The Saeima has adopted and the President promulgated the following laws: For the Republic of Latvia and Canada Convention on the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and capital article 1. 1995. April 26 Ottawa signed in the Republic of Latvia and Canada Convention on the avoidance of double taxation and the prevention of tax evasion (hereinafter referred to as the Convention) with this law is accepted and approved. 2. article. The law shall enter into force on the date of its promulgation. To put this in law referred to in article 1 of the law of Latvian language in the Convention. 3. article. The Convention shall enter into force on its article 29 within the time and in order. The law adopted in 1995 the Saeima on 14 September. The President g. Ulmanis in Riga, 1995 October 3, the Republic of Latvia and CANADA Convention on the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital the Government of the Republic of Latvia and the Government of Canada, desiring to conclude a Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and capital, agreed to: (I) the scope of the Convention. Article 1 of the Convention's scope this Convention shall apply to persons that is one or both of the residents of the Contracting States. Article 2 taxes covered by this Convention 1. this Convention shall be applied in respect of income and capital taxes, which are levied in Latvia, or local authorities, or Canada, regardless of which way this taxation occurs. 2. On the income and capital taxes, all taxes will be taxed with total income total capital or income or capital items, including tax with which the taxed income from moveable and immovable property alienation, as well as the taxes which are subject to capital gains. 3. this Convention shall be applied in relation to existing taxes, which are: (a) in Latvia: (i) the profit tax; (ii) the individual income tax; (iii) the property tax; (hereinafter referred to as "Latvian tax"); (b) Canada: the taxes imposed on the Government of Canada under the income tax Act, (hereinafter referred to as "Canadian tax"). 4. the Convention will be applied also to any similar taxes and capital taxes which are imposed after the date of signature of this Convention, supplementing or replacing the existing taxes. Contracting State the competent authorities are required to notify each other of any significant amendments which have been made to the tax laws of these countries. II. Definitions article 3 General definitions 1. In this Convention, unless the context does not follow other meanings: (a) the term "Latvia" means the Republic of Latvia and, used in a geographical sense, represents the territory of the Republic of Latvia and any other Latvian territorial waters adjacent territory in accordance with Latvian and international law can be implemented in Latvia of rights to the depths of the sea, underground and the natural resources contained therein; (b) the term "Canada" used in a geographical sense represents the territory of Canada, including: (i) any area beyond the territorial sea of Canada which, in accordance with international law and the laws of Canada is an area within which Canada may exercise their rights in relation to the depths of the sea, underground and the natural resources contained therein; (ii) waters and air space above any (i) in the area referred to in respect of any activity that is associated with the above natural resource exploration or exploitation; (c) the term "Contracting State" and "the other Contracting State" mean Latvia or Canada depending on the context; (d) the term "person" means a natural person, property, trusts, corporations, partnerships, or any other person as a whole; (e) the term "company" means any entity or any United body for the purposes of taxation is considered as a United entity; (f) the terms "enterprise of a Contracting State" and "enterprise of the other Contracting State" represents the company, run by a resident of a Contracting State and an enterprise run by the second resident of a Contracting State; (g) the term "competent authority" means: (i) in Latvia: the Minister of Finance or his authorised representative; (ii) in Canada, the Minister of national revenue or his authorized representative (h) the term "national" means: (i) any natural person which has the nationality of a Contracting State; (ii) any legal person, partnership or association, which determined the status of the national legislation in force; (i) the term "international traffic" in relation to a Contracting State means any travel by ship or aircraft to transport passengers or property except for the cases when the main purpose of the transfer is to transport passengers or property between places in the other only in the Contracting State; 2. the application of this Convention at any time Contracting State will use any term which is not defined here, unless the context requires otherwise, use it only in the sense that it has at that time in this country, the tax legislation in relation to the taxes to which this Convention applies. Article 4 residence 1. For application of this Convention, the term "resident of a Contracting State" means: (a) any person who, in accordance with the national legislation is subject to taxation on the basis of her permanent residence, residence, location of the actual management, incorporation (registration: the interpreter.) or by any of the criteria in nature; (b) the Government of a Contracting State or a political or administrative units, local government, or any Government, political and administrative units or local government agency or Office. But this term does not include any person who is taxed in the country solely on the income from sources in that country. 2. If, following the provisions of paragraph 1, a person is a resident of both Contracting States, then its status will be determined in the following manner: (a) the person shall be deemed to be a resident only of the State in which the permanent place of residence; If they have a permanent residence in both States, this person will be considered a resident of the State with which it has a deeper personal and economic relations (Centre of vital interests); (b) if it is not possible to determine the country in which that person is a vital interest of the Centre, or if it does not have a permanent place of residence in one of the two countries, that person will be considered only for residents of the country where it is common in the home; (c) if they come home is in both countries or none of them, then it will be considered only for its residents, the State of which a citizen is a person; (d) if the person is a citizen of both countries, or in one of those Contracting States, the competent authorities shall settle the question by mutual agreement. 3. Where, in accordance with the provisions of paragraph 1 a company is a resident of both Contracting States, it will be considered only for its residents, the State of which a citizen is that company. 