Double Tax Treaty between Luxembourg & Uzbekistan

CONVENTION

BETWEEN THE GRAND DUCHY OF LUXEMBOURG AND THE REPUBLIC OF UZBEKISTAN

on the avoidance of double taxation and the prevention of fiscal fraud in respect of Taxes

on Income and on Capital

The Government of the Grand Duchy of Luxembourg and the Government of the Republic of Uzbekistan desire to conclude a Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and capital.

Have agreed as follows

Article 1

Persons Covered

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

 

Article 2

Taxes Covered

  1. The following shall be considered to be taxes on income and on capital: taxes imposed on total income or on elements of income or capital, including taxes on gains from the alienation of movable or immovable property from the alienation of movable or immovable property, taxes on the total amount of salaries paid by wages paid by businesses, and taxes on capital gains.
  1. The existing taxes to which the Convention shall apply are:

(a) in the case of the Grand Duchy of Luxembourg:

(i) the personal income tax;

(ii) the corporate income tax;

(iii) the special tax on directors’ fees

(iv) wealth tax;

(v) the common commercial taxa1;

(hereinafter referred to as “Luxembourg tax”)

(b) in the case of the Republic of Uzbekistan

(i) the income tax on enterprises, associations and organizations;

(ii) personal income tax in respect of citizens of the Republic of Uzbekistan, foreign citizens and persons without citizenship

(iii) property tax;

(hereinafter referred to as “Uzbek tax”).

  1. The Convention shall also apply to taxes of the same or a similar nature which are imposed The Convention shall also apply to any identical or substantially similar taxes 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 substantial changes in their respective tax laws.

 

Article 3

GENERAL DEFINITIONS

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

(a) the term ,,Luxembourg” means the Grand Duchy of Luxembourg and, when used in a geographical sense, means the territory of the Grand Duchy of Luxembourg;

(b) the term ,,Uzbekistan” means the Republic of Uzbekistan, including the territorial waters and any area beyond the territorial waters over which the Republic of Uzbekistan exercises, in accordance with international law, its sovereign rights with respect to the exploration of the natural resources of the sea bed, its subsoil and its overlying waters;

(c) the term ,,person” includes natural persons, corporations and any other groupings

(d) the term ,,corporation” means any body corporate, joint venture or entity which is treated as a body corporate for tax purposes

(e) the terms ,,enterprise of a Contracting State” and ,,enterprise of the other Contracting State” respectively, means an enterprise carried on by a resident of a Contracting State and an enterprise carried on by a resident of the other Contracting State.

(f) the term “international traffic” means any transport by a ship, aircraft, road or rail vehicle operated by an enterprise of a Contracting State, except where the ship, aircraft, road or rail vehicle is operated only between points in the other Contracting State

(g) the term “competent authority” means:

(i) in relation to Luxembourg, the Minister of Finance or his authorized representative

(ii) in the case of Uzbekistan, the Chairman of the State Tax Committee or his authorized representative Chairman of the State Tax Committee or his authorized representative;

(h) the term ,,nationaI” means:

(i) any natural person who is a national or citizen of a Contracting State;

(ii) any legal person, partnership or association formed in accordance with the law of a contracting State;

(i) the terms “a Contracting State” and “the other Contracting State” mean, as the case may be Luxembourg or Uzbekistan, as the case may be.

  1. For the purposes of the application of the Convention at any time by a Contracting State, any term or defined therein shall, unless the context otherwise requires, have the meaning which it has at that time under the law of the the law of that State at that time relating to the taxes to which the Convention applies, the meaning given to that term by the meaning given to that term under the tax law of that State shall prevail over the meaning given to it under other laws of that State.

 

Article 4

Resident

  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 the person’s domicile, residence, place of registration, place of management or any other criterion of a similar nature and shall of a similar nature and shall also apply to that State and its local authorities. However, the term shall not include any person who is subject to tax in that State only on income from sources in that State or However, this term does not include persons who are subject to tax in that State in respect only of income from sources in that State or of capital situated therein.
  1. Where, under the provisions of paragraph 1, an individual shall be a resident of both

(a) he shall be deemed to be a resident of the State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident of the State with which his personal and economic relations are closer (center of vital interests);

(b) if the State in which such person has his centre of vital interests cannot be determined, or if he has no permanent home in any of the States, he shall be deemed to be a resident only of the State in which he has an habitual abode;

(c) if such person 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 nationality;

(d) if such person 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.

