rijk/verdrag/verdrag-tussen-het-koninkrijk-der-nederlanden-en-het-vorstendom-andorra-tot-het/BWBV0007016

titel	bwb_id	type	status	datum_inwerkingtreding	bron	citeertitel
Verdrag tussen het Koninkrijk der Nederlanden en het Vorstendom Andorra tot het vermijden van dubbele belasting met betrekking tot belastingen naar het inkomen en naar het vermogen en het voorkomen van het ontduiken en ontwijken van belasting (met Protocol)	BWBV0007016	verdrag	geldend	2024-12-31	https://wetten.overheid.nl/BWBV0007016	Verdrag tussen het Koninkrijk der Nederlanden en het Vorstendom Andorra tot het vermijden van dubbele belasting met betrekking tot belastingen naar het inkomen en naar het vermogen en het voorkomen van het ontduiken en ontwijken van belasting (met Protocol)

Verdrag tussen het Koninkrijk der Nederlanden en het Vorstendom Andorra tot het vermijden van dubbele belasting met betrekking tot belastingen naar het inkomen en naar het vermogen en het voorkomen van het ontduiken en ontwijken van belasting (met Protocol)

Hoofdstuk I. SCOPE OF THE CONVENTION

Artikel 1

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

2.

For the purposes of this Convention, income derived by or through an entity or arrangement that is treated as wholly or partly fiscally transparent under the tax law of either Contracting State and that is formed or organized:

a) a) in either Contracting State; or b) b) in a State that has an agreement in force containing a provision for the exchange of information on tax matters with the Contracting State from which the income, profit, or gain is derived,

shall be considered to be income of a resident of a Contracting State but only to the extent that the income is treated, for purposes of taxation by that State, as the income of a resident of that State.

In no case shall the provisions of this paragraph be construed so as to affect a Contracting State’s right to tax the residents of that Contracting State.

Artikel 2

1. This Convention shall apply to taxes on income and on capital imposed on behalf of a 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 and on capital all taxes imposed on total income, on total capital, or on elements of income or of capital, including taxes on gains from the alienation of movable or immovable property, 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) a) in the Kingdom of the Netherlands:

        (i)
        the income tax (de inkomstenbelasting);
      
      
        (ii)
        the wages tax (de loonbelasting);
      
      
        (iii)
        the company tax (de vennootschapsbelasting) including the Government share in the net profits of the exploitation of natural resources levied pursuant to the Mining Act (de Mijnbouwwet);
      
      
        (iv)
        the dividend tax (de dividendbelasting); and
      
      
        (v)
        the withholding tax (de bronbelasting);
      
    
    (hereinafter referred to as “Netherlands tax”);

(i) (i) the income tax (de inkomstenbelasting); (ii) (ii) the wages tax (de loonbelasting); (iii) (iii) the company tax (de vennootschapsbelasting) including the Government share in the net profits of the exploitation of natural resources levied pursuant to the Mining Act (de Mijnbouwwet); (iv) (iv) the dividend tax (de dividendbelasting); and (v) (v) the withholding tax (de bronbelasting); b) b) in the Principality of Andorra:

        (i)
        the corporate income tax (impost sobre societats);
      
      
        (ii)
        the personal income tax (impost sobre la renda de les persones físiques);
      
      
        (iii)
        the tax on income for fiscal non-residents (impost sobre la renda dels no-residents fiscals) and
      
      
        (iv)
        tax payable on the increase in value in immovable property (impost sobre les plusvàlues en les transmissions patrimonials immobiliàries);
      
    
    (hereinafter referred to as “Andorran tax”).

(i) (i) the corporate income tax (impost sobre societats); (ii) (ii) the personal income tax (impost sobre la renda de les persones físiques); (iii) (iii) the tax on income for fiscal non-residents (impost sobre la renda dels no-residents fiscals) and (iv) (iv) tax payable on the increase in value in immovable property (impost sobre les plusvàlues en les transmissions patrimonials immobiliàries);

4. The Convention shall apply also to any identical or substantially similar taxes that are imposed after the date of signature of the Convention in addition to, or in place of, the existing taxes. The competent authorities of the Contracting States shall notify each other of any significant changes that have been made in their taxation laws.

Hoofdstuk II. DEFINITIONS

Artikel 3

1.