4. Where, in accordance with the provisions of paragraph 1 a person other than a natural person, not a company is a resident of both Contracting States, then the competent contracting authorities must resolve the question by mutual agreement and to determine the way in which the Convention is applied in respect of that person. Article 5 permanent establishment 1. For the purposes of this Convention, the term "permanent establishment" means a fixed place of business of which is wholly or partly carried on business. 2. The term "permanent establishment" includes: (a) the management of the company; (b) a branch; (c) the Office; (d) a factory; (e) a workshop; and (f) a mine, an oil or gas extraction sites, quarries or any other natural resource exploration or mining site, the construction Site 3 or Assembly project will be considered only if the permanent representation of the building or the project takes longer than six months. 4. Notwithstanding the preceding paragraphs of this article, the provisions of the concept of "permanent establishment" does not include the following: (a) building and equipment use exclusively the goods belonging to the storage, viewing and supplies; (b) company-owned stock of products and products intended solely for storage, viewing and supplies; (c) company-owned stock of products and products intended for processing are solely in the other company. (d) the permanent place of business which is intended exclusively for the purchase of goods or products, or for the collection of necessary information; (e) the permanent place of business which is intended solely to make the company the necessary preparatory or ancillary jobs; (f) a permanent place of business, which is intended solely to deal with (a) – (e) activities referred to in any combination of them, provided that the overall activity is preparatory or ancillary activities. 5. Notwithstanding points 1 and 2 of the rules, if the person is not subject to paragraph 6 in the independent agent status, running your business, and it is assigned, and it usually uses its the power to enter into contracts in good state, it is considered that this company uses the permanent representation in the country, in respect of any activities carried out by that person in the name of the company, except where that person is carrying out activities referred to in paragraph 4, which is going through its own site, cannot be regarded as permanent representations in accordance with its terms. 6. Will be considered not independent to the company's offices in the State, then if the undertaking is established in that country with REALTORS, sales agent or any other agent of an independent status, in addition, provided that such persons perform their normal business activities. However, when the activities of such an agent is completely or almost completely in favour of this company, he cannot be considered independent of the status of the agents in the sense referred to in paragraph 7., the fact that the company — resident of a Contracting State controls or is controlled from the society, which is a resident of the other Contracting State, or which carries on business in that other State (via the permanent representations, or in any other way) itself does not turn into one of those companies on the other company's permanent representation. III. Taxation of income article 6 Income from real property 1. Income for the resident of a Contracting State from immovable property (including income from agriculture or forestry) situated in the other Contracting State, may be taxed in the other State. 2. The purpose of this Convention, the term "immovable property" shall have the meaning it has in the Contracting State in which the legislative objectives of the estate. In any case, this concept will include property which belongs to real estate property, livestock and equipment used in agriculture and forestry, rights to which the provisions of general legislation on the property, located on the ground, any real estate purchase, sales rights or other similar rights, the right to acquire real estate, uzufrukt real estate and rights to variable or fixed payments for the right to use or on mineral and other natural resources; ships and aircraft shall not be regarded as immovable property. 3. paragraph 1 of this article, the rules will apply to income derived from the property direct use, letting or use in any other way, as well as income from the alienation of immovable property. 4. If the company's shares or other corporate rights give the holder the right to public use of the immovable property, the income from the direct use, letting or use in any other manner may be subject to tax in the Contracting State in which the real estate is located. 5. paragraphs 1 and 3 of the rules must also apply to the income from immovable property belonging to the company and to income from immovable property, which is used for independent individual services. Article 7 business profits 1. Contracting State business profits will be taxed only in the country, except when such an undertaking is established in the other Contracting State through a permanent representation there. If the enterprise carries or has carried out business in this way, the company can profit to tax in the other country, but only about the profit that can be attributed to the permanent establishment. 2. in accordance with the provisions of paragraph 3, if a company of a Contracting State carries on business in the other Contracting State through a permanent representation located there, in each Contracting State to the permanent representations to be subject to the amount of profit it would, if it were clearly separate company that performs the same or a similar business, under the same or similar conditions and work independently with this company and with all other persons. 3. in determining the profits of the permanent representation will be made permanent representation costs (which are not the expenses that would not be allowed to deduct if the permanent establishment were a separate enterprise, the deduction of the amount of taxable. This expenditure can be representations of operational and general administrative expenses incurred by the State in which the permanent establishment or elsewhere. 4. If a Contracting State has been the practice to determine the business profits attributable to a permanent establishment, the profits of the company after the joint distribution of the proportion principle by departments, in paragraph 2, shall not prevent a Contracting State to determine the taxable business profit by this principle, as it is usual; However, this method of distribution must be applied so that the result matches the principles contained in this article. 5. On the permanent representation will not be applied to the business profit only because it has purchased your business goods or articles. 