DRAFT RESOLUTION No. 18 /X

Whereas Council Directive No. 2003 /48/CE of June 3, 2003,

on the taxation of savings income in the form of interest (which aims

to allow those income, paid in a Member State of the European Union to

actual beneficiaries who are natural persons with tax residency in another

Member State, to be subject to effective taxation in accordance with the

legislation of the latter Member State) establishes that the Application of the provisions

internal transposition depends on the conclusion of agreements or other arrangements that

define that all dependent territories or relevant associates of states-

Members adopt equivalent measures or identical to those of the said Directive;

Whereas the Agreement concluded with Jersey enshrines the normative framework for

that this territory adopt the said measures, particularly those relating to taxation

by retention by the payer agent on interest payments to natural persons

residents in Portuguese territory with revenue allocation, and which constitutes a

essential element for achieving the objectives of Directive No 2003 /48/CE;

Thus:

Pursuant to paragraph 1 (d) of the article 197. of the Constitution, the Government presents to the

Assembly of the Republic the following motion for a resolution:

Approves the Agreement between the Portuguese Republic and the Dependent Territory of the Crown

British from Jersey, by Exchange of Letters, respectively from June 22, 2004 and from

November 19, 2004, Relative to Taxation of the Savings Income and the

Respective Provisional Application, the text of which, Appendix 1 and its respective Annex, in the versions

authenticated in the Portuguese and English languages, are published in annex.

Visa and approved in Council of Ministers of July 22, 2005

The Prime Minister

The Minister of the Presidency

The Minister of Parliamentary Affairs

AGREEMENT

IN THE FORM OF AN EXCHANGE OF LETTERS

RELATIVE TO THE TAXATION OF SAVINGS INCOME AND THE

RESPECTIVE PROVISIONAL APPLICATION

A. Letter from the Portuguese Republic

Excellent Sir,

I have the honour of referring back to the texts, respectively, of the " Model Proposal of

agreement between Guernsey, the Isle of Man and Jersey and each of the EU Member States

which will apply the automatic exchange of information "and the" Proposal for a settlement model

between Guernsey, the Isle of Man and Jersey and each of the EU Member States that will

apply the withholding tax in the period of transition ", which resulted from the negotiations of

an Agreement on Taxation of Savings with the Authorities of the Islands, and were

apensas, respectively as Annex I and Annex II, to the outcome of the proceedings of the

High Level Group of the Council of Ministers of the European Union of March 12

(Doc. 7408/04 FISC 58).

In the face of the aforementioned texts, I have the honour to propose V. Ex. the "Agreement concerning

taxation of savings income" constant from Appendix 1 to this letter, and the

mutual commitment to ultimarmos with the largest Brevity possible our

internal constitutional formalities for the entry into force of this Agreement and

we proceed without delay to the reciprocal notification that these formalities are

concluded.

In the pendency of the completion of the internal tramites and the entry into force of the present

"Agreement concerning the taxation of savings income", I have the honour to propose to

V. Ex. th that Portugal and Jersey apply the present Agreement provisionally, having in

account for the framework of the respective internal constitutional ordinances, as of

of January 1, 2005, or of the date of application of Directive 2003 /48/CE of the Advice

of June 3, 2003 on the taxation of income from savings in the form of

interest, worth the later date of the dates.

If the foregoing is acceptable by the Government of V. Ex. th, I have the honour to propose that the

present letter and your confirmation constitute, together, an Agreement between

Portugal and Jersey.

Queira accepts, Excelent Lord, the protests of our highest regard,

By the Portuguese Republic

Minister of State and Finance

Done in Lisbon, Jun 22, 2004

B. Letter from Jersey

Excellent Sir,

I have the honor to acknowledge receipt of your letter of Your Excellency with today's date, of the

following content:

" Excellent Lord,

I have the honour to refer to the texts, respectively, of the "Model Proposal of

agreement between Guernsey, the Isle of Man and Jersey and each of the EU Member States

which will apply the automatic exchange of information" and the " Proposal of model of agreement

between Guernsey, the Isle of Man and Jersey and each of the EU Member States that will

apply the withholding tax in the transition period ", which resulted from the negotiations of

an Agreement on Taxation of Savings with the Authorities of the Islands, and were

apenesses, respectively as Annex I and Annex II, to the result of the work of the

High-Level Group of the Council of Ministers of the European Union of March 12

(Doc. 7408/04 FISC 58).

In the face of the aforementioned texts, I have the honour to propose V. Ex. the "Agreement concerning

taxation of savings income" constant from Appendix 1 to this letter, and the

mutual commitment to ultimarmos with the largest Brevity possible our

internal constitutional formalities for the entry into force of this Agreement and

we proceed without delay to the reciprocal notification that these formalities are

concluded.

In the pendency of the completion of the internal tramites and the entry into force of the present

"Agreement concerning the taxation of savings income", I have the honour to propose to

V. Ex. th that Portugal and Jersey apply the present Agreement provisionally, having in

account for the framework of the respective internal constitutional ordinances, as of

of January 1, 2005, or the date of application of Directive 2003 /48/CE of the Advice

of June 3, 2003 on the taxation of income from savings in the form of

interest, worth the later date of the dates.

If the foregoing is acceptable by the Government of V. Ex. th, I have the honour to propose that the

present letter and your confirmation constitute, together, an Agreement between

Portugal and Jersey.

Queira accepts, Excelent Lord, the protests of our highest

consideration "

I can confirm that Jersey is in accordance with the content of the letter of V. Ex.

Queira accept, Excellent Lord, the protests of mine higher

consideration,

By Jersey

President, Policy and Resources Committee

Done on 11/19/2004

Appendix 1

AGREEMENT ON THE TAXATION OF INCOME FROM THE

SAVINGS BETWEEN JERSEY AND THE PORTUGUESE REPUBLIC

CONSIDERING THE FOLLOWING:

1. Provides for Article 17 of Directive 2003 /48/CEE ("the Directive") of the Council of the

European Union ("the Council") on the taxation of income from

savings that before January 1, 2004 Member States adopt and

publish the laws, regulations and administrative provisions

necessary to comply with that Directive, whose provisions will be

applied as of January 1, 2005, provided that:

" i) a Swiss Confederation, the Principality of Liechtenstein, the Republic of São

Marino, the Principality of Monaco, the Principality of Andorra apply from

of that same date measures equivalent to those set out in this Directive,

in accordance with the agreements concluded between these countries and the Community

European, in the sequence of a unanimous decision of the Council;

ii) have been concluded all agreements or other arrangements that establish

that all dependent territories or relevant associates will apply to depart

of that same date as automatic exchange of information in the molds provided for in

Chapter II of that Directive, (or, during the transitional period defined in the

Article 10, shall apply a withholding tax under the conditions laid down in the

articles 11 and 12) ".

2. The Jersey relationship with the EU is the subject of the Protocol No 3 of the Treaty

of Accession of the United Kingdom to the European Community. Under the terms of the Protocol

Jersey is not located in the EU's tax territory.

3. Jersey notes that, if the final objective of the EU Member States

is to allow for an effective taxation of interest in the Member State of

tax residence of the beneficial owner through the exchange of information between

they regarding these interest payments, three Member States, namely

Austria, Belgium and Luxembourg, will not be required to exchange information

during a transitional period but will apply a withholding tax to the

Savings in savings covered by the Directive.

4. The "withholding tax" referred to in the Directive shall be referred to as "tax of

withholding" in the domestic law of Jersey. For the purposes of this Agreement the two

terms shall be read coalately as "withholding tax / tax of

retention" and having the same meaning.

5. Jersey has agreed to apply a withholding tax with effect from

of January 1, 2005 provided that Member States have adopted the

legislative, regulatory and administrative provisions necessary to give

compliance with the Directive, and have been generously complied with the requirements

of Article 17 of the Directive and Article 17 (2) of this Agreement.

6. Jersey has agreed to apply the exchange of automatic information in the molds

provided for in Chapter II of the Directive from the end of the transitional period

defined in Article 10 (2) of the Directive.

7. Jersey has legislation on collective investment bodies

which is presumed to be equivalent as to its effect to the EC legislation referred to in us

Articles 2 and 6 of the Directive.

Jersey and Portugal hereafter referred to as "Contracting Party" or "Contracting Parties"

unless the context otherwise requires,

Agreed to conclude the following agreement that obliges exclusively the Parties

Contracting Parties and provides for:

a) the automatic exchange of information from the competent authority of Portugal to the

competent authority of Jersey in the same way as for the authority

competent of a Member State;

b) the application by Jersey, during the transitional period defined in Article 10 of the

Directive, of a withholding tax from the same date and in the same

conditions as set out in Articles 11 and 12 of that Directive;

c) the exchange automatic information from the competent authority of Jersey to the

competent authority of Portugal in harmony with Article 13 of the Directive;

d) the transfer of the competent authority from Jersey to the competent authority

of Portugal from 75% of the withholding tax revenue.

in relation to interest payments made by a paying agent established in a

Contracting Party to a natural person resident in the other Contracting Party.

For the purposes of this Agreement the term "competent authority" when applied to

Contracting Parties means " the Minister of Finance or his representative

authorized "relatively to Portugal and" the Comptroller of Income Tax " relatively to

Jersey.

