3 JUIN 2007. - An Act to assent to the Convention between the Kingdom of Belgium and the Republic of San Marino to avoid double taxation and to prevent tax evasion on income tax, signed in San Marino on 21 December 2005 (1) (2) (2)

ALBERT II, King of the Belgians,
To all, present and to come, Hi.
The Chambers adopted and We sanction the following:
Article 1^er. This Act regulates a matter referred to in Article 77 of the Constitution.
Art. 2. The Convention between the Kingdom of Belgium and the Republic of San Marino to avoid double taxation and to prevent tax evasion on income tax, signed in San Marino on 21 December 2005, will come out its full and full effect.
Promulgation of this law, let us order that it be clothed with the seal of the State and published by the Belgian Monitor.
Given in Brussels, 3 June 2007.
ALBERT
By the King:
Minister of Foreign Affairs,
K. DE GUCHT
Minister of Finance,
D. REYNDERS
Seal of the state seal:
The Minister of Justice,
Ms. L. ONKELINX
____
Note
(1) 2006-2007 session.
Senate:
Documents. - Bill tabled on 29 January 2007, No. 3-2045/1. - Report, no. 3-2045/2.
Annales parliamentarians. - Discussion. Session of March 22, 2007. - Vote. Session of March 22, 2007.
House of Representatives:
Documents. - Project transmitted by the Senate, No. 51-3021/1. - Text adopted in plenary and under Royal Assent No. 51-3021/2.
Annales parliamentarians. - Discussion. Session of April 19, 2007. - Vote. Session of April 19, 2007.
(2) This Convention comes into force on 25 June 2007, in accordance with Article 31.1 of the Convention. The provisions of the Convention shall apply from 1^er January 2008, pursuant to Article 31.2 of the Convention.

Convention between the Kingdom of Belgium and the Republic of San Marino to avoid double taxation and to prevent tax evasion on income taxes
The Government of the Kingdom of Belgium
and
The Government of the Republic of San Marino,
DESIRING to conclude a Convention to Avoid Double Taxation and Prevent Tax Fraud in Income Tax, and to strengthen the orderly development of economic relations between the two States in the context of greater cooperation, agreed on the following provisions:
Target persons
Article 1^er
This Convention applies to persons who are residents of a Contracting State or both Contracting States.
Taxes targeted
Article 2
1. This Convention applies to income taxes collected on behalf of a Contracting State, its political or administrative subdivisions or local authorities, regardless of the system of collection.
2. Income taxes are considered to be taxed on total income or income elements, including taxes on gains from the alienation of movable or real property, taxes on the total amount of wages paid by companies, and taxes on surplus-values.
3. Current taxes to which the Convention applies include:
(a) with regard to San Marino:
the general income tax (general income tax) that is collected:
1° dependent on natural persons;
2° dependant on legal persons and individual enterprises (proprietorships),
even when it is perceived by means of restraint at the source,
(hereinafter referred to as the "Saint-Marine Tax");
(b) with regard to Belgium:
1° the tax of natural persons;
2° corporate tax;
3° the tax of legal persons;
4° the non-resident tax;
5° the complementary contribution of crisis;
including forecasts and additional cents to such taxes and pre-payments,
(hereinafter referred to as "Belgian tax").
4. The Convention also applies to taxes of an identical or similar nature that would be established after the date of signature of the Convention and that would be in addition to or replace existing taxes. The competent authorities of the Contracting States shall communicate the significant changes to their tax laws.
General definitions
Article 3
1. For the purposes of this Convention, unless the context requires a different interpretation:
(a) 1° the term "San Marino" means the Republic of San Marino; employed in a geographical sense, it designates the territory of the Republic of San Marino, including the spaces on which, in accordance with international law, the Republic of San Marino exercises sovereign rights or jurisdiction;
2° the term "Belgium" means the Kingdom of Belgium; employed in a geographical sense, it designates the territory of the Kingdom of Belgium, including the territorial sea and the maritime areas and the airspace on which, in accordance with international law, the Kingdom of Belgium exercises sovereign rights or jurisdiction;
(b) the terms "a Contracting State" and "the other Contracting State" mean, in the context, Belgium or San Marino;
(c) the term "person" includes individuals, societies and other groups of persons;
(d) the term "society" means any corporation or entity that is considered to be a legal entity for taxation purposes in the Contracting State of which it is a resident;
(e) the terms "company of a Contracting State" and "company of the other Contracting State" shall, respectively, designate a business operated by a resident of a Contracting State and a business operated by a resident of the other Contracting State;
(f) the term "international traffic" means any transport by a ship or aircraft operated by an enterprise whose effective steering seat is located in a Contracting State, except where the vessel or aircraft is operated only between points in the other Contracting State;
(g) the term "competent authority" means:
1° with respect to San Marino, the Ministry of Finance, and
2° in respect of Belgium, the Minister of Finance or its authorized representative;
(h) the term "national" means:
1° any natural person who has the nationality of a Contracting State;
2. any legal person, partnership or association incorporated in accordance with the legislation in force in a Contracting State.
