DECREE NO. 7,020, OF November 27, 2009.

Promulga the Convention between the Government of the Federative Republic of Brazil and the Government of the Republic of Peru to Prevent the Double Taxation and Preventing Tax Evasion with Relation to Income Tax, firmed in Lima, on February 17, 2006.

THE PRESIDENT OF THE REPUBLIC, in the use of the attribution that confers it on art. 84, inciso IV, of the Constitution, and

Whereas the Government of the Federative Republic of the Brazil and the Government of the Republic of Peru celebrated, in Lima, on February 17, 2006, a Convention to Prevent Double Taxation and Prevent Fiscal Evasion with Relation to the Income Tax;

Whereas the National Congress passed this Convention through the Legislative Decree no 500, of August 10 of 2009;

Considering that the Convention entered into international force on August 14, 2009, in the terms of paragraph 28 of your Article 28;

DECRETA:

Art. 1st The Convention between the Government of the Federative Republic of Brazil and the Government of the Republic of Peru to Avoiding Double Taxation and Preventing Tax Evasion with Relation to the Income Tax, firmed up in Lima, on February 17, 2006, appended by copy to the present Decree, will be executed and fulfilled as entirely as it contains.

Art. 2nd Are subject to National Congress approval any acts that may result in review of the said Convention, as well as any further adjustments which, under the art. 49, inciso I, of the Constitution, carries charges or gravy commitments to the national heritage.

Art. 3rd This Decree goes into effect on the date of its publication.

Brasilia, November 27, 2009; 188th of the Independence and 121st of the Republic.

LUIZ INÁCIO LULA DA SILVA

Ruy Nunes Pinto Nogueira

CONVENTION BETWEEN THE GOVERNMENT OF THE FEDERATIVE REPUBLIC OF BRAZIL AND THE

GOVERNMENT OF THE REPUBLIC OF PERU TO AVOID DOUBLE TAXATION AND

PREVENT TAX EVASION WITH RESPECT TO INCOME TAX

The Government of the Federative Republic of Brazil

e

The Government of the Republic of Peru,

Wishes desire to conclude a Convention aimed at avoiding double taxation and preventing tax evasion with respect to tax on the income,

Wake up the following:

CHAPTER I

Scope of application of the Convention

ARTICLE 1

People Visit

The present Convention applies to the resident persons of one or both of the Contracting States.

ARTICLE 2

Vised taxes

1.This Convention applies to taxes on income demanded by each of the Contracting States, whatever the system of exation.

2.São considered taxes on income the ones that write the entirety of the income any part of it.

3.The current taxes to which this Convention applies are:

a) in Peru:

-do taxes established in?Income Tax Act?

(henceforth named the? uPeruvian tax?);

b)in Brazil:

-the federal tax on income

(henceforth named the? Brazilian tax?).

4.The Convention will also apply to taxes of an identical or substantially analogous nature that are introduced after the date of the signing of it, be it in addition to those mentioned above, be it in their replacement. The competent authorities of the Contracting States shall communicate the significant modifications that occurred in their respective tax legislations.

CHAPTER II

Definitions

ARTICLE 3

General definitions

1.For the purposes of this Convention, unless the context imposes different interpretation:

a)the term?Turkey? means the Republic of Peru;

b) the term?Brazil? means the Federative Republic of Brazil;

c) the expressions? a Contracting State? e? the other Contracting State? mean, in accordance with the context, Brazil or Peru;

d) the term? person? understands physical or natural persons, societies, fideicomments (?trusts?), associations (?partnerships?) and any other grouping of people;

e)the term? society? means any legal person or any entity deemed to be legal person for tax purposes;

f)the expressions? company of a Contractor State? e? company of the other Contracting State? means, respectively, a company operated by a resident of a Contracting State and a company operated by a resident of the other Contracting State;

g)the expression? international traffic? means every transport effected by a ship, boat, aircraft or land transport vehicle operated by a company of a Contracting State, except where such transport takes place exclusively between two points located in the other State Contractor;

h) the expression? competent authority? means:

i) in Peru, the Minister of Economics and Finance or their representatives authoritative;

ii) in Brazil, the Minister of State for Finance, the Secretary of the Federal Revenue Officer or their authorized representatives.

i) the term? national? means:

i) any physical or natural person who posits the nationality of a State Contractor; or

ii) any legal person, society of persons or association constituted in accordance with the current legislation in a Contracting State.

2.For the application of the Convention at a given time by a Contracting State, any term or expression which it does not find itself to be defined will have, unless the context requires different interpretation, the meaning that at that time is assigned to it by the legislation of that State concerning the taxes that are the object of the Convention, the meaning assigned by the tax legislation on the meaning that would ascribe to it the other branches of the law of that state.

ARTICLE 4

Resident

1.For the purposes of this Convention, the expression? resident of a Contracting State? designates every person who, by virtue of the legislation of that State, is subject to taxation in that State on the grounds of his domicile, residence, seat of direction, place of constitution or any other criterion of a similar nature, and also includes the own state and any political subdivision or local authority. However, such an expression does not include persons who are subject to taxation in that State solely for the income they obtain from sources located in the said State.

