which its place of effective management
   is situated. If a place of effective management is considered as situated in both Contracting States,
   the competent authorities of the Contracting States shall settle the question by mutual agreement.

Article 5
PERMANENT ESTABLISHMENT

Article 6
INCOME FROM IMMOVABLE PROPERTY

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

2. 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, rights to explore for or to exploit
   mineral deposits, sources and other natural resources and rights to amounts computed by reference to
   the amount or value of production from such resources; ships and aircraft shall not be regarded as
   immovable property. 

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

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

Article 7
BUSINESS PROFITS

1. 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 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: 

   (a)	that permanent establishment;
   (b)	sales in that other State of goods or merchandise of the same or similar kind as those sold through that permanent establishment; or
   (c)	other business activities carried on in that other State of the same or similar kind as those effected through that 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 the determination of the
   profits of a permanent establishment there shall be allowed as deductions expenses which are incurred
   for the purposes 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 embodied 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 solely for the enterprise.

Article 8
SHIPPING AND AIR TRANSPORT

1. Profits from the operation of
   ships or aircraft in international traffic carried on by an enterprise of a Contracting State shall be
   taxable only in that State.

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

3. With respect to profits derived by
   the Danish, Norwegian and Swedish air transport consortium, known as the Scandinavian Airlines System
   (SAS), the provisions of paragraph 1 shall only apply to such part of the profits as corresponds to
   the shareholding in the consortium held by Det Danske Luftfartelskab (DDL), the Danish partner of
   Scandinavian Airlines System (SAS). 

Article 9
ASSOCIATED ENTERPRISES

1. Where :

   (a)	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
   (b)	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 profits on which an
   enterprise of a Contracting State has been charged to tax in that State are also included in the
   profits of an enterprise of the other Contracting State and taxed accordingly, and the profits so
   included are profits which would have accrued to that enterprise of the other State if the conditions
   made between the enterprises had been those which would have been made between independent
   enterprises, then the first-mentioned State shall make an appropriate adjustment to the amount of tax
   charged on those profits in the first-mentioned State. In determining such an adjustment due regard
   shall be had to the other provisions of this Convention in relation to the nature of the income, and
   for this purpose the competent authorities of the Contracting States shall if necessary consult each
   other. 

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 State.

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

   (a)	10 percent of the gross amount of the dividends if the recipient is a company (excluding partnership) which holds directly at least 25 percent of the capital of the company paying the dividends;
   (b)	in all other cases 20 percent of the gross amount of the dividends.
   The competent authorities of the Contracting States shall by mutual agreement settle the mode of application of this limitation. 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 taxation law 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 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,
   through a permanent establishment situated therein or performs in that other State professional
   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 a case the
   provisions of Article 7 or Article 14, as the case may be, shall apply. 

5. Where a company which is a
   resident of 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 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 undistributed profits, even
   if the dividends paid or the undistributed profits consist wholly or partly of profits or income
   arising in such other State. 

6. Where a company resident of a
   Contracting State has in the other Contracting State a permanent establishment, the profits of this
   permanent establishment shall, after having borne the corporation tax, be liable to a tax, the rate of
   which shall not exceed 15%, according to the laws of that other Contracting State. 

7. The provision of paragraph 6 of
   this Article shall not affect the provisions contained in any production sharing contracts and
   contracts of work (or any other similar contracts) relating to the oil and gas sector or other mining
   sector concluded by the Government of Indonesia, its instrumentality, its relevant State oil and gas
   company or any other entity thereof with a person who is a resident of Denmark on or before 31
   December 1983.

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 State.

2. However, such interest may also be
   taxed in the Contracting State in which it arises, and according to the law of that State, but if the
   recipient is the beneficial owner of the interest, the tax so charged shall not exceed 10% of the
   amount of the interest. The competent authorities of the Contracting States shall by mutual agreement
   settle the mode of application of this limitation. 