2. For the application of the Convention at any time by a Contracting State, any term or expression that is not defined therein shall, unless the context requires a different interpretation, the meaning assigned to it at that time by the law of that State in respect of the taxes to which the Convention applies, the meaning assigned to that term or expression by the tax law of that State in respect of the meaning assigned to it by the other branches of the law of that State.
Resident
Article 4
1. For the purposes of this Convention, the term "resident of a Contracting State" means any person who, under the law of that State, is subject to tax in that State, because of his domicile, residence, management seat or any other similar criteria, and also applies to that State as well as to all its political or administrative subdivisions or to its local authorities. However, this term does not include persons who are subject to tax in that State only for income from sources in that State.
2. Where, according to the provisions of paragraph 1, a natural person is a resident of the two Contracting States, his or her situation shall be settled as follows:
(a) that person is considered to be a resident only of the State where the person has a permanent home; if it has a permanent home in both states, it is considered to be a resident only of the State with which its personal and economic ties are the narrowest (centre of vital interests);
(b) if the State where that person has the centre of its vital interests cannot be determined, or if it does not have a permanent home in any of the States, it is considered to be a resident only of the State where it normally resides;
(c) if the person normally stays in both States or if he or she does not normally stay in any of them, he or she is considered to be a resident only of the State of which he or she is a national;
(d) if the person possesses the nationality of the two States or has no nationality of any of them, the competent authorities of the Contracting States shall decide the question by mutual agreement.
3. Where, according to the provisions of paragraph 1, a person other than a natural person is a resident of the two Contracting States, it is considered to be a resident only of the State where its effective management seat is located.
Stable establishment
Article 5
1. For the purposes of this Convention, the term "stable establishment" means a fixed business facility through which a company operates all or part of its business.
2. The term "stable establishment" includes:
(a) a steering seat,
(b) a branch,
(c) an office,
(d) a factory,
(e) a workshop and
(f) a mine, oil or gas well, a career or any other place of extraction of natural resources.
3. A construction or construction site is a permanent establishment only if its duration exceeds 12 months.
4. Notwithstanding the preceding provisions of this Article, it is considered that there is no "stable establishment" if:
(a) the use of facilities for the sole purpose of storage, exposure or delivery of goods owned by the company;
(b) goods belonging to the undertaking are stored for storage, exposure or delivery purposes only;
(c) goods belonging to the enterprise are stored for the sole purpose of processing by another company;
(d) a fixed business facility is used for the sole purpose of purchasing goods or collecting information for the company;
(e) a fixed business facility is used for the sole purpose of carrying out any other preparatory or auxiliary activity for the enterprise;
(f) a fixed business facility shall be used only for the purpose of the cumulative year of activities referred to in subparagraphs (a) to (e), provided that the overall activity of the fixed business facility resulting from this accumulated business shall be preparatory or auxiliary.
5. Notwithstanding the provisions of paragraphs 1 and 2, where a person - other than an agent enjoying an independent status to which paragraph 6 applies - shall act on behalf of a business and shall have in a Contracting State powers that it normally exercise to enter into contracts on behalf of the enterprise, that undertaking shall be deemed to have a permanent establishment in that State for all activities that that that person exercises for the enterprise, unless
6. A business of a Contracting State is not considered to have a permanent establishment in the other Contracting State solely because it operates therein through a broker, a general commissioner or any other agent enjoying an independent status, provided that such persons act within the ordinary framework of their activity.
7. The fact that a corporation that is a resident of a Contracting State controls or is controlled by a corporation that is a resident of the other Contracting State or that operates therein (either through a permanent establishment or not) is not sufficient in itself to make any of these companies a permanent establishment of the other.
Real estate income
Article 6
1. The income that a resident of a Contracting State derives from real property (including income from farms or forestry) located in the other Contracting State is taxable in that other State.
2. The term "real property" has the meaning assigned to it by the law of the Contracting State in which the property is located. The term includes, in any case, accessories, dead or alive livestock of farms and forests, the rights to which the provisions of private law apply in respect of land ownership, the usufruct of real property and the rights to variable or fixed payments for the exploitation or concession of the exploitation of mineral deposits, sources and other natural resources; ships, ships and aircraft are not considered real property.
3. The provisions of paragraph 1 shall apply to income derived from direct exploitation or enjoyment, lease or charter, as well as any other form of exploitation of real property.
4. The provisions of paragraphs 1 and 3 also apply to income from real property of a business as well as to income from real property used in the exercise of an independent profession.
Business benefits
Article 7
1. The profits of an enterprise of a Contracting State shall be taxable only in that State, unless the enterprise carries on business in the other Contracting State through a permanent establishment located therein. If the company operates in such a way, the profits of the company are taxable in the other State but only to the extent that they are attributable to that permanent establishment.
2. Subject to the provisions of paragraph 3, where a business of a Contracting State carries on business in the other Contracting State through a permanent establishment located therein, it shall be charged, in each Contracting State, to that permanent establishment the profits that it could have realized if it had constituted a separate undertaking carrying out identical or similar activities under identical or similar conditions and acting independently.
3. In order to determine the benefits of a permanent establishment, deductions are made of the expenses incurred for the purposes of this permanent establishment, including the executive expenses and general administrative expenses so exposed, either in the State where the permanent establishment is located or elsewhere.