Article 1 Retention of tax by paying agents

The interest payments set out in Article 8 of this Agreement made

by a payer agent established in Jersey to actual beneficiaries, in the meaning of

Article 5 of this Agreement, which are residents of Portugal stay, without prejudice to the

provisions of Article 3 of this Agreement, subject to a retention in respect of the

amount of interest paid during the period of transition referred to in Article 14 of the

present Agreement as of the date referred to in the article 15. of this Agreement. The rate of the

withholding tax is expected to be 15% during the first three years of the

transition period, from 20% during the subsequent three years and from 35% after this last period.

Article 2 Communication of information by the paying agents

1. Where interest payments are made, set out in Article 8 of the

this Agreement, by a paying agent established in Portugal to

actual beneficiaries, as defined in Article 5 of this Agreement, which

are residents of Jersey, or where the provisions of paragraph 3 (a) of Article 3 (3) of this Agreement apply, the paying agent shall communicate to the

respective competent authority:

a) identity and residence of the beneficial owner, determined in accordance

with Art. 6 of the present Agreement;

b) name or denomination and address of the paying agent;

c) account number of the beneficial owner or, failing that, identification of the

generator credit of interest;

d) information regarding of the interest payments specified in paragraph 1 of the

Article 4 of this Agreement. However, the Contracting Parties may limit the

minimum content of the information that the paying agent must communicate in what

refers to the payment of interest, the total amount of interest or income

and to the total amount of the product of the assignment, rescue or refund;

and Portugal must observe the n. 2 of this article.

2. In the six months subsequent to the expiry of its fiscal year, the competent authority

competent of Portugal shall communicate to the competent authority of Jersey,

automatically, the information referred to in points (a) to (d) of paragraph 1 of the present

article, in relation to all the interest payments made during that year.

Article 3 Exceptions to the withholding tax system

1. By applying the withholding tax, in accordance with Article 1 of the present

Agreement, Jersey shall establish one, or both, of the following procedures

so that effective beneficiaries may request non-application from that

retention:

a) a procedure that allows the beneficial owner, with the definition that

to be given by Article 5, to avoid the withholding tax specified in Art. 1

of this Agreement, authorizing expressly your paying agent to

communicate the information regarding the payments of interest to the authority

competent of the Contracting Party of establishment of the paying agent. This

authorization will cover all the interest payments made to the beneficiary

effective by that paying agent;

b) a procedure that ensures that the withholding tax will not be enforced

when the beneficial owner submit to his / her paying agent a certificate

issued on his behalf by the competent authority of the Contracting Party of

tax residence pursuant to paragraph 2 of this Article.

2. At the request of the beneficial owner, the competent authority of the Contracting Party

of the country of tax residence shall issue a certificate stating:

i) name, address and tax identification number, or other, or, at the lack thereof of these,

date and place of birth of the beneficial owner;

ii) name or denomination and address of the paying agent;

iii) account number of the beneficial owner or, in their absence, identification of the title

credit.

This certificate will be valid for a period of not more than three years. It should be

passed on to any beneficial owner who requests it, within two months of submitting

of the submission of that application.

3. When applying to paragraph 1 (a) of this Article, the authority

competent Jersey of establishment of the paying agent shall communicate to

information referred to in Article 2 (1) of this Agreement to the authority

competent from Portugal as a country of residence of the beneficial owner.

Such communication will be automatic and will take place at least once a year, in the

six months subsequent to the term of the tax year defined in the legislation of the

Contracting Party, in relation to all interest payments made during

that year.

Article 4 Base of incidence of withholding tax

1. A paying agent established in Jersey shall apply the withholding tax

in harmony with Article 1 of this Agreement as follows:

a) in the case of a payment of interest within the meaning of Article 8 (1) (a)

of this Agreement: on the gross amount of interest paid or taken on credit;

b) in the case of a payment of interest within the meaning of paragraph 1 (b) or (d) of

Article 8 of this Agreement: on the amount of interest or of the income

referred to in points (b) or (d) of that paragraph or through an imposition of

effect equivalent to the recipient's office on the total amount of the product of

assignment, refund or ransom;

c) in the case of an interest payment within the meaning of paragraph 1 (c) of Article 8 (c)

of the present Agreement: on the amount of interest referred to in that provision;

d) in the case of a payment of interest within the meaning of Article 8 (4) of the present

Agreement: on the amount of interest attributable to each of the members of the

entity referred to in Article 7 (2) of this Agreement which assemble the

conditions of Article 5 (1) of this Agreement;

and) where Jersey avails itself of the possibility provided for in Article 8 (5) of the

this Agreement: on the amount of the annualized interest.

2. For the purposes of points (a) and (b) of paragraph 1 of this Article, the tax of

retention shall be deducted on a proportional basis with respect to the period during

which the beneficial owner holds a credit. Should the paying agent not

be able to determine the period of detention on the basis of the information at its disposal,

the paying agent will assume that the beneficial owner has held up to the possession of the

credit during the entirety of the period of the its existence, save if the latter

provides evidence regarding the date on which it acquired it.

3. The application of the withholding tax by Jersey does not preclude the other Party

Tax residence contractor of the beneficial owner of taxing the income

in accordance with its domestic law.

4. During the transition period, Jersey may provide that an economic operator

who pays interest, or assigns the payment of interest, to an entity referred to in

paragraph 2 of Article 7 of this Agreement in the other Contracting Party shall be

considered as the paying agent in place of the entity and apply the tax of

withholding on those interest unless the entity has formally accepted that

your name and address, as well as the total amount of interest paid to it

or assigned, are communicated in harmony with the last paragraph of paragraph 2

of the article 7. of this Agreement.

Article 5 Definition of effective beneficiary

1. For the purposes of this Agreement, by "beneficial owner" means any

natural person who receives a payment of interest or any natural person to

who is assigned an interest payment, unless he makes proof that the

interest has not been paid to you or assigned to your advantage. It is assumed that a

natural person is not a beneficial owner whenever:

a) acts in the quality of paying agent within the meaning of Article 7 (1) of the

this Agreement;

b) acts on account of a legal person, from an entity with taxed profits

in the framework of common law provisions on corporate taxation, a

Authorized UCITS of harmony with the provisions of Directive 85 /611/CEE or a

equivalent collective investment body established in Jersey, or a

of the entities referred to in Article 7 (2) of this Agreement and, in this

last case, reveal the name and address of that entity to the economic operator

liable for the payment of interest, and the latter communicates thereafter these

information to the competent authority of its Contracting Party of

establishment;

c) act on account of another natural person who be the beneficial owner and that

communicate to the paying agent the identity of the beneficial owner.

2. Should you possess information that would assume that the natural person who has received a

payment of interest or who has been assigned an interest payment may not be

the beneficial owner and case does not apply to paragraph 1 (a) or (b),

the paying agent shall take the reasonable steps to determine the identity

of the beneficial owner. If it cannot identify the beneficial owner, the

paying agent shall consider the natural person concerned as the beneficiary

effective.

Article 6 Identification and determination of the place of residence of the beneficiaries

herds

1. Each Party shall adopt and guarantee the application, in its territory, of the

procedures necessary to enable the paying agent to identify the

actual beneficiaries and the respective place of residence for the purpose of the present

Agreement. These procedures must respect the established minimum standards

in the n. paragraphs 2 and 3.

2. The paying agent shall determine the identity of the beneficial owner of

agreement with minimum standards that vary depending on the date of commencement of

relations between the paying agent and the receiver of the interest payment, namely

a) for the contractual relationships established before January 1, 2004, the agent

payer shall determine the identity of the beneficial owner expressed by his / her

name and address, based on the information available to it, particularly in

application of the regulations in force in its State of establishment and of

Directive 91 /308/CEE of June 10, 1991 in the case of Portugal or legislation

equivalent in the case of Jersey concerning the prevention of the use of the system

financial for the purposes of money laundering;

b) for the established contractual relationships, or for the transactions carried out in the

lack of contractual relationships, as of January 1, 2004 the paying agent

must determine the identity of the beneficial owner, expressed by his or her name,

address and, if there is, tax identification number assigned by the State-

Member of tax residence. These elements must be determined on the basis

in the passport or the official identity card presented by the beneficiary

effective. If it does not appear on the passport or the official identity card, the

address is determined on the basis of any other supporting document

presented by the beneficial owner. If the tax identification number does not

appear on the passport, the official identity card nor any other

supporting document, including, possibly, the residence certificate

tax, presented by the beneficial owner, the identity will be completed by

mention of the date and place of birth of the beneficial owner, determined

on the basis of his or her passport or official identity card.

