section 1 of the agreement for the avoidance of double taxation and
Prevention of tax evasion with respect to taxes on income and
on the fortune that Sweden and Chile signed on 4 June
in 2004, together with the Protocol annexed to the
Agreement and as part of this, apply that law here in
the country. The agreement and the Protocol is written in Swedish,
Spanish and English. The Swedish and English text shown
of the annex to this law.
section 2 of the tax rules of the agreement shall apply only to the
some of these causes restriction of the tax liability in Sweden
that would otherwise exist.
3 repealed by law (2011:1412).
Transitional provisions
2004:1051
This law shall enter into force on the day the Government determines and
apply in respect of
a) withholding taxes, on amounts paid or tillgodoförs 1
January of the year immediately following the year in which the agreement
enters into force, or later,
(b)) other taxes on income, the income tax levied on
tax year that begins on 1 January of the year immediately
following the year in which the agreement enters into force, or later, and
c) wealth tax, if and to the extent a general tax
on capital introduced in Chile after the signing of the agreement,
for tax levied on assets held on 1 January
the years immediately following the date of such General
tax on capital is introduced or later.
Annex
Agreement between the Kingdom of Sweden and the Republic of Chile for the
avoidance of double taxation and the prevention of fiscal evasion
with respect to taxes on income and on capital
The Kingdom of Sweden and the Republic of Chile, desiring to conclude an
Agreement for the avoidance of double taxation and the prevention of
tax evasion with respect to taxes on income and on capital,
have agreed as follows:
CHAPTER I
THE SCOPE OF THE AGREEMENT
Article 1
Persons to whom the agreement applies
This agreement shall apply to persons who are domiciled in a
Contracting State or in both Contracting States.
Article 2
Taxes covered by the agreement
1. this Agreement shall apply to taxes on income and on
wealth that accrues to a Contracting State, its
political underavdelningars or local authorities,
regardless of the way in which taxes are levied.
2. taxes on income and on capital, of course, all
taxes levied on income or on capital in its
entirety or on elements of income or wealth, in that
including taxes on gains from the alienation of movable
or immovable property, as well as taxes on capital appreciation.
3. The currently outgoing taxes to which this agreement
applied are especially:
a) in Chile, taxes imposed under the income tax Act, "Ley
sobre Impuesto a la Renta "(in the following referred to as" Chilean
tax "), and
b) in Sweden,
1. the State income tax,
2. the withholding tax rate,
3. the Special income tax for non-residents,
4. the Special income tax for non-resident artists
et al.,
5. the municipal income tax, and
6. the State property tax
(in the following referred to as "Swedish tax").
4. the agreement also apply to taxes for the same or essentially
similar nature and on taxes on capital, after
the signing of the agreement is levied alongside or in place
for the currently outgoing taxes. The competent
the authorities of the Contracting States shall, at the end of
each year, communicate to each other the substantial amendments made to the
the respective tax laws.
CHAPTER II
DEFINITIONS
Article 3
General definitions
1. Unless the context gives rise to different, have in the application
by this agreement the following expressions the following meaning:
a) "Chile" refers to the Republic of Chile and includes, in addition to Chile's
territory, any sea area over which the Republic of
Chile, in accordance with international law, exercises
sovereign rights or jurisdiction;
b) "Sweden" means the Kingdom of Sweden and the includes Sweden's
territory, territorial waters of Sweden and other maritime areas
over which Sweden, in accordance with international law,
sovereignty or jurisdiction,
(c)) "a Contracting State" and "the other Contracting
the State "refers to Chile or Sweden, depending on the context,
d) "person" includes natural persons, companies and other
Association,
e) "company" means any legal person or any other that at
taxation is treated as a legal person,
f) "enterprise of a Contracting State" and "enterprise of the other
Contracting State "refers to the business carried on by any person with
resident in one Contracting State or business conducted
by a resident of the other Contracting State,
g) "international transport" means transport by ship or
aircraft used by enterprises of a Contracting State except
When the transport is carried out solely between places in the other
Contracting State,
h) "competent authority" means:
1) in Chile: the Minister of finance or his authorised representative,
and
2) in Sweden: the Minister of finance or his authorised representative
or authority to whom be entrusted to be competent
authority for the purposes of this agreement,
in) "national" means:
1) natural person which has the nationality of a Contracting
State, or
2) legal person or association governed by the
laws in force in a Contracting State.
2. Where a Contracting State applies the agreement at a particular
time is deemed, unless the context shall give rise to different,
any expression that is not defined in this agreement have the meanings
that statement has at that time under the State's
legislation in respect of such taxes to which the agreement
applied and the relevant expression is under current
tax law of that State shall take precedence over the
significance of the expression under any other legislation in this
State.
Article 4
Resident
1. for the purposes of this agreement, the term "person with
resident in one Contracting State "person under
the laws of that State, is liable to tax there because of
domicile, residence, place of management, company formation
or other similar circumstances and also includes this
State, its political subdivisions and local authorities
and its public bodies or institutions. This
expression, however, does not include a person who is liable to tax in
This State only of income from sources in that State or of
wealth located there.