4. If it is customary in a Contracting State to determine the profits attributable to a permanent establishment on the basis of a distribution of the total profits of the enterprise between its various parties, no provision in paragraph 2 shall prevent that Contracting State from determining the taxable profits according to the distribution in use; However, the method of distribution adopted must be such that the result obtained is consistent with the principles contained in this article.
5. No profit is charged to a permanent establishment because it simply purchased goods for the company.
6. For the purposes of the preceding paragraphs, the benefits to be charged to the permanent establishment are determined annually on the same basis, unless there are valid and sufficient grounds to proceed otherwise.
7. Where profits include income elements treated separately in other articles of this Convention, the provisions of these articles are not affected by the provisions of this article.
Maritime and air navigation
Article 8
1. The profits derived from the operation, in international traffic, of ships or aircraft shall be taxable only in the Contracting State where the effective management seat of the enterprise is located.
2. If the effective management seat of a marine navigation company is on board a vessel, that seat shall be considered to be located in the Contracting State where the vessel's port of attachment is located, or if the vessel is not carrying the vessel, in the Contracting State of which the vessel operator is a resident.
3. The provisions of paragraph 1 also apply to benefits derived from participation in a pool, a joint operation or an international operating organization.
Associated companies
Article 9
1. When
(a) a business of a Contracting State directly or indirectly participates in the direction, control or capital of a business of the other Contracting State, or
(b) the same persons directly or indirectly participate in the direction, control or capital of a business of a Contracting State and a business of the other Contracting State,
and that, in both cases, both companies are, in their commercial or financial relations, bound by agreed or imposed conditions, that differ from those that would be agreed between independent companies, the profits that, without these conditions, would have been realized by one of the companies but could not be in fact because of these conditions, may be included in the profits of that undertaking and imposed accordingly.
2. When a Contracting State includes in the profits of a company of that State - and therefore imposes - profits on which a company of the other Contracting State has been imposed in that other State, and that the profits thus included are profits that would have been realized by the enterprise of the first State if the terms agreed between the two enterprises had been those that would have been agreed between independent enterprises, the other State shall make the adjustment that it considers appropriate of the tax To determine this adjustment, the other provisions of this Convention shall be taken into account and the competent authorities of the Contracting States shall consult.
Dividends
Article 10
1. Dividends paid by a corporation that is a resident of a Contracting State to a resident of the other Contracting State shall be taxable in that other State.
2. However, such dividends may also be taxed in the Contracting State of which the corporation paying the dividends is a resident, and according to the law 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) 0 per cent of the gross amount of the dividends if the beneficial owner is a corporation that, at the time of payment of the dividends, holds directly, for an uninterrupted period of at least 12 months, at least 25 per cent of the capital of the corporation that pays the dividends;
(b) 5 per cent of the gross amount of the dividends if the beneficial owner is a corporation that, at the time of payment of the dividends, holds directly for an uninterrupted period of not less than 12 months, not less than 10 per cent but less than 25 per cent of the capital of the corporation that pays the dividends;
(c) 15 per cent of the gross amount of dividends in all other cases.
This subsection does not affect the corporation's taxation of profits that are used to pay dividends.
3. The term "dividends" used in this article refers to income from shares, shares or benefits, shares of mine, share of founder or other share of beneficiaries with the exception of receivables, as well as income - even allocated in the form of interest - subject to the same tax regime as income from shares by the tax legislation of the State whose debiting society is a resident.
4. The provisions of paragraphs 1 and 2 shall not apply where the beneficial owner of the dividends, a resident of a Contracting State, exercises in the other Contracting State whose dividend paying company is a resident, either an industrial or commercial activity through a permanent establishment located therein or an independent occupation by means of a fixed base located therein, and that the dividend-generating interest is effectively connected to it. In this case, the provisions of Article 7 or Article 14, as applicable, shall apply.
5. Where a corporation that is a resident of a Contracting State derives from the profits or income of the other Contracting State, that other State may not collect any tax on the dividends paid by the corporation, except to the extent that such dividends are paid to a resident of that other State or to the extent that the dividend-generating interest is effectively connected to a permanent establishment or to a fixed base located in that other State, or prelever any
Interest
Article 11
1. Interest arising from a Contracting State and paid to a resident of the other Contracting State shall be taxable in that other State.
2. However, these interests are also taxable in the Contracting State in which they arise and according to the law 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 per cent of the gross amount of the interest.
3. Notwithstanding the provisions of paragraph 2, interest shall be exempted from tax in the Contracting State from which it arises when it is:
(a) interest in commercial receivables - including those represented by commercial effects - resulting from the payment of goods, goods or services by companies in the future;
(b) interest paid by a loan or credit granted, guaranteed or insured under a regime organized by a Contracting State, one of its political or administrative subdivisions or one of its local authorities to promote exports;
(c) interest in receivables or loans of any kind, not represented by bearer securities, paid to bank companies;
(d) interest in deposits of money deposits made with a banking company;
(e) interest paid to the other Contracting State or to any of its political or administrative subdivisions or local authorities.