3. The paying agent shall determine the residence of the beneficial owner of

agreement with minimum standards that vary depending on the date of commencement of

relations between the paying agent and the receiver of the interest payment. Subject to

of the exposed below, the residence is deemed to be located in the country in which the

beneficial owner has its permanent domicile:

a) for the contractual relationships established before January 1, 2004, the agent

payer shall determine the residence of the beneficial owner on the basis of the

information available to it, in particular in application of the regulations in

vigour in its State of establishment and Directive 91 /308/CEE in the case of

Portugal or equivalent legislation in the case of Jersey;

b) for the contractual relationships established, or for transactions carried out in

lack of contractual relationships, as of January 1, 2004, agent

payers must determine the residence of the beneficial owner on the basis of the

address mentioned in your passport or official identity card or, if

required, in any other supporting document presented by the

beneficial owner, in accordance with the following procedure: for the persons

natural persons who present a passport or a ticket of official identity

issued by a Member State and declare to be residents in a third country, the

residence must be determined on the basis of a tax residence certificate

issued by the competent authority of the third country in that the natural person

declare residir. In the lack of presentation of that attestative, it is considered that the

residence is situated in the Member State that issued the passport or any other

official identity document. "

Article 7 Definition of payer agent

1. For the purposes of this Agreement, by "paying agent" means any

economic operator who pays interest or assigns the payment of interest in

immediate beneficial profit from the beneficial owner, regardless of whether that operator

is the debtor of the interest generator credit or the operator entrusted by the

debtor or by the beneficial owner of paying or assigning the payment of the

interest.

2. Any entity established in a Contracting Party to which interest is paid

or attributed the payment of interest to the benefit of the beneficial owner must

also be considered as a paying agent at the time of that payment or the

attribution of the same. This provision does not apply if the operator

economic has reason to believe, on the basis of supporting elements

officers presented by the entity, that:

a) is about a legal person, with the exception of legal persons referred to

in paragraph 5 of this Article; or

b) its profits are taxed in application of common law provisions in

corporate taxation matters; or

c) is an authorized UCITS of harmony with the provisions of the

Council Directive 85 /611/CEE or an investment body

equivalent collective established in Jersey.

An economic operator who pays or assigns the payment of interest to an entity

of such an established type in another Contracting Party that is considered as an agent

payer under the terms of this paragraph shall communicate the name and the address of the

entity, as well as the total amount of interest paid or assigned to the entity, to

competent authority of its establishment Contracting Party, which will communicate in

followed this information to the authority competent of the Contracting Party of

establishment of the said entity.

3. The entity referred to in paragraph 2 shall, however, have the possibility of being treated for

effects of this Agreement as a UCITS or equivalent body

referred to in point (c) of paragraph 2. Recourse to such a possibility shall be the subject of a

certificate issued by the Contracting Party of establishment of the entity and

delivered by that entity to the economic operator. The Contracting Parties

shall lay down the specific rules relating to that possibility for the entities

established in their territory.

4. Should the economic operator and the entity referred to in paragraph 2 be established

in the same Contracting Party, the latter shall take the necessary measures to

ensure that the entity complies with the provisions of this Agreement when act

in the quality of paying agent.

5) Legal persons excluded from the application of paragraph 2 (a) are:

a) in Finland: avoin yhtio (Ay) and kommandiittiyhtio (Ky) /oppet bolag and

kommanditbolag;

b) in Sweden: handelsbolag (HB) and kommanditbolag (KB).

Article 8 Definition of payment of interest

1. For the purposes of this Agreement, "payment of interest" means:

a) the interest paid or credited to account for claims of any nature,

with or without a mortgage guarantee and with a right or not to participate in the profits of the

debtor, and, in particular the income from the government debt and obligations of

loans, including premiums reaching those securities; the penalties per

lives on payment are not considered to be payment of interest;

b) the interest accrued or capitalized realized at the time of the assignment, of the reimbursement

or from the ransom of the credits referred to in point (a);

c) the income from interest payments, whether these are

carried out directly, either through an entity referred to in paragraph 2

of Article 7 of this Agreement, distributed by:

i) an authorized UCITS of harmony with the provisions of Directive 85 /611/CEE of the

Council;

ii) an established equivalent collective investment body in Jersey;

iii) entities that benefit from the possibility provided in the n Article 7 (3) of the

this Agreement;

iv) collective investment bodies established outside the territory to which

applies the Treaty establishing the European Community by virtue of its

Article 299 and out of Jersey.

d) income realized at the time of the assignment, the refund or the rescue of parts

or units of participation in the following bodies and entities, if they have

invested, directly or indirectly, by intermediate of other organisms of

collective investment or authorities below referred to, more than 40% of their

active in credits referred to in point (a):

i) an authorized UCITS of harmony with the provisions of Directive 85 /611/CEE;

ii) an equivalent collective investment body established in Jersey.

iii) entities that benefit from the possibility provided for in Article 7 (3) of the

this Agreement;

iv) Collective investment bodies established outside the territory to which

applies the Treaty establishing the European Community by virtue of its

article 299. ° and outside of Jersey.

However, the Contracting Parties may limit the inclusion of the income referred to in

(d) of paragraph 1 of this Article in the definition of interest only in the proportion in which those

incomes correspond to income that, directly or indirectly, comes from a

payment of interest within the meaning of paragraphs (a) and (b) of paragraph 1 of this Article.

2. With respect to points (c) and (d) of paragraph 1 of this Article, if an agent

payer does not have any information relating to the part of the income

arising from interest payments, the total amount of the income shall be

considered to be payment of interest.

3. With regard to paragraph 1 (d) of this Article, if a paying agent

does not have any information regarding the percentage of the asset invested in

credits or in parts or units of participation as defined in that

point, it should be considered that that percentage is more than 40%. When not

can determine the amount of income realized by the beneficial owner,

it is considered that the income is the product of the assignment, the refund or the

ransom of the parties or units of participation.

4. When they are paid or credited to the account of an entity referred to in paragraph 2 of

Article 7 of this Agreement interest as set out in paragraph 1 and that entity

does not benefit from the possibility provided for in Article 7 (3) of the present Agreement,

these interest shall be considered as a payment of interest carried out by

that entity.

5. With respect to points (b) and (d) of paragraph 1 of this Article, the Parties

Contracting may require paying agents located in their territory to

annualization of interest in respect of a period which may not exceed one year, and

treat these annualized interest as a payment of interest even if it does not

have verified any assignment, refund or ransom during that period.

6. By way of derogation from paragraphs (c) and (d) of paragraph 1 of this Article, the

Contracting Parties may exclude from the definition of payment of interest any

income referred to in those provisions from bodies or entities

established in its territory whenever the investments of these entities in the

credits referred to in paragraph 1 (a) do not exceed 15% of its asset. Of the

same mode, in derogation from the provisions of paragraph 4 of this Article, the Parties

Contracting may decide to exclude from the definition of interest payment

constant of paragraph 1 the interest paid or credited to an account of an entity

referred to in Article 7 (2) of this Agreement which does not benefit from

the possibility provided for in Article 7 (3) of this Agreement and is

established in its territory, where the investments of such entities in the

credits referred to in paragraph 1 (a) do not exceed 15% of its asset.

A use of this option by a Contracting Party makes it binding to the

too many Contracting Parties.

7. As of January 1, 2011, the percentage referred to in point (d) of paragraph 1 and

in paragraph 3 of this Article shall henpart up to 25%.

8. The percentages referred to in paragraph 1 (d) of this Article and in paragraph 6 of the

this Article shall be determined as a function of the investment policy

as defined in the fund regulation or the constitutive documents of the

bodies or entities concerned or, failing that, as a function of the composition

effective of the assets of such bodies or entities.

Article 9 Breakdown of withholding tax revenues

1. Jersey must withhold 25% percent of the withholding tax deducted under the present

Agreement and transfer the remaining 75% of these revenues to the other Party

Contractor.

2. By applying a withholding tax, in harmony with Article 4 (4) of the

this Agreement, Jersey shall conserve 25% of its revenue and transfer 75%

of those revenues to Portugal in proportion to the transfers made in the

terms of paragraph 1 of this Article.

3. Such transfers must be carried out annually, in a single installment, the

at the latest within 6 months subsequent to the term of the fiscal year

defined in the legislation of Jersey.

4. When applying a withholding tax, Jersey should adopt the necessary measures

to ensure the proper functioning of the revenue sharing system.

Article 10 Elimination of double taxation

1. The Contracting Party of tax residence of the beneficial owner shall ensure

elimination of any double taxation eventually resulting from the imposition

by Jersey of the withholding tax referred to in this Agreement of harmony

with the following provisions:

i) if the interest received by an effective beneficiary has been subject to

Withholding tax in Jersey, the other Contracting Party should grant it

a credit of tax equal to the amount of the retention in accordance with the

your internal right. In the case that the amount of this exceeds the amount of tax

due in accordance with its domestic law, the other Contracting Party

shall reimburse to the beneficial owner the amount of withholding tax

in excess;

ii) if, in addition to the withholding tax referred to in Article 4 of this Agreement,

the interest received by an actual beneficiary shall have been subject to any

another type of withholding tax / withholding tax and the Contracting Party of

tax residence grants a tax credit for that withholding in

source / withholding tax in accordance with your domestic law or

Conventions on double taxation, such other withholding tax / tax of

retention shall be credited before the procedure provided for in

(i) of this article is to be applied.

2. The Contracting Party tax residence of the beneficial owner may replace the

mechanism of tax credit provided for in paragraph 1 of this Article by

a refund of the withholding tax referred to in Article 1 of the present

Agreement.