6. The above point: business profits attributed to the permanent representation of each year should be determined using the same method, except when it is sufficiently justified the need to act. 7. If business profits includes income types are discussed in other articles of this Convention, then the provisions of this article shall not affect the other provisions of this article. Article 8 of sea and air transport, 1. profit that a company of a Contracting State derives from the sea and air transport, the use of international traffic will be taxed only in the country. 2. Notwithstanding the provisions of article 7, the Contracting State of which the company's profit is being made about the transfer, whose main purpose is to transport passengers or property between places in the other Contracting State, may be taxed in that other State. 3. paragraphs 1 and 2 shall also apply to profits gained by participation in Pula, the total business, or international transport company. 4. the application of this article, profits from the sea and air transport for use in international traffic shall include: (a) the return of sea and air transport equipment rentals, hiring them without crew and supply (bērboutčarter); (b) profits from the use, maintenance of containers or letting (including trailers and related equipment for the transport of containers), transport of goods or products; in cases where such use, maintenance or rental or leasing company additionally takes marine or air transport for use in international traffic. 9. Article Saskarīg undertakings 1. in cases when: (a) the Contracting State Enterprise directly or indirectly participating in the other Contracting State, the company's management, control or it owns part of the company's capital; (b) the same persons directly or indirectly participating in the management, control, or they belong to the company's capital, which is located in a Contracting State and at the same time in another company in the other Contracting State; and in each case between the two enterprises in their commercial or financial relations are created or established rules different from the provisions, which runs between the two independent (non-related) companies, then any profit, which created one of the companies, but the above provisions do not affect the established, can be included in the company's earnings and taxed accordingly. 2. where a Contracting State includes in the profits of an enterprise of that State (and accordingly taxable) profit on the territory of the other Contracting State of which the company must pay taxes, and this included a profit is a profit, which would have been the first company of a Contracting State, if the relationship between the two enterprises had been those which would have been between two totally independent companies, then the other countries have to make corresponding changes in relation to the size of the tax with which this income is taxed in the other State. In determining these changes, you need to take into account the other provisions of this Convention, and if necessary, the competent authorities shall consult. 3. a Contracting State is not necessary to adjust the company's profit under the conditions referred to in paragraph 1 of its internal law in the end of the period, and in any case, five years after the end of the year, the company in accordance with the conditions referred to in paragraph 1 have been built up profit that would have to be adjusted. 4. paragraphs 2 and 3 shall not be applied to the prevention of fraud, deliberate default or the obligation to complete the case. Article 10 dividends 1. Dividends that the company — a resident of a Contracting State-paid second resident of a Contracting State, may be exempt from taxes in the other country. 2. However, such dividends may also be taxing in the Contracting State where the resident is a company that pays dividends, in accordance with the legislation of that State, but if a resident of a Contracting State in the other is the true owner of dividends following the imposed tax may not exceed: (a) except in the case of dividends paid to non-resident-owned investment corporation that is a resident of Canada, 5 per cent of the gross amount of the dividends if the true owner is a company which controls directly, not less than 25 percent of the voting rights in the company, which pays dividends; (b) 15 per cent of the gross amount of the dividends in all other cases. This paragraph shall not affect the taxation of the company in respect of which the earnings are paid in dividends. 3. The term "dividends" in this article means income from shares, shares, which give right to the public part of its property in the event of liquidation or the right to participate in company profits, not in response to its commitments; mining shares, founders ' shares or other rights, not claims, to participate in profits, as well as income which is subjected to the same taxation as income from shares in accordance with the law of the country in which the resident is a company that carries out the distribution of profits. 4. paragraphs 1 and 2 shall not apply if the true owner of the dividends, being a resident of a Contracting State engaged in business in the second Contracting State through a permanent establishment situated there, or take the second country independent personal services through a permanent base located there, where the company that pays dividends, is this second country resident, and where participation which is paid out in dividends is practically related to the permanent representations, or permanent base. In this case it is necessary to apply article 7 or article 14. 5. when the company, which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not be taxing any tax the dividends paid, except when the dividends are paid to a resident of that other State or if participation, which is paid for those dividends, is practically related to the permanent representation or permanent base in another country; nor put the company's undistributed profits to a tax on retained earnings even if the dividends paid or retained earnings composed wholly or partly of profits or income arising in the second country. 6. No provision of this Convention shall not be construed as prohibiting Contracting State taxing public income attributable to the permanent establishment in the country, in addition to the tax which would be chargeable on the earnings of a company which is a national of that State, provided that any additional tax imposed must not exceed 5% of the amount of income that has not been subject to additional tax in previous taxation years. The purpose of this provision, the term "earnings" means the profits, including the profit from the disposal of property, from which are deducted all taxes, other than the additional tax referred to here by taxed by the profit in this country that is attributable to the Contracting State existing in the permanent representation of the year and previous years. Article 11 interest 1. Percent, formed 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 in which they are formed, and in accordance with the legislation of that State, but if a resident of a Contracting State in the other is the true owner of the interest, the tax may not exceed 10 per cent of the gross amount of the interest. 