4. The term "interest" used in this section refers to income from receivables of any kind, whether or not accompanied by mortgage guarantees or an interest clause in the debtor's profits, including income from public funds and borrowing obligations, including premiums and lots attached to these securities. However, this term does not include, within the meaning of this section, penalties for late payment or interest treated as dividends under paragraph 3 of Article 10.
5. The provisions of paragraphs 1, 2 and 3 shall not apply where the beneficial owner of the interest, a resident of a Contracting State, carries on in the other Contracting State in which the interest arises, either an industrial or commercial activity through a permanent establishment located therein or an independent occupation by means of a fixed base located therein, and that the interest-generating debt is effectively linked to it. In this case, the provisions of Article 7 or Article 14, as applicable, shall apply.
6. Interest shall be deemed to arise from a Contracting State where the debtor is a resident of that State. However, where the debtor of interest, whether or not a resident of a Contracting State, has in a Contracting State a permanent establishment, or a fixed base, for which the debt giving rise to the payment of interest has been contracted and which bears the burden of such interests, these shall be deemed to arise from the State where the permanent establishment or fixed base is located.
7. Where, because of special relations between the debtor and the beneficial owner or between the debtor and the other person maintain with third persons, the amount of interest, taking into account the debt for which they are paid, exceeds the amount agreed upon by the debtor and the beneficial owner in the absence of such relations, the provisions of this Article shall apply only to the latter amount. In such cases, the surplus portion of the payments shall be taxable in accordance with the laws of each Contracting State and taking into account the other provisions of this Convention.
Claims
Article 12
1. Royalties from a Contracting State and paid to a resident of the other Contracting State shall be taxable in that other State.
2. However, such royalties are also taxable in the Contracting State in which they arise and according to the law 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" used in this article means the remuneration of any kind paid for the use or concession of the use of a copyright on a literary, artistic or scientific work, including software, film and films or tapes registered for radio or television, a patent, a trademark or trade, a drawing or a model, a plan
4. The provisions of paragraphs 1 and 2 shall not apply where the beneficial owner of the royalties, a resident of a Contracting State, exercises in the other Contracting State in which the royalties arise, either an industrial or commercial activity through a permanent establishment located therein or an independent occupation by means of a fixed base located therein, and that the right or property that generates royalties is effectively connected to it. In this case, the provisions of Article 7 or Article 14, as applicable, shall apply.
5. The royalties shall be deemed to arise from a Contracting State when the debtor is a resident of that State. However, where the debtor of royalties, whether or not a resident of a Contracting State, has in a Contracting State a permanent establishment, or a fixed base, for which the contract giving rise to the payment of royalties has been concluded and which bears the charge of such royalties, these shall be deemed to be from the State where the permanent establishment, or the fixed base, is located.
6. Where, because of special relations between the debtor and the beneficial owner or between the debtor and the other person maintain with third persons, the amount of royalties, taking into account the benefit for which they are paid, exceeds the amount agreed upon by the debtor and the beneficial owner in the absence of such relations, the provisions of this section apply only to the latter amount. In such cases, the surplus portion of the payments shall be taxable in accordance with the laws of each Contracting State and taking into account the other provisions of this Convention.
Capital gains
Article 13
1. The 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, shall be taxable in that other State.
2. The gains from the alienation of movable property that are part of the assets of a permanent establishment that a business of a Contracting State has in the other Contracting State, or of movable property that belong to a fixed base of which a resident of a Contracting State disposes in the other Contracting State for the exercise of an independent profession, including such gains from the alienation of that permanent establishment (ully or with
3. Gains derived from the alienation of ships or aircraft operated in international traffic, or movable property assigned to the operation of such ships or aircraft, shall be taxable only in the Contracting State where the effective management seat of the enterprise is located.
4. The gains derived by a resident of a Contracting State from the alienation of shares of a corporation of which more than 50 per cent of the value comes directly or indirectly from real property located in the other Contracting State are taxable in that other State.
5. The gains from the alienation of any property other than those referred to in paragraphs 1, 2, 3 and 4 shall be taxable only in the Contracting State of which the assignor is a resident.
Independent occupations
Article 14
1. The income derived by a resident of a Contracting State from a liberal profession or other activities of an independent character shall be taxable only in that State, unless that resident has in the other Contracting State a fixed basis for the exercise of his or her activities in an ordinary manner. If it has such a fixed base, income may be taxed in the other State but only to the extent that it is attributable to that fixed base.
The term "liberal profession" includes independent scientific, literary, artistic, educational or educational activities, as well as independent activities of physicians, lawyers, engineers, architects, dentists and accountants.
Dependent professions
Article 15
1. Subject to the provisions of Articles 16, 18, 19 and 20, wages, salaries and other similar remuneration that a resident of a Contracting State receives under an employee employment shall be taxable only in that State, unless employment is exercised in the other Contracting State. If the employment is exercised, the remuneration received as such is taxable in that other State.
2. Notwithstanding the provisions of paragraph 1, the remuneration of a resident of a Contracting State in respect of an employee employed in the other Contracting State shall be taxable only in the first State if:
(a) the beneficiary stays in the other State for a period or periods not exceeding a total of 183 days during any period of twelve months beginning or ending during the tax period under review, and
(b) compensation shall be paid by an employer or on behalf of an employer who is not a resident of the other State, and
(c) the pay charge is not borne by a permanent establishment or a fixed base that the employer has in the other State.