For the purposes of this Convention, unless the context otherwise requires:

a) a) the terms “a Contracting State” and “the other Contracting State” mean the Kingdom of the Netherlands, in respect of the Netherlands, or the Principality of Andorra, in respect of Andorra, as the context requires; b) b) the term “the Netherlands” means the European part of the Kingdom of the Netherlands, including its territorial sea and any area beyond and adjacent to its territorial sea within which the Kingdom of the Netherlands, in accordance with international law, exercises jurisdiction or sovereign rights; c) c) the term “Andorra” means the Principality of Andorra and, when used in a geographical sense means the territory of the Principality of Andorra; d) d) the term “person” includes an individual, a company and any other body of persons; e) e) the term “company” means any body corporate or any entity that is treated as a body corporate for tax purposes; f) f) the term “enterprise” applies to the carrying on of any business; g) 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 a resident of the other Contracting State; h) h) the term “international traffic” means any transport by a ship or aircraft, except when the ship or aircraft is operated solely between places in a Contracting State and the enterprise that operates the ship or aircraft is not an enterprise of that State; i) i) the term “competent authority” means:

        (i)
        in the Netherlands, the Minister of Finance or his authorized representative;
      
      
        (ii)
        in Andorra, the Minister in charge of Finance or his authorized representative;

(i) (i) in the Netherlands, the Minister of Finance or his authorized representative; (ii) (ii) in Andorra, the Minister in charge of Finance or his authorized representative; j) j) the term “national”, in relation to a Contracting State, means:

        (i)
        in the case of the Netherlands, any individual possessing the nationality of the Kingdom of the Netherlands and any legal person, partnership or association deriving its status as such from the laws in force in the Netherlands;
      
      
        (ii)
        in the case of Andorra any individual possessing the nationality of Andorra and any legal person, partnership or association deriving its status as such from the laws in force in Andorra;

(i) (i) in the case of the Netherlands, any individual possessing the nationality of the Kingdom of the Netherlands and any legal person, partnership or association deriving its status as such from the laws in force in the Netherlands; (ii) (ii) in the case of Andorra any individual possessing the nationality of Andorra and any legal person, partnership or association deriving its status as such from the laws in force in Andorra; k) k) the term “business” includes the performance of professional services and of other activities of an independent character; l) l) the term “recognised pension fund” of a State means an entity or arrangement established in that Contracting State that is treated as a separate person under the taxation laws of that State, and that is generally exempt from taxes on income in that State and

        (i)
        that is established and operated exclusively or almost exclusively to administer or provide retirement benefits and ancillary or incidental benefits to individuals and that is regulated as such by that State or one of its political subdivisions or local authorities; or
      
      
        (ii)
        that is established and operated exclusively or almost exclusively to invest funds for the benefit of entities or arrangements referred to in subdivision (i).

(i) (i) that is established and operated exclusively or almost exclusively to administer or provide retirement benefits and ancillary or incidental benefits to individuals and that is regulated as such by that State or one of its political subdivisions or local authorities; or (ii) (ii) that is established and operated exclusively or almost exclusively to invest funds for the benefit of entities or arrangements referred to in subdivision (i).

2. As regards the application of the Convention at any time by a Contracting State, any term not defined therein shall, unless the context otherwise requires, have the meaning that it has at that time under the law of that State for the purposes of the taxes to which the Convention applies, any meaning under the applicable tax laws of that State prevailing over a meaning given to the term under other laws of that State.

Artikel 4

1. For the purposes of this Convention, the term “resident of a Contracting State” means any person who, under the laws of that State, is liable to tax therein by reason of his domicile, residence, place of management or any other criterion of a similar nature, and also includes that State and any political subdivision or local authority thereof.

2.

A person, other than an individual, shall be regarded to be liable to tax:

a) a) in the Netherlands, if the person is a resident of the Netherlands for the purposes of the company tax; b) b) in Andorra, if the person is a resident of Andorra for the purposes of corporate income tax;

provided that the income derived by that person is treated under the tax laws of that State as income of that person and not as the income of the person’s beneficiaries, members or participants; even if, according to those laws, all or part of it is exempted from tax.

3. Notwithstanding the provisions of paragraphs 1 and 2, the term “resident of a Contracting State” does not include any person who is liable to tax in that State in respect only of income from sources in that State or capital situated therein.

4.

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:

a) a) he shall be deemed to be a resident only 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 only of the State with which his personal and economic relations are closer (centre of vital interests); b) b) 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 only of the State in which he has an habitual abode; c) c) if he has an habitual abode in both States or in neither of them, he shall be deemed to be a resident only of the State of which he is a national; d) d) if he is a national of both States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement.