3. Notwithstanding points 1 and 2 of the regulations: (a) the percentage that formed in Latvia will be taxed only in Canada if the interest is paid to: (i) the Government of Canada or a political or administrative unit of local government; (ii) the Bank of Canada; or (iii) the Export Development Corporation; (b) interest that formed in Canada will be taxed only in Latvia if the interest is paid to: (i) the Latvian Government or local government or; (ii) the Bank of Latvia; or (iii) any organisation which is similar to the Export Development Corporation, and established in Latvia after the date of signature of this Convention (Contracting States competent authorities mutually agreed way to set or these organizations are similar in nature); (c) interest in a Contracting State and which are paid to a resident of the other Contracting State for the loans which are guaranteed by or insure any of (a) and (b) referred to in the said institutions, will be taxed only in that other State; (d) the interest of the Contracting State, be taxed in the other Contracting State only if: (i) the recipient is a company of the second Contracting State and the interest owner will exercise, and (ii) the interest is paid to the company for debt obligations that emerged, selling on credit to the first company of that State any goods or industrial, commercial or scientific equipment, except where the sale or debt obligations between related persons; (e) interest, formed a Contracting State and paid to a resident of the other Contracting State who is the true owner, will be taxed in the other Contracting State only if the interest is interest on delayed payments. 4. for the purposes of this article, the term "interest" means income from debt obligations of any kind, whatever their security guarantees, and in particular income from government securities and income from bonds, promissory notes, including bonuses and prizes, which belong to these securities, bonds or debentures, as well as income which is subjected to the same taxation as income on money lending, in accordance with the law of the country where the income is formed. However, the term "interest" shall not include income, the taxation of which is determined by article 10. 5.1, 2 and 3 shall not be applied if the rightful owner of the interest, being a resident of a Contracting State, carries on business in the other Contracting State in which the interest is created when using the stand-alone missions located there, or provide this second country independent personal services through a permanent base located there, and shows a commitment on the basis of which the interest is paid, is practically related to the permanent representations, or permanent base. In this case, depending on the circumstances, have to apply article 7 or article 14. 6. Will be considered that the interest in the formation of a Contracting State when the payer is a resident of that State. If, however, the person paying the interest, whether he is a resident of a Contracting State or not, used in the Contracting State of the permanent representation hosted, or a fixed base in connection with which the developed shows the relationship that pays the interest, and this interest is paid from the permanent missions or permanent base, will then be considered that these interest formed in the State in which the permanent establishment or fixed base. 7. If the special relationship between the payer of the interest and the interest of the owner, or implemented between them and a third person, the amount of interest that relate to debt obligations, on the basis of which it is paid, exceeds the amount which would have been agreed between the payer and the interest of the owners implemented in the absence of this special relationship, then this article will be applied only to the latter (harmonised, translated.). In this case, the remaining part of the payment is taxed in accordance with the legislation of each Contracting State on the condition that you comply with the other provisions of the Convention. Article 12 royalties 1. The author of the author's royalties, which formed in a Contracting State and paid to a resident of the other Contracting State, may be taxing in the second country. 2. However, the author's fees can also be taxing in the Contracting State in which it is formed, and in accordance with the legislation of that State, but if the second resident of a Contracting State is implemented by this author royalty owner, tax shall not exceed 10 per cent of the gross amount of the royalties to the author. 3. The concept of "author's fees" in the context of this article represents payments of any kind received as a compensation for the use of, or the right to use, any copyright, patent, trade mark, design or model, plan, secret formula or process or other intangible property, or for the use of, or the right to use industrial, commercial or scientific equipment, or for information concerning industrial, commercial or scientific experience, and includes payments of any kind of motion picture films and works with , videotape or other means of reproduction for use in connection with the television. 4. paragraphs 1 and 2 shall not be applied if the exercise of these duties as owner, resident of a Contracting State, carries on business in the other Contracting State in which the formation of the author's royalties, using the existing permanent representation there, or in the other country, independent individual services through a permanent base located there, and if the right or property covered by the author's royalty payments, is practically related to the permanent representations, or base. In these cases, depending on the circumstances, have to apply article 7 or article 14. 5. it will be considered that the author's royalty for the formation of a Contracting State, if the person is a resident of that State. However, when the person who paid the author's royalty, irrespective of whether that person is a resident of a Contracting State or not, used in the Contracting State of the permanent representation located or fixed base in connection with which the obligation to pay up the author's royalty, and the author's royalties are paid out from the permanent missions or fixed base, then it will be considered that the author's royalty is created in the State in which the permanent establishment or fixed base. 6. If the special relationship between the payer and the author's royalties shall implement the owner or between them and any other third party by the amount of fees relating to the use, right or information for which it is paid, exceeds the amount of the author's royalties for one would have been able to agree and implement a taxpayer owner if they would not have such a special relationship, the provisions of this article will apply only to the last-mentioned author royalties. In such cases, the payment of the share exceeding this amount will be taxed in accordance with the legislation of each Contracting State, taking into account the other provisions of the Convention. 