2.When, by virtue of the provisions of paragraph 1, a physical or natural person is resident of both the Contracting States, their situation shall be determined as follows:

a)that person will be regarded as a resident only of the Contracting State in which he / she has a dwelling permanent; if it disposes of permanent housing in both states, it will be considered as resident only of the state with which its personal and economic connections are narrower (vital interest center);

b)if the state in which that person has the center of their vital interests cannot be determined, or if it does not disposes of a permanent dwelling in any of the States, shall be deemed to be resident only of the State in which it remains customarily;

c)if that person habitually stays in both states or if it does not habitually remain in any of them, it shall be regarded as resident only of the State of which it is national;

d) if that person is a national of both States or if it is not national of any of them, the competent authorities of the Contracting States will resolve the matter by a mutual agreement procedure.

3.When, by virtue of the provisions of paragraph 1, a person, who is not a physical or natural person, is resident of both the Contracting States, the competent authorities of the Contracting States shall do their best to resolve the case. In the absence of a mutual agreement, said person shall not be entitled to any of the benefits or tax exemptions contemplated by this Convention.

ARTICLE 5

Permanent Establishment

1.For the purposes of this Convention, the expression? permanent establishment? means a fixed business installation by means of which a company exercises all or part of its activity.

2.The expression? permanent establishment? understands especially:

a) the directing sedes;

b)the branches;

c)the offices;

d)the factories;

and) the workshops;

f) the mines, oil or gas wells, quarries or any other site related to the extraction or exploitation of natural resources.

3.The expression? permanent establishment? also comprises a construction site or construction project, installation or assembly or a supervision activity directly related to them, however only when it dictates work, construction project, installation or assembly, or activity endures for a period of more than six (6) months. For the purposes of calculating the time limits referred to in this paragraph, the activities carried out by a company associated with another company under Article 9 will be increased to the period during which the activities by the company are carried out of which it is associated, if the activities of both companies are identical or substantially similar

4.Notwithstanding the foregoing provisions of this Article, shall the expression? permanent establishment be considered? does not include:

a) the use of facilities solely for the purpose of storage, exhibition or delivery of goods or goods belonging to the company, always and when this does not constitute a sale;

b) the maintenance of a stock of goods or goods belonging to the company solely for the purposes of storage, exhibition or delivery, always and when this does not constitute a sale;

c) the maintenance of a stock of goods or goods belonging to the company solely for the purposes of processing by another company;

d) the maintenance of an installation fixed business solely for purposes of purchasing goods or goods or obtaining information for the company;

e) the maintenance of a fixed business installation solely for the purposes of realizing, for the company, any other preparatory character activity or auxiliary.

5. Notwithstanding the provisions of paragraphs 1 and 2, when a person, who is not an independent agent to which paragraph 7 applies, attests to a company and has and habitually exercised in a Contracting State powers to conclude contracts on behalf of the company, it will be considered that such a company has a permanent establishment in that State in respect of any of the activities that such person develops for the company unless such activities are limited to those mentioned in the paragraph 4, which, if exercised through a fixed business installation, would not allow such a fixed installation to be considered as a permanent establishment under the terms of that paragraph.

6.Notwithstanding the earlier provisions of this Article, a resident insurer company of a Contracting State shall be deemed to have, except in respect of the reinsurance, a permanent establishment in the other Contracting State if it raises awards in the territory of that other State or if it holds risks situated on the same through a representative who is not an independent agent to which paragraph 7 applies.

7.It does not consider that a company has a permanent establishment in a Contracting State by the mere fact of carrying out its activities in that State through a broker, a general commissioner or any other independent agent, provided that these people act in the normal scope of their activities.

8.The fact that a resident society of a Contracting State controls or is controlled by a resident corporation of the other Contracting State, or develops business activities in that other State (either through an establishment permanent it wants otherwise), it is not, by itself, sufficient to make any of these societies a permanent establishment of the other.

CHAPTER III

Taxation of the Earnings

ARTICLE 6

Real Estate Income

1.The income that a resident of a Contracting State obtains from immovable property (inclusive of income from agricultural or forestry holdings) located in the other Contracting State may be taxed in that other State.

2.The expression? real estate? will have the meaning assigned to it by the legislation of the Contracting State in which the goods in issue are situated. Said expression comprises, in any case, the accessory property of the real estate, the cattle and equipment used in agricultural and forestry holdings, the rights to which the provisions of the private law relating to the property apply of immovable property, the enjoyment of immovable property and the right to receive variable or fixed payments for the exploitation or concession of the exploitation of mineral deposits, sources and other natural resources. The ships, boats, aircraft and land transport vehicles are not considered real estate.

3.The provisions of paragraph 1 shall apply to the income derived from direct holding, renting or partnership, as well as any other form of exploitation of immovable property.

4.The provisions of paragraphs 1 and 3 also apply to income from immovable property of a company and the immovable property used for the provision of independent personal services.

5.Where the ownership of shares, holdings or other rights in a corporation or other legal person confers on its owner the enjoyment of immovable property located in a Contracting State and maintained by that corporation or that other legal person, the income that the owner gets from direct use, renting or any other form of use of such rights can be taxed in that other state. The provisions of this paragraph shall be applied without prejudice to the provisions of Article 7.

