To Negotiate Agreements On Preventing Double Taxation With Lithuania

Original Language Title: o sjednání Smlouvy o zamezení dvojího zdanění s Litvou

Read the untranslated law here: https://portal.gov.cz/app/zakony/download?idBiblio=43244&nr=230~2F1995~20Sb.&ft=txt

230/1995 Coll.
COMMUNICATION

Ministry of Foreign Affairs


Ministry of Foreign Affairs informs that on 27 October 1994 in Vilnius
signed the Treaty between the Czech Republic and Lithuania
Republic on avoidance of double taxation and prevention of fiscal evasion in
taxes on income and on capital.

With the Treaty approved by the Parliament of the Czech Republic and President of the Republic ratified
.

Contract by virtue of Article 28, paragraph. 2, entered into force on 8 August 1995.


Czech version of the Treaty shall be open simultaneously. The English version of the Treaty,
which is decisive for its interpretation, can be consulted at the Ministry
Foreign Affairs and the Ministry of Finance.


AGREEMENT
Between the Czech Republic and Lithuania on the avoidance of double taxation and the prevention
Fiscal Evasion with respect to Taxes on Income and on Capital

Czech Republic and Lithuania,

Desiring to conclude an agreement on the avoidance of double taxation and the prevention
Fiscal Evasion with respect to taxes on income and property

Agree as follows:
Article 1


Persons to which the Convention applies

This Agreement shall apply to persons who are resident in
one or both of the Contracting States (residents).
Article 2


Taxes to which the Convention applies

First This Convention shall apply to taxes on income and on capital imposed
behalf of a Contracting State or its political subdivisions
or local authorities, irrespective of the manner levied.

Second Taxes on income and assets are considered all taxes imposed on total income
, on total capital, or on elements of income or assets
including taxes on gains from the alienation of movable or immovable property and
well as taxes on capital appreciation.

Third The existing taxes to which the Convention applies are:

A) in Lithuania:

(I) the tax on corporate profits;

(Ii) the tax on income of individuals;

(Iii) the tax on corporate use of property owned by the State;

(Hereinafter referred to as "Lithuanian tax");

B) in the Czech Republic:

(I) the income tax;

(Ii) the tax on corporate income;

(Iii) the tax on immovable property;

(Hereinafter referred to as "Czech tax").

Fourth This agreement will also apply to taxes
same or similar kind which are imposed after the signature of this contract
alongside or in place of existing taxes. The competent authorities of the Contracting States shall notify each other
substantial changes which have been made in their respective taxation laws
.
Article 3



General Definitions
First For the purposes of this Agreement, unless the context otherwise requires:

A) the term "Lithuania" means the Republic of Lithuania and, when used in a geographical sense
, the Republic of Lithuania or any area
adjacent to the territorial waters of the Republic of Lithuania, which may be
under the laws of the Republic of Lithuania and in accordance with international law
exercised rights of Lithuania on the seabed and its subsoil and their natural resources
;

B) the term "Czech Republic" means the territory of the Czech Republic, where
are under Czech legislation and in accordance with international law
exercised sovereign rights of the Czech Republic;

C) the terms "a Contracting State" and "the other Contracting State" mean
the Czech Republic or Lithuania;

D) the term "person" includes an individual, a company and any other body of persons
;

E) the term "company" means any body corporate or
entity that is treated for tax purposes as a legal entity;

F) the terms "enterprise of a Contracting State" and "enterprise of the other Contracting State
" mean an enterprise carried on by a resident of a Contracting State
an enterprise carried on by a resident of the other Contracting State;

G) the term "enterprise" has the same meaning as under national legislation
Contracting State;

H) the term "national" means:

(I) in the case of Lithuania, any natural person who is a citizen of the Republic of Lithuania
, and any legal person, partnership, sole proprietorship or
association established under the laws of the Republic of Lithuania
;

(Ii) in the case of the Czech Republic, any natural person who is a national
Czech citizen and any legal person, partnership or association
constituted under the laws of the Czech Republic;

Ch) the term "international traffic" means any transport

By a ship or aircraft operated by an enterprise of a Contracting State
if such transportation is carried out only
between places in the other Contracting State;

I) the term "competent authority" means:

(I) in the case of Lithuania, the Minister of Finance or his authorized representative;

(Ii) in the case of the Czech Republic, the Minister of Finance or his authorized representative
.