Article 11 Transitional provisions for negotiable debt securities

1. During the transitional period referred to in Article 14 of this Agreement, but

by December 31, 2010 at the latest, the national and

international and other negotiable debt securities whose initial issuance is

prior to March 1, 2001 or whose initial prospectuses have been targeted

prior to that date by the competent authorities within the meaning of

Council Directive 80 /390/CEE or by the responsible authorities of countries

third parties should not be considered credits within the meaning of paragraph 1 (a) of

Art. 8 para. of this Agreement, provided that no new issuance is held

of these negotiable debt securities as of March 1, 2002. However,

should the transition period continue to invigorate after December 31, 2010, the

provisions of this article will only continue to apply to the debt securities

negotiable:

-which include clauses " of all " and early redemption; and

-in cases where the paying agent is established in a Contracting Party

that applies the withholding tax and in which such paying agent pays interest or

ascribe payment of interest in immediate advantage of an effective beneficiary

resident in the other Party Contractor.

If, as of March 1, 2002, new issuance of one of the securities of

the above-mentioned negotiable credit issued by a public administration or entity

afim, acting on the quality of public authority, or whose function is recognized in a

international treaty, as defined in the Annex to this Agreement, all

issues of that title, i.e. the initial issue and any additional issuance, shall be

considered as a issuance of a credit title within the meaning of paragraph 1 (a)

of Article 8 of the present Agreement.

If, as of March 1, 2002, if any new issuance of one of the securities of

the aforementioned negotiable credit issued by any entity not covered by the

second paragraph, this new issue shall be be considered an issue of a title

of credit within the meaning of paragraph 1 (a) of Article 8 of this Agreement.

2. No provision of this article prevents the Contracting Parties from

taxing the income from the negotiable debt securities referred to in paragraph 1 of

harmony with their respective domestic law.

Article 12 para. Mutual agreement procedure

Whenever they overcome between the Parties difficulties or doubts regarding the application

or interpretation of this Agreement, the Contracting Parties shall exercise in the sense of

remedy the matter by mutual agreement.

Article 13 Confidentiality

1. The confidentiality of all the information provided and

received by the competent authority of a Contracting Party shall be preserved.

2. The information provided to the competent authority of a Contracting Party does not

may be used for any purpose other than for the purposes of taxation

direct without prior written consent of the other Contracting Party.

3. The information provided should only be disclosed to persons or authorities

interested for direct taxation purposes, and used by such persons or

authorities only for these effects or for supervisory purposes, which may

include the introduction of an eventual appeal. For this purpose, the information may

be disclosed in a public hearing or in court decision.

4. When the competent authority of a Contracting Party considers that the

information it has received from the competent authority of the other Contracting Party

may be useful to the competent authority of another Member State, it may

pass on such information with the agreement of the competent authority that

provided the information.

Article 14 Transitional Period

At the end of the transitional period defined in Article 10 (2) of the Directive, Jersey

must stop applying the withholding tax and the allocation of revenue provided for in

this Agreement and shall apply in respect of the other Contracting Party to the provisions

in respect of the automatic exchange of information in the moulds provided for in Chapter II of the

Directive. If during the transitional period Jersey chooses to apply the provisions in

automatic exchange of information in the molds provided for in Chapter II of

Directive, it will cease to apply withholding tax / withholding tax and the apportionment of the

revenue provided for in Article 9 of this Agreement.

Article 15 Entry into force

Subject to the provisions of Article 17 of this Agreement, the present Agreement enters into

vigour in 1 of January 2005.

Article 16 Denpronunciation

1. This Agreement shall remain in force until it is denounced by a Party

Contractor.

2. Any of the Contracting Parties may denounce the present Agreement by

notice in writing to the other Contracting Party, in a notification specifying the

circumstances that led to this same notification. In this case, the present

Agreement cede no effect 12 months after the notification.

Article 17 Application and suspension of application

1. The application of this Agreement shall be conditional on the adoption and application by

all Member States of the European Union, by the United States of

America, Switzerland, Andorra, oLiechtenstein, Monaco and Saint Marino, and by all

the dependent and associated territories relevant to the Member States of the

European Community, respectively, of measures that conform to or are

equivalent to those contained in the Directive or in this Agreement, and provide for the

same dates of application.

2. The Contracting Parties shall decide by common agreement, at least six months

prior to the date referred to in Article 15 of this Agreement, if the condition

established in paragraph 1 shall be met, taking into account the dates of entry into force

of the relevant measures in the Member States, third countries and territories

dependent or associated in cause.

3. Subject to the mutual agreement procedure provided for in Article 12 of the

this Agreement, the application of this Agreement or of Parties to the Agreement may

be suspended by any of the Contracting Parties with immediate effect

upon notification to the other that specifies the circumstances that led to

such notification, in the event that the Directive cees to be applicable, to title

temporary or permanent, in accordance with Community law or in the

case of a Member State suspend the application of its legislation of

transposition. The implementation of the Agreement will resume as soon as they leave

check the circumstances that led to the suspension.

4. Subject to the mutual agreement procedure provided for in Article 12 of the

this Agreement, any of the Contracting Parties may suspend the application

of this Agreement by notification to the other that specifies the

circumstances that led to such notification in the case of one of the territories or

third countries referred to in paragraph 1 shall subsequently leave to apply the measures

referred to in this number. The suspension of application will not be able to occur less than

two months after notification. The implementation of the Agreement will be resumed as soon as the

measures are reimposed by the third country or territory concerned.

Made in the Portuguese and English languages, making all texts equally authentic.

ANNEX

List of the equated entities referred to in Article 11

For the purposes of the provisions of Article 11º of this Agreement, they shall be deemed to be

" entity affinth, acting on the quality of public authority, or whose function is

recognized in an international treaty ", the following entities:

EUROPEAN UNION ENTITIES:

Belgium

- Vlaams Gewest (Flamenga Region)

-Région wallonne (Valan Region)

-Région bruxelloise / Brussels Gewest (Brussels Region)

-Communauté française (French Community)

-Vlaamse Gemeenschap (Flamenga Community)

-Deutschsprachige Gemeinschaft (German-speaking Community)

Spain

-Xunta de Galicia (Together from Galicia)

-Junta de Andalucía (Junta da Andalusia)

-Junta of Extremadura (Junta da Extremadura)

-Junta de Castilla-La Mancha (Junta de Castela-Mancha)

- Joint of Castilla-León (Wedding of Castile-Lion)

-Gobierno Foral of Navarra (Regional Government of Navarra)

-Govern de les Illes Balears (Government of the Balearic Islands)

-Generalitat de Catalunya (Autonomous Government of Catalonia)

-Generalitat de Valencia (Autonomous Government of Valencia)

-Diputación General de Aragón (Regional Council of Aragon)

-Gobierno de las Islas Canarias (Government of the Canary Islands)

-Gobierno de Murcia (Government of Murcia)

-Gobierno de Madrid (Government of Madrid)

- Gobierno de la Comunidad Autónoma del País Vasco / Euzkadi (Government of the

Autonomous Community of the Basque Country)

-Diputación Foral de Guipúzcoa (Provincial Council of Guipuzcoa)

-Diputación Foral de Vizcaya / Bizkaia (Council Provincial of Biscay)

-Diputación Foral de Alava (Provincial Council of Alava)

-Ayuntamiento de Madrid (Municipality of Madrid)

-Ayuntamiento de Barcelona (Municipality of Barcelona)

-Insular Cabildo de Gran Canaria (Insular Council of the Canary Gran)

-Insular Cabildo de Tenerife (Insular Council of Tenerife)

-Official Credit Institute (Official Credit Institute)

-Instituto Catalán de Finanzas (Catalan Institute of Finance)

-Valencian Institute of Finanzas (Valencian Institute of Finance)

Greece

-ΡΓΑΝΙΣΜΌΣ Ηλεπικοινωνιών Ελλάδος (Organism from the Telecommunications of

Greece)

-ργανισμός Σιδηροδρόμων Ελλάδος (Organism of the Greek Iron Paths)

-Δημόσια Επιχείρησιεκτρισμου (Public Electricity Company)

France

-La Caisse d' amortissement de la dette sociale (CADES) (Amortization Box of

Social Debt)

-L' Agence française de développement (AFD) (French Agency of

Development)

-Réseau Ferré de France (RFF) (Network of the Iron Paths of France)

-Caisse Nationale des Autoroutes (CNA) (National Highway Box)

-Assistance publique Hôpitaux de Paris (APHP) (Public Assistance Hospitals of

Paris)

-Charbonnages de France (CDF) (French Coal Mines)

-Entreprise minière et chimique (EMC)

Italy

-Regions

-Provinces

- Municipalities

-Cassa Depositi e Prestiti (Box of Deposits and Loans)

Latvia

-Pašvaldības (Local governments)

Poland

-gminy (commune)

-powiaty (districts)

-województwa (provinces)

-związki gmin (associations of communes)

-powiatów (association of districts)

-województw (association of provinces)

-miasto stołeczne Warszawa (Warsaw capital)

-Agencja Restrukturyzacji i Modernizacji Rolnictwa (Agency for the Restructuring

and Modernization of Agriculture)

-Agencja Nieruchomości Rolnych (Agricultural Property Agency)

Portugal

-Autonomous Region of Madeira

-Autonomous Region of the Azores

-Municipalities

Slovakia

-mis a obce (municipalities)

-Železnice Slovenskej republiky (Company of the Railways of Slovakia)

-Štátny fond cestného hospodarstva

-Slovenské elektrárne (Electrical Companies of Slovakia)

-Vodohospodárska výstavba (Water Economy Building Company)

INTERNATIONAL ENTITIES:

-European Bank for Reconstruction and Development

-European Investment Bank

-Asian Development Bank

-African Development Bank

-World Bank / World Bank / BIRD / IMF

-Society International Financial

-Inter-American Development Bank

-Social Development Fund of the Council of Europe

-EURATOM

-European Community

-Fomento Andina Corporation (CAF)

- Eurofima

-European Coal and Steel Community

-Nordic Investment Bank

-Caribbean Development Bank

The provisions of Article 11º shall be without prejudice to any obligations that the Contracting Parties

may have assumed in respect of the entities internationals referred to above.