7. If in any Convention for the avoidance of double taxation, which Latvia signed with a third country which is the economic development and cooperation (OECD) member at the time of signature of this Convention, after that date, Latvia agrees to exempt from taxes in Latvia: (a) a copyright author's fees and other similar payments in relation to any literary, dramatic, musical or artistic work in the creation or reproduction (not including the author's royalties in respect of motion picture nor the author's royalties in respect of works with film, videotape or other means of reproduction for use in connection with the television broadcasts), or (b) the author's royalties for the use of, or the right to use, any patent or any information concerning industrial, commercial or scientific experience (not including any information supplied in connection with a rental or franchise agreement (for the right to use trademarks and methods) of the Treaty) This exemption will automatically apply in respect of (a) and (b) referred to the author's royalties. Article 13 capital gains 1. Capital gains received by a resident of a Contracting State concerning the disposal of immovable property situated in the other Contracting State, may be taxing in the second country. 2. Capital gains earned on the property, which form a company of a Contracting State to the permanent representation of the second Contracting State commercial units, part of the seizures, or income earned on property that belongs to a resident of a Contracting State to the permanent base of the second Contracting State established independent personal services, including forfeiture of profits from such permanent missions (alone or with the whole enterprise) or of such a permanent disposal base disposal can be taxing the second Contracting State. 3. Capital increase the company of a Contracting State in international traffic of ships or aircraft used for the disposal, whether these vessels and aircraft belonging to the forfeiture of the property, will be subject to tax only in that Contracting State. 4. a resident of a Contracting State, the capital gains received a forfeit: (a) shares (other than shares listed on a recognised stock exchange in the other Contracting State) forming the essential participation of the company, which is the second resident of a Contracting State, and its value mainly from the second Contracting State of the real estate; or (b) the significant participation in a partnership, trust or property, established under the law of a Contracting State in the other, and the value of which primarily stems from this second country property, may be taxed in the other State taxes. The purpose of this paragraph, the term "immovable property" includes (a) a company referred to shares, or (b) the participation referred to in the trust or a limited partnership property, but does not include any property, other than rental property, in which corporations, partnerships, trusts or property transaction. 5. If a resident of a Contracting State alienates property in accordance with organizēšano, reorganization, mergers, divisions or any other similar activity, and profit, gain or income in relation to this alienation is not recognized for taxable with tax in this country, if requested to do the person who bought this property, the other Contracting State, the competent authority may agree to this acceptable to the competent authority rules and deadlines, to delay profits , (capital: the interpreter.) or the recognition of taxable income to a tax in the other country for so long and in such manner as may be specified in the agreement (competent authorities, interpreters). 6. capital gains, of any property, which is different from 1, 2, 3 and 4 above, the forfeiture of property, will be subject to tax only in the Contracting State of which the resident is the seizure of property. 7. the provisions of paragraph 6 shall not affect the right of a Contracting State in accordance with its laws taxing capital gains on the disposition of any property of the natural person who has been a first: a resident of that State at any time, the five-year period before the expropriation. Article 14 independent personal services 1. Natural persons — residents of a Contracting State in respect of income, professional or similar services of an independent nature, will be taxed only in that State unless the resident services not used regularly available permanent base the second Contracting State. If you have used or are using the following permanent base, the income may be taxing the other country, but only to the extent they apply to the permanent base. In this regard will be considered that the natural person who is a resident of a Contracting State shall use its regular access to a permanent base the second Contracting State, if it keeps the second Contracting State for a period or periods exceeding 183 days in General, in any 12-month period that begins or ends in the tax year, and income from the above, other activities in the country, will be applied to this permanent base. 2. The term "professional services" includes independent scientific, literary, artistic, educational or teaching activities as well as the independent activities of physicians, lawyers, engineers, architects, dentists and accountants profession. Article 15 dependent personal services 1.16, 18 and article 19 of the regulations of wages and other forms of remuneration received by a resident of a Contracting State in his work, will be taxed only in the country, except for the paid work is carried out in the second Contracting State. In such cases, the remuneration received by taxing the other can. 2. Notwithstanding the provisions of paragraph 1, remuneration which a resident of a Contracting State receives for paid work that is being done in the second Contracting State, be taxed in the first only in that country, if: (a) the recipient of the remuneration is another country no more than 183 days in any 12-month period that begins or ends in the tax year concerned, and (b) the remuneration is paid by the employer, which is not a resident of the other State or the employer in and (c) the remuneration is not paid from a permanent mission or a permanent base, used by the employer in the second country. 3. Notwithstanding the preceding provisions of this article, remuneration received for work that is being done to a company of a Contracting State of a ship or aircraft operating in international traffic, may be taxing in the country. Article 16 Directors ' fees directors ' fees and other similar charges which are residents of a Contracting State receives as a member of the Board of Directors, or any similar companies — the second resident of a Contracting State, a member of the governing body, may be subject to tax in the other country. Article 17 artists and athletes 1.7, articles 14 and 15 of the rules, the income received by a resident of a Contracting State as izpildītājmāksliniek, as, for example, theatre, film, radio or television actor or a musician, or as an athlete on their individual activities in the area carried out the second Contracting State can be taxing in the second country. 