Income, profits or capital gains acquired by the person
that is fiscally transparent under the laws of one of the
the Contracting States are considered acquired by any person with
resident in one Contracting State to the extent that income or
the profits according to the tax laws of this State is treated as
income, profits or capital gains of a person with
resident there.
2. where by reason of the provisions of paragraph 1 an individual is
a resident of both Contracting States, is determined his residence
in the following ways:
a) natural person considered to be resident only of the State in which the
the individual has a permanent home available to his
disposal. If the natural person has such a home in both
States, shall be deemed to be a resident only of the State with which the
his personal and economic relations are strongest
(Centre of life interests),
(b)) if it cannot be settled in the State natural person has
Centre for their living interests or if the person is not in
neither State has a dwelling that is permanently available to the
made available, shall be deemed to be a resident only of the State in which the
the person usually resides,
c) If natural person usually resides in both States or
not reside permanently in any of them, shall be deemed to be resident
only in the State in which the person is a national,
d) If a natural person is a national of both States or is not
nationals of any of them, the competent authorities of the
Contracting States may settle the question by mutual
agreement.
3. where by reason of the provisions of paragraph 1 a person other than the
an individual is a resident of both Contracting States, it is considered
He is resident only in the State in which he is a national. If
the person is a national of both Contracting States or
not in any of them, the competent authorities of the
Contracting States shall seek to establish his residence by
mutual agreement. In the absence of such agreement
the person concerned shall not be entitled to any tax credit
or an exemption from tax under this agreement.
Article 5
Permanent establishment
1. for the purposes of this agreement the term "fixed
establishment means a fixed place of business, from
What a business is wholly or partly carried on.
2. The term "permanent establishment" includes especially:
a) place of business management,
b) branch,
c) offices,
d) factory,
e) workshop, and
f) mine, an oil or gas well, a quarry or any other place
related to the exploration or extraction of natural resources.
3. The term "permanent establishment" shall also include:
a) site for construction, landscaping or
installation activities and activities of
monitoring in connection therewith, but only where the activities
runs longer than six months, and
(b)) the provision of services, including consultancy services,
by an enterprise through employees or other individuals
engaged by the enterprise for such purpose, if the operation is in progress
within a Contracting State for a period or
time periods that in total exceed 183 days during a
12-month period.
In the calculation of the time limits specified in this paragraph shall
activities of an associated enterprises with
another company in the manner set out in article 9 shall be added together
with the period during which activities are carried out by the latter
the company on corporate activities are identical or
substantially similar.
4. Notwithstanding the preceding provisions of this article shall be deemed to
the term "permanent establishment" shall not include:
(a)) the use of facilities solely for storage,
exhibition or disclosure of company-owned goods,
(b) holding of a company belonging to) stock in trade solely
for storage, exhibition or distribution,
(c) holding of a company belonging to) stock in trade solely
for working or processing by other company,
d) holding of fixed place of business
exclusively for the purchase of goods or obtaining information
for the company,
e) holding of fixed place of business
exclusively for advertising, information provision, or
the pursuit of scientific research for the company, if
the business is of a preparatory or auxiliary character.
5. If a person, who is not such independent representative on
which paragraph 6 of this article applies, is active for a
companies, as well as in a Contracting State and which are regularly
using the power of attorney to conclude contracts in the name, it is considered
This company-notwithstanding the provisions of paragraphs 1 and
2 of this article-to have a permanent establishment in that State in respect of
each activity which that person carries on business. This
does not apply, if the activities of that person engaged in
is limited to those referred to in paragraph 4 and which on the
conducted from a fixed place of business are not
would make this fixed place of business to
permanent establishment under the provisions of that paragraph.
6. the Company is not considered to have a permanent establishment in a Contracting
State only on the basis that the company conducts
business in that State through the intermediary of brokers,
Commissioner, or other independent agent, in
in doing so, provided that such person is engaged in his customary
business activities and that the terms be agreed or
provided in the person's commercial or financial
relations with the company do not differ from those which would be
agreed with independent brokers, agents or
representatives.
7. the fact that a company resident in a
Contracting State controls or is controlled by a
a company resident in the other Contracting State or in a
companies doing business in the other State
(either from a permanent establishment or otherwise),
not in and of itself to constitute either company a permanent establishment
for the other.
CHAPTER III
TAXATION OF INCOME
Article 6
Income from immovable property
1. income, as a person resident in one Contracting State
acquires immovable property (including income from agriculture
or forestry) situated in the other Contracting State, may
be taxed in that other State.
2. for the purposes of this agreement, the term "fixed
property "has the same meaning as the term under the laws
in the Contracting State in which the property is situated. The expression
However, always include accessory to immovable property, living and
kill equipment in agriculture and forestry, rights to which the
the provisions of civil law relating to immovable property apply,
buildings, tenancies of immovable property, as well as the right to
changeable or fixed remuneration for the use of, or
the right to use mineral occurrence, source or other
natural resource. Ships and aircraft is not considered to be fixed
property.
3. the provisions of paragraph 1 shall apply to income acquired
through immediate use, through rental or other
use of immovable property.