ENTITIES IN THIRD COUNTRIES:

The entities that fulfill the following criteria.

1. The entity is clearly considered a public entity in accordance with the

national criteria.

2. A public entity of that kind is a non-market producer that administers and

funds a group of activities, which essentially consist of providing goods and

non-market services intended for the collective, and which are effectively controlled

by the public administrations.

3. A public entity of this type issues debt securities regularly and in large

quantity.

4. The State concerned is in a position to ensure that such a public entity does not

proceed to the early repayment in the event that there are any resaration clauses

(gross-up).

CONDITIONS OF CHANGE TO THIS ATTACHMENT:

The list of equiparable entities listed in this attachment can be changed by

mutual agreement.

.

AGREEMENT

IN THE FORM OF AN EXCHANGE OF LETTERS

ON THE FORM OF AN EXCHANGE OF LETTERS

ON THE TAXATION OF SAVINGS INCOME AND THE PROVISIONAL

APPLICATION

TAXABLE

A. Letter from the Portuguese Republic

Sir,

I have the honour to refer to the texts of the " Proposed Model Agreement

between each

of Guernsey, Isle of Man, and Jersey and each other individual EU Member State that is to

apply

automatic exchange of information "and the" Proposed Model Agreement between each

of

Guernsey, Isle of Man, and Jersey and each individual EU Member State that is to apply

the

withholding tax in the transitional period ", that kicked from the negotiations with the

Island

Authorities on a Savings Tax Agreement, and that were proceeding, proceeding with the Annex

I and

Annex II, to the Outcome of Proceedings of the High Level Working Party of the

Council of

Ministers of the European Union of 12 March (Doc. 7408/04 FISC 58).

In view of the above mentioned texts I have the honour to propose to you the

"Agreement on the taxation of savings income" as contained in Appendix 1 to this

letter, and our mutual undertaking to be made at the earliest possible date with our

internal constitutional investigation for the entry into force of this Agreement and

to notify each other without delay when such an effort are

completed.

Pending the completion of these internal procedures and the entry into force of this

"Agreement on the taxation of savings income", I have the honour to propose to you

that Portugal and Jersey apply this Agreement provisionally, within the framework of

our respective domestic constitutional requirements, those from 1 January 2005, or the date

of application of Council Directive 2003 /48/EC of 3 June 2003 on taxation of savings

income in the form of interest payments, whichever is later.

I have the honour to propose that, if the above is acceptable to your Government, this

letter and your confirmation shall together receive an Agreement between Portugal

and Jersey.

Please accept, Sir, the assurance of our highest consideration,

For the World Republic

Minister of State and Finance

Done at Lisbon, on Jun 22, 2004, in the English language in three copies.

B. Letter from Jersey

Sir,

I've had the honour to acknowledge receipt of your letter of today's date, which reads as

follows:

" Sir,

I have the honour to refer to the texts of photographs of the "Proposed Model Agreement

between each of Guernsey, Isle of Man, and Jersey and each individual EU member

State that is to apply automatic exchange of information" and the " Proposed Model

Agreement between each other of Guernsey, Isle of Man, and Jersey and each individual EU

member State that is to apply the withholding tax in the transitional period ", that

revenues from the negotiations with the Island Authorities on a Savings Tax Agreement,

and that were served, as an outcome of the Annex I and Annex II, to the Outcome of

Proceedings of the High Level Working Party of the Council of Ministers of the

European Union of 12 March (Doc. 7408/04 FISC 58).

In view of the above mentioned texts I have the honour to propose to you the

"Agreement on the taxation of savings income" as contained in Appendix 1 to this

letter, and our mutual undertaking to be made at the earliest possible date with our

internal constitutional investigation for the entry into force of this Agreement and to

notify each other without delay when such fears are completed.

Pending the completion of these internal procedures and the entry into force of this

" Agreement on the taxation of savings income ", I have the honour to propose to you

that Portugal and Jersey apply this Agreement provisionally, within the framework of

our respective domestic constitutional requirements, those from 1 January 2005, or the date

of application of Council Directive 2003 /48/EC of 3 June 2003 on taxation of savings

income in the form of interest payments, whichever is later.

I have the honour to propose that, if the above is acceptable to your Government, this

letter and your confirmation shall together receive an Agreement between

Portugal and Jersey.

Please accept, Sir, the assurance of our highest consideration, "

I am able to confirm that Jersey is in agreement with the contents of your letter.

Please accept, Sir, the assurance of my highest consideration,

For Jersey

President, Policy and Resources Committee

Done at St. Helier, on 11/19/2004, in the English language in three copies.

Appendix 1

AGREEMENT ON THE TAXATION OF SAVINGS INCOME BETWEEN

JERSEY AND THE WORLD REPUBLIC

WHEREAS:

1. Article 17 of Directive 2003 /48/EEC ("the Directive") of the Council of the

European Union ("the Council") on taxation of savings income provides that before

1 January 2004 Member States shall adopt and publish the laws, regulations and

administrative provisions necessary to be applied with this Directive

shall be applied from 1 January 2005 provided that:

" (i) the Swiss Confederation, the Principality of Liechtenstein, the Republic of San

Marino, the Principality of Monaco and the Principality of Andorra apply from that

same date measures equivalent to those contained in this Directive, in accordance

with agreements entered into by them with the European Community, following

unanimous decisions of the Council;

(ii) all agreements or other arrangements are in place, which provide that all the relevant

dependent or associated territories apply from that same date automatic exchange of

information in the same manner as is provided for in Chapter II of this Directive,

(or, during the transitional period defined in Article 10, apply for withholding tax on

the same terms as are contained in Articles 11 and 12) ".

2. The relationship of Jersey with the EU is determined by Protocol 3 of the Treaty of

Accession of the United Kingdom to the European Community. Under the terms of

the Protocol Jersey is not within the EU fiscal territory.

3. Jersey notes that, while it is the ultimate aim of the EU Member States to bring

about effective taxation of interest payments in the beneficial owner's Member State

of residence for tax purposes through the exchange of information concerning

interest payments between themselves, three Member States, Austria,

Belgium and Luxembourg, during the transitional period, shall not be required to

exchange information but shall apply withholding a tax to the savings income

covered by the Directive.

4. The "withholding tax" referred to in the Directive will be referred to as the

"retention tax" in Jersey's domestic legislation. For the purposes of this Agreement

the two terms therefore are to be read coterminously as the "withholding/retention tax"

and shall have the same accurate.

5. Jersey has agreed to apply for retention tax with effect from 1 January 2005 provided

the Member States have adopted the laws, regulations, and administrative provisions

necessary to apply with the Directive, and the requirements of Article 17 of the

Directive and Article 17 (2) of this Agreement have generally been met.

6. Jersey has agreed to apply automatic exchange of information in the same manner as

is provided for in Chapter II of the Directive from the end of the transitional period

as defined in Article 10 (2) of the Directive.

7. Jersey has legislation relating to undertakings for collective investment that is

meaning to be equivalent in its effect to the EC legislation referred to in Articles 2

and 6 of the Directive.

Jersey and Portugal Referred to as a "contracting party" or the "contracting

parties" unless the context otherwise requires,

Have agreed to agree on the following agreement which contains obligations on the part

of the contract parties only and provides for:

(a) the automatic exchange of information by the competent authority of Portugal to

the competent authority of Jersey in the same manner as to the competent

authority of a Member State;

(b) the application by Jersey, during the transitional period defined in Article 10 of

the Directive, of a retention tax from the same date and on the same terms as are

contained in Articles 11 and 12 of that Directive;

(c) the automatic exchange of information by the competent authority of Jersey to

the competent authority of Portugal in accordance with Article 13 of the

Directive;

(d) the transfer by the competent authority of Jersey to the competent authority of

Portugal of 75% of the revenue of the retention tax;

in respect of interest payments made by a paying agent established in a contracting party

to an individual resident in the other contracting party.

For the purposes of this Agreement the term 'competent authority' when applied to the

contracting parties means "the Minister of Finance or an authorised representative" in

respect of Portugal and "the Comptroller of Income Tax" in respect of Jersey.

Article 1 Retention of Tax by Paying Agents

Interest payments as defined in Article 8 of this Agreement which are made by a Paying

agent established in Jersey to beneficial owners within the course of Article 5 of this

Agreement who are residents of Portugal shall, subject to Article 3 of this Agreement,

be subject to a retention from the amount of interest payment during the transitional

period referred to in Article 14 of this Agreement starting at the date referred to in

Article 15 of this Agreement. The rate of retention tax shall be 15% during the first

three years of the transitional period, 20% for the subsequent three years and 35%

photographs.