5. 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 endeavour to determine by mutual agreement the Contracting State of which such person shall be deemed to be a resident for the purposes of the Convention, having regard to its place of effective management, the place where it is incorporated or otherwise constituted and any other relevant factors. In the absence of such agreement, such person shall not be entitled to any relief or exemption from tax provided by this Convention except to the extent and in such manner as may be agreed upon by the competent authorities of the Contracting States.

Artikel 5

1. For the purposes of this Convention, 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:

a) a) a place of management; b) b) a branch; c) c) an office; d) d) a factory; e) e) a workshop; f) f) a mine, an oil or gas well, a quarry or any other place of extraction of natural resources, and g) g) an agricultural, pastoral or forestry exploitation.

3. A building site or construction or installation project constitutes a permanent establishment only if it lasts more than twelve months.

4.

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

a) a) the use of facilities solely for the purpose of storage, display or delivery of goods or merchandise belonging to the enterprise; b) b) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of storage, display or delivery; c) c) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of processing by another enterprise; d) d) the maintenance of a fixed place of business solely for the purpose of purchasing goods or merchandise or of collecting information, for the enterprise; e) e) the maintenance of a fixed place of business solely for the purpose of carrying on, for the enterprise, any other activity; f) f) the maintenance of a fixed place of business solely for any combination of activities mentioned in subparagraphs a) to e),

provided that such activity or, in the case of subparagraph f), the overall activity of the fixed place of business, is of a preparatory or auxiliary character.

5.

Paragraph 4 shall not apply to a fixed place of business that is used or maintained by an enterprise if the same enterprise or a closely related enterprise carries on business activities at the same place or at another place in the same Contracting State and:

a) a) that place or other place constitutes a permanent establishment for the enterprise or the closely related enterprise under the provisions of this Article, or b) b) the overall activity resulting from the combination of the activities carried on by the two enterprises at the same place, or by the same enterprise or closely related enterprises at the two places, is not of a preparatory or auxiliary character,

provided that the business activities carried on by the two enterprises at the same place, or by the same enterprise or closely related enterprises at the two places, constitute complementary functions that are part of a cohesive business operation.

6.

Notwithstanding the provisions of paragraphs 1 and 2, but subject to the provisions of paragraph 7, where a person is acting in a Contracting State on behalf of an enterprise and, in doing so, habitually concludes contracts, or habitually plays the principal role leading to the conclusion of contracts that are routinely concluded without material modification by the enterprise, and these contracts are:

a) a) in the name of the enterprise; or b) b) for the transfer of the ownership of, or for the granting of the right to use, property owned by that enterprise or that the enterprise has the right to use; or c) c) for the provision of services by that enterprise,

that enterprise shall be deemed to have a permanent establishment in that State in respect of any activities which that person undertakes for 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 (other than a fixed place of business to which paragraph 5 would apply), would not make this fixed place of business a permanent establishment under the provisions of that paragraph.

7. Paragraph 6 shall not apply where the person acting in a Contracting State on behalf of an enterprise of the other Contracting State carries on business in the first-mentioned State as an independent agent and acts for the enterprise in the ordinary course of that business. Where, however, a person acts exclusively or almost exclusively on behalf of one or more enterprises to which it is closely related, that person shall not be considered to be an independent agent within the meaning of this paragraph with respect to any such enterprise.

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 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.

9. For the purposes of this Article, a person is closely related to an enterprise if, based on all the relevant facts and circumstances, one has control of the other or both are under the control of the same persons or enterprises. In any case, a person shall be considered to be closely related to an enterprise if one possesses directly or indirectly more than 50 per cent of the beneficial interest in the other (or, in the case of a company, more than 50 per cent of the aggregate vote and value of the company’s shares or of the beneficial equity interest in the company) or if another person possesses directly or indirectly more than 50 per cent of the beneficial interest (or, in the case of a company, more than 50 per cent of the aggregate vote and value of the company’s shares or of the beneficial equity interest in the company) in the person and the enterprise or in the two enterprises.

Hoofdstuk III. TAXATION OF INCOME

Artikel 6

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 1 shall 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.

Artikel 7

1. 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 that are attributable to the permanent establishment in accordance with the provisions of paragraph 2 may be taxed in that other State.

2. For the purposes of this Article and Article 22, the profits that are attributable in each Contracting State to the permanent establishment referred to in paragraph 1 are the profits it might be expected to make, in particular in its dealings with other parts of the enterprise, if it were a separate and independent enterprise engaged in the same or similar activities under the same or similar conditions, taking into account the functions performed, assets used and risks assumed by the enterprise through the permanent establishment and through the other parts of the enterprise.