2. in cases where the artist or athlete's income on his individual activity in this area, are not paid the same artist or athlete but to another person, this income, regardless of the 7, 14 and 15 of the rules may be subject to tax in the Contracting State in which the activity or sports izpildītājmāksliniek. 3. paragraph 2 shall not apply if it is proved that neither izpildītājmāksliniek nor the athlete nor persons related to them not participating directly or indirectly referred to in paragraph 2, the profits of the person. 4. paragraphs 1 and 2 shall not be applied in respect of income derived from the activities carried out by the Contracting State or the izpildītājmāksliniek athlete, if they visit the country are financed in whole or in part from the other Contracting State or of its political or administrative unit, a local authority public funds. In such cases, the income will be taxed taxes only in the Contracting State of which the resident is izpildītājmāksliniek, or athlete. Article 18 pensions and annual fees 1. Pension and annual fees, a Contracting State and paid to a resident of the other Contracting State, may be taxed in that other State, but any part of the pension that would be excluded from taxable income in the first-mentioned State if the recipient were a resident thereof, should be exempted from taxation in the other State. 2. Retirement, formed a Contracting State and paid to a resident of the other Contracting State, may also be exempt from taxes in the country in which they are formed, and in accordance with the laws of the country. However, periodic pension which is not social security, the cost of the tax imposed in the case may not exceed the lesser of: (a) 15 per cent of the gross amount of the payment; and (b) the rate, which is determined based on the size of the tax payment (pension — interpreter.) should be paid to the beneficiary for the year, for a total year periodic pension payment received, if he were resident in the Contracting State in which these payments. 3. Annual fees by a Contracting State and paid to a resident of the other Contracting State may also be taxed in the State in which they are formed, and in accordance with the national law; but the tax imposed must not exceed 10 per cent of its annual payment that is taxed in that State. However, these restrictions do not apply to the total cost of the disposal of a participation in annual instalments, or on any kind of payments under the annuity contract, where costs have been wholly or partly deductible in determining income for any person who has purchased this contract. 4. Notwithstanding anything in this Convention, alimony and other similar payments, formed a Contracting State and paid to a resident of the other Contracting State who is subject to taxation in respect of these payments will be taxed only in that other State. Article 19 government service 1. (a) salaries, wages and similar remuneration, other than a pension, paid by a natural person, to which the Contracting State or of its political or administrative unit of local government, for this country, or unit, or the services provided to the municipality will be subject to tax only in the country. (b) However, such salaries, wages or similar remuneration will be exempt from taxes only the second Contracting State if the individual is this (the second — the interpreter.) A resident of the State who: (i) is a national of that State; or (ii) did not become a resident of that State solely for the purposes of providing the services. 2. the provisions of paragraph 1 shall not apply to remuneration paid in respect of services rendered in connection with a Contracting State or of its political or administrative units, local authorities carried out the business. Article 20 students payments which a student, apprentice or trainee who is or was immediately before the entry to the other Contracting State, a resident of a Contracting State and situated in the first mentioned State solely for the purpose of study or placement period, gets him to maintain themselves, study or internship will not be taxed in that State provided that such payments are formed outside of this country. Article 21 other income 1. in accordance with paragraph 2, a resident of a Contracting State in the other forms of income, regardless of where they formed that taxation is not laid down in the preceding articles of this Convention, be taxed only in the country. 2. However, where the income received by a resident of a Contracting State from sources in the other Contracting State, this income may also be taxed in the State in which the tax is, and in accordance with the laws of the country. Where this income is income from a trust or property that is not a trust, in which the contributions were deductible, the tax imposed shall not exceed 15 per cent of the gross amount of the income, provided that the income is subject to taxation in the country where the income of the residents is the rightful owner. IV. Taxation of capital article 22 capital 1. a resident of a Contracting State owns capital which is represented by the second Contracting State an existing real property, may be taxed in the other State taxes. 2. Capital represented by the fact that the estate, which forms part of the second Contracting State located in the Contracting State of the permanent representation of the company property, or capital represented by movable property that belongs to a resident of a Contracting State to the permanent base of the second Contracting State used an independent personal services, may be taxed in the other State taxes. 3. the State Enterprise capital represented by ships and aircraft, which are used in international traffic, as well as the fact that the property that belong to this ship and airplane use will be subject to tax only in the country. 