  1. Where, under the provisions of paragraph 1, a person other than an individual isa resident of both Contracting States, he shall be deemed to be a resident only of the State in which its place of effective management is situated. natural .

 

Article 5

Permanent Establishment

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.

  1. The term “permanent establishment” includes in particular

(a) a place of management

(b) a branch office,

(c) an office,

(d) a factory,

(e) a workshop, and

(f) a mine, oil or gas well, quarry or other place of resource extraction

  1. A construction or assembly site constitutes a permanent establishment only if its duration exceeds twelve months.
  1. Notwithstanding the preceding provisions of this Article, the term “permanent establishment” shall be deemed not to include

(a) use is made of facilities solely for the purpose of storage, display or delivery of goods or merchandise belonging to the enterprise;

(b) goods or merchandise belonging to the enterprise are stored solely for the purpose of storage, display or delivery;

(c) goods belonging to the business are stored solely for the purpose of processing by another business by another enterprise;

(d) a fixed place of business is used solely for the purpose of purchasing goods or gathering information, for the enterprise;

(e) a fixed place of business is used solely for the purpose of carrying on any other activity of a preparatory or auxiliary character for the enterprise ;

(f) a fixed place of business shall be used solely for the purpose of carrying on, in conjunction with each other, activities mentioned in subparagraphs (a) to (e), provided that the overall activity of the fixed place of business resulting from such combination is of a preparatory or auxiliary character

  1. Notwithstanding the provisions of paragraphs 1 and 2, where a person – other than an agent of independent status to whom paragraph 7 applies – is acting on behalf of an enterprise and habitually exercises in a Contracting State such powers as will enable him to conclude contracts in the enterprise, that enterprise shall be deemed to have a permanent establishment in that State in respect of all activities which that person undertakes for the enterprise, unless the activities of that person are limited to those mentioned in paragraph 4 which, if exercised through a which, if exercised through a fixed place of business, would not make it possible to regard such place of business as a such fixed place of business would not qualify as a permanent establishment under the provisions of that paragraph.
  1. Notwithstanding the preceding provisions (In this Article, an insurance enterprise of a Contracting State shall, except in the case of reinsurance, be deemed to have a permanent establishment in the other State if it collects (premiums in) the territory of that State or insures risks incurred therein through a person other than an agent having independent status to whom paragraph 7 applies.
  1. An enterprise shall not be deemed to have a permanent establishment in a Contracting State merely because it carries on business in that Contracting State through a broker, general commission agent or any other or any other agent of an independent status, provided that such persons are acting in the ordinary course of their ordinary course of business.

S . 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 a permanent establishment of the other Contracting State. company a permanent establishment of the other.

 

Article 6

Income from Real Estate

I . Income derived by a resident of a Contracting State from immovable property (including income from agricultural or forestry operations) situated in the other Contracting State may be taxed in that other State.

  1. The term “immovable property” shall have the meaning which it has under the law of the Contracting State in which the property is situated. The term shall in any case include property accessory to immovable property, livestock and equipment and forestry operations, rights to which the provisions of the private law concerning land ownership, usufruct (real estate and rights to variable or fixed payments for the operation or fixed payments for the exploitation or concession of the exploitation of mineral deposits, springs and other natural resources; ships, aircraft, road and rail vehicles are not considered real property.
  1. The provisions of paragraph 1 shall apply to income derived from the direct operation, rental or leasing, and any other form of exploitation of real property.
  1. The provisions of paragraphs I and 3 shall also apply to the income from (the real estate of) an enterprise as well as to the income from real estate used for the exercise of a self-employed profession.