3. Where, in accordance with paragraph 2, a Contracting State adjusts the profits that are attributable to a permanent establishment of an enterprise of one of the Contracting States and taxes accordingly profits of the enterprise that have been charged to tax in the other State, the other State shall, to the extent necessary to eliminate double taxation on these profits, make an appropriate adjustment to the amount of the tax charged on those profits. In determining such adjustment, the competent authorities of the Contracting States shall if necessary consult each other.

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

Artikel 8

1. Profits from the operation of ships or aircraft in international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated.

2. If the place of effective management is aboard a ship, then it shall be deemed to be situated in the Contracting State in which the home harbour of the ship is situated, or, if there is no such home harbour, in the Contracting State of which the operator of the ship is a resident.

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

Artikel 9

1.

Where

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

Artikel 10

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, dividends paid by a company which is a resident of a Contracting State may also be taxed in that State according to the laws of that State, but if the beneficial owner of the dividends is a resident of the other Contracting State, the tax so charged shall not exceed 15 per cent of the gross amount of the dividends.

3.

Notwithstanding the provisions of paragraph 2, dividends referred to in paragraph 1 shall be taxable only in the other Contracting State, if the beneficial owner of the dividends is:

a) a) a company (other than a partnership) which is a resident of the other Contracting State and holds directly at least 5 per cent of the capital of the company paying the dividends throughout a 365 day period that includes the day of the payment of the dividend (for the purpose of computing that period, no account shall be taken of changes of ownership that would directly result from a corporate reorganisation, such as a merger or divisive reorganisation, of the company that holds the capital or that pays the dividend); or b) b) a recognized pension fund of a Contracting State.

4. The provisions of paragraphs 2 and 3 shall not affect the taxation of the company in respect of the profits out of which the dividends are paid.

5. 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 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.

6. The provisions of paragraphs 1, 2, 3 and 8 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 and the holding in respect of which the dividends are paid is effectively connected with such permanent establishment. In such case the provisions of Article 7 shall apply.

7.

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 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.

8. Notwithstanding the provisions of paragraphs 1, 2 and 7, dividends paid by a company which under the laws of a Contracting State is a resident of that State, to an individual who is a resident of the other Contracting State and who upon ceasing to be a resident of the first-mentioned State is taxed on the appreciation of capital as meant in paragraph 6 of Article 13, may also be taxed in that State in accordance with the laws of that State, but only insofar as the revenue claim on the appreciation of capital is still outstanding.

Artikel 11

1. Interest arising in a Contracting State and beneficially owned by a resident of the other Contracting State shall be taxable only in that other State.

2. 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. Penalty charges for late payment shall not be regarded as interest for the purpose of this Article.

3. The provisions of paragraph 1 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, and the debt-claim in respect of which the interest is paid is effectively connected with such permanent establishment. In such case the provisions of Article 7 shall apply.

4. Interest shall be deemed to arise in a Contracting State when the payer is 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 in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment, then such interest shall be deemed to arise in the State in which the permanent establishment is situated.

5. 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 Convention.

Artikel 12

1. Royalties arising in a Contracting State and beneficially owned by a resident of the other Contracting State may be taxed in that other State.

2. However, royalties arising in a Contracting State may also be taxed in that State according to the laws of that State, but if the beneficial owner of the royalties is a resident of the other Contracting State, the tax so charged shall not exceed 5 per cent 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 information concerning industrial, commercial or scientific experience.

4. The provisions of paragraph 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 and the right or property in respect of which the royalties are paid is effectively connected with such permanent establishment. In such case the provisions of Article 7 shall apply.

5. Royalties shall be deemed to arise in a Contracting State when the payer is a resident of that State. However, if the person paying the royalties, whether or not a resident of a Contracting State, has in a Contracting State a permanent establishment in connection with which the obligation to pay the royalties was incurred, and the such royalties are borne by such permanent establishment, then such royalties shall be deemed to arise in the State where the permanent establishment 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 payments shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Convention.

Artikel 13

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, including such gains from the alienation of such a permanent establishment (alone or with the whole enterprise), 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 place of effective management of the enterprise is situated.

4.

Gains derived by a resident of a Contracting State from the alienation of shares or comparable interests, such as interests in a partnership or trust, deriving, at any time during the 365 days preceding the alienation, more than 50 per cent of their value directly or indirectly from immovable property situated in the other Contracting State may be taxed in that other State.