ARTICLE 7

Profits of Enterprises

1.The profits of a company from a Contracting State are taxable only in that State, unless the Company exercises its activity in the other Contracting State through a permanent establishment there. If the company exercises or has exercised its activity in the indicated form, its profits can be taxed in the other state, but solely to the extent that they are attributable to that permanent establishment.

2.Re-salvaged the provisions of paragraph 3, when a company of a Contracting State exercises activities in the other Contracting State through a permanent establishment therein, shall be assigned, in each Contracting State, to that permanent establishment, the profits it would obtain if it constituted a separate and separate company, which exerted identical or similar activities, under identical or similar conditions, and treated with absolute independence with the company that it is a permanent establishment.

3.For the determination of the profits of a permanent establishment, it shall be permitted to deduct the necessary expenses that have been made for the achievement of the purposes of the permanent establishment, inclusive of the directing expenses and the general charges of administration for the same purposes.

4.No profit will be assigned to a permanent establishment by the mere fact of the purchase of goods or goods for the company.

5.Where the profits comprise income treated separately in other Articles of this Convention, the provisions of these Articles shall not be affected by those of the present Article.

ARTICLE 8

Air, Earth, Maritime, and Fluvial Transport

1.The profits of a company from a Contracting State arising from the operation of ships, boats, aircraft or ground transport vehicles in international traffic will only be taxable in that State.

2.For the purposes of this Article, the expression? operation of ship, boat, aircraft, or land transport vehicle? by a company also comprises:

a) the afreation or rental of ship, boat or aircraft, without crew, or from ground transport vehicle;

b) the rental of containers and respective equipment.

as long as said afreation or rent is accessory to the operation, by that company, of ships, boats, aircraft or of ground transport vehicles in international traffic.

3.The provisions of paragraph 1 also apply to profits arising from participation in a? pool?, in a mixed company or in an international operating agency, but only to the extent that such profits are attributable to the participant proportionally to its part in the joint operation.

ARTICLE 9

Associated Companies

Quando:

a) a company from a Contracting State to participate, directly or indirectly, in the direction, control or capital of a company of the other Contracting State, or

b)the same persons participate, directly or indirectly, in the direction, control, or capital of a company of a Contracting State and of a company of the other State Contractor,

and, in both cases, the two companies, in their business relations or financial, are linked by conditions accepted or imposed that differ from those that would be established between independent companies, the profits that, without those conditions, would have been obtained by one of the companies, but they were not by virtue of such conditions, can be included in the profits of that company and, consequently, taxed.

ARTICLE 10

Dividends

1.Dividends paid by a resident corporation of a Contracting State to a resident of the other Contracting State may be taxed in that other State.

2.However, such dividends may also be taxed in the Contracting State in which it resides with the corporation that pays them and in accordance with the legislation of that State, but, if the effective beneficiary of the dividends is a resident of the other Contracting State, the tax so required will not be able to exceed:

a) 10% of the gross amount of the dividends, if the effective beneficiary is a society that controls, directly or indirectly, at least 20% percent of the shares entitled to the vote of the society that pays the dividends;

b) 15% of the gross amount of dividends in all other cases.

The provisions of this paragraph shall not affect the taxation of the society with reference to the profits that give rise to the payment of the dividends.

3.The term? dividends? used in this Article means income from shares, shares of fruition or usufruct on shares, shares of mining companies, shares of founder or other rights of share in profits, with the exception of credits, as well as income from other social equities subject to the same tax treatment as the income from shares by the state law in which the society that distributes them is resident.

4.The provisions of paragraphs 1 and 2 of this Article shall not apply when the effective beneficiary of the dividends, resident of a Contracting State, exercises, in the other Contracting State of which is resident the society paying the dividends, a business activity through a permanent establishment there, or to provide in that other State independent personal services by means of a fixed base there, and the generating share of the dividends is effectively linked to such permanent establishment or fixed base. In this case the provisions of Article 7 or Article 14 shall be applicable, as the circumstances.

5.Where a resident corporation of a Contracting State receives profits or income from the other Contracting State, that other State shall not be able to demand any tax on 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 generating share of dividends is effectively linked to a permanent establishment or to a fixed basis located in that other State, nor to submit the profits not distributed from society to a tax on the same, yet dividends paid or undistributed profits consist of, wholly or partially, profits or income from that other state.

6.When a resident of a Contracting State holds a permanent establishment in the other Contracting State, such permanent establishment will be able to be subject to a separate tax of the tax that affects the profits of the permanent establishment in that other Contracting State and in accordance with the legislation of that State. However, such a tax distinct from the tax on profits may not exceed the limit set out in the letter (a) of paragraph 2 of this Article.

7.The provisions of this Article shall not apply if the main purpose or one of the main purposes of any person involved with the creation or assignment of shares or other rights in respect of which the dividend is paid is to take advantage of this Article upon such creation or attribution.

ARTICLE 11

Juros

1.Interest earned from a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.

2.However, such interest may also be taxed in the Contracting State of which they originate, and in accordance with the legislation of that State, but, if the effective beneficiary of the interest is a resident of the other Contracting State, the tax so required shall not be exceed 15% of the gross amount of interest.