 

Article 7

Business profits

 

  1. The profits (of an enterprise of a Contracting State shall be taxable only in that State unless enterprise carries on business in the other Contracting State through a permanent establishment situated therein. permanent establishment situated therein. If the enterprise carries on business in such a manner, the profits of the enterprise If the enterprise carries on business in such a manner, the profits of the enterprise may be taxed in the other State but only so much of them as is directly or indirectly attributable to that permanent establishment.
  1. Subject to the provisions of paragraph 3, where an enterprise of a Contracting State carries its business in the other Contracting State through a permanent establishment situated therein, there shall be attributed in each Contracting State the profits which it might be expected to make if it were a separate enterprise carrying on business in the other Contracting State shall in each Contracting State be attributed to that permanent establishment 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.
  1. In determining the profits of a permanent establishment, expenses incurred for the purposes of that permanent establishment shall be allowed as a deduction. permanent establishment, including executive and general administrative expenses so incurred, shall be deducted. and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere .
  1. If it is customary in a Contracting State to determine the profits attributable to a permanent establishment on the basis of an on the basis of an apportionment of the total profits of the enterprise to its various parts, nothing in paragraph 2 shall prevent such provision of paragraph 2 shall not prevent that Contracting State from determining the taxable profits according to the apportionment in use; the method of apportionment adopted shall, however, be such that the result is in accordance with the principles contained in this Article.
  1. No profit shall be attributed to a permanent establishment merely because it has purchased goods or merchandise for the enterprise.
  1. For the purposes of the preceding paragraphs, the profits to be attributed to the permanent establishment shall be determined annually by the same method, unless there are good and sufficient reasons for proceeding otherwise.
  1. Where profits include items of income which are dealt with separately in other Articles of this Convention, the provisions of those Articles shall not be affected by the provisions of this Article.

 

Article 8

International Carriage

  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.
  1. The provisions of paragraph 1 shall also apply

(a) occasional profits from the bareboat hire of ships or aircraft operated in international traffic;

(b) profits from the use, handling or hire of containers (including trailers and equipment for the transport of containers), where such profits are additional or incidental to the profits referred to in paragraph 1.

  1. The provisions of paragraphs 1 and 2 shall apply to a pool, a joint venture or an organization also nism to the profits from the international operating participation.

 

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 profits which would, but for those conditions, have accrued to one of the enterprises but which would not have accrued to the other of the enterprises, shall be deemed to have accrued to the other of the enterprises if those conditions had not been agreed upon.of one of the enterprises, but which could not in fact have been realized by reason of those conditions, may be included in the profits of that enterprise and taxed accordingly.

  1. 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 taxed in that other State, and the profits so included have been taxed in that other State, then the profits so included shall be taxed in that other State, and the profits so included are profits that would have accrued to the enterprise of the first-mentioned State if the conditions agreed upon between State if the conditions agreed upon between the two enterprises had been those which would have been the other State shall make an appropriate adjustment to the amount of tax imposed therein on such profits. In determining such adjustment, due regard shall be had to the othe provisions of this Convention and, if necessary, the competent authorities of the Contracting States shall consult each other.

 

Article 10

DIVIDENDS

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

(a) 5 percent of the gross amount of the dividends if the beneficial owner is a company that directly owns at least 25 percent of the capital of the company paying the dividends;

(b) 15 percent of the gross amount of the dividends in all other cases. This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are

  1. The term “dividends” as used in this article means income from shares, “jouissance” shares or shares or profit sharing certificates, mining shares, founder’s shares or other profit shares, with the exception of debt claims, as well as income from other shares subject to the same tax regime as income from shares under the legislation of the income from shares by the legislation of the State of which the distributing company is a resident.
  1. The provisions of paragraphs 1 and 2 shall not apply where 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 resident, carries on business in the other Contracting State of which the company paying the dividends is a resident, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and that the holding in respect of which the dividends are paid is effectively connected with such permanent establishment. In such a case, the provisions of Article 7 or Article 14, as the case may be, shall apply.
  1. 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 to the extent that such dividends are paid to a resident of that other State or to the extent that the holding in respect of which the dividends are paid is connected with the holding in respect of which the dividends are paid. dividends are effectively connected with a permanent establishment or a fixed base situated in that other the company, except to the extent that such dividends are paid to a resident of that other State or to the extent that 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 shall it impose any tax on the undistributed distributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of the company shall not be liable to any tax on the undistributed profits of the company, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other State.