3. Notwithstanding the provisions of
   paragraph 2, interest arising in a Contracting State and paid to the Government of the other
   Contracting State or local authority thereof, the Central Bank of that other Contracting State, or any
   agency wholly owned by that Government or local authority shall be exempt from tax in the
   first-mentioned Contracting State. It is agreed that this paragraph applies to the following
   institutions of Denmark: 
   1) The National Bank of Denmark
   2) The Industrialization Fund for Developing Countries
   3) The Danish Export Credit Council
   4) The Danish Export Finance Corporation
   5) The Ship Credit Fund of Denmark
   on loans or credits granted with the consent of the Minister in charge of financial affairs or of
   planning in Indonesia. The competent authorities of the Contracting States may determine by mutual
   agreement any other governmental institution to which this paragraph shall apply.

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
   bonds or debentures. 

5. The provisions of paragraphs 1 and
   2 shall not apply if the recipient 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 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 

   (a)	such permanent establishment or fixed base, or with
   (b)	business activities referred to under (c) of paragraph 1 of Article 7.
   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 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 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, 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 for
   whatever reason 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. 

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 State.

2. However, such royalties may also
   be taxed in the Contracting State in which they arise, and according to the law of that State, but if
   the recipient is the beneficial owner of the royalties, the tax so charged shall not exceed 15% of the
   gross amount of the royalties. 

3. 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,
   trade mark, 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. 

4. The provisions of paragraphs 1 and
   2 shall not apply if the recipient 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 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 

   (a)	such permanent establishment or fixed base, or with
   (b)	business activities referred to under (c) of paragraph 1 Article 7.
   In such a 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 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 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
   Contracting State in which the permanent establishment is situated. 

6. 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 for whatever reason 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.

Article 13
CAPITAL GAINS

1. Gains from the alienation of
   immovable property as defined in paragraph 2 of Article 6, may be taxed in the Contacting State in
   which such property is situated.

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

3. Gains 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 the Contracting State in which the enterprise operating
   the ships or aircraft is a resident. 

4. 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.

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 State except in the following circumstances, when such income may also
   be taxed in the other Contracting State: 

   (a)	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
   (b)	if his stay in the other Contracting State is for a period or periods amounting to or exceeding in the aggregate 91 days within any period of 12 months; in that case, only so much of the income as is derived from his activities performed in that other State may be taxed in that other State.

2. 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.

Article 15
DEPENDENT PERSONAL SERVICES

1. 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. 

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:

   (a)	the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days within any period of 12 months, and
   (b)	the remuneration is paid by or on behalf of, an employer who is not a resident of the other State, and
   (c)	the remuneration is not borne by a permanent establishment or a fixed base which the employer has in the other State.

3. Notwithstanding the preceding
   provisions of this Article, remuneration in respect of an employment exercised aboard a ship or
   aircraft in international traffic may be taxed in the Contracting State in which the enterprise
   operating the ship or aircraft is a resident. 

Article 16
DIRECTORS’ FEES

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

Article 17
ARTISTES AND ATHLETES

1. Notwithstanding the provisions of
   Articles 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. 

2. 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. 

3. Notwithstanding the provisions of
   paragraph 1, remunerations or profits, and wages, salaries and other similar income derived by
   entertainers and athletes from their personal activities as such in a Contracting State shall be
   taxable only in the other Contracting State if their visit to the first Contracting State is supported
   substantially from public funds of that other Contracting State, one of its political subdivisions or
   local authorities or of a statutory body thereof. 

4. Notwithstanding the provisions of
   paragraph 2, where income in respect of personal activities as such of entertainers and athletes in a
   Contracting State accrues not to that entertainer or athlete himself but to another person,
   notwithstanding the provisions of Articles 7, 14 and 15, that income shall be taxable only in the
   other Contracting State if this person is supported substantially from public funds of that other
   Contracting State, one of its political subdivisions or local authorities or of a statutory body
   thereof. 

Article 18
PENSIONS, SOCIAL SECURITY PAYMENTS, ANNUITIES AND ALIMONY

1. Pensions, annuities and social
   security payments arising in a Contracting State and paid to a resident of the other Contracting State
   shall be taxable only in the first-mentioned State. 