However, this paragraph shall not apply to gains derived from the alienation:

a) a) of shares of a company listed on a recognised stock exchange of one or both Contracting States or a European Union or European Economic Area Member State, where the alienator at all times during the 12 month period preceding such alienation held directly or indirectly not more than 25% of the capital of the company whose shares are alienated; b) b) of shares of a company which is a resident of the other Contracting State and benefits from tax deferral in the first-mentioned State under its domestic law within the framework of a special tax regime which applies to reorganizations which takes places between companies within the same group. For the purposes of determining the gain on a subsequent alienation, the cost of the shares for the acquirer shall be determined on the basis of the cost that they had for the alienator. This provision shall not preclude the obligation of informing of the reorganization under domestic law of the Contracting States.

5. Gains from the alienation of any property, other than that referred to in paragraphs 1, 2, 3 and 4, shall be taxable only in the Contracting State of which the alienator is a resident.

6. Where an individual has been a resident of a Contracting State and has become a resident of the other Contracting State, the provisions of this Article shall not prevent the first-mentioned State from taxing under its domestic law the capital appreciation of shares, profit sharing certificates, call options and usufruct on shares and profit sharing certificates in and debt-claims on a company for the period of residency of that individual in the first-mentioned State. In such case, the appreciation of capital taxed in the first-mentioned State shall not be included in the tax base when determining the appreciation of capital by the other State.

Artikel 14

1. Subject to the provisions of Articles 15, 17 and 18, 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) a) the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in any twelve month period commencing or ending in the fiscal year concerned; and b) b) the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State; and c) c) the remuneration is not borne by a permanent establishment which the employer has in the other State.

3. Notwithstanding the preceding provisions of this Article, remuneration derived by a resident of a Contracting State in respect of an employment, as a member of the regular complement of a ship or aircraft, that is exercised aboard a ship or aircraft operated in international traffic, other than aboard a ship or aircraft operated solely within the other Contracting State, shall be taxable only in the first-mentioned State.

Artikel 15

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

Artikel 16

1. Notwithstanding the provisions of Articles 7 and 14, 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 a sportsperson, from that resident’s personal activities as such exercised in the other Contracting State may be taxed in that other State.

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

3. The provisions of paragraphs 1 and 2 shall not apply to income derived from activities exercised in a Contracting State by entertainers or sportspersons if the visit to that State is wholly or mainly supported by public funds of the other Contracting State or political subdivisions or local authorities thereof. In such a case, the income is taxable only in the Contracting State in which the entertainer or the sportsperson is a resident.

Artikel 17

1. Subject to the provisions of Article 18, pensions and other similar remuneration, as well as annuities, paid to a resident of a Contracting State shall be taxable only in that State.

2.

Notwithstanding the provisions of paragraph 1:

a) a) pensions and other similar retirement remuneration, as well as annuities, arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in the first-mentioned State. A pension or other similar retirement remuneration or an annuity shall be deemed to arise in a Contracting State insofar as the contributions or payments associated with that pension or other similar retirement remuneration or annuity, or the entitlement to such pension or similar retirement remuneration or annuity qualified for relief from tax in that State. b) b) Pensions and other payments made under the social security legislation of a Contracting State to a resident of the other Contracting State may be taxed in the first-mentioned State.

3. The provisions of this Article shall also apply in case a lump sum payment is made in lieu of a pension, other similar retirement remuneration or an annuity.

4. For the purposes of this Article the term “annuity” means a stated sum payable periodically at stated times during life or during a specified or ascertainable period of time under an obligation to make the payments in return for adequate and full consideration in money or money’s worth.

Artikel 18

1. Salaries, wages and other similar remuneration paid by a Contracting State or a political subdivision or a local authority thereof to an individual in respect of services rendered to that State or subdivision or authority shall be taxable only in that State.

2.

However, such salaries, wages and other similar remuneration shall be taxable only in the other Contracting State if the services are rendered in that State and the individual is a resident of that State who:

a) a) is a national of that State; or b) b) did not become a resident of that State solely for the purpose of rendering the services.

3. a) a) Notwithstanding the provisions of paragraph 1, pensions and other similar remuneration paid by, or out of funds created by, a Contracting State or a political subdivision or a local authority thereof to an individual in respect of services rendered to that State or subdivision or authority shall be taxable only in that State. b) b) However, such pensions and other similar remuneration shall be taxable only in the other Contracting State if the individual is a resident of, and a national of, that State.

4. The provisions of Articles 14, 15, 16 and 17, shall apply to salaries, wages and other similar remuneration in respect of services rendered in connection with a business carried on by a Contracting State or a political subdivision or a local authority thereof.

Artikel 19

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 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 arise from sources outside that State.