Second Any term not otherwise defined, shall have the application of this treaty Contracting State
meaning which it has under the law of that State
concerning the taxes covered by this Agreement, unless the context otherwise requires
interpretation.
Article 4

Resident


First For the purposes of this Convention, the term "resident of a Contracting State"
means any person who, under the law of that State
undergone in the State of taxation by reason of his domicile, residence, place
management, place of incorporation or any other similar criteria.
This term does not include any person who is liable to tax in that Contracting State
only of income from sources in that State or
assets located in that State. For the purposes of this contract will be the government
Contracting State, its political subdivisions and local authorities considered
resident of a Contracting State.

Second If the individual is under the provisions of paragraph 1
resident of both Contracting States, then his status shall be determined as follows
way:

A) It is assumed that this person is a resident of the State in which he has a permanent home
; if he has a permanent home in both States, it is assumed that
a resident of the state, which has closer personal and economic relations
(center of vital interests);

B) if it can not be determined, the State in which he has his center of vital interests
, or if he has a permanent home in any state
assumed that a resident of the State in which they are usually
resides;

C) if he has an habitual abode in both States or in neither of them
, it is assumed that a resident of the State whose national
citizen;

D) if he is a citizen of both States or of neither of
them, the competent authorities of the Contracting States
question by mutual agreement.

Third If a person other than an individual under the provisions of paragraph 1
resident of both Contracting States, the competent authorities of the Contracting States
seek to settle the question by mutual agreement and determine for such person
method of applying the Treaty.
Article 5

Permanent establishment


First For the purposes of this Convention, the term "permanent establishment" means a fixed place of business
in which the enterprise is wholly or partly
its activities.

Second The term "permanent establishment" includes especially:

A) a place of management;

B) plant;

C) an office;

D) a factory;

E) a workshop; and

F) a mine, an oil or gas well, a quarry or any other place of extraction of natural resources
.

Third The term "permanent establishment" also includes:

) A building site or construction, assembly or installation project or supervisory or consulting
associated activities, but only lasts
if such site, project or activity for more than nine months;

B) the provision of services, including consultancy and managerial services,
enterprise of a Contracting State through employees or other personnel engaged
now for these purposes, but only if
such activities continue within the territory of the other Contracting State
after a period or periods exceeding in the aggregate six months within any twelve-month period
.

Fourth Notwithstanding the preceding provisions of this Article assumed
the term "permanent establishment" shall not include:

A) equipment which is used only for storage, display or delivery of goods
belonging to the enterprise;

B) the supply of goods or merchandise belonging to the enterprise solely for the purpose
storage, display or delivery;

C) the supply of goods or merchandise belonging to the enterprise solely for the purpose
processing by another enterprise;

D) the maintenance of a fixed place of business solely for the purpose
purchasing goods or collecting information for the enterprise;

E) the maintenance of a fixed place of business maintained for the enterprise solely for the purpose
advertising, providing information, scientific research or similar

Activities which have for preparatory or auxiliary character;

F) the maintenance of a fixed place of business solely for
any combination of activities mentioned in subparagraphs a) - e) if
overall activity of the fixed place of business resulting from this combination is
preparatory or auxiliary character.

Fifth Notwithstanding the provisions of paragraphs 1 and 2, a person - other than
independent agent to whom paragraph 6 applies - is acting in
Contracting State on behalf of an enterprise and has, and habitually || | power that allows it to conclude contracts on behalf of the company, it is understood that
this enterprise has a permanent establishment in that State in respect of any
activities which that person undertakes for the enterprise, unless the activities of
person are limited to those mentioned in paragraph 4 which, if exercised through
permanent facility, would not
existence of a permanent establishment under the provisions of this paragraph.

6th They are not considered, the enterprise has a permanent establishment in a Contracting State
just because in this state carries out its activities through
broker, general commission agent or other independent agent
if such persons are acting in the ordinary course of their activity. However, if
activities of such an agent are wholly or largely devoted
interests of the company, it will not be considered an agent of an independent status within
meaning of this paragraph.