3. Notwithstanding the preceding provisions of this Article, remuneration received for an employee employed on board a ship or aircraft operated in international traffic shall be taxed in the Contracting State where the effective management seat of the enterprise is located.
Corporate managers
Article 16
1. The fortieth, attendance and other similar remuneration that a resident of a Contracting State receives as a member of the board of directors or of a similar body of a corporation that is a resident of the other Contracting State may be taxed in that other State.
The foregoing provision also applies to remuneration received because of the performance of functions which, under the legislation of the Contracting State whose company is a resident, are treated as functions of a nature similar to those exercised by a person referred to in that provision.
2. The remuneration that a person referred to in paragraph 1 receives from a corporation that is a resident of a Contracting State because of the exercise of a day-to-day direction or technical, commercial or financial activity shall be taxable in accordance with the provisions of Article 15, as if it were remuneration that an employee derives from an employee employment and as if the employer were the corporation.
Artists and Sportives
Article 17
1. Notwithstanding the provisions of Articles 14 and 15, income derived by a resident of a Contracting State from his or her personal activities in the other Contracting State as an artist of the spectacle, such as a theatre, cinema, radio or television artist, or a musician, or as a sportsman, may be taxed in that other State.
2. Where the income of activities that an entertainer or a sportsperson exercises personally and in this capacity is attributed not to the artist or to the athlete himself but to another person, such income shall be taxable, notwithstanding the provisions of Articles 7, 14 and 15, in the Contracting State where the activities of the artist or athlete are carried out.
Pensions
Article 18
1. Subject to the provisions of paragraph 2 of Article 19, pensions and other similar remuneration, paid to a resident of a Contracting State for an earlier job, shall be taxable only in that State.
2. The provisions of paragraph 1 shall not apply if the beneficiary is not taxed on such income in the State of which he is a resident and in accordance with the law of that State. In this case, these revenues are taxable in the State from which they come from.
3. Notwithstanding the provisions of paragraph 1 of this article, pensions and other similar remuneration, paid by a Contracting State in accordance with the provisions of social legislation or under a general regime organized by that State to supplement the benefits provided by its social legislation, shall be taxable only in that State.
Public functions
Article 19
1. (a) Salaries, salaries and other similar remuneration, other than pensions, paid by a Contracting State or any of its political or administrative subdivisions or local authorities to a natural person, for services rendered to that State or subdivision or community, shall be taxable only in that State.
(b) However, such wages, salaries and other similar remuneration shall be taxable only in the other Contracting State if the services are rendered in that State and if the natural person is a resident of that State who:
1° has the nationality of that State, or
2° did not become a resident of that State for the sole purpose of rendering the services.
2. (a) Pensions paid by a Contracting State or any of its political or administrative subdivisions or local authorities, either directly or by debiting from funds they have constituted, to a natural person, for services rendered to that State or to that subdivision or community, shall be taxable only in that State.
(b) However, such pensions shall be taxable only in the other Contracting State if the natural person is a resident of that State and has its nationality.
3. The provisions of Articles 15, 16, 17 and 18 apply to salaries, salaries and other similar remuneration, as well as to pensions, paid for services rendered in the course of a commercial or industrial activity carried out by a Contracting State or one of its political or administrative subdivisions or local authorities.
Professors, teachers and researchers
Rule 20
1. A teacher, teacher or researcher who temporarily resides in a Contracting State, for a period not exceeding two years, to teach or conduct research at a university, college, school or other similar educational institution officially recognized, and who is, or was immediately before that stay, a resident of the other Contracting State, is exempted from tax in the first Contracting State on remuneration received under these educational or research activities.
2. The provisions of paragraph 1 do not apply to remuneration received for research undertaken not in the general interest but primarily for the personal benefit of one or more specified persons.
Students and trainees
Article 21
The sums that a student or trainee who is, or who was immediately before going to a Contracting State, a resident of the other Contracting State and who resides in the first State for the sole purpose of pursuing his or her studies or training shall be paid to cover his or her maintenance, education or training expenses shall not be taxable in that State, provided that they arise from sources outside that State.
Other income
Article 22
1. The income elements 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.
2. The provisions of paragraph 1 shall not apply to income other than income derived from real property as defined in paragraph 2 of Article 6, where the beneficiary of such income, a resident of a Contracting State, carries on in the other Contracting State, either an industrial or commercial activity through a permanent establishment located therein, or an independent occupation by means of a fixed base located therein, and that the right or the right or the right or right of origin shall In this case, the provisions of Article 7 or Article 14, as applicable, shall apply.
3. Notwithstanding the provisions of paragraphs 1 and 2, the income elements of a resident of a Contracting State that are not dealt with in the preceding articles of the Convention and that come from the other Contracting State shall also be taxable in that other State if such elements are not imposed in the first State.
Miscellaneous
Article 23
A person who is a resident of a Contracting State and who derives income from the other Contracting State may not benefit from the exemptions or tax reductions normally provided for in this Convention, where the principal purpose or any of the principal purposes of any person concerned by the creation or assignment of such income elements was to benefit from the provisions of this Convention.