Artikel 20

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 and the right or property in respect of which the income is paid is effectively connected with such permanent establishment. In such case the provisions of Article 7 shall apply.

Artikel 21

1. Capital represented by immovable property referred to in Article 6, owned by a resident of a Contracting State and situated in the other Contracting State, may be taxed in that other State.

2. Capital represented by 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 may be taxed in that other State.

3. Capital represented by ships and aircraft operated in international traffic and by movable property pertaining to the operation of such ships and aircraft, shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated.

4. All other elements of capital of a resident of a Contracting State shall be taxable only in that State.

Hoofdstuk IV. METHODS FOR ELIMINATION OF DOUBLE TAXATION

Artikel 22

1. The Netherlands, when imposing tax on his residents, may include in the basis upon which such taxes are imposed, the items of income or capital which, according to the provisions of this Convention, may be taxed or shall be taxable only in Andorra. In such cases, however, the Netherlands shall allow a reduction of or a deduction from the Netherlands tax according to the provisions of paragraphs 2, 3, 4, 5 and 6, except to the extent that the provisions of this Convention allow taxation by Andorra solely because the items of income or capital are also income derived or capital owned by a resident of Andorra.

2. Where a resident of the Netherlands derives items of income or owns items of capital which according to paragraphs 1, 3 and 4 of Article 6, paragraph 1 of Article 7, paragraph 1 and 3 of Article 8, paragraph 6 of Article 10, paragraph 3 of Article 11, paragraph 4 of Article 12, paragraphs 1, 2 and 3 of Article 13, paragraph 1 of Article 14, paragraph 2 of Article 17, paragraph 1 and subparagraph a of paragraph 3 of Article 18, paragraph 2 of Article 20 and paragraphs 1, 2 and 3 of Article 21 of this Convention may be taxed in Andorra, and are included in the basis referred to in paragraph 1, the Netherlands shall exempt such items of income or capital by allowing a reduction of its tax. This reduction shall be computed in conformity with the provisions of the Netherlands law for the elimination of double taxation. For that purpose the said items of income or capital shall be deemed to be included in the amount of the items of income or capital which are exempt from Netherlands tax under those provisions.

3. The provisions of paragraph 2 shall not apply to items of income derived or of capital owned by a resident of the Netherlands where Andorra applies the provisions of this Convention to exempt such items of income or capital from tax or applies the provisions of paragraph 2 or 3 of Article 10, paragraph 2 of Article 12 to such items of income or capital.

4. Notwithstanding the provisions of paragraph 2 and 3, the Netherlands shall allow a deduction from the Netherlands tax for the tax paid in Andorra on items of income which according to paragraph 1 of Article 7, paragraph 6 of Article 10, paragraph 3 of Article 11, paragraph 4 of Article 12, paragraph 2 of Article 13 and paragraph 2 of Article 20 of this Convention may be taxed in Andorra, to the extent that these items of income are included in the basis referred to in paragraph 1, insofar as the Netherlands under the provisions of the Netherlands law for the elimination of double taxation allows a deduction from the Netherlands tax of the tax levied in another jurisdiction on such items of income. For the computation of this deduction the provisions of paragraph 5 of this Article shall apply accordingly.

5. Where a resident of the Netherlands derives items of income which according to paragraphs 2, 3 and 8 of Article 10, paragraph 2 of Article 12, paragraph 4 and 6 of Article 13, Article 15, paragraphs 1 and 2 of Article 16 and paragraph 3 of Article 17 of this Convention may be taxed in Andorra, the Netherlands shall allow a deduction from its tax to the extent that these items are included in the basis referred to in paragraph 1. The amount of this deduction shall be equal to the tax paid in Andorra on these items of income, but shall, in case the provisions of the Netherlands law for the elimination of double taxation provide so, not exceed the amount of the deduction which would be allowed if the items of income so included were the sole items for which the Netherlands gives a deduction under the provisions of the Netherlands law for the elimination of double taxation.

6. The provisions of paragraph 5 shall not restrict allowance now or hereafter accorded by the provisions of the Netherlands law for the elimination of double taxation, but only as far as the calculation of the amount of the deduction from Netherlands tax is concerned with respect to the aggregation of income from more than one jurisdiction and the carry forward of the tax paid in Andorra on the said items of income to subsequent years.

7.