7th The fact that a company which is a resident of a Contracting
State controls or is controlled by a company which is
resident of the other Contracting State, or which carries
activity (whether through a permanent establishment or otherwise) , shall not of itself
itself constitute either company a permanent establishment of the other
company.
Article 6


2 Income from immovable property

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

Second The term "immovable property" shall have the meaning which it has under the law
Contracting State in which the property in question is situated.
Analogous legal regime is also applicable to income from immovable property accessories,
livestock and equipment used in agriculture and forestry, rights to
which the provisions of law relating to land, buildings
, options or similar rights to acquire immovable property, right
enjoyment of immovable property and rights to variable or fixed payments as
working of, or consent to work, mineral deposits, sources and other natural resources
; ships, boats and aircraft shall not be regarded as immovable
property.

Third The provisions of paragraph 1 shall apply to income derived from the direct use, letting
or any other form of immovable property.

Fourth If the ownership of shares or other rights in a company entitles the owner
shares or corporate rights to the enjoyment of immovable property
which the company owner, the income from direct use, letting
or any other form of such rights may be taxed
in the Contracting State in which the immovable property is situated.

Fifth The provisions of paragraphs 1 and 3 shall also apply to the income from immovable property
enterprise and to income from immovable property used for the performance of independent personal
.
Article 7



Business Profits
First 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 situated therein.
If the enterprise carries on business in this manner may be profits of the enterprise
taxed in the other State but only to the extent to which the
attributable to that permanent establishment.

Second If an enterprise of a Contracting State, carries on business in
other Contracting State through a permanent establishment situated therein
located, attributed to subject to the provisions of paragraph 3
in each Contracting State to that permanent establishment the profits which it might be expected
make if it were a separate enterprise engaged in the same or
similar activities under the same or similar conditions and was completely independent
contact with the enterprise of which it is a permanent establishment.

Third In determining the profits of a permanent establishment will be allowed as deductions expenses

Enterprise incurred for the purposes of the permanent establishment, including
management expenses and general administrative expenses so incurred, whether
incurred in the State in which the permanent establishment is situated or elsewhere.
Costs that permit a Contracting State to deduct, will include only
expenses deductible under the national law of that State.

Fourth If in a Contracting State to determine the profits
be attributed to a permanent establishment on the basis of apportionment of the total profits of the enterprise
its various parts, the provisions of paragraph 2 to
Contracting State from determining the profits to be taxed by the usual
division; The method of apportionment must, however, be such that
result was in line with the principles set out in this article.

Fifth Nepřičtou permanent establishment with no profit on the basis of the fact that
mere purchase of goods for the enterprise.

6th The profits to be attributed to a permanent establishment for the purposes of the preceding paragraphs
set each year by the same way if
there is not sufficient reason to the contrary.

7th Where profits include items of income which are dealt with separately in
other articles of this agreement will not affect the provisions of those Articles
provisions of this Article.
Article 8

International transport


First The profits of an enterprise of a Contracting State from the operation of ships or
aircraft in international traffic shall be taxable only in that State.

Second The provisions of paragraph 1 shall also apply to profits from participation in a pool,
joint business or an international operating organization.
Article 9

Associated companies

If


A) an enterprise of a Contracting State participates directly or indirectly in
management, control or capital of an enterprise of the other Contracting State; or

B) the same persons participate directly or indirectly in the management, control or capital of an enterprise
a Contracting State and an enterprise of the other Contracting State
and in either case the two enterprises in their commercial or financial relations
bound by the terms agreed to or imposed on them
which differ from those which would be made between independent enterprises
, then any profits which would, but for those
conditions, have accrued to one of the enterprises, but due to these
conditions have not so accrued, may be included in the profits of that enterprise and taxed
.
Article 10

Dividends


First Dividends paid by a company which is a resident of a Contracting State
, a resident of the other Contracting State may be taxed in that other State
.

