S.L. 123.146 Art. 4debt-claims of a right government and prizes late payment the term regarded as 5. The interest, being Contracting situated effectively provisions of 6. Where, beneficial interest, which would absence of last-mentioned taxable other 7. resident of that a resident of establishment paid was such intere

The term "interest" as used in this Article means income from every kind, whether or not secured by mortgage and whether or not carrying to participate in the debtor's profits, and in particular, income from securities and income from bonds or debentures, including premiums attaching to such securities, bonds or debentures. Penalty charges for shall not be regarded as interest for the purpose of this Article. However, "interest" shall not include for the purpose of this Article interest dividends under paragraph 4 of Article 10. provisions of paragraph 1 shall not apply if the beneficial owner of the a resident of a Contracting State, carries on business in the other State in which the interest arises, through a permanent establishment therein and the debt-claim in respect of which the interest is paid is connected with such permanent establishment. In such case the Article 7 shall apply. by reason of a special relationship between the payer and the owner or between both of them and some other person, the amount of the having regard to the debt-claim for which it is paid, exceeds the amount have been agreed upon by the payer and the beneficial owner in the such relationship, the provisions of this Article shall apply only to the amount. In such case, the excess part of the payments shall remain according to the laws of each Contracting State, due regard being had to the provisions of this Convention. Interest shall be deemed to arise in a Contracting State when the payer is a State. Where, however, the person paying the interest, whether he is a Contracting State or not, has in a Contracting State a permanent in connection with which the indebtedness on which the interest is incurred, and such interest is borne by such permanent establishment, then shall be deemed to arise in the State in which the permanent is situated. reduced tax rate provided for in paragraphs 2 and 3 of this Article shall interest arising in a Contracting State and paid to the permanent of an enterprise of the other Contracting State, situated in the third provision of this Article shall not apply if it was the main purpose or purposes of any person concerned with the creation or assignment of in respect of which the interest is paid to take advantage of this means of that creation or assignment. Article 12 ROYALTIES

Royalties arising in a Contracting State and paid to a resident of the other State, who is the beneficial owner of such royalties, may be taxed in that

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

term "royalties" as used in this Article means payments of any kind a consideration for the use of, or the right to use, any copyright of artistic or scientific work including cinematograph films, any patent, trade or model, plan, secret formula or process, or for information industrial, commercial or scientific experience.

provisions of paragraph 1 shall not apply if the beneficial owner of the being a resident of a Contracting State, carries on business in the other State in which the royalties arise, through a permanent establishment therein and the right or property in respect of which the royalties are paid is connected with such permanent establishment. In such case the Article 7 shall apply.