Subject to the provisions of the law of Andorra regarding the elimination of double taxation which shall not affect the general principle hereof, double taxation shall be eliminated as follows:

a) a) where a resident of Andorra derives income or owns capital which, in accordance with the provisions of this Convention, may be taxed in Netherlands, Andorra shall allow as a deduction from the tax of that resident an amount equal to the tax paid in Netherlands. Such deduction shall not, however, exceed that part of the Andorran tax, as computed before the deduction is given, which is attributable to such items of income derived from Netherlands. b) b) Where a resident of Andorra derives income or owns capital which, in accordance with the provisions of this Convention is exempt from tax in Andorra, Andorra may in order to calculate the amount of tax on the remaining income or capital of the resident, take into account the income or capital has been exempted.

Hoofdstuk V. SPECIAL PROVISIONS

Artikel 23

1. Notwithstanding the other provisions of this Convention, a benefit under this Convention shall not be granted in respect of an item of income or capital if it is reasonable to conclude, having regard to all relevant facts and circumstances, that obtaining that benefit was one of the principal purposes of any arrangement or transaction that resulted directly or indirectly in that benefit, unless it is established that granting that benefit in these circumstances would be in accordance with the object and purpose of the relevant provisions of this Convention.

2. Where a benefit under this Convention is denied to a person under paragraph 1, the competent authority of the Contracting State that would otherwise have granted this benefit shall nevertheless treat that person as being entitled to this benefit, or to different benefits with respect to a specific item of income or capital, if such competent authority, upon request from that person and after consideration of the relevant facts and circumstances, determines that such benefits would have been granted in the absence of the transaction or arrangement referred to in paragraph 1.

3.

Where

a) a) an enterprise of a Contracting State derives income from the other Contracting State and the first-mentioned State treats such income as attributable to a permanent establishment of the enterprise situated in a third jurisdiction; and b) b) the profits attributable to that permanent establishment are exempt from tax in the first-mentioned State;

the benefits of this Convention shall not apply to any item of income on which the tax in the third jurisdiction is less than the lower of 10 per cent of the amount of that item of income and 60 per cent of the tax that would be imposed in the first-mentioned State on that item of income if that permanent establishment were situated in the first-mentioned State. In such a case any income to which the provisions of this paragraph apply shall remain taxable according to the domestic law of the other State, notwithstanding any other provisions of the Convention.

4. The provisions of paragraph 3 shall not apply if the income derived from the other State described in paragraph 3 emanates from, or is incidental to, the active conduct of a business carried on through the permanent establishment (other than the business of making, managing or simply holding investments for the enterprise’s own account, unless these activities are banking, insurance or securities activities carried on by a bank, insurance enterprise or registered securities dealer, respectively).

5. If benefits under the Convention are denied pursuant to paragraph 3 with respect to an item of income derived by a resident of a Contracting State, the competent authority of the other Contracting State may, nevertheless, grant these benefits with respect to that item of income if, in response to a request by such a resident, such competent authority determines that granting such benefits is justified in light of the reasons such resident did not satisfy the requirements of paragraphs 3 and 4.

6. The competent authority of a Contracting State shall consult with the competent authority of the other Contracting State before either granting or denying a benefit under paragraphs 1 or 3, or granting or rejecting a request made under paragraph 2 or 5.

Artikel 24

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, in particular with respect to residence, 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. Stateless persons who are residents of a Contracting State shall not be subjected in either 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 the State concerned in the same circumstances, in particular with respect to residence, are or may be subjected.

3. 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.

4. Except where the provisions of paragraph 1 of Article 9, paragraph 5 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. Similarly, any debts of an enterprise of a Contracting State to a resident of the other Contracting State shall, for the purpose of determining the taxable capital of such enterprise, be deductible under the same conditions as if they had been contracted to a resident of the first-mentioned State.

5. 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.

6. The provisions of this Article shall, notwithstanding the provisions of Article 2, apply to taxes of every kind and description.

Artikel 25

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 Convention, he may, irrespective of the remedies provided by the domestic law of those States, present his case to the competent authority of either Contracting State. 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 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 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 the Convention. Any agreement reached shall be implemented notwithstanding any time limits in the domestic law 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. They may also consult together for the elimination of double taxation in cases not provided for in the Convention.

4. The competent authorities of the Contracting States may communicate with each other directly, including through a joint commission consisting of themselves or their representatives, for the purpose of reaching an agreement in the sense of the preceding paragraphs.

5.