 

Article 11

INTERESTS

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

3 . exemptions Notwithstanding the provisions of paragraph 2, interest the amount of tax payable in the Contracting State in which it arises. paid in respect of bank loans shall be taxed in the Contracting State in which it arises.

  1. 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 bonds, including premiums and prizes attached thereto. attached to such securities. Penalties for late payment shall not be considered as interest for the purposes of this section.
  1. The provisions of paragraphs 1, 2 and 3 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, or carries on business through a permanent establishment situated therein, or performs in the other Contracting State in which the interest arises either a trade or business through a permanent establishment situated therein, or is effectively connected with it. In such a case, the provisions of Article 7 or Article 14, as the case may be, shall apply.
  1. Interest shall be deemed to arise in a Contracting State when the payer is a resident of that State a resident of that State. However, where the payer of the interest, whether a resident of a Contracting State, has in a Contracting State a permanent establishment or a fixed base in connection with which the indebtedness the debt-claim giving rise to the payment of interest was incurred and which bears the expense of that interest, such interest shall be deemed to arise in the State in which the permanent establishment or fixed base is situated.
  1. Where, by reason of a special relationship between the payer and the beneficial owner or where both maintain the debtor and the beneficial owner, or with other persons, the amount of the interest, having regard to the debt-claim for which it is paid, exceeds for which it is paid, exceeds that which would have been agreed upon by the debtor and the beneficial owner in the absence of such in the absence of such relationship, the provisions of this section shall apply only to the latter amount. In such a case, the excess part of the payments shall remain taxable according to the laws of each Contracting State, due regard being due to the other provisions of this Convention.

 

Article 12

Royalties

  1. Royalties arising in a Contracting State and paid to a resident of that State may be taxed in that other State. The taxable income of the other Contracting State shall be taxed in that other State.
  1. However, such royalties may also be taxed in the Contracting State in which they arise and according to the laws of that State, but if the beneficial owner of the royalties is a resident of the other Contracting State, the tax so charged shall not exceed 5 percent of the gross amount of the royalties.
  1. The term “royalties” as used in this Article means remuneration of any kind whatsoever paid for the use of, or the right to use, any copyright of literary, artistic or scientific work scientific work, including cinematograph films and films or tapes used for television or radio broadcasts or radio broadcasting, a patent, a trademark, a design, a model, a copyright, a design patent or a design, plan, secret formula or process, or for information relating to industrial, commercial or scientific experience in the industrial, commercial or scientific field.
  1. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties, being a resident of a Contracting State, carries on business in the other Contracting State in which the or performing independent personal services from a fixed base situated therein, and the right or property in respect of which the royalties are paid is vested in that The taxpayer is not required to pay any tax on the profits of the business. In such case, the provisions of Article 7 or of Article 14, as the case may be, shall apply.

5 . Royalties shall be deemed to arise in a Contracting State when the payer is a resident of that State. However, where the payer of the royalties, whether or not a resident of a Contracting State, has in a Contracting State, has in a Contracting State a permanent establishment or a fixed base in connection with which the obligation to pay the royalties was incurred and which bears the expense of such royalties, such royalties shall be deemed to arise in that State. Those royalties shall be deemed to arise in the State in which the permanent establishment or fixed base is situated.

  1. Where, by reason of a special relationship between the payer and the beneficial owner, or beneficial owner, the amount of the royalties, having regard to the service for which they are paid, shall be for which they are paid, exceeds the amount that would have been agreed upon by the debtor and the beneficial owner in the absence of such relationship, the provisions of this article shall apply only to the apply only to the latter amount. In such a case, the excess part of the payments shall remain taxable according to the laws of each Contracting State and having regard to the other provisions of this Convention.