Second However, such dividends may also be taxed in the Contracting State in
which the company paying the dividends is a resident and according to the law
law of that State, but if the recipient is the beneficial owner
dividend tax so charged shall not exceed:

A) 5% of the gross amount of the dividends if the beneficial owner is
company (other than a partnership) which holds directly at least 25%
assets of the company paying the dividends;

B) 15% of the gross amount of the dividends in all other cases.
The competent authorities of the Contracting States may by mutual agreement
method of application of these limitations. This paragraph shall not affect the taxation of profits
company from which dividends are paid.

Third The term "dividends" as used in this Article means income from shares or other rights
, with the exception of claims, participating in profits, as well
income from corporate rights which, under the tax laws of the state, || | in which the company making the distribution is a resident, built on the same footing
income from shares.

Fourth The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends
who is a resident of a Contracting State, carries
in the other Contracting State in which the resident company paying the dividends
, industrial or commercial activity through a fixed
establishment situated therein, or performs in that other State independent personal
a fixed base situated therein, and
the holding in respect of which the dividends are paid is effectively connected with such permanent establishment
or fixed base. In this case
provisions of Article 7 or 14, depending on what goes
.

Fifth Where a company which is a resident of a Contracting State
derives profits or income from the other Contracting State, that

Second state tax on the dividends paid by the company, unless such
dividends are paid to a resident of that other State or insofar as the holding
which the dividends are paid is effectively connected with a permanent establishment or a fixed base
which is located in that other State, nor
subject the company's undistributed profits tax on undistributed profits, even
if the dividends paid or the undistributed profits consist wholly or partly of
profits or income arising in that other State.
Article 11

Interest


First Interest arising in a Contracting State and paid to a resident
other Contracting State may be taxed in that other State.

Second However, interest referred to in paragraph 1 of this Article may also be taxed
in the Contracting State in which it arises, and according to the laws of that State
, but if the recipient is the beneficial owner of the interest, the tax so charged shall not exceed
10 % of the gross amount of the interest.

The competent authorities of the Contracting States may by mutual agreement
method of application of these limitations.

Third Notwithstanding the provisions of paragraph 2, interest arising in a Contracting State and
that arise and are actually owned by the Government of the other
State, including its political subdivisions and local authorities, central
bank or any financial institution wholly
owned by that Government, or interest derived from loans guaranteed by the government, will be exempted from taxation
mentioned State.

Fourth The term "interest" as used in this Article means income from debt-claims of every kind
not secured by a lien on the property
or having or not carrying a right to participate in profits
borrower and in particular, income from government securities and income
from bonds or debentures, including premiums and rewards associated with these securities
bonds or debentures. Penalties for late payment are not considered
interest for the purposes of this article.

Fifth The provisions of paragraphs 1, 2 and 3 shall not apply if the beneficial owner of the interest
who is a resident of a Contracting State, carries
in the other Contracting State in which the interest arises,
business through a permanent establishment situated therein
located, or independent personal services from a fixed base situated there
and the debt on which the interest is paid is effectively connected
such permanent establishment or fixed base.
In such case the provisions of Article 7 or Article 14
it, as the case.

6th It is believed that the interest arising in a Contracting State when the payer is
resident of that State. If, however, the person paying
interest, whether he is a resident of a Contracting State or not, has in a Contracting State
permanent establishment or fixed base in connection with which there has been
indebtedness on which the interest is paid, and such interest is going
borne by such permanent establishment or fixed base, then such interest shall be deemed
state in which the permanent establishment or fixed base
located.

7th If the amount of interest related to the debt for which it is paid
exceeds the result of a special relationship between
payer and the beneficial owner of the interest, or even the second one keeps
with a third party, the amount would have been agreed upon by the payer and the beneficial owner
absence of such relationship, the provisions of this article
only on the latter amount. The amount of salary that exceeds
it will in this case remain taxable according to the laws of each Contracting State
with regard to the other provisions of this Treaty.
Article 12

Royalties


First Royalties that are arising in a Contracting State
paid to a resident of the other Contracting State may be taxed in that other State
.

Second However, such royalties may also be taxed in the Contracting
State in which they arise, and in accordance with the laws
that State, but if the recipient is the beneficial owner of the royalties
taxes, the tax so determined not exceed 10% of the gross amount of royalties
.