3.The term? interest? used in this Article means the income from claims of any nature, accompanied or not of a mortgage guarantee and, in particular, the income from the public debt, securities or debentures, as well as any other income than the state tax legislation that they come from assimilating to the incomes of borrowed importations.

4.The provisions of paragraphs 1 and 2 do not apply when the effective beneficiary of the interest, resident of a Contracting State, exercises, in the other Contracting State of which they provenance interest, business activity through an establishment permanent therein, or pay independent personal services through a fixed basis located in the said State, and the credit in respect of which the interest is paid is effectively linked to that permanent establishment or fixed basis. In such circumstances, the provisions of Article 7 or Article 14 apply, according to the case.

5.The limitation set out in paragraph 2 shall not apply to the interest arising from a Contracting State and paid to a permanent establishment of a company of the other Contracting State located in a third State.

6.Interest shall be deemed to come from a Contracting State when the debtor is a resident of that State. However, where the debtor of the interest, whether or not a resident of a Contracting State, has in a Contracting State a permanent establishment or a fixed basis in relation to which there is contracted the obligation which gives rise to the payment of the interest and kayba to such permanent establishment or fixed basis the payment of such interest, such interest shall be considered from the Contracting State in which the permanent establishment or fixed base are situated.

7.When, on the grounds of existing special relations between the debtor and the effective beneficiary, or between both and third parties, the amount of interest paid, considering the credit for which they are due, exceeds what would be agreed between the debtor and the creditor in the absence of such relations, the provisions of this Article shall be applicable only to the latter amount. In this case, the surplus portion of the payments shall be taxable in accordance with the legislation of each Contracting State, taking into account the other provisions of this Convention.

8.The provisions of this Article shall not apply if the main purpose or one of the main purposes of any person involved with the creation or assignment of the credit in respect of which the interest is paid is to take advantage of this Article upon such creation or attribution.

ARTICLE 12

Royalties

1.The royalties arising from a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.

2.However, such royalties may also be taxed in the Contracting State of which they originate, and in accordance with the legislation of that State, but, if the effective beneficiary is a resident of the other Contracting State, the tax thus established shall not be able exceed 15% of the gross amount of royalties.

3.The term? royalties?, employed in this Article, means the remunerations of any nature paid for by the use or by the granting of the use of copyright on literary, artistic or scientific works (inclusive of film films, films, recording tapes and other means of image and sound reproduction), of patents, industry or trade marks, drawings or models, plans, formulas or secret processes or other intangible property, as well as by the use or grant of the use of industrial, commercial or scientific equipment, or by information relating to industrial, commercial or scientific experiments.

4.The provisions of paragraphs 1 and 2 of this Article do not apply when the effective beneficiary of the royalties, resident of a Contracting State, exercises, in the other Contracting State of which the royalties originate, an entrepreneal activity through of a permanent establishment located there, or pay in that other State independent personal services through a fixed basis located in said State, and the good or the generator right of the royalties is effectively linked to that permanent establishment or fixed base. In such cases, the provisions of Article 7 or Article 14 apply in accordance with the circumstances.

5.The royalties are considered to come from a Contracting State when the debtor is a resident of that State. However, where the debtor of the royalties, resident or otherwise of a Contracting State, has in a Contracting State a permanent establishment or fixed basis to which the payment of such royalties shall be considered, those shall be considered from the State in that the permanent establishment or the fixed base is situated.

6.When, on the grounds of special relations existing between the debtor and the effective beneficiary, or between both and third parties, the amount of royalties paid, taking into account the use, right or information by which they are paid, exceeds what would be agreed between the debtor and the effective beneficiary in the absence of such relationships, the provisions of this Article shall be applicable only to the latter amount. In this case, the surplus portion of the payments shall be taxable in accordance with the legislation of each Contracting State, taking into account the other provisions of this Convention.

7.The provisions of this Article shall not apply if the main purpose or one of the principal purposes of any person related to the creation or assignment of rights with respect to which royalties are paid is to take advantage of this Article upon such creation or attribution.

ARTICLE 13

Capital Gains

1.The gains that a resident of a Contracting State obtains from the disposal of immovable property, as set out in Article 6, and located in the other Contracting State, may be taxed in that other State.

2.The gains from the disposal of movable property that is part of the asset of a permanent establishment that a company of a Contracting State posits in the other Contracting State, or of movable property belonging to a fixed base that a resident of a Contracting State has in the other Contracting State for the provision of independent personal services, including the gains from the disposal of that permanent establishment (isolated or with the company's set) or of the fixed base, can be taxed in that other state.

3.The gains from the disposal of ships, boats, aircraft or land transport vehicles operated in international traffic, or from mobile goods affected to the exploitation of such ships, boats, aircraft or ground transport vehicles, will be taxable only in the Contracting State in which it resides the alienant.

4.Nothing of the established in this Convention will affect the application of the legislation of a Contracting State to tax capital gains arising from the disposal of any other type of property other than those mentioned in this Article.