 

Article 13

CAPITAL GAINS

  1. Gains derived by a resident of a Contracting State from the alienation of real property referred to in Article 6 and situated in the other Contracting State may be taxed in that other State.
  1. Gains from the alienation of movable property forming part of the business property of a permanent enterprise of a Contracting State has in the other Contracting State, or movable property pertaining to a fixed base belongs to a fixed base which a resident of a Contracting State has in the other Contracting State for the purpose of performing independent personal services, including such gains from the alienation of such permanent establishment (alone or with the whole enterprise) or fixed base, may be taxed in that other State.
  1. Gains derived by an enterprise of a Contracting State from the alienation of ships, aircraft or road and railroad vehicles operated by the enterprise may be taxed in that other State. vehicles operated in international traffic, or movable property pertaining to the operation of such ships, aircraft the operation of such ships, aircraft or road and railroad vehicles, shall be taxable only in that State.
  1. Gains from the alienation of any property other than that referred to in paragraphs 1, 2 and 3 shall be taxable only in the Contracting State of which the alienator is a resident. The provisions of paragraphs 1, 2 and 3 shall not apply.

 

Article 14 

Independent professions

  1. Income derived by a resident of a Contracting State from professional services or other activities of a self-employed character may be taxed only in that State; however, such income may also be taxed in the other Contracting State if of an independent character shall be taxable only in that State; however, such income may also be taxed in the other Contracting State if

(a) if he has a fixed base in the other Contracting State for the purpose of performing his activities; in that case, only that part of the income which is attributable to that fixed base may be taxed in the other State; or

(b) if his stay in the other Contracting State extends over a period or periods equal to or exceeding in the aggregate 183 days in any twelve-month period commencing or ending in the calendar year concerned; in such case, only that portion of the income derived from his activities carried on in that other State during the year concerned may be taxed in that other State.

  1. The term “professional services” includes, in particular, independent scientific, literary, artistic, educational or teaching activities, as well as the independent activities of physicians, lawyers, engineers, architects, dentists, etc, The term “professional services” includes, in particular, 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 professions

  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 If the employment is exercised in that State, remuneration received in respect thereof may be taxed in that other State.
  1. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting State received in respect of an employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in any twelve-month period commencing or ending in the calendar year, and
  1. Notwithstanding the provisions of paragraphs 1 and 2, remuneration received in respect of employment on board a ship, aircraft, or road or railroad vehicle operated in international traffic by an enterprise of a Contracting State may be taxed in that State.

Article 16

Fees

Directors’ fees and other similar payments derived by a resident of a Contracting State 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

Artists and Athletes

  1. Notwithstanding the provisions of Articles 14 and 15, income derived by a resident of a Contracting State from his personal activities as an entertainer, such as a theatre artist, actor or sportsman, exercised in the other Contracting State artist, such as a theater, motion picture, radio or television artiste, or a musician, or as a sportsman, may be taxed in that other State.
  1. Where income in respect of activities exercised personally by an entertainer or a sportsman in that capacity is attributed not to the entertainer or sportsman himself but to another person, such 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 sportsman are exercised activities of the artist or sports person are carried on.

(3) The provisions of paragraphs 1 and 2 shall not apply where the activities of an entertainer or sportsperson in a Contracting State are substantially supported by public funds of one or both of the Contracting States or of a local authority. In such case, the income In such case, the income shall be taxable only in the Contracting State of which the entertainer or athlete is a resident.

 

Article 18

Pensions

  1. Notwithstanding the provisions of paragraph of the social security legislation of a Subject to the provisions of paragraph 2 of Article 19, pensions and other similar remuneration paid to a resident of a Contracting State in respect of past employment shall be taxable only in that State.
  1. In the case of a resident of a Contracting State and other amounts paid pursuant to shall be taxable only in that State.

 

Article 19 

Public functions

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

(b) 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:

  1. The provisions of Articles 15, 16, 17 and 18 shall apply to salaries, wages and other similar remuneration and to pensions paid in respect of services rendered in connection with a business carried on by a Contracting State or a local authority thereof. he provisions of Articles 15, 16, 17 and 18 shall apply to wages, salaries and other similar remuneration and to pensions paid in respect of services rendered in connection with a business carried on by a Contracting State or a local authority thereof.

 

Article 20 

Students

Amounts that a student or trainee who is, or was immediately before visiting a Contracting State, a resident of the other Contracting State and who is to a Contracting State, a resident of the other Contracting State and who is present in the first-mentioned State solely for the the sole purpose of his education or training, receives for his maintenance, education or training shall not be taxable in the training shall not be taxable in that State, provided that such payments are derived from sources outside that State.