Article 2 Reporting of Information by Paying Agents

(1) Where interest payments, those defined in Article 8 of this Agreement, are made by a

paying agent established in Portugal to beneficial owners, the defined in Article 5 of

this Agreement who are residents of Jersey, or where the provisions of Article

3 (1) (a) of this Agreement apply, the, paying agent shall report to its competent

authority:

(a) the identity and residence of the beneficial owner established in accordance with

Article 6 of this Agreement;

(b) the name and address of the paying agent;

(c) the account number of the beneficial owner or, where there is none,

identification of the debt claim giving rise to the interest;

(d) information concerning the interest payment specified in Article 4 (1) of this

Agreement. However, each contracting party may restrict the minimum amount

of information concerning interest payment to be reported by the paying agent to

the total amount of interest or income and to the total amount of the amount of the year.

from sale, redemption or refund;

and Portugal will be banned with paragraph (2) of this Article.

(2) Within six months following the end of the tax year, the competent authority of

Portugal shall communicate to the competent authority of Jersey, automatically,

the information referred to in paragraph (1) (a) (a)-(d) of this Article, for all

interest payments made during that year.

Article 3 Exceptions to the Retention Tax Procedure

(1) Jersey when levying a retention tax in accordance with Article 1 of this Agreement

shall provide for one or both of the following procedures in order to ensure that the

beneficial owners may request that in the tax be retained:

(a) a procedure which allows the beneficial owner as defined in Article 5 of this

Agreement to avoid the retention tax specified in Article 1 of this Agreement by

expressly displaying his paying agent to report the interest payments to the

competent authority f the contracting party in which the paying agent is established.

Such an authorisation shall cover all interest payments made to the beneficial owner by

that paying agent;

(b) a procedure which reveals that retention tax shall not be where the beneficial

owner presents to his paying agent a certificate drawn up in his name by the

competent authority of the contracting party of residence for tax purposes in

accordance with paragraph (2) of this Article.

(2) At the request of the beneficial owner, the competent authority of the contracting party

party of the country of residence for tax purposes shall issue a certificate thereof:

(i) the name, address and tax or other identification number or, failing such, the date

and place of birth of the beneficial owner;

(ii) the name and address of the paying agent;

(iii) the account number of the beneficial owner or, where there is none, the

identification of the security.

Such a certificate shall be valid for a period not consecutive three years. It shall be issued to

any beneficial owner who requests it, within two months following such request.

(3) Where paragraph (1) (a) of this Article applies, the competent authority of Jersey

in which the paying agent is established shall communicate the information

referred to in Article 2 (1) of this Agreement to the competent authority of

Portugal as the country of residence of the beneficial owner. Such

communications shall be automatic and shall take place at least once a year,

within six months following the end of the tax year established by the laws of a

contracting party, for all interest payments made during that year.

Article 4 Basis of assessment for retention tax

(1) A paying agent established in Jersey shall levy retention tax in accordance with

Article 1 of this Agreement as follows:

(a) in the case of an interest payment within the years of Article 8 (1) (a) of this

Agreement: on the gross amount of interest paid or credited;

(b) in the case of an interest payment within the year of Article 8 (1) (b) or (d) of

this Agreement: on the amount of interest or income referred to in (b) or (d) of

that paragraph or by a levy of equivalent effect to be borne by the recipient on

the full amount of the sale of the sale, redemption or refund;

(c) in the case of an interest payment within the case of Article 8 (1) (c) of this

Agreement: on the amount of interest referred to in that sub-section;

(d) in the case of an interest payment within the Article 8 (4) of this

Agreement: on the amount of interest attributable to each other of the members of the

entity referred to in Article 7 (2) of this Agreement who meet the conditions of

Article 5 (1) of this Agreement;

(e) where Jersey exercises the option under Article 8 (5) of this Agreement: on the

amount of annualised interest.

(2) For the purposes of sub-paragraphs (a) and (b) of paragraph (1) of this Article,

the retention tax shall be deducted on a pro rata basis to the period during which

the beneficial owner held the debt-claim. If the paying agent is unable to

determine the period of holding on the basis of the information made available to

him, the paying agent shall treat the beneficial owner as having been in

]. entire period of its existence, unless the

latter provides evidence of the date of the acquisition.

(3) The opposition of retention tax by Jersey shall not be able to receive the other contract

party of residence for tax purposes of the beneficial owner from taxing income

in accordance with its national law.

(4) During the transitional period, Jersey may provide that an economic operator

paying interest to, or securing interest for, an entity referred to in Article 7 (2) of

this Agreement in the other contracting party shall be considered the paying

agent in place of the entity and shall levy the retention tax on that interest, unless

the entity has formally agreed to its name, address, and the total amount of the

interest paid to it or secured for it being held in accordance with the

last paragraph of Article 7 (2) of this Agreement.

Article 5 Definition of beneficial owner

(1) For the purposes of this Agreement, "beneficial owner" shall mean any

individual who convicted an interest payment or any individual for an individual for an individual's time

interest payment is secured, unless individual such individual can provide evidence that the

interest payment was not received or secured for his own benefit. An individual

is not being told to be the beneficial owner when he:

(a) acts as a paying agent within the course of Article 7 (1) of this Agreement;

(b) acts on behalf of a legal person, an entity which is taxed on its profits under the

general arrangements for business taxation, an UCITS authorised in accordance

with Directive 85 /611/EEC or an equivalent undertaking for collective

investment established in Jersey, or an entity referred to to in Article 7 (2) of this

Agreement and, in the last mentioned case, discloses the name and address of

that entity to the economic operator making the interest payment and the latter

communicates such information to the competent authority of its contracting party

party of establishment;

(c) acts on behalf of another individual who is the beneficial owner and discloses to

the paying agent the identity of that beneficial owner.

(2) Where a paying agent has information reveals that the individual who has been

an interest payment or for an interest payment is secured that is secured may not be the

beneficial owner, and where neither paragraph (1) (a) nor (1) (b) of this Article

applies, it shall take reasonable steps to establish the identity of the beneficial

owner. If the paying agent is unable to identify the beneficial owner, it shall treat the

individual in question as the beneficial owner.

Article 6 Identity and residence of beneficial owners

(1) Each Party shall, within its territory, adopt and ensure the application of the

procedures necessary to allow the paying agent to identify the beneficial owners and

their residence for the purposes of this Agreement. Such procedures shall be required

with the minimum standards established in paragraphs (2) and (3).

(2) The paying agent shall establish the identity of the beneficial owner on the basis of

minimum standards which vary according to when relations between the paying

agent and the recipient of the interest are entered into, the follows:

(a) for contractual relations entered into before 1 January 2004, the paying agent shall

establish the identity of the beneficial owner, thereof of his name and address, by

using the information at its disposal, in particular to the regulations in force

in its country of establishment and to Council Directive 91 /308/EEC of the 10th

June, 1991 in the case of Portugal or equivalent legislation in the case of Jersey on

prevention of the use of the financial system for the purpose of money laundering;

(b) for contractual relations entered into, or transactions carried out in the course of

contractual relations, on or after 1 January, 2004 the paying agent shall establish the

identity of the beneficial owner, thereof. the name, address and, if there is one,

the tax identification number allocated by the Member State of residence for tax

purposes. These details should be established on the basis of the passport or of the

official identity card reveals by the beneficial owner. If it does not appear on that

passport or official identity card, the address shall be established on the basis of any

other documentary proof of identity corrected by the beneficial owner. If the tax

identification number is not mentioned on the passport, on the official identity card

or any other documentary proof of identity, including, possibly the certificate of

residence for tax purposes, which is preferred by the beneficial owner, the identity shall be

helpful by a reference to the latter's date and place of birth established on the

basis of his passport or official identification card.

(3) The paying agent shall establish the residence of the beneficial owner on the basis of

minimum standards which vary according to when relations between the paying

agent and the recipient of the interest are entered into. Subject to the conditions set

out below, residence shall be considered to be situated in the country where the

beneficial owner has his permanent address:

(a) for contractual relations entered into before 1 January, 2004 the paying agent shall

establish the residence of the beneficial owner by using the information at its

disposal, in particular, to the regulations in force in its country of

establishment and to Directive 91 /308/EEC in the case of Portugal or equivalent

legislation in the case of Jersey;

(b) for contractual relations entered into, or transactions carried out in the proceedings of

contractual relations, on or after 1 January, 2004, the paying agents shall establish

the residence of the beneficial owner on the basis of the address mentioned on the

passport, on the official identity card or, if necessary, on the basis of any

documentary proof of identity corrected by the beneficial owner and according to

the following procedure: for individuals wealthy a passport or official identity

card issued by a Member State well who declare themselves to be resident in a third

country, residence shall be established by means of a tax residence certificate issued

by the competent authority of the third country in which the individual claims to be

resident. Failing the presentation of such a certificate, the Member State which

issued the passport or other official identity document shall be considered to be considered to be the

country of residence.