ARTICLE 14

Independent Personal Services

1.The income earned by a person who is a resident of a Contracting State by the provision of professional services or other independent activities of a similar nature shall be taxable only in that State, unless:

a)remuneration for such services or activities are paid by a resident of the other State Contractor or fall to a permanent establishment or to a fixed base situated in that other State; or

b)referred person, its employees or other persons by it tasked to remain, or the activities proceed, in the other State for a period or periods that, in total, add up or exceed 183 days, within a period any of twelve months; in that case, it may only be taxable in that other state the part of the income gained from the activities performed by that person in that other state; or

c)such services or activities are provided in the other Contracting State and the beneficiary has a fixed basis available in that other state for the purpose of carrying out its activities, but only to the extent that such yields are attributable to the services carried out in that other State.

2.The expression? independent personal services? understands especially the independent activities of scientific, technical, literary, artistic, artistic, educational or pedagogical character, as well as the independent activities of doctors, lawyers, engineers, architects, dentists, auditors and counters.

ARTICLE 15

Dependent Personal Services

1.The provisions of Articles 16, 18 and 19, the welds, wages and other similar remuneration obtained by a resident of a Contracting State on the grounds of a job are only taxable in that State, unless employment is exercised in the other Contracting State. If employment is exercised in this manner, the corresponding remunerations can be taxed in that other state.

2.Notwithstanding the provisions of paragraph 1, the remunerations received by a resident of a Contracting State on the grounds of a job exercised in the other Contracting State are taxable only in the first State if:

a)the beneficiary remaining in the other state during one or several periods not exceeding in total 183 days in any period of twelve months that begins or ends in the fiscal year considered;

b) the remunerations are paid by, or in the name of, an employer who is not resident of the other state, and

c)the remunerations are not charged to a permanent establishment or a fixed basis that the employer posits in the other state.

3.Notwithstanding the foregoing provisions of this Article, remunerations obtained by a resident of a Contracting State on the grounds of a job exercised on board a ship, boat, aircraft or land transport vehicle operated in traffic international only can be taxed in that state.

ARTICLE 16

Remunerations of Directors or Councillors

The remunerations of directors and other similar retributions received by a resident of a Contracting State as a member of a board or of a board of a society resident of the other Contracting State may be taxed in that other State.

ARTICLE 17

Artists and Desportists

1.Notwithstanding the provisions of Articles 14 and 15, the income that a resident of a Contracting State obtains from the exercise of his or her personal activities in the other Contracting State in the quality of professional of spectacles, such as an artist of theatre, film, radio or television, or musician, or as a sportsman, can be taxed in that other state.

2.Notwithstanding the provisions of Articles 7, 14 and 15, when the income from the personal activities of the practitioners of spectacles or sportsmen, in that capacity, are assigned not to the professional of spectacles themselves or sportsman, but the other person, such income can be taxed in the Contracting State in which the activities of the spectacle professional or the sportsman are exerted.

ARTICLE 18

Pensions, Anuities, and Social Security System Payments

1.Rebutted the provisions of paragraph 2 of Article 19, pensions and other similar remuneration perceived on the grounds of a previous employment, as well as annuities, coming from a Contracting State and paid to a resident of the other State Contractors can be taxed in the state from which provenham.

2.Notwithstanding the provisions of paragraph 1, pensions and other payments effected by virtue of an official pension program that integrates the Social Security system of a Contracting State or of a political subdivision or an authority location of the same are taxable only in that state.

3.In the present Article:

a) the expression? pensions and other similar remuneration? assigns periodic payments, effected after retirement, on the grounds of prior employment or the title of compensation for damages suffered in consequence of said employment;

b)the term? annuity? assigns a given amount, paid out periodically on specified deadlines, be it lifetime title, whether for certain or determinable periods of time, due to an obligation to effectuate the payments as retribution of a full and proper contravalor in cash or evaluable in cash (other than for services provided).

ARTICLE 19

Public Functions

1.a) the welds, salaries and other similar remuneration, excluded the pensions, paid by a Contracting State or by one of its political subdivisions or local authorities to a physical or natural person, on the grounds of services provided to that State or to that subdivision or authority, are only taxable in that State.

b) however, these welds, salaries and other similar remunerations may only be taxed in the other Contracting State if services are provided in that State and the person physical or natural for a resident of that State who:

i) be a national of that State; or

ii) has not acquired the condition of resident of that state solely to provide the services.

2.The pensions paid by a Contracting State, one of its political subdivisions or local authorities, either directly or by means of funds by them constituted, to a physical or natural person on the grounds of services provided to that State, to that State subdivision or authority, are taxable only in that state.

3.Applies to Articles 15, 16, 17 and 18 to solders, salaries and other similar remuneration, as well as to pensions, paid in the grounds of services provided in the context of a business activity exercised by a Contracting State or by one of its political subdivisions or local authorities.

ARTICLE 20

Students and Apprentices

1.The importances that a student, trainee or apprentice who is, or was, in period immediately prior to his visit to a Contracting State, resident of the other Contracting State and who remains in the first State only with the sole end of therein pursue your studies or your practical training, receive to make face to the expenses with your maintenance, education or training, will not be taxed in that state, provided that these payments come from sources situated outside of that state.