Where,

a) a) under paragraph 1, a person has presented a case to the competent authority of a Contracting State on the basis that the actions of one or both of the Contracting States have resulted for that person in taxation not in accordance with the provisions of this Convention, and b) b) the competent authorities are unable to reach an agreement to resolve that case pursuant to paragraph 2 within two years from the date when all the information required by the competent authorities in order to address the case has been provided to both competent authorities,

any unresolved issue arising from the case shall be submitted to arbitration if the person so requests in writing. These unresolved issues shall not, however, be submitted to arbitration if a decision on these issues has already been rendered by a court or administrative tribunal of either Contracting State. Unless a person directly affected by the case does not accept the mutual agreement that implements the arbitration decision, that decision shall be binding on both Contracting States and shall be implemented notwithstanding any time limits in the domestic laws of these States. The competent authorities of the Contracting States shall by mutual agreement settle the mode of application of this paragraph.

Artikel 26

1. The competent authorities of the Contracting States shall exchange such information as is foreseeably relevant for carrying out the provisions of this Convention or to the administration or enforcement of the domestic laws concerning taxes of every kind and description imposed on behalf of the Contracting States, or of their political subdivisions or their local authorities, insofar as the taxation thereunder is not contrary to the Convention. The exchange of information is not restricted by Articles 1 and 2.

2. Any information received under paragraph 1 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) concerned with the assessment or collection of, the enforcement or prosecution in respect of, the determination of appeals in relation to the taxes referred to in paragraph 1, or the oversight of the above. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions. Notwithstanding the foregoing, information received by a Contracting State may be used for other purposes when such information may be used for such other purposes under the laws of both States and the competent authority of the supplying State authorises such use.

3. The Contracting States may supply to an arbitration board, established under the provisions of paragraph 5 of Article 25, such information as is necessary for carrying out the arbitration procedure. The members of the arbitration board shall be subject to the limitations on disclosure described in paragraph 2 of this Article with respect to any information so released.

4.

In no case shall the provisions of paragraphs 1, 2 and 3 be construed so as to impose on a Contracting State the obligation:

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

5. If information is requested by a Contracting State in accordance with this Article, the other Contracting State shall use its information gathering measures to obtain the requested information, even though that other State may not need such information for its own tax purposes. The obligation contained in the preceding sentence is subject to the limitations of paragraph 4 but in no case shall such limitations be construed to permit a Contracting State to decline to supply information solely because it has no domestic interest in such information.

6. In no case shall the provisions of paragraph 4 be construed to permit a Contracting State to decline to supply information solely because the information is held by a bank, other financial institution, nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in a person.

Artikel 27

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

2. For the purposes of the Convention, an individual who is a member of a diplomatic missions or consular post of a Contracting State in the other Contracting State or in a third State and who is a national of the sending State shall be deemed to be a resident of the sending State if he is subjected therein to the same obligations in respect of taxes on income and on capital as are residents of that State.

3. The Convention shall not apply to international organisations, organs and officials thereof and members of a diplomatic mission or consular post of a third State, being present in a Contracting State, if they are not subjected therein to the same obligations in respect of taxes on income and on capital as are residents of that State.

Artikel 28

1. This Convention may be extended, either in its entirety or with any necessary modifications, to any part of the Kingdom of the Netherlands which is not situated in Europe and 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 or in any other manner in accordance with their constitutional procedures.

2. Unless otherwise agreed, the termination of this Convention shall not also terminate this Convention for any part of the Kingdom of the Netherlands to which this Convention has been extended under this Article.

Hoofdstuk VI. FINAL PROVISIONS

Artikel 29

1. The Contracting States shall notify each other in writing, through diplomatic channels, that the procedures required by its law for the entry into force of this Convention have been satisfied. The Convention shall enter into force on the last day of the month following the month in which the later of the notifications has been received.

2. The Convention shall have effect for taxable years and periods beginning, and taxable events occurring, on or after the first day of January in the calendar year following that in which the Convention has entered into force.

3. Article 21 shall only apply if, after the signing of the Convention, one of the contracting states has introduced the necessary legal basis in relation to this Article. In such case, that Contracting State shall inform the other Contracting State of the date from which that Contracting State has introduced the necessary legal basis through diplomatic channels.

Artikel 30

This Convention shall remain in force until terminated by a Contracting State. A Contracting State may terminate the Convention, through diplomatic channels, by giving notice of termination at least six months before the end of any calendar year after the expiration of a period of five years from the date of its entry into force. In such event, the Convention shall cease to have effect for taxable years and periods beginning, and taxable events occurring, on or after the first day of January in the calendar year following the calendar year in which the notice of termination has been given. If a notice has been given in the last six months of a calendar year, the Convention shall cease to have effect for taxable years and periods beginning, and taxable events occurring, after the end of the calendar year following the calendar year in which the notice of the termination has been given.