Methods to eliminate double taxation
Article 24
1. With regard to San Marino, double taxation is avoided as follows:
(a) Where a resident of San Marino receives income that, in accordance with the provisions of this Convention, is taxable in Belgium, San Marino exempts such income, subject to the provisions of subparagraphs (b) and (c), but may nevertheless, to calculate the amount of its taxes on the rest of the income of that resident, apply the same rate as if the income in question was not exempted.
(b) When a resident of San Marino receives income that, in accordance with the provisions of sections 10 and 11, is taxable in Belgium, San Marino grants, on the tax it receives on the income of that resident, a deduction of an amount equal to the tax paid in Belgium. However, this deduction cannot exceed the portion of the income tax, calculated before deduction, corresponding to income from Belgium.
(c) Notwithstanding the provisions of (b), where a corporation that is a resident of San Marino holds at least 25 per cent of the capital of a corporation that is a resident of Belgium and distributes dividends, and that such participation has been held for at least 12 months before the decision to distribute the dividends, San Marino exempts from tax the dividends that the corporation that is a resident of Belgium pays to the corporation that is a resident.
2. With regard to Belgium, double taxation is avoided as follows:
(a) Where a Belgian resident receives income, other than dividends, interest or royalties, that is taxable in San Marino in accordance with the provisions of this Convention, and that are taxed therein, Belgium exempts such income from tax, but may, in calculating the amount of its taxes on the rest of that resident's income, apply the same rate as if the income in question had not been exempted.
However, in the case of a corporation that is a resident of Belgium, where the Saint-Marine tax is less than 15 per cent of the net amount of the revenues referred to in this provision, Belgium does not exempt these revenues but reduces to a third party the Belgian tax proportionally related to them, calculated as if these revenues were Belgian source revenues.
(b) Notwithstanding the provisions of (a) of this paragraph and any other provision of this Convention, Belgium shall take into account, for the determination of additional taxes established by Belgian municipalities and towns, the professional income exempted from tax in Belgium in accordance with (a) of this paragraph. These additional taxes are calculated on the tax that would be due in Belgium if the professional income in question were derived from Belgian sources.
(c) The dividends that a corporation that is a resident of Belgium receives from a corporation that is a resident of San Marino are exempted from the tax of companies in Belgium, under the conditions and limits provided for in Belgian legislation.
(d) Subject to the provisions of Belgian law relating to the imputation on Belgian tax of taxes paid abroad, where a Belgian resident receives income elements that are included in his overall income subject to Belgian tax and which consist of interest or royalties, the Saint-British tax collected on these revenues is charged on the Belgian tax relating to such income.
(e) Where, in accordance with Belgian law, losses incurred by a company operated by a resident of Belgium in a permanent establishment located in San Marino have been effectively deducted from the profits of that undertaking for its taxation in Belgium, the exemption provided for in (a) does not apply in Belgium to the profits of other taxable periods that are attributable to that establishment, to the extent that these profits have also been exempted from taxes to San Marino on the basis of their compensation.
Non-discrimination
Rule 25
1. Nationals of a Contracting State shall not be subject in the other Contracting State to any taxation or obligation relating thereto, which is other or heavier than those to which nationals of that other Contracting State are or may be subject to the same situation, particularly in respect of the residence. This provision also applies, notwithstanding the provisions of Article 1, to persons who are not residents of a Contracting State or both Contracting States.
2. Stateless persons who are residents of a Contracting State shall not be subject in either Contracting State to any taxation or relative obligation that is other or heavier than those to which nationals of the State concerned are or may be subject in the same situation, particularly in respect of the residence.
3. The imposition of a permanent establishment that a business of a Contracting State has in the other Contracting State is not established in that other State in a less favourable manner than the taxation of the enterprises of that other State that exercise the same activity. This provision shall not be construed as requiring a Contracting State to grant personal deductions, deductions and tax reductions to the residents of the other Contracting State on the basis of the situation or family expenses that it grants to its own residents.
4. 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 other expenses paid by an enterprise of a Contracting State to a resident of the other Contracting State shall be deductible, for the determination of the taxable profits of that undertaking, on the same terms as if they had been paid to a resident of the first Contracting State.
5. The undertakings of a Contracting State, whose capital is wholly or partly, directly or indirectly, held or controlled by one or more residents of the other Contracting State, shall not be subject in the first State to any taxation or obligation relating thereto, which is other or heavier than those to which the other similar enterprises of the first State are or may be subject.
6. The provisions of this section shall apply, notwithstanding the provisions of section 2, to taxes of any kind or denomination.
Friendly procedure
Rule 26
1. Where a person considers that the measures taken by a Contracting State or by the two Contracting States shall result in or result in taxation not in accordance with the provisions of this Convention, the person may, independently of the remedies provided by the domestic law of those States, submit his case to the competent authority of the Contracting State of which the person is a resident or, if the case falls under paragraph 1 of Article 25, to that of the Contracting State of which the person is a national. The case shall be submitted within two years after the first notification of the measure that results in taxation not in conformity with the provisions of the Convention.