2.In relation to grants, scholarships and employment earnings not covered by paragraph 1, students and apprentices of which it treats paragraph 1 will be entitled, ademals, during the period of study or practice, to benefit from the same personal deductions, exemptions and reductions, in relation to taxes, granted to the residents of the state who are visiting.

ARTICLE 21

Other Renditions

The incomes of a resident of a Contracting State untreated in the previous Articles of present Convention and which come from the other Contracting State may be taxed in that other Contracting State.

CHAPTER IV

Methods to Eliminate Double Taxation

ARTICLE 22

Elimination of Double Taxation

1.In the case of Peru, double taxation will be avoided in the following manner:

a) Peru will allow it to its residents credit against the income tax payable in the Perú, as credit, the Brazilian tax paid for the income taxed in accordance with Brazilian legislation and the provisions of this Convention. The credit considered may not exceed, in any case, the fraction of the income tax in Peru attributable to the income that can be taxed in Brazil,

b)when a resident company of Brazil pays dividend to a resident society of Peru and the same control, directly or indirectly, at least 10% of the right to vote of the society, the credit should take into account the tax paid in Brazil by the corporation in relation to the profits on which such dividend is paid, however only to the extent that the Peruvian tax exceeds the amount of credit determined without taking into account this subparagraph.

2.In the case of Brazil, the double taxation will be avoided in the following manner:

When a resident of Brazil receiving income which, in accordance with the provisions of this Convention, are taxable in Peru, Brazil will admit the deduction, from the income tax of that resident, of an amount equal to the income tax paid in the Peru, in accordance with the applicable provisions of Brazilian legislation. However, such a deduction may not exceed the fraction of the income tax, calculated before the deduction, corresponding to taxable income in Peru.

3.Where, in accordance with any provision of this Convention, the income earned by a resident of a Contracting State shall be exempt from tax in that State, the said State may, however, take into account the exempted income for the purpose of determining the amount of tax on the rest of the income of the said resident.

CHAPTER V

Provisions Specials

ARTICLE 23

No Discrimination

1.Nationals of a Contracting State shall not be subject in the other Contracting State to any corresponding taxation or obligation, amusing or more gravous than those to which they are or may be subject to nationals of that other State which find themselves in the same situation, especially in relation to the residence.

2.The permanent establishments that a company of a Contracting State has in the other Contracting State shall not be taxed in that other State in a less favourable manner than the companies of that other State which carry out the same activities.

3.Nothing set out in this Article may be construed to obligate a Contracting State to grant the residents of the other Contracting State the personal deductions, exemptions and reductions which, for tax purposes, shall accord to its own residents in function of their marital status or family charges.

4.Unless the provisions of Article 9, paragraph 7 of Article 11 or paragraph 6 of Article 12, interest, royalties and too much expense paid by a company of a Contracting State, in accordance with that established in the legislation of that Article, apply State, to a resident of the other Contracting State are deductible, to determine the taxable profits of this company, under the same conditions as if they had been paid to a resident of the state mentioned in the first place.

5.The resident enterprises of a Contracting State whose capital is wholly or partially owned, detained or controlled, directly or indirectly, by one or more residents of the other Contracting State shall not be subject in the first State to any taxation or obligation to it related diverse or more gravy than those to which they are or may be subject to the similar undertakings resident of the first State whose capital is, wholly or partially, held or controlled, directly or indirectly, by one or more residents of a third state.

6.In the present Article, the term? taxation? applies to the taxes targeted by this Convention.

ARTICLE 24

Friendly procedure

1.Where a person considers that the measures taken by one or both the Contracting States imply, or may imply, in relation to themselves, a taxation at odds with the provisions of this Convention, may, irrespective of the resources provided for by the domestic law of those States, submit their case to the competent authority of the Contracting State where to reside. The case is to be submitted in accordance with the deadlines set out in the respective domestic legislation.

2.The competent authority, if the complaint appears justified and if it is itself not in a position to adopt satisfactory solution, shall endeavour to resolve the matter by amicable agreement with the competent authority of the other State Contracting, in order to avoid taxation not in accordance with this Convention.

3.The competent authorities of the Contracting States shall do their best to resolve the difficulties or to address the doubts to which the interpretation or application of the Convention can take place upon amicable agreement.

4.The competent authorities of the Contracting States will be able to communicate directly in order to reach an agreement in the terms of the preceding paragraphs.

ARTICLE 25

Exchange of Information

1.The competent authorities of the Contracting States shall exchange among themselves the information necessary to implement the provisions of this Convention or those of the internal legislation of the Contracting States relating to the taxes of any class or denomination established by the Contracting States to the extent that the taxation in them provided for is not contrary to the Convention. The exchange of information is not limited by Articles 1 and 2. Information received by a Contracting State shall be deemed secret in the same manner as the information obtained on the basis of the domestic legislation of that State and may only be communicated to persons or authorities (including courts and administrative bodies) in charge of the launch or collection of the taxes targeted in the Convention or internal legislation as per the definition set out in this paragraph, of the procedures declaratives or executives concerning such taxes, or of the decision of the appeals relating to them. The said persons or authorities shall use such information solely for such purposes, and, if required, they may disclose them in court tribunals, observing the constitutional and legal norms of both the Contracting States.