 

Article 21 

Other income

1.Items of income of a resident of a Contracting State, wherever they arise, which are not dealt with in the preceding articles of this Convention shall be taxable only in that State.

  1. 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, or by movable property which belongs to a fixed belongs to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent personal services, may be taxed in that other State.
  1. Capital represented by ships, aircraft or road and railroad vehicles operated in international traffic by an enterprise of a Contracting State, and movable property (including containers referred to in paragraph 2 of Article 8) used in the operation of such ships, aircraft or road and railroad vehicles, shall be taxable only in that State.
  1. All the other elements of the capital of a resident of a Contracting State shall be taxable only in this state.

 

Article 23

Elimination of double taxation

As far as Luxembourg is concerned, double taxation is avoided as follows:

(a) Where a resident of Luxembourg derives income or possesses capital which, in accordance with the provisions of this Convention, may be taxed in Uzbekistan, Luxembourg shall the provisions of this Convention, may be taxed in Uzbekistan, Luxembourg shall exempt such income or shall exempt such income or capital from tax, subject to the provisions of subparagraphs (b) and (c), but may, in calculating the amount of tax on the remaining income or capital of the (b) the resident’s income or capital, apply the same rates of tax as if the income or capital had not been exempted.

(b) Where a resident of Luxembourg receives income which, in accordance with the provisions of Articles 10, 11 and 12, may be taxed in Uzbekistan, Luxembourg shall allow a deduction from the tax Luxembourg shall allow a deduction from the tax it levies on the income of such resident in an amount equal to the tax paid in Uzbekistan. This deduction may not, however, exceed the fraction of the tax, calculated before deduction, corresponding to these items of income received from Uzbekistan.

  1. c) Where a company which is a resident of Luxembourg receives dividends from Uzbek sources Luxembourg shall exempt such dividends from tax, provided that such a company which is a resident of Luxembourg holds directly since the beginning of its fiscal year at least 10 per cent of the percent of the capital of the company paying the dividends. The above-mentioned shares or units of the Uzbek company are, under the same conditions, taxable in Luxembourg.
  1. As far as Uzbekistan is concerned, double taxation is avoided in the following way:

(a) Where a resident of Uzbekistan derives income or possesses capital which, in accordance with the provisions of this Convention, may be taxed in Luxembourg, Uzbekistan shall grant

– on the tax it collects on the income of that resident, a deduction of an amount equal to the income tax paid in Luxembourg;

– on the tax it collects on the property of the resident, a deduction of an amount equal to wealth tax paid in Luxembourg.

In either case, however, such deduction may not exceed the fraction of the income tax or property tax, calculated before deduction, corresponding to the or property tax, calculated before deduction, corresponding to the income or wealth taxable in income or wealth taxable in Luxembourg

(b) Where, in accordance with any provision of the Convention, income derived or capital owned by a resident of Uzbekistan is exempt from tax in Uzbekistan may nevertheless, in calculating the amount of tax on the remaining income or capital of such resident, take into account the Uzbekistan may, however, take into account the exempted income or assets in calculating the amount of tax on the remaining income or assets of such residents.

 

Article 24

Non-discrimination

  1. Nationals of a Contracting State shall not be subjected in the other Contracting State to any taxation which is other or more burdensome than those to which nationals of that other State in the same circumstances, in particular with regard to residence, are or may be subjected. nationals of that other State who are in the same situation, in particular with regard to residence. This provision shall also apply, notwithstanding the provisions of Article 1, to persons who are not residents of one or both of the Contracting States. The taxation of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall not be less favourably established in that other State than (a) the tax on the profits of the enterprise shall be less favorable than the tax on the profits of enterprises of that other State engaged in the same activity. This provision shall not be construed as obliging a Contracting State to grant to residents of the other Contracting State the personal deductions, allowances and reductions of tax according to the circumstances or for family expenses that it grants to its own residents.
  1. Unless the provisions of paragraph 1 of Article 9, paragraph 7 of Article 11 or paragraph 6 of Article 12 are applicable, interest, royalties and paragraph 6 of Article 12 are applicable, interest, royalties and other expenses paid by an enterprise of a Contracting State to a resident of the other Contracting State shall be deductible, in determining the taxable profits of that enterprise, under the same conditions as if they had been paid to a resident of the first-mentioned State. paid to a resident of the first-mentioned State. Similarly, 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 that enterprise, be deductible under the same conditions as if they had been incurred to a resident of the first-mentioned State.
  1. 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 those to which other similar enterprises of the first-mentioned State are or may be subjected.