The competent authorities of the Contracting States may by mutual agreement
method of application of these limitations.

Third The term "royalties" as used in this Article means payments
any kind received as a consideration for the use or the right to use

Copyright of literary, artistic or scientific
including cinematograph films and films or recordings for radio or television broadcasting
, any patent, trade mark, design or
model, plan, secret formula or production process or for the use or
for the right to use, industrial, commercial or scientific equipment, or for information
which relate to the experience acquired in
industrial, commercial or scientific.

Fourth The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner
royalties, being a resident of a Contracting State
exercised in the other Contracting State in which the royalties
arise a business through a permanent
establishment situated therein, or performs independent personal
through a permanent establishment situated therein and the right or
assets, of which the royalties are paid is effectively connected
such permanent establishment or fixed base . In this case the
provisions of Article 7 or 14, depending on what it is.

Fifth It is assumed that the royalties to arise in a Contracting State when the payer is
resident of that State. However, if a taxpayer
royalties, whether he is or is not a resident of a Contracting State
, has in a Contracting State a permanent establishment or a fixed base in connection with which
was obliged to pay royalties that go to || | borne by a permanent establishment or fixed base, then such royalties
to arise in the Contracting State in which the permanent
establishment or fixed base is situated.

6th If the amount of royalties that apply to the use,
right or information for which they are paid, exceeds
due to the special relationship between the payer and the beneficial owner
or the second one maintains with third party , the amount which would have been
agreed upon by the payer and the beneficial owner in the absence of such relationship,
the provisions of this Article shall apply only to the latter amount
. The amount of the salary, the excess will be taxed in this case
under the laws of each Contracting State, taking into account
other provisions of this Agreement.
Article 13


Gains from the alienation of property

First Profits derived by a resident of a Contracting State from the alienation
immovable property referred to in Article 6, which is located on the second
Contracting State or shares in a company whose name is made up mostly
such property may be taxed in that other State.

Second Gains from the alienation of movable property forming part of the business assets
permanent establishment which an enterprise of a Contracting State in the other
Contracting State or movable property pertaining to a fixed base,
by a resident of a Contracting State has in the other Contracting State to
performance of professional services, including such gains from the alienation
such a permanent establishment (alone or with the whole enterprise)
or of such fixed base, may be taxed in that other State.

Third Profits derived by an enterprise of a Contracting State from the alienation of ships
or aircraft operated in international traffic or movable property,
the operation of such ships or aircraft shall be taxable only in that State
.

Fourth Gains from the alienation of any property other than that referred to in paragraphs 1, 2 and 3
shall be taxable only in the Contracting State of which the alienator
resident.
Article 14


Independent Personal

First Income received by an individual who is a resident of a Contracting State
of professional services or other independent activities
shall be taxable only in that State unless such person for the purpose of performing his activities
regularly available fixed base
in the other Contracting State. If he has or had such a fixed base,
income may be taxed in the other State, but only to the extent that can be attributed
fixed base. For the purposes of this paragraph, it is considered that
individual has in a Contracting State a permanent base for the tax year
if her residence in that state lasts at least 183 days in any twelve-month period
commencing or ending in the year.

Second The term "professional services" includes especially independent

Scientific, literary, artistic, educational or teaching activities as well as
independent activities of physicians, lawyers, engineers, architects, dentists and accountants
.
Article 15

Occupation


First Salaries, wages and other similar remuneration derived by a resident of a Contracting State
respect of an employment shall be subject to the provisions
Articles 16, 18, 19 and 20, be taxable only in that State unless the employment is exercised in
the other Contracting State. If the employment is so exercised, such remuneration
may be adopted for them taxed in that other State.

Second Remuneration which a resident of a Contracting State in respect of an employment exercised
in the other Contracting State shall
notwithstanding the provisions of paragraph 1 shall be taxable only in the first-mentioned State if
all the following conditions are met:

A) the recipient is present in the other State for a period or periods exceeding in the aggregate
183 days in any twelve month period commencing or ending
in the relevant financial year; and

B) the remuneration is paid by the employer or the employer who
not a resident of the other State; and

C) the remuneration is not borne by a permanent establishment or a fixed base which the employer
in the other State.