4. All the other Contracting State, a resident of the capital items will be taxed only in the country. V. methods for PREVENTION of double taxation article 23 for the avoidance of double taxation 1. In Latvia, double taxation will be avoided in the following manner: (a) where a resident of Latvia derives income or owns capital which, in accordance with this Convention, may be taxed in Canada, taxes if they are not provided in the internal legislation more favourable provisions, Latvia must allow: (i) deduct from the income tax residents of size that is equal to the income tax paid in Canada; (ii) to deduct from the tax for residents of the capital of size equal to the capital tax paid in Canada; These deductions may in no case exceed the income or capital of the part of the tax, which is calculated before the deduction of this application, which is attributable, as the case may be, to the income or the capital which may be taxed taxes in Canada. (b) of this article, (a) the goals when a company that is a resident of Latvia receives a dividend from a company that is a resident of Canada, and in which it owns at least 10% of shares with full voting rights, the tax paid in Canada be included not only tax that taxed dividends, but also tax, which taxed the earnings of the company, from which the dividend is paid. 2. Canada, double taxation will be avoided in the following manner: (a) in accordance with the existing provisions of the law of Canada regarding the outside the territory of Canada of taxes paid deduction from tax payable in Canada, as well as in accordance with the provisions of any subsequent modification, without affecting the underlying principle of these regulations, unless in accordance with the laws of Canada be granted greater relief, or allow more deductions, tax paid in Latvia on profits , income or gains (capital: the interpreter.), formed in Latvia, must be deducted from any Canadian tax payable in respect of such profits, income or gains; (b) in accordance with the existing provisions of the law of Canada regarding the income of the foreign affiliate's taxation, as well as in accordance with the rules of any of the following modifications without affecting the underlying principle of these regulations, the Canadian tax calculation purposes, a company which is a resident of Canada when calculating its taxable income will be allowed to deduct any dividend received by it out of the company's subsidiaries which are resident of Latvia, non-taxable income; (c) where in accordance with any provisions of the Convention, the income received by a resident of Canada is exempt from taxation in Canada, regardless of whether Canada can take into account the exempted income in calculating tax on the remaining income of residents. 3. Will be considered that the companies which are residents of Canada, the tax paid in Latvia in relation to profit gained by manufacturing or agriculture, natural resource exploration, or use of, or the construction or telecommunications projects carried out in Latvia, include any amount that would be paid as a tax in any year, but for which a tax exemption or reduction is granted in that year or any part thereof in accordance with the special Latvian legislation to promote economic development, provided that these exemptions or reductions are granted for a period not exceeding 10 years. 4. For the purposes of this article, will be considered a resident of a Contracting State's profit, income or growth (capital: the interpreter.) who, in accordance with this Convention is subject to tax in the other Contracting State, formed in the second country. Vi. Special provisions article 24 non-discrimination 1. prevent nationals of a Contracting State shall not be subjected in the other Contracting State to taxation or any requirements connected with them, which is more burdensome than the taxation or related requirements, which may be or are exposed to the other citizens of the country in the same circumstances. 2. the State company's permanent representation in that it uses the second Contracting State, may be taxed in that other State to any taxation which is less favourable than the taxes that are taxed in the other State companies that perform similar actions. 3. Nothing in this article shall not be construed as obliging a Contracting State the obligation to grant the other Contracting State any of the personal residents discounts, exemptions or tax reductions, taking into account the civil status or family obligations, which it applies to its residents. 4. the Contracting State whose capital is wholly or partly belongs to one or more of the other Contracting State or the resident or residents-residents directly or indirectly controlled by the company, the first in that country may not be subject to taxation or any requirements connected with them, which is more burdensome than the taxation and connected requirements to which it is or may be subject to similar companies in the first State where capital completely or partly belongs to one or more residents of a third State or the resident or residents directly or indirectly controlled by these companies. 5. In this article the term "taxation" means the taxes to which this Convention applies. 25. Article 1 mutual consultation procedures. If a person believes that one or both of the Contracting States result or may lead to taxation this person who does not comply with the provisions of this Convention, that person may, irrespective of the internal legislation of these countries the rules governing taxation to prevent this, submit a written application that is based on this revision of the taxation of the Member State competent authorities, that the person is resident. The application must be filed within two years after the first notification of the action resulting in taxation has taken place in accordance with this Convention. 2. in paragraph 1, the competent authorities are obliged to strive, if it appears that the complaint is justified, and if the same fail to reach a satisfactory solution, to resolve the matter by mutual agreement with the other Contracting State, the competent authorities in order to avoid taxation, contrary to this Convention. 3. a Contracting State must not increase each Contracting State a resident of the tax base to include income that has been taxed also taxes the second Contracting State after its internal legislation to the end of the deadline, and in any case, after five years from the end of the taxable period in which the income concerned has been obtained, the end. This paragraph does not apply to fraud, deliberate default or the obligation to complete the case. 4. the national competent authorities should seek mutual consent in the course of resolving any problems or concerns that may arise in the interpretation or application of this Convention. 5. The competent authorities of the Contracting States may consult together to resolve double taxation cases which are not provided for in this Convention and may communicate directly with one another in the implementation of this Convention. Article 26 exchange of information 1. National authorities should exchange information, which is essential for the carrying out of the provisions of this Convention or in the internal law of the Contracting States, in relation to taxation insofar as such taxation is not contrary to this Convention. 1. the article does not limit the exchange of information. Any information received by a Contracting State, should be treated as sensitive as information that is obtained in accordance with the national legislation and may be disclosed only to persons or authorities (including courts and administrative bodies) involved in the collection of taxes in the calculation of, the use of coercive measures, trials or appeals. Such persons or authorities must use this information only for the purposes mentioned above. They may disclose this information in a lawsuit or court decisions. 