 

Article 25 

Procedure nnricrble

1.Where a person considers that the measures taken by a Contracting State or by both Contracting States result or will result for him or her in taxation not in accordance with the provisions of this Convention, he may, independently of the remedies provided for by the internal law of those States, submit her case to the competent authority of the Contracting State of which she is a resident or, if her case falls under paragraph 1 of Article 24, to that of the Contracting State of which she is a national. The case must be presented within three years from the first notification of the action resulting in taxation not in accordance with the provisions of the Convention.

2.The competent authority shall endeavor, if the complaint appears to it to be justified and if it is not itself able to find a satisfactory solution, to resolve the case by mutual agreement with the competent authority of the other Contracting State, for the avoidance of taxation which is not in accordance with the Convention. The agreement is applied regardless of the time limits provided for by the internal law of the Contracting States.

3.The competent authorities of the Contracting States shall endeavor, by mutual agreement, to resolve any difficulties or to dispel any doubts which may arise in 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 within a joint commission composed of these authorities or their representatives, with a view to reaching an agreement as indicated in the preceding paragraphs.

 

Article 26 

Exchange of information

1.The competent authorities of the Contracting States shall exchange the information necessary to apply the provisions of this Convention or those of the internal legislation of the Contracting States relating to the taxes covered by the Convention insofar as the taxation it provides is not contrary. to the Convention. The exchange of information is not restricted by Article 1. Information received by a Contracting State shall be kept secret in the same way as information obtained under the domestic law of that State and shall only be communicated to persons or authorities (including courts and administrative bodies) concerned by the establishment or collection of taxes covered by the Convention, by the proceedings or prosecutions relating to such taxes, or by decisions on appeals relating to these taxes. These persons or authorities only use this information for these purposes. They may reveal this information in public court hearings or in judgments.

2.The provisions of paragraph 1 may in no case be interpreted as imposing on a Contracting State the obligation:

  • to take administrative measures at variance with its laws and administrative practice or those of the other Contracting State;
  • 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;
  • to provide information which would reveal a trade secret, industrial, professional or a trade process or information the communication of which would be contrary to public order.

 

Article 27

Members of diplomatic missions and consular posts

The provisions of this Convention are without prejudice to the fiscal privileges enjoyed by members of diplomatic missions or consular posts by virtue either of the general rules of international law or of the provisions of special agreements.

 

Article 28

 Entry into force

  1. Each Contracting State shall notify the other Contracting State of the completion of the procedures required by its legislation for the entry into force of this Convention. The Convention shall enter into effective on the date of receipt of the last of such notifications.
  1. The provisions of the Convention shall apply

(i) in respect of taxes withheld at source, to income allocated on or after January 1 of the calendar year immediately following that in which the year in which the Convention enters into force;

(ii) in respect of other taxes on income and on capital (property), for any taxation year beginning on or after the first day of January in the calendar year following that in which the Convention enters into force.

 

Article 29

Denunciation

This Convention shall remain in force until denounced by a Contracting State. Either Contracting State may, on or before June 30 of any calendar year after the expiration of a period of five years following the year in which the Convention has entered into force, give in force, give written notice of denunciation through diplomatic channels to the other Contracting State. In the event of denunciation before July 1 of any such year, the Convention shall cease to have effect:

(i) in respect of taxes withheld at source, to income allocated on or after January 1 of the calendar year immediately following that in which the notice of termination is given

(ii) in respect of other taxes on income and capital (property), for any taxation year beginning on or after January 1 of the calendar year immediately following that in which the notice of termination is given in which the notice of termination is given.

IN WITNESS WHEREOF the undersigned, duly authorized thereto, have executed this Agreement.

DONE in duplicate at Luxembourg, this 2nd day of July 1997 in the English, French and Uzbek languages, the three texts being equally authentic.

 

 

 

 

 

 

 

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