Third Notwithstanding the preceding provisions of this Article, remuneration
respect of an employment exercised resident of a Contracting State
aboard a ship or aircraft in international traffic
taxed in that State.
Article 16

Royalties


Fees and other similar remuneration derived by a resident of a Contracting State
his capacity as a board member or another similar organ of a company,
which is a resident of the other Contracting State may be taxed in that other State
.
Article 17

Artists and athletes


First Income derived by a resident of a Contracting State as an entertainer
such as theater, film, radio or television
artist or a musician or as a sportsman from such person
activities performed in the other Contracting State, may be regardless
to the provisions of Articles 14 and 15, be taxed in that other State.

Second If revenues from personal activities exercised by an entertainer or an athlete
accrues not to the entertainer or athlete himself but to another
person, that income may, notwithstanding the provisions of Articles 7, 14 and 15
taxed in the Contracting State in which entertainer or athlete performs
its activities.

Third Incomes, which are mentioned in this article, it will regardless
provisions of paragraphs 1 and 2 exempt from tax in the Contracting State in which
entertainer or athlete are exercised, provided that such activity is
funded substantially from public funds of the State
its political subdivision or local authority.
Article 18

Pensions


First Pensions and other similar remuneration paid in consideration of past employment
resident of a Contracting State shall be subject to the provisions of paragraph 2 of Article
19 taxable only in that State.

Second Notwithstanding the provisions of paragraph 1 and paragraph 2 of Article 19
, paid pensions and other benefits, whether it
periodic or one-time bonus, paid under the Law on Social Security
a Contracting State or based on the public system
organized by a Contracting State for social welfare, will
taxable only in that State.
Article 19

Public functions


First

A) Remuneration, other than a pension, paid by a Contracting State or
political subdivision or local authority thereof or agency or
institution wholly owned by the State, political subdivision or local authority
individual in respect of services rendered that State or subdivision or local authority
or agency or institution shall be taxable only in that
State.

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

(I) is a national of that State; or

(Ii) did not become a resident of that State solely for the purpose of rendering those services
.

Second

A) Any pension paid by, or out of funds created a
Contracting State, political subdivision or local authority thereof or agency

Or institution wholly owned by the State, political subdivision or local authority
individual in respect of services rendered dependent nature
that State or subdivision or local authority or agency or institution
shall be taxable only in that State .

B) However, such pension shall be taxable only in the other Contracting State
if the individual is a resident and citizen of this state.

Third The provisions of Articles 15, 16 and 18 shall apply to remuneration and pensions
services rendered in connection with a business carried
a Contracting State or a political subdivision or local authority thereof
state or agency or institution wholly owned State
administrative subdivision or local authority.
Article 20


Students, professors and researchers

First Payments which a student or apprentice or trainee who is or was
immediately before visiting a Contracting State a resident
in the other Contracting State and who is present in the first-mentioned State solely for the purpose
education or training receives for maintenance, education or training
not be taxed in that State, provided that such
payments arise from sources outside that State.

Second A natural person who visits a Contracting State for the purpose of teaching
or conducting research at a university, college or other recognized
educational institution in that Contracting State and who is or was immediately
visiting a resident of the other Contracting State,
will be exempt from tax in the first-mentioned Contracting State on remuneration for
such teaching or research for a period not exceeding two years from the date of
first visit for that purpose.

Third The provisions of paragraph 2 of this Article shall not apply to income from
research if such research is undertaken not for public interest
but primarily for the private benefit of a specific person or persons.
Article 21

Other income


First Items of income of a resident of a Contracting State, and that
they arise anywhere, not dealt with in the foregoing Articles
thereof, shall be taxable only in that State.