2. nothing in paragraph 1 shall not be construed as obliging a Contracting State the obligation: (a) to carry out administrative measures that are not in accordance with the legislation of a Contracting State or an administrative practice; (b) to supply information that is not available under one or the other national legislation or administrative practice; (c) to supply information that can be disclosed to any trade, commercial or professional secret or trade process, or information the disclosure of which would be contrary to public policy (ordre public). 3. If a Contracting State requested information in accordance with this article, the other Contracting State should endeavour to obtain the information to which the request relates in the same way as if it would apply to its taxation. If a Contracting State competent authorities specifically asked, the other Contracting State should endeavour to provide the information as it is being sought; It can be as an approved trail and not edited copies of original documents (including books, records, reports, source documents, records, bills or articles), the extent of this testimony and documents are available in accordance with the national laws and administrative practices in respect of the taxes. Article 27 Diplomatic and consular officers 1. Nothing in this Convention shall not affect the diplomatic and consular officers fiscal privileges that apply to them in accordance with international law, or special agreements. 2. Notwithstanding article 4, an individual who is party to a diplomatic mission, consular or Permanent Mission of a point in the second Contracting State or in a third country, the Member States, the objectives of this Convention will be considered a resident of the sending State if he is in the country of dispatch is subject to the same obligations in relation to tax on his total income, which is subject to a resident of the sending State. 3. the Convention will not be applied to international organizations, to organs or employees and persons who are third-country or country group of diplomatic, consular or Permanent Mission of a point, which is located in a Contracting State and which are not in one of the Contracting States shall not be subject to the same obligations in relation to tax on his total income, which is subject to their residents. Article 28 miscellaneous rules 1. Nothing in this Convention shall be construed to restrict in any manner any exemption, allowance, credit (tax: the interpreter.) or other deductions in accordance with: (a) the legislation of a Contracting State, the tax imposed by that State; or (b) any contract concluded by the Contracting State. 2. Nothing in this Convention shall be construed as prohibiting the Contracting State to any taxation of the amounts included in the income of a resident of that country in respect of the partnership, trust or company, which is this person an accomplice. 3. Notwithstanding any provisions of this Convention, a resident of a Contracting State that internal legislative exemptions that are granted with the aim of promoting foreign investment, this State is not subject to tax or taxes are taxed at a reduced rate, will not receive the second Contracting State any exemption or reduction of tax which is assigned in accordance with this Convention, when the resident or persons associated with it main objective , or one of the main goals has been to use the advantages of this Convention. 4. the contributions made by a natural person, which provides independent personal services Contracting State Pension Fund, which is established and recognised for taxation purposes in the other Contracting State, be deductible in determining the taxable income of physical persons in the first country, during a period of not more than 60 months in total, and they should be treated the same, and must be subject to the same conditions and limitations as contributions to the pension funds , which are recognised for taxation purposes in the first country, provided that: (a) the individual was not a resident of this State and already made pension contributions just before he began a working relationship in this country; (b) the national competent the authority acknowledges that the pension fund comply with the Pension Fund, which is being considered for taxation purposes in this country. The purpose of this provision, the term "pension" means a measure which the natural person participates to ensure pension costs of dependent personal services and the pension fund should be recognised for the purposes of taxation in the country where the contributions to this Fund may qualify for tax relief in that State. 5. with regard to the General Agreement on trade and services (GATS) article 22, paragraph 3, of the Contracting States agree that, notwithstanding that paragraph, any dispute between them as to whether the object of taxation is the subject of any of the provisions of this Convention, within the framework of this Convention, may be submitted to the Council on trade in services, as provided in that paragraph, only with the consent of both Contracting States. VII. final provisions article 29 entry into force each Contracting State diplomatic channels must notify the other State Government for legislation that the procedures necessary for the entry into force of this Convention have been complied with. The Convention will enter into force with the last statement date, and its provisions will be applied: (a) in respect of taxes withheld at the time cost of amounts paid or credited to non-residents of January of the calendar year, or after the first day of the calendar year following the year in which the Convention enters into force; and (b) in respect of other taxes, beginning with tax years beginning in January of the calendar year, the first day, on or after the calendar year following the year in which the Convention enters into force. Article 30 termination this Convention shall remain in force for a limited period, but each Contracting State may in any calendar year, on or before June 30, so submit the second Contracting State diplomatic channels not for disruption. In such event, the Convention will be terminated: (a) in respect of taxes withheld at the time cost of amounts paid or credited to non-residents of January of the calendar year, or after the first day of the calendar year following the year in which the notes are filed; and (b) in respect of other taxes, beginning with tax years beginning in January of the calendar year, the first day, on or after the calendar year following the year in which the notes are filed. This, the undersigned, being duly authorised, have signed this Convention. The Convention is drawn up in duplicate in Ottawa, 26 April 1995, in Latvian, English and French, all texts being equally authentic.

The Government of the Republic of Latvia in Canada on behalf of the Government of the Republic of Latvia, Minister of Foreign Affairs Canada's Foreign Minister Valdis Birkavs Andre Oulet in the