Article 7 Definition of paying agent

(1) For the purposes of this Agreement, 'paying agent' means any economic

operator who pays interest to or secures the payment of interest for the

immediate benefit of the beneficial owner, whether the operator is the debtor of

the debt claim which we discuss the interest or the operator charged by the debtor

or the beneficial owner with paying interest or securing the payment of interest.

(2) Any entity established in a contracting party to which interest is paid or for

which interest is secured for the benefit of the beneficial owner shall also be

considered a paying agent upon such payment or securing of such payment. This

provision shall not apply if the economic operator has reason to believe, on the

basis of official evidence produced by that entity that:

(a) it is a legal person with the exception of those legal persons referred to in

paragraph (5) of this Article; or

(b) its profits are taxed under the general arrangements for business taxation; or

(c) it is an UCITS recognised in accordance with Directive 85 /611/EEC of the

Council or an equivalent undertaking for collective investment established in

Jersey.

An economic operator paying interest to, or securing interest for, such an entity

established in the other contracting party which is considered a paying agent under this

paragraph shall communicate the name and address of the entity and the total amount of

interest paid to, or secured for, the entity to the competent authority of its contracting

party of establishment, which shall pass this information on to the competent authority

of the contracting party where the entity is established.

(3) The entity referred to in paragraph (2) of this Article shall, however, have the

option of being held for the purposes of this Agreement as a UCITS or

equivalent undertaking as a referred to in sub-paragraph (c) of paragraph (2) of

this article. The exercise of this option shall require a certificate to be issued by

the contracting party in which the entity is established and has been granted to the

economic operator by that entity. The contracting party shall lay down the detailed

rules for this option for entities established in its territory.

(4) Where the economic operator and the entity referred to in paragraph (2) of this

Article are established in the same contracting party, that contracting party shall

take the necessary measures to ensure that the entity thereof is to be established with the

provisions of this Agreement when it acts as a paying agent.

(5) The legal persons displaced from sub- paragraph (a) of paragraph (2) of this

Article are

(a) in Finland: avoin yhtio (Ay) and kommandiittiyhtio (Ky) /oppet bolag and

kommanditbolag;

(b) in Sweden: handelsbolag (HB) and kommanditbolag (KB).

Article 8 Definition of interest payment

(1) For the purposes of this Agreement "interest payment" shall mean:

(a) interest paid, or credited to an account, relating to debt claims of every kind,

whether or not secured by mortgage and whether or not to be carrying a right to

participate in the debtor's profits, and, in particular, income from government

securities and income from bonds or debentures, including profits and prizes

attaching to such securities, bonds or debentures; penalty charges for late

payment shall not be held as a interest payment;

(b) interest accrued or capitalised at the sale, refund or redemption of the debt

claims referred to in (a);

(c) income deriving from interest payments either directly or through an entity

referred to in Article 7 (2) of this Agreement, distributed by:

(i) an UCITS authorised in accordance with EC Directive 85 /611/EEC of the

Council;

(ii) an equivalent undertaking for collective investment established in Jersey;

(iii) entities which qualify for the option under Article 7 (3) of this Agreement;

(iv) undertakings for collective investment established outside the territory to which

the Treaty thereof shall be established by virtue of Article 299

protests and outside Jersey.

(d) income upon the sale, refund or redemption of shares or units in the

following undertakings and entities, if they invest directly or indirectly, via other

undertakings for collective investment or entities referred to below, more than

40% of their assets in debt claims as to be referred to in (a):

(i) an UCITS authorised in accordance with Directive 85 /611/EEC;

(ii) an equivalent undertaking for collective investment established in Jersey.

(iii) entities which qualify for the option under Article 7 (3) of this Agreement;

(iv) undertakings for collective investment established outside the territory to which

theTreaty would represent the European Community applies by virtue of Article 299

Meaning and outside Jersey.

thereof, the contracting parties shall have the option of including income mentioned

under paragraph (1) (d) of this Article in the definition of interest only to the extent that

such income as an income directly or indirectly deriving from interest payments

within the populations of paragraphs (1) (a) and (b) of this Article.

(2) The populations (1) (c) and (d) of this Article, when a paying agent has no

information concerning the proportion of the income which derives from interest

payments, the total amount of the income shall be considered an interest

payment.

(3) The Amendments (1) (d) of this Article, when a paying agent has no

information concerning the percentage of the assets thereof in debt claims or in

shares or units as defined in that paragraph, that percentage shall be considered

to be above 40%. Where he cannot determine the amount of income by

the beneficial owner, the income shall be found to be eligible to the income

of the sale, refund or redemption of the shares or units.

(4) When interest, the defined in paragraph (1) of this Article, is paid to or credited to

an account held by an entity referred to in Article 7 (2) of this Agreement, such

entity not having qualified for the option under Article 7 (3) of this Agreement,

such interest shall be considered an interest payment by such entity.

(5) The Amendments (1) (b) and (d) of this Article, a Party shall

have the option of paying agents in its territory to annualise the interest

over a period of time which may not exceed one year, and photographs such

annualised interest as an interest payment even if on sale, redemption or refund

occurs during that period.

(6) By way of banned from paragraphs (1) (c) and (d) of this Article, a

contracting party shall have the option of excluding from the definition of

interest payment any income referred to in those provisions from undertakings or

entities established within its territory where the investment in debt claims

referred to in paragraph (1) (a) of this Article of such entities has not been exceeded

15% of their assets. Banned, by way of opposition from paragraph (4) of this

Article, a contracting party shall have the option of excluding from the definition

of interest payment in paragraph (1) of this Article interest paid or credited to an

account of an entity referred to in Article 7 (2) of this Agreement which has not

qualified for the option under Article 7 (3) of this Agreement and is established

within its territory, where the investment of such an entity in debt claims referred

to in paragraph (1) (a) of this Article has not exceeded 15% percent of its assets.

The exercise of such an option by one contracting party shall be binding on the other

contracting party.

(7) The percentage referred to in paragraph (1) (d) of this Article and paragraph (3)

of this Article shall from 1 January, 2011 be 25%.

(8) The percentages referred to in paragraph (1) (d) of this Article and in paragraph

(6) of this Article shall be determined by reference to the investment policy as

laid down in the fund rules or instruments of incorporation of the undertakings

or entities concerned or, failing which, by reference to the current composition of

the assets of the undertakings or entities concerned.

Article 9 Retention Tax Revenue sharing

(1) Jersey shall retain 25% percent of the retention tax deducted under this Agreement and

transfer the remaining 75% percent of the revenue to the other contracting party.

(2) Jersey levying retention tax in accordance with Article 4 (4) of this Agreement

shall retain 25% of the revenue and transfer 75% to Portugal thereof to the

transfers carried out to paragraph (1) of this Article.

(3) Such transfers shall take place for each year in one instalment at the latest within

a period of six months following the end of the tax year established by the laws

of Jersey.

(4) Jersey levying retention tax shall take the necessary measures to ensure the

proper functioning of the revenue sharing system.

Article 10 Elimination of double taxation

(1) A contracting party in which the beneficial owner is resident is resident for tax purposes

shall ensure the elimination of any double taxation which might result from the

banned by Jersey of the retention tax to which this Agreement refers in

accordance with the following provisions:

(i) if interest received by a beneficial owner has been subject to retention tax in

Jersey, the other contracting party shall be grant a tax credit equal to the amount of

the tax retained in accordance with its national law. Where this amount exceeds

the amount of tax due in accordance with its national law, the other contracting states

party shall repay the excess amount of tax retained to the beneficial owner;

(ii) if, in addition to the retention tax referred to in Article 4 of this Agreement,

interest received by a beneficial owner has been subject to any other type of

withholding/retention tax and the contracting party of residence for tax purposes

grants a tax credit for such withholding / retention tax in accordance with its

national law or double taxation conventions, such as other withholding/retention

tax shall be credited before the procedure in sub-paragraph (i) of this Article is

applied.

(2) The contracting party which is the country of residence for tax purposes of the

beneficial owner may replace the tax credit mechanism referred to in paragraph

(1) of this Article by a refund of the retention tax referred to in Article 1 of this

Agreement.

Article 11 Transitional provisions for negotiable debt securities

(1) During the transitional period referred to in Article 14 of this Agreement, but

until 31 December 2010 at the latest, domestic and international bonds and other

negotiable debt securities which have been first issued before 1 March 2001 or

for which the original public prospectuses have been approved before that date

by the competent authorities within the Recommend of Council Directive

80 /390/EEC or by the responsible authorities in third countries shall not be

considered as a debt claims within the following of Article 8 (1) (a) of this

Agreement, provided that no further issues of such negotiable debt securities are

made on or after 1 March 2002. However, should the transitional period continue

beyond 31 December 2010, the provisions of this Article shall only continue to

apply in respect of such negotiable debt securities:

-which contain gross up and early redemption clauses; and,

-where the paying agent is established in a contracting party's own retention

tax and that paying agent pays interest to, or secures the payment of interest for the

immediate benefit of a beneficial owner resident in the other contracting party.

If a further issue is made on or after 1 March 2002 of an allegedly negotiable debt

security issued by a Government or a related entity acting as a public authority or whose

role is recognised by an international treaty, as defined in the Annex to this Agreement,

the entire issue of such security, investigations of the original issue and any further issue,

shall be considered a debt claim within the course of Article 8 (1) (a) of this

Agreement.