2. The competent authority shall endeavour, if the request appears to it to be founded and if it is not itself able to make a satisfactory solution to it, to resolve the case by amicable agreement with the competent authority of the other Contracting State, with a view to avoiding taxation not in conformity with the Convention. The amiable procedure ends at the end of the third year following the one in which the case was submitted. If an agreement is reached, it shall be applied irrespective of the time limits provided by the domestic law of the Contracting States.
3. The competent authorities of the Contracting States shall endeavour, by mutual agreement, to resolve the difficulties or to dispel the doubts to which the interpretation or application of the Convention may take place.
4. The competent authorities of the Contracting States shall agree on the administrative measures necessary for the implementation of the provisions of the Convention and in particular on the justifications to be provided by the residents of each Contracting State to benefit in the other State from the exemptions or tax reductions provided for in this Convention.
5. The competent authorities of the Contracting States shall communicate directly with each other for the purposes of the Convention.
Exchange of information
Rule 27
1. The competent authorities of the Contracting States shall exchange the information necessary to implement the provisions of this Convention or those of the domestic legislation of the Contracting States relating to the taxes covered by this Convention to the extent that the taxation it provides is not contrary to the Convention, in particular to prevent tax evasion. The exchange of information is not restricted by section 1. The information received by a Contracting State shall be kept secret in the same manner as the information obtained pursuant to the domestic legislation of that State and shall be communicated only to the persons or authorities (including the courts and administrative bodies) concerned by the establishment or collection of the taxes referred to in this Convention, by the procedures or prosecutions relating to such taxes, or by the decisions on remedies relating to such taxes. These individuals or authorities only use this information for these purposes. They may report this information at public court hearings or in judgments.
2. In no case shall the provisions of paragraph 1 be construed as imposing on a Contracting State the obligation:
(a) take administrative measures derogating from its legislation, administrative practice or those of the other Contracting State;
(b) provide information that could not be obtained on the basis of its legislation or in the course of its normal administrative practice or those of the other Contracting State;
(c) provide information that would reveal a commercial, industrial, professional or commercial secret or information that would be contrary to public order.
Recovery assistance
Rule 28
1. The Contracting States shall provide mutual assistance and assistance to notify and recover the taxes covered by this Convention as well as any additional, increments, interests, fees and fines without a criminal nature relating to such taxes where such tax claims are payable and are no longer subject to appeal under the laws or regulations of the requesting State for assistance.
2. At the request of the requesting State, the requested State shall notify and recover the tax claims of that State in accordance with the legislation and administrative practice applicable to the notification and recovery of its own tax claims, unless the Convention otherwise provides.
3. The requested State is not obliged to comply with the request of the requesting State if the requesting State has not exhausted all means of recovering its tax debt on its own territory.
4. The request for assistance for the recovery of a tax debt is accompanied by:
(a) an official copy of the title allowing execution in the requesting State;
(b) an official copy of any other document required in the requesting State for recovery; and
(c) where appropriate, a certified copy of any decision made in force by an administrative body or tribunal.
5. The title allowing execution in the requesting State produces the same effects in the requested State.
6. Issues relating to the limitation period of tax debt are governed exclusively by the legislation of the requesting State.
7. The acts of recovery carried out by the requested State following a request for assistance and which, according to the law of that State, would have the effect of suspending or interrupting the limitation period have the same effect under the law of the requesting State. The requested State shall inform the requesting State of the measures taken to that end.
8. Tax claims for the recovery of which assistance is requested do not enjoy any privilege in the requested State.
9. The requested State is not required to apply means of enforcement which are not authorized by the legal or regulatory provisions of the requesting State.
10. With regard to the tax claims of a Contracting State that are the subject of an appeal or are still subject to an appeal, the competent authority of that Contracting State may, for the safeguard of its rights, request the competent authority of the other Contracting State to take the precautionary measures provided for in the legislation of that Contracting State. The provisions of the preceding paragraphs shall apply mutatis mutandis to these measures.
11. The competent authorities of the Contracting States shall agree to establish the modalities for the transfer of the sums recovered by the requested State on behalf of the requesting State.
Members of diplomatic missions and consular posts
Rule 29
1. The provisions of this Convention shall not affect the tax privileges enjoyed by members of diplomatic missions or consular posts under either the general rules of international law or the provisions of special agreements.
2. For the purposes of the Convention, members of diplomatic missions or consular posts of a Contracting State accredited in the other Contracting State or in a third State, who have the nationality of the accrediting State, shall be deemed to be residents of that State if they are subject to the same obligations in respect of income taxes, as residents of that State.
3. The Convention does not apply to international organizations, their organs or officials, or to persons who are members of diplomatic missions or consular posts of a third State, where they are located in the territory of a Contracting State and are not treated as residents in one or the other Contracting State in respect of income tax.
Refunds
Rule 30
1. Taxes collected in a Contracting State by way of deduction to the source shall be refunded at the request of the party concerned, where the right to collect such taxes is limited by the provisions of this Convention.
2. Claims for reimbursement, which must be submitted within the time limits provided for in the legislation of the Contracting State to make the refund, shall be accompanied by an official declaration of the Contracting State of which the taxpayer is a resident, certifying that the taxpayer meets the conditions enabling it to claim the benefits of this Convention.