2. 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.

Article 19
GOVERNMENT SERVICE

Article 20
STUDENTS

1. Payments which a student or
   business apprentice 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 Contracting 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 State, provided that such payments are made to him from sources
   outside that State. 

2. Notwithstanding the provisions of
   paragraph 1, remuneration which a student or business apprentice who is or was formerly a resident of
   a Contracting State and who is present in the other Contracting State solely for the purpose of his
   education or training derives from services rendered in that other State shall not be taxed in that
   other State provided that such services are in connection with his education or training or that the
   remuneration of such services is necessary to supplement the resources available to him for the
   purpose of his maintenance.

Article 21
TEACHERS AND RESEARCHERS

1. A professor or teacher who visits
   a Contracting State for a period not exceeding two years for the purpose of teaching or carrying out
   research at a university, college, school or educational institution in that Contracting State and who
   is, or was immediately before such visit, a resident of the other Contracting State shall be exempt
   from tax in the first-mentioned Contracting State on any remuneration for such teaching or research in
   respect of which he is subject to tax in the other Contracting State. 

2. This Article shall not apply to
   income from research if such research is undertaken not in the public interest but primarily for the
   private benefit of a specific person or persons.

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 Convention shall
   be taxable only in that 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 State independent personal services 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. 

3. Notwithstanding the provisions of
   paragraphs 1 and 2, items of income of a resident of a Contracting State not dealt with in the
   foregoing Articles of this Convention and arising in the other Contracting State may also be taxed in
   that other State. 

Article 23
ELIMINATION OF DOUBLE TAXATION

1. The laws of each of the
   Contracting States shall continue to govern the taxation of income whether derived from the
   Contracting State or elsewhere except where express provisions to the contrary are made in this
   Convention. Where income derived from a Contracting State is subject to tax in both Contracting
   States, relief from double taxation on such income shall be given in accordance with the following
   provisions of this Article. 

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

   (a)

   Indonesia, when imposing tax on residents of Indonesia, may include in the basis upon which such tax is imposed the items of income which may be taxed in Denmark in accordance with the provisions of this Convention;

   (b)

   where a resident of Indonesia derives income from Denmark and that income may be taxed in Denmark in accordance with the provisions of this Convention, the amount of Danish tax payable in respect of the income shall be allowed as a credit against the Indonesian tax imposed on that resident. The amount of credit, however, shall not exceed that part of the Indonesian tax which is appropriate to the income.

3. In the case of Denmark, double
   taxation shall be avoided as follows :

   (a)	Subject to the provisions of sub-paragraph c), where a resident of Denmark derives income which, in accordance with the provisions of this Convention may be taxed in Indonesia, Denmark shall allow as a deduction from the tax on the income of that person, an amount equal to the income tax paid in Indonesia.
   (b)	The deduction shall not, however, exceed that part of the income tax, as computed before the deduction is given, which is appropriate to the income which may be taxed in Indonesia.
   (c)	Where a resident of Denmark derives income which, in accordance with the provisions of this Convention shall be taxable only in Indonesia, Denmark may include this income in the tax base, but shall allow as a deduction from the income tax that part of the income tax which is appropriate to the income derived from Indonesia.
   (d)	Where Indonesian tax levied on dividends is relieved below the rates provided for in Article 10, paragraph 2, for dividends by special incentive measures under Indonesian Law No. 1 of 1967 regarding Foreign Capital Investment, sofar as they were in force on, and have not been modified since the date of signature of this Convention or have been modified only in minor respects so as not to affect their general character there shall be allowed as a credit against Danish income tax on such dividends an amount corresponding to the rate of tax provided for in the foregoing mentioned provisions of this Convention. The credit allowed under the foregoing sentence shall, however, not exceed the amount of Indonesian tax which would have been payable but for such relief.
   This provision shall cease to have effect after December 31, 1992.