If a further issue is made on or after 1 March 2002 of an allegedly negotiable debt

security issued by any other issuer not covered by the second sub-paragraph, such

further issue shall be considered a debt claim within the opposition of Article 8 (1) (a) of

this Agreement.

(2) Nothing in this Article shall prevent the contracting parties from taxing the

income from the negotiable debt securities referred to in paragraph (1) in

accordance with their national laws.

Article 12 Mutual agreement procedure

Where difficulties or doubts arise between the parties regarding the implementation of the implementation or

interpretation of this Agreement, the contracting parties shall use their best endeavours

to resolve the matter by mutual agreement.

Article 13 Confidentiality

(1) All information provided and received by the competent authority of a

contracting party shall be kept confidential.

(2) Information provided to the competent authority of a contracting party may not

be used for any purpose other than for the purposes of direct taxation without the

prior written consent of the other contracting party.

(3) Information provided shall be disclosed only to persons or authorities concerned

with the purposes of direct taxation, and used by such persons or authorities only

for such purposes or for oversight purposes, including the determination of any

appeal. For these purposes, information may be disclosed in public court

proceedings or in judicial proceedings.

(4) Where the competent authority of a contracting party considers that information

which it has received from the competent authority of the other contracting party

is likely to be useful to the competent authority of another Member State, it may

transmit it to the latter competent authority with the agreement of the competent

authority which supplied the information.

Article 14 Transitional Period

At the end of the transitional period as defined in Article 10 (2) of the Directive, Jersey

shall cease to apply the retention tax and revenue sharing provided for in this

Agreement and shall apply in respect of the other contracting party to the automatic

exchange of information provisions in the same manner as is provided for in Chapter II

of the Directive. If during the transitional period Jersey elects to apply the automatic

exchange of information provisions in the same manner as is provided for in Chapter II

of the Directive, it shall be no longer apply the withholding / retention tax and the revenue

sharing provided for in Article 9 of this Agreement.

Article 15 Entry into force

Subject to the provisions of Article 17 of this Agreement, this Agreement shall come into force

into force on 1 January 2005.

Article 16 Termination

(1) This Agreement shall remain in force until terminated by either the contracting

party.

(2) or so (2) We may terminate this Agreement by giving notice of

termination in writing to the other contracting party, such notice to specify the

opposition leading to the giving of such notice. In such a case, this

Agreement shall cease to have effect 12 months after the serving of notice.

Article 17 Application and suspension of application

(1) The application of this Agreement shall be conditional on the adoption and

implementation by all the Member States of the European Union, by the United

States of America, Switzerland, Andorra, Liechtenstein, Monaco and San

Marino, and by all the relevant dependent and associated territories of the

Member States of the European Community, probability, of measures which

conform with or are equivalent to those contained in the Directive or in this

Agreement, and providing for the same dates of implementation.

(2) The contracting parties shall decide, by common accord, at least six months

before the date referred to in Article 15 of this Agreement, whether the condition

set out in paragraph (1) will be met having regard to the dates of entry into force

of the relevant measures in the Member States, the named third countries and the

dependent or associated territories concerned.

(3) Subject to the mutual agreement procedure provided for in Article 12 of this

Agreement, the application of this Agreement or parts enhancing may be suspended

by either a contracting party with immediate effect through notification to the

other enhancing the opposition leading to such notification should the

Directive cease to be applicable either temporarily or permanently in accordance

with European Community law or in the event that a Member State should

suspend the application of its implementing legislation. Application of the

Agreement shall summarizes as soon as the necessary leading to the suspension

no longer apply.

(4) Subject to the mutual agreement procedure provided for in Article 12 of this

Agreement, either a contracting party may suspend the application of this

Agreement through notification to the other excellent the leading

to such notification in the event that one of the third countries or territories

referred to in paragraph (1) should cease to apply to apply the measures

referred to in that paragraph. Suspension of application shall take place in the

earlier than two months after notification. Application of the Agreement shall

summarizes as soon as the measures are reinstated by the third country or territory in

question.

Done in the World and English languages, all texts being equally authentic.

"

List of related entities referred to in Article 11

For the purposes of Article 11 of this Agreement, the following entities will be

considered to be a"related entity acting as a public authority or whose role is

recognised by an international treaty":

ENTITIES WITHIN THE EUROPEAN UNION:

Belgium

Vlaams Gewest (Flemish Region)

Région wallonne (Walloon Region)

Région bruxelloise / Brussels Gewest (Brussels Region)

Communauté française (French Community)

Vlaamse Gemeenschap (Flemish Community)

Deutschsprachige Gemeinschaft (German-speaking Community)

Spain

Xunta de Galicia (Regional Executive of Galicia)

Junta de Andalucía (Regional Executive of Andalusia)

Junta de Extremadura (Regional Executive of Extremadura)

Junta de Castilla-La Mancha (Regional Executive of Castilla-La Mancha)

Junta de Castilla-León (Regional Executive of Castilla-León)

Gobierno Foral de Navarra (Regional Government of Navarre)

Govern de les Illes Balears (Government of the Balearic Islands)

Generalitat de Catalunya (Autonomous Government of Catalonia)

Generalitat de Valencia (Autonomous Government of Valencia)

Diputación General de Aragón (Regional Council of Aragon)

Gobierno de las Islas Canarias (Government of the Canary Islands)

Gobierno de Murcia (Government of Murcia)

Gobierno de Madrid (Government of Madrid)

Gobierno de la Comunidad Autónoma del País Vasco / Euzkadi (Government of the

Autonomous Community of the Basque Country)

Diputación Foral de Guipúzcoa (Regional Council of Guipúzcoa)

Diputación Foral de Vizcaya / Bizkaia (Regional Council of Vizcaya)

Diputación Foral de Alava (Regional Council of Alava)

Ayuntamiento de Madrid (City Council of Madrid)

Ayuntamiento de Barcelona (City Council of Barcelona)

Insular Cabildo de Gran Canaria (Island Council of Gran Canaria)

Cabildo Insular de Tenerife (Island Council of Tenerife)

Official Credit Institution (Public Credit Institution)

Catalán Institute of Finanzas (Finance Institution of Catalonia)

Valencian Institute of Finanzas (Finance Institution of Valencia)

Greecand

ements ργανισμός tions ηλεπικοινωνιών Ελλάδος (National Telecommunications Organisation)

Organργανισμός Σιδηροδρόμων Ελλάδος (National Railways Organisation)

Δημόσια Επιχείρηση Ηλεκτρισμοğ (Public Electricity Company)

France

La Caisse d' amortissement de la dette sociale (CADES)

L' Agence française de développement (AFD) (French) Development Agency)

Réseau Ferré de France (RFF) (French Rail Network)

Caisse Nationale des Autoroutes (CNA)

Assistance publique Hôpitaux de Paris (APHP) (Paris Hospitals Public Assistance)

Charbonnages de France (CDF) (French Coal Board)

Entreprise minière et chimique (EMC) (Mining and Chemicals Company)

Italy

Regions

Provinces

Municipalities

Cassa Depositi e Prestiti (Deposits and Loans Fund)

Latvia

Pašvaldības (Local government)

Poland

gminy (communes)

powiaty (districts)

województwa (provinces)

związki gmin (associations of communes)

powiatów (association of districts)

województw (association Of provinces)

miasto stołeczne Warszawa (capital city of Warsaw)

Agencja Restrukturyzacji i Modernizacji Rolnictwa (Agency for Restructuring and

Modernisation of Agriculture)

Agencja Nieruchomości Rolnych (Agricultural Property Agency)

Portugal

Autonomous Region of Madeira (Autonomous Region of Madeira)

Autonomous Region of the Azores (Autonomous Region of decades)

Municipalities

mis a obce (municipalities)

Železnice Slovenskej republiky (Slovak Railway Company)

Štátny fond cestného hospodárstva (State Road Management Fund)

Slovenské elektrárne (Slovak Power Plants)

Vodohospodárska výstavba (Water Economy Building Company)

INTERNATIONAL ENTITIES:

European Bank for Reconstruction and Development

European Investment Bank

Asian Development Bank

African Development Bank

World Bank / IBRD / IMF

International Finance Corporation

Inter-American Development Bank

Council of Europe Social Development Fund

EURATOM

European Community

Corporación Andina de Fomento (CAF)

Eurofima

European Coal & Steel Community

Nordic Investment Bank

Caribbean Development Bank

The provisions of Article 11 are without prejudice to any international obligations that

the Contracting Parties may have entered into with respect to the above mentioned

international entities.

ENTITIES IN THIRD COUNTRIES:

The entities that meet the following criteria:

1) The entity is exploring considered to be a public entity according to the national

criteria.

2) Such public entity is a non-market producer which adheres and finances a

group of activities, adopting providing non-market goods and services, intended for

the benefit of the community and which are effectively controlled by general

government.

3) Such a public entity is a large and regular issuer of debt.

4) The State concerned is able to guarantee that such public entity will not exercise

early redemption in the event of gross-up clauses.

CONDITIONS FOR ENHANCING THE PRESENT DAY:

The list of related entities in this Annex may be elected by mutual agreement.