3. The competent authorities of the Contracting State shall agree, in accordance with the provisions of Article 26 of this Convention, on the method of application of this Article.
Entry into force
Rule 31
1. Each Contracting State shall notify the other Contracting State of the fulfilment of the procedures required by its legislation for the entry into force of this Convention. The Convention shall enter into force on the date of receipt of the second notification.
2. The provisions of the Convention shall apply:
(a) taxes due to the source on income awarded or paid from 1^er January of the year immediately following that of the entry into force of the Convention;
(b) taxes other than those due at source established on incomes of taxable periods beginning on or after 1^er January of the year immediately following that of the entry into force of the Convention.
Denunciation
Rule 32
This Convention shall remain in force as long as it has not been denounced by a Contracting State, but each of the Contracting States may, until 30 June inclusive of any calendar year from the fifth year following that of the entry into force, denounce it, in writing and through diplomatic channels, to the other Contracting State. In case of denunciation before 1^er July of such a year, the Convention will cease to apply:
(a) taxes due to the source on income awarded or paid from 1^er January of the year immediately following the denunciation;
(b) taxes other than those due at source established on incomes of taxable periods beginning on or after 1^er January of the year immediately following the denunciation.
IN WITNESS WHEREOF, the undersigned, to that duly authorized by their respective Governments, have signed this Convention.
DONE in San Marino, on 21 December 2005, in duplicate, in French, Dutch, Italian and English, the four texts being equally authentic. The English language text will prevail in the event of a discrepancy between the texts.
PROTOCOLE
At the time of the signing of the Convention between the Kingdom of Belgium and the Republic of San Marino to avoid double taxation and to prevent tax evasion in respect of income taxes, the undersigned agreed on the following provisions which are an integral part of the Convention.
It is understood that:
1. The provisions of the Convention do not prevent the application of the agreement between the European Community and the Republic of San Marino providing for measures equivalent to those provided for in Council Directive 2003/48/EC on the taxation of savings income in the form of interest payments, signed in Brussels on 7 December 2004.
2. Ad article 3, paragraph 1, (d):
In San Marino, a trust is considered to be a legal entity for tax purposes when and only to the extent that the trust is subject to the income tax of Saint-marin.
3. Ad article 4:
The term "resident of a Contracting State" also means an institution or agency, established in accordance with the legislation of a Contracting State, which has the sole purpose of establishing a pension, even if the institution or agency in question is exempt from tax in the State in which it is established.
4. Ad article 5:
No provision of Article 5 shall preclude the consideration of an insurance business of a Contracting State as having a permanent establishment in the other Contracting State when it receives premiums in that other Contracting State, or shall be liable to such undertakings, by means of an intermediary or agent established therein, but not by an agent referred to in paragraph 6 of that Article, unless the agent has the authority to conclude
5. Ad article 15, paragraph 1:
Employee employment is exercised in a Contracting State where the activity under which wages, salaries and other similar remuneration are paid is actually exercised in that State, i.e. when the employee is physically present in that State to carry out this activity.
6. Ad article 16, paragraph 2:
With respect to Belgium, the remuneration that a resident of a Contracting State derives from his or her daily activity as a partner in a corporation other than a share-based corporation, which is a resident of Belgium is taxable in accordance with the provisions of Article 15, as if it were remuneration that an employee derives from an employee employment and as if the employer were the company.
7. Ad article 18, paragraph 2, article 22, paragraph 3 and article 24, paragraph 2, (a):
For the purposes of the application by Belgium of paragraph 2 of Article 18, paragraph 3 of Article 22, and paragraph 2, (a) of Article 24 of the Convention, an income shall be taxed to San Marino when it is actually understood in the taxable basis on which the Saint-Marine tax is calculated. As a result, an income is not taxed in San Marino where, while being subject to the tax regime normally applicable to that income under San Marino legislation, it is either non-taxable or tax-free in San Marino.
8. In no case shall the provisions of the Convention be construed as preventing a Contracting State from applying the provisions of its national legislation relating to the prevention of tax evasion.
9. The provisions of the Convention that are drafted in accordance with the corresponding provisions of the OECD Model Convention on Income and Capital are expected to have generally the same meaning as those given in the OECD Commentary. The previous sentence does not apply with respect to:
(a) reservations or observations made by each of the Contracting States on the OECD Model or its Comment;
(b) the contrary interpretations contained in this Protocol;
(c) any contrary interpretation contained in a comment published by one of the Contracting States and communicated to the competent authority of the other Contracting State before the entry into force of the Convention;
(d) any contrary interpretation agreed upon between the competent authorities after the entry into force of the Convention.
The OECD Commentary, as can be revised periodically, is a means of interpretation within the meaning of the Vienna Convention of 23 May 1969 on the Law of Treaties.
IN WITNESS WHEREOF, the undersigned, duly authorized by their respective Governments, have signed this Protocol.
DONE in San Marino, on 21 December 2005, in duplicate, in French, Dutch, Italian and English, the four texts being equally authentic. The English language text will prevail in the event of a discrepancy between the texts.