2.In no case shall the provisions of paragraph 1 be construed to impose on a Contracting State the obligation to:

a)adopt administrative measures contrary to their legislation or administrative practice, or those of the other Contracting State;

b)provide information that cannot be obtained on the basis of its own legislation or in the framework of its practice normal administrative, or those of the other Contracting State;

c) provide information that disclose corporate, commercial, industrial or professional secrets, commercial procedures or information whose communication is contrary to the public order.

3.Notwithstanding the provisions of paragraph 2 of this Article, the competent authority of the required Contracting State shall, taking into consideration the constitutional and legal limitations and reciprocity of treatment, obtain and provide information that possess the financial instititures, mandators or persons acting as representatives, agents or fiduciaries. In relation to social shareholdings or shareholdings in capital companies, the competent authority should obtain and provide information including on shares to the holder. If the information is specifically required by the competent authority of a Contracting State, the competent authority of the other Contracting State shall provide the information pursuant to this Article in the form of witness statements and copies authenticated from unheard original documents (including books, informs, statements, accounting records and annotations) with the same breadth with which such statements and documents can be obtained in the terms established by the laws and practices administrative from that other state.

4.Where the information is requested by a Contracting State in accordance with this Article, the other Contracting State shall obtain the information referred to in the application in the same manner as if it were to be treated for its own taxation, without importing the fact that this other state, at that point in time, did not require such information.

5.The Contracting States shall consult each other in order to determine the cases and procedures for the simultaneous surveillance of taxes. It is understood by simultaneous supervision, for the purposes of this Convention, an agreement between the two Contracting States to simultaneously scrutinize, each in its territory, the tax situation of a person or persons possessing common or linked interests, in order to interchange the relevant information they obtain.

ARTICLE 26

Members of Diplomatic Missions and Consular Representations

The provisions of this Convention will not prejudice the tax privileges of which benefit members of the diplomatic missions or consular representations, be it under the general principles of International Law, be it provisions of special agreements.

ARTICLE 27

Provisions Several

1.Se, after the signing of this Convention, a Contracting State adopt a legislation second to what yields from abroad obtained by a society:

a) of the activity of navigation;

b) of banking, financial, insurance, investment, or activities activity similar; or

c) on the grounds of being the head office, the coordination center, or a similar entity that provides administrative services or other type of support to a group of companies that exercises business activity particularly in other states;

find themselves exempt from tax or if they find subject to taxation to an aliquot substantially lower than the aliquot applied to income earned from similar activities exerted on its own territory, the other Contracting State shall not be obligated to apply any limitation imposed by this Convention on its right to subject taxation to the income earned by the society of such activities exercised abroad or about their right to tax dividends paid by the society.

2.An entity deemed to be a resident of a Contracting State which obtains profits or income from sources in the other Contracting State shall not be entitled in that other Contracting State to the benefits of this Convention if more than 50% of the effective participation in that entity (or in the case of a society, more than 50% of the accrued value of the shares with or without right to vote and the shares in general of the society) is owned, direct or indirect, of any combination of one or more people who are not residents of the first mentioned Contractor State. However, this provision shall not be applicable in cases where it dictates entity develops, in the Contracting State of which it is resident, a substantial business activity other than mere holding of securities or any other similar activities in relation to other associated entities.

3.The competent authorities of the Contracting States shall be able to regulate the arrangements for the implementation of the Convention and, in particular, the formalities which must be followed by the residents of a Contracting State to obtain in the other Contracting State the tax benefits provided for by the Convention. The said formalities will be able to understand the submission of a residence certification form with indication, among others, of the nature and amount of the income involved and with attestation of the tax authorities of the first state.

CHAPTER VII

Finals provisions

ARTICLE 28

Input in Vigor

1.Each of the Contracting States shall notify the other, in writing and by diplomatic way, of the fulfilment of the procedures required by its legislation for the entry into force of this Convention. The duration of this Convention shall begin from the date of receipt of the last notification.

2.The provisions of the Convention will be applicable:

a) in Peru, in relation to Peruvian taxes and amounts paid, credited to an account, put at the disposal or accounted for as an expense on or after the first day of January of the calendar year following the one in which the Convention enters into force,

b) in Brazil:

i)in what concerne to taxes withheld at the source, to the paid importations, referred to or credited to or after the first day of January of the calendar year immediately following to the one in which the Convention enters into force;

ii) in what concerne the other taxes of which treats this Convention, to the income produced in the fiscal year beginning from the first day of January, inclusive, of the calendar year immediately following the one in which the Convention enters into force.

ARTICLE 29

Denpronunciation

1.This Convention shall remain in force until it is denounced by one of the Contracting States. Any Contracting State may denounce this Convention by diplomatic means by communicating in writing, with at least six months of anticipation in respect of the end of any calendar year, after transcurring five years from its entry into force.

2.In such a case, the Convention will cease to be applied:

a) in Peru, in relation to taxes peruvians and paid amounts, credited to an account, put at disposal or accounted for as an expense on or after the first day of January of the following calendar year,

b) in Brazil:

i)in what concerne to taxes withheld at the source, to the paid importations, referred to or credited to or after the first day of January of the calendar year immediately following to the one in which the complaint occurred;

ii) in what concerne the other taxes it deals with the Convention, to the income produced in the fiscal year beginning on or after the first day of January of the calendar year immediately following that in which the notice of complaint has occurred.