Second Paragraph 1 shall not apply to income, other than income from
immovable property as defined in paragraph 2 of Article 6, if
recipient of such income, being a resident of a Contracting State
, an industrial or commercial business in the other Contracting State
through a permanent establishment situated therein, or performs in
the other Contracting State through a permanent establishment situated therein, and
the right or property in respect of which the income is paid is effectively || | connected with such permanent establishment or fixed base.
In this case, the provisions of Article 7 or 14, depending on what case
.
Article 22

Assets


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

Second Capital represented by movable property forming part of the
property of a permanent establishment which an enterprise of a Contracting State
in the other Contracting State, or movable property belonging to a permanent
base which a resident of a Contracting State in
other Contracting State for the performance of professional services, may be taxed in that other State
.

Third Capital represented by ships or aircraft operated in international traffic
enterprise of a Contracting State and movable property
pertaining to the operation of such ships or aircraft shall be taxable only in that
State.

Fourth All other elements of capital of a resident of a Contracting State shall
taxable only in that State.
Article 23

Avoidance of double taxation


First In the case of a resident of Lithuania, double taxation shall be avoided as follows:
Where a resident of Lithuania derives income or owns property which
in accordance with this Agreement may be taxed in the Czech Republic, Lithuania,
if its law does not provide for more favorable treatment , authorizes
:

A) as a reduction of income tax of that resident, an amount equal to the
income tax paid in the Czech Republic;

B) a reduction in property taxes that resident, an amount equal to the
property tax paid in the Czech Republic.

Such a reduction, however, in no case exceed that portion of the tax
income or assets in Lithuania as computed before the deduction, which
is attributable to the income which may be under the provisions of this contract
taxed in Czech Republic.

Second In the case of a resident of the Czech Republic, double taxation shall be avoided as follows
:

A) The Czech Republic, when imposing taxes on its residents
basis on which such taxes are imposed, income or property which may be
in accordance with the provisions of this Agreement may also be taxed in Lithuania, || | but shall allow the amount of tax computed on such a base an amount
tax paid in Lithuania. This reduction, however, exceed that part of the Czech
tax computed before the deduction is given, which is attributable to the income or assets
which may be under the provisions of this Treaty taxed in Lithuania.

B) Where, in accordance with the provisions of this Agreement or national laws
income derived or capital owned by a resident of the Czech Republic
exempt from taxation in the Czech Republic, the Czech Republic may
in calculating tax on the remaining income or capital of that resident
take into account the exempted income or capital.

Third For the purposes of paragraphs 1 and 2 shall be deemed that the term "tax paid
in the Czech Republic", or "tax paid in Lithuania"
includes any tax that would be due if under the laws of Czech || | Republic or Lithuania to promote economic development was provided
exemptions or tax reductions.
Article 24

Prohibition of discrimination


First Nationals of a Contracting State shall not be subjected in the other Contracting State
any taxation or any requirement connected therewith,
which is other or more burdensome than the taxation and connected requirements
which are or may be subjected nationals of that other
State who are particular with respect to residence, in the same situation.
This provision shall, notwithstanding the provisions of Article 1, also apply to
persons who are not residents of one or both of the Contracting States.

Second Taxation on a permanent establishment which an enterprise of a Contracting State has in
other Contracting State shall not be in that other State
favorable than the taxation of enterprises of that other State carrying on the same activities.
This provision shall not be construed as obliging a Contracting State
to grant to residents of the other Contracting State any personal allowances, reliefs and reductions
taxes on account of civil status or family responsibilities which
grants to its own residents.

Third Except where the provisions of Article 9, paragraph 7 of Article 11
and paragraph 6 of Article 12 apply, interest, royalties and other disbursements
paid by an enterprise of a Contracting State to a resident of the other Contracting State
deductible in determining taxable profits
this business under the same conditions as if they had been paid to a person who is
resident of the first-mentioned State. Similarly, any debts
enterprise of a Contracting State to a resident of the other Contracting State shall
for the purpose of determining the taxable capital of such enterprise
deductible under the same conditions as if they had been contracted to a resident of the first-mentioned State
.

Fourth Enterprises of a Contracting State, the capital of which is wholly or partly
directly or indirectly owned or controlled by a person or persons
resident of the other Contracting State shall not be subjected in the first
mentioned Contracting State to any taxation or any requirement
associated with it, which is other or more burdensome than the taxation and connected
obligations are or may be subjected to other similar enterprises
first-mentioned State.