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 State in the same circumstances are or may be subjected. This provision 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 favourably levied in that other State than the taxation levied on enterprises of that other
   State carrying on the same activities.
   This provision 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. 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
   Contracting 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 that
   first-mentioned State are or may be subjected. 

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

Article 25
MUTUAL AGREEMENT PROCEDURE

1. 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, notwithstanding the remedies provided
   by the national laws 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. This case must be presented within three years from the
   first notification of the action giving rise to taxation not in accordance with the Convention. 

2. The competent authority 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 which is not in accordance with the
   Convention. Any agreement reached shall be implemented notwithstanding any time limits in the national
   laws of the Contracting States. 

3. 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. 

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 preceding paragraphs. When it seems advisable in order to reach agreement to have
   an oral exchange of opinions, such exchange may take place through a Commission consisting of
   representatives of the competent authorities of the Contracting States. 

Article 26
EXCHANGE OF INFORMATION

1. 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 concerning taxes covered by this
   Convention insofar as the taxation thereunder is not contrary to this Convention. The exchange of
   information is not restricted by Article 1. Any information received by a Contracting State shall be
   treated as secret in the same manner as information obtained under the domestic laws of that State 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 which are the subject of the Convention. Such
   persons or authorities shall use the information only for such purposes. These persons or authorities
   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 one of the Contracting States the obligation:

   (a)	to carry out administrative measures at variance with the laws and administrative practice of that or of the other Contracting State;
   (b)	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;
   (c)	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 (ordure public).

Article 27
DIPLOMATIC AGENTS AND CONSULAR OFFICERS

Nothing in this Convention 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
TERRITORIAL EXTENSION

This Convention may be extended, either in its
entirety or with any necessary modifications, to any part of the territory of Denmark which is
specifically excluded from the application of the Convention and which imposes taxes substantially similar
in character to those to which the Convention applies. Any such extension shall take effect from such date
and subject to such modifications and conditions, including conditions as to termination, as may be
specified and agreed between the Contracting States in notes to be exchanged through diplomatic channels.

Article 29
ENTRY INTO FORCE

1. The Government of the Contracting
   State shall notify to each other that the constitutional requirements for the entry into force of this
   Convention have been complied with.

2. The Convention shall enter into
   force on the date of the latter of the notifications referred to in paragraph 1 and its provisions
   shall have effect in respect of taxes for the income year which coincides with or replaces the
   calendar year immediately following that in which the Convention enters into force and subsequent
   income years.

Article 30
TERMINATION

This Convention shall remain in force until terminated
by a Contracting State. Either Contracting State may terminate the Convention, through diplomatic
channels, by giving written notification of termination on or before the thirtieth day of June of any
calendar year following after a period of five years from the year in which the Convention enters into
force. In such event, the Convention shall cease to have effect in respect of taxes for the income year
which coincides with or replaces the calendar year immediately following that in which the notification of
termination is given and subsequent income years.

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

Done in Duplicate at Jakarta on the
twenty eighth day of December 1985 in the English language.

PROTOCOL

At the signing of the Convention
between the Republic of Indonesia and the Kingdom of Denmark for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on income, the undersigned have agreed that the
following provisions shall form an integral part of the said Convention :

Ad Article 5, paragraph 1:
Notwithstanding paragraph 1 of Article 5, it is understood that activities consisting of preliminary
surveys or exploration of hydrocarbons carried out with ships, drilling rigs, and installations constitute
a permanent establishment.

Ad Article 5, paragraph 3:
It is understood that the time-limit of six months shall apply to an assembly or installation project
performed by the main contractor in connection with a building site or construction project.

Ad Article 15, paragraph 3:
It is understood that where a resident of Denmark derives remuneration in respect of an employment
exercised aboard an aircraft operated in international traffic by the Scandinavian Airlines System (SAS)
consortium, such remuneration shall be taxation only in Denmark.

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

DONE in duplicate at Jakarta on the
twenty eight day of December 1985 in the English language.