In testimony to what, the signatories, duly authorized for that purpose, have signed the present Convention in the city de Lima, on February 17, 2006, in two original copies, in the Portuguese and castelian languages, being both texts being equally authentic.

_______________________________________

BY THE GOVERNMENT OF THE FEDERATIVE REPUBLIC OF BRAZIL

Celso Amorim

Foreign Minister

__________________________________________

BY THE GOVERNMENT OF THE REPUBLIC OF PERU

Oscar Maúrtua de Romaña

Minister of Foreign Relations

PROTOCOL

At the time of the signing of the Convention between the Government of the Federative Republic of Brazil and the Government of the Republic of Peru to Avoiding Double Taxation and Preventing Fiscal Evasion with Relation to Income Tax, the undersigned concame to the following provisions constituting an integral part of the Convention.

1.With reference to Article 3 (?General definitions?), paragraph 1 (d):

In the case of Peru, the term? person? understands also the marital societies and the indivisible successions.

2.With reference to Article 8 (?Air, Terrestrial, Maritime and Fluvial Transport?), paragraph 1:

For the purposes of this Article, the term? profits? understands, in particular:

i) the gross revenues that originate directly from the exploitation of ships, boats, aircraft or vehicles of land transport in international traffic, and

ii)the interest on importations generated directly from the exploitation of ships, boats, aircraft or ground transport vehicles in international traffic, whenever such interest are inherent in exploitation.

3.With reference to Article 11 (?Interest?), paragraph 3:

Do the importances paid for the title of? remuneration on the equity capital? Under Article 9 of the Brazilian Law in 9.249/ 95 are considered to be interest for the purposes of paragraph 3 of Article 11.

4.With reference to Article 12 (?Royalties?), paragraph 3:

The provisions of paragraph 3 of Article 12 apply to any sort of payment species received for the provision of technical and technical assistance services.

The willing in this item applies also to digital and business services, including to the consultancies.

5.With reference to Article 23 (?Non-Discrimination?):

a) The provisions of paragraph 6 of Article 10 are not considered discriminatory in accordance with paragraph 2 of Article 23;

b) The provisions of the legislation Brazilian tax that do not allow the? royalties?, mentioned in paragraph 3 of Article 12, paid for by a permanent establishment situated in Brazil to a resident of Peru who exercises business activities in Brazil through that permanent establishment, be it deductible at the time of determining the taxable income of the said permanent establishment, are not discriminatory under paragraph 4 of Article 23. This paragraph shall also apply to Peru in case, in the future, establish a tax regime similar to the vicar in Brazil at the time of the signing of this Convention;

c) The provisions of the Peruvian tax legislation that establish that taxpayers who account for as an expense or cost the royalties, and consideration for services, technical assistance, assignment of use or others of a similar nature, billed by non-residents (not domiciled), shall pay the fisc the amount equivalent to the withholding in the month in which it is given accounting record, regardless of whether or not they are paid the respective contravements to the non-residents (not domiciled), are not discriminatory under paragraph 4 of Article 23;

d) The provisions of the Convention, especially those of Article 23, will not prevent a Contracting State from applying the provisions of its national legislation relating to insufficient capitalization or to combat the deferment of the payment of income tax, included legislation of foreign controlled societies (legislation of?CFC?) or other similar legislation.

6.With reference to Article 24 (?Friendly Procedure?):

Regardless of the participation of the Contracting States in?General Agreement on Trade in Services?, or in any international agreements, the tax matters relating to taxes endorsed in the Convention occurring between the Contracting States shall be subject to the provisions of the Convention only.

7.With reference to Article 25 (?Exchange of Information?), paragraph 1:

In the case of Brazil, the provisions of paragraph 1 of the Article 25 only applies to federal taxes;

In the case of Peru, the provisions of the paragraph 1 of Article 25 only cover the taxes of the Central Government.

8.With reference to Article 27 (?Miscellaneous Provisions?):

In the case of Peru, nothing in this Convention will prevent the application of the provisions of the Legislative Decrees in the 662, 757 and 109 and Laws in the 26221, 27342, 27343, in accordance with the prevailing text on the date of the signing of the Convention and all the amending standards that do not amend its general principle nor the optional nature of the subscription of tax stability contracts in accordance with the above mentioned standards. A person who is part of a contract that would hear tax stability as per the statutory provisions referred to must, notwithstanding the aliquots set out in the Convention, remain subject to the tax aliquots set out in the contract, during its duration.

In testimony of what, the signatories, duly authorized to this end, sign the present Protocol in the city of Lima on February 17, 2006, in two original copies, in the Portuguese and Castian languages, being both texts being equally authentic.

_____________________________________________

BY THE GOVERNMENT OF THE FEDERATIVE REPUBLIC OF BRAZIL

Celso Amorim

Foreign Minister

__________________________________

BY THE GOVERNMENT OF THE REPUBLIC OF PERU

Oscars Maúrtua de Romaña

Minister of Foreign Affairs