Fifth The provisions of this Article shall, notwithstanding the provisions of Article 2
apply to taxes of every kind and description.
Article 25

Mutual agreement


First If a person considers that the actions of one or both of the Contracting
States result or will result for him in taxation not in accordance with the provisions
thereof, may, notwithstanding the remedies provided by the domestic
legislation such State
present his case to the competent authority of the Contracting State of which he is a resident
if his case comes under paragraph 1 of Article 24, the Contracting
State of which he is a national. The case must be presented within three

Years from the first notification of the action resulting in taxation not in
accordance with the provisions of this Treaty.

Second The competent authority shall objection be justified and
if it is not itself able to arrive at a satisfactory solution, it will try to
case by mutual agreement with the competent authority of the other Contracting State,
to the avoidance of taxation which is not in accordance with this agreement.
Any agreement reached shall be implemented notwithstanding
time limits in national law of the Contracting States.

Third The competent authorities of the Contracting States shall endeavor to resolve by mutual agreement
difficulties or doubts that may arise regarding the interpretation or application of this Agreement
. They may also consult in order to avoid
double taxation in cases not provided for in the Treaty.

Fourth The competent authorities of the Contracting States may communicate with each other directly for the purpose
reaching an agreement in the sense of the preceding paragraphs. If oral
exchange of views seems advisable for reaching agreement, such exchange may take place through
views commission consisting of representatives
competent authorities of the Contracting States.
Article 26

Exchange of information


First The competent authorities of the Contracting States shall exchange information necessary for
application of the provisions of this Agreement or national laws
laws of the Contracting States concerning taxes covered by
thereof, insofar as the taxation thereunder is not
violation of this agreement. The exchange of information is not restricted by Article 1. Any information received
Contracting State shall be treated as secret in the same manner
as information obtained under the domestic laws of that State and
shall be disclosed only to persons or authorities (including courts and administrative
bodies) involved in the assessment or collection of the taxes to which this agreement applies
, enforcement or prosecution in respect of, taxes or
determination of appeals. Such persons or authorities shall use
such information only for such purposes. They may disclose the information
in public court proceedings or in judicial decisions.

Second The provisions of paragraph 1 shall in no case be interpreted as meaning that
impose on a Contracting State the obligation:

A) to carry out administrative measures at variance with the laws or administrative practice
a Contracting State;

B) to supply information which is not obtainable under the laws or regulations
normal administration of that or of the other State;

C) to supply information which would disclose any trade, business, industrial,
commercial or professional secret or trade process, or whose
disclosure of which would be contrary to public policy.
Article 27


Diplomats and consular officials

Nothing in this Agreement shall affect the fiscal privileges
of diplomatic or consular officials under the general rules
international law or under the provisions of special agreements.
Article 28

Entry into force


First The Governments of the Contracting States shall notify each other of the completion of the constitutional
requirements for entry into force of this Treaty.

Second This Agreement shall enter into force on the date of the latter notification
within the meaning of paragraph 1 and its provisions shall apply:

A) in respect of taxes withheld at source on amounts paid on 1
January or later in the calendar year following the year in which
Agreement enters into force;

B) in respect of other taxes on income and taxes on capital, to taxes chargeable
for any taxable year beginning on or after 1 January
calendar year following the year in which the Convention enters into force.
Article 29

Termination


This Agreement shall remain in force until terminated by a Contracting State
. Each Contracting State may terminate
diplomatic channels by giving written notice at least six months before
end of each calendar year. In this case, the Agreement shall cease to apply
:

A) in respect of taxes withheld at source on amounts paid on 1
January or later in the calendar year next following that in which the notice is given
;

B) in respect of other taxes on income and taxes on capital, to taxes chargeable
for any taxable year beginning on or after 1 January
calendar year following the year in which the notice is given.


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

Done in duplicate at Vilnius on 27 October 1994 in the Czech,
Lithuanian and English languages, both texts being equally authentic.
In case of any divergence of interpretation, the English text shall prevail.

The Czech Republic:

Ivan Kočárník vr

The Republic of Lithuania:

Eduardas Vilkelis vr