4. the provisions of paragraphs 1 and 3 shall also apply to income
of immovable property belonging to the company and on the income of the firm
property used by independent professional activities.
Article 7
Income from operating
1. the Income of an enterprise of a Contracting State
acquire, shall be taxable only in that State unless the enterprise
carries on business in the other Contracting State from where
permanent establishment situated. If the enterprise carries on or has
engaged in operating on the newly specified manner, the company's income
be taxed in the other State but only so much thereof as
is attributable to that permanent establishment.
2. enterprises of a Contracting State carries on business in the
other Contracting State from where the permanent establishment situated
are entered, unless the provisions of paragraph 3 shall give rise to another, in
Each Contracting State to the permanent establishment the
income as it can be assumed that the establishment would have acquired,
If it was a standalone company, which is operated by
the same or similar nature under the same or similar conditions
and independently completed the business with the undertaking to which the
establishment and with all other persons.
3. In determining permanent establishment the income, deductions
be made for necessary expenses incurred for the fixed
establishment, including included expenses for the company's
management and General Administration, whether the expenditure
raised in the State in which the permanent establishment is situated
or elsewhere.
4. income not attributable to a permanent establishment by reason only of the
the reason to purchase goods through the permanent establishment
merchandise for the enterprise.
5. for the purposes of the preceding paragraphs, income is determined as
is attributable to the permanent establishment by the same procedure
from year to year, unless good and sufficient reasons causing the
other things.
6. Included in income by operating income which are dealt with in particular in
other articles of this agreement, the provisions of these
articles of the rules contained in this article.
Article 8
Sea and air transport
1. income acquired by the company in a Contracting State
through the use of ships or aircraft in international
traffic shall be taxable only in that State.
2. For the purposes of this article, including the expressions:
a) "income":
1) gross revenues directly derived from the use of ship
or aircraft in international traffic, and
2) interest on the amount directly acquired through the use of
ship or aircraft in international traffic, but only if
interest income in relation to the activities of the rest of the
incidental,
(b)) "the use by ships or aircraft of a company:
1) charter or rental of ships or aircraft on so-called
bare boat basis, and
2) the rental of containers and related equipment,
provided that such charter or rental, in
relation to the company's use of ship or
aircraft in international traffic, is of secondary
importance.
3. the provisions of paragraph 1 shall also apply to income
acquired through participation in a pool, a joint business
or an international operating agency.
Article 9
Companies with associated enterprises
1. In cases where the
a) an enterprise of a Contracting State, either directly or indirectly
participate in the management or control of a company in the other
Contracting State or owns part of the company capital,
or
(b)) the same person participates directly or indirectly in the management,
or control of an enterprise of a Contracting State
as an enterprise of the other Contracting State or own
part in both of these corporate capital, observed the following.
If between businesses in terms of trade relations or
financial relations agreed upon or prescribed conditions, as
differ from those which would have been agreed between each other
independent company, receives all the income, that without such conditions
would have been one company but who, because of
the terms in question did not come about this company, be included in the
This company's income and taxed accordingly.
2. In cases where one Contracting State in the income of a company
in this State do-and accordingly, taxes
-income, for which an enterprise of the other Contracting
State is taxed in the other State, and it thus
ancillary income is such as would have been the company
in the first State on the terms agreed between
the enterprises had been those which would have been agreed between the
independent companies, the other State, if the
agree, implement the proper adjustment of the amount of the tax
levied for income there. When such adjustments are observed
the other provisions of this agreement and the competent authorities
in the Contracting States is discussing with each other when necessary.
Article 10
Dividend
1. Dividends paid by a company resident in one Contracting State
to a resident of the other Contracting State,
be taxed in that other State.
2. Dividend, taxed in the Contracting State in which
the company paying the dividends is a resident, according to
the laws of that State, if it has the right to
However, the distribution is a resident of the other Contracting
the State shall not exceed:
a) 5 per cent of the gross amount of the dividends if the beneficial
the dividend is a company which, directly or indirectly,
control at least 20 per cent of the total number of votes in the
the distributing company, and
b) 10 per cent of the gross amount of the dividends in all other cases.
The provisions of this paragraph shall be without prejudice to the company's taxation
for the profit of which the dividends are paid.
The provisions of this paragraph do not limit at
the application of the additional tax (the "additional tax")
out in Chile provided that the primary corporate tax rate
("the first category tax") can be offset from
the additional tax. In addition, that from such date of
the said regulations cease to apply, the Contracting
States consult with each other with a view to amending the agreement of
to restore the balance of the commitments in the agreement.
3. The term "dividends" is understood in this article income by
shares or other rights, not being debt-claims, with
right to share in profits, as well as income from other rights which
According to the law of the State in which the distributing company has
domicile for tax purposes is treated in the same way as income
of shares.
4. the provisions of paragraphs 1 and 2 shall not apply if the
who is entitled to the dividends is a resident of a Contracting
State and carries on business in the other Contracting State,
which the company paying the dividends is a resident, from where
permanent establishment situated or exercising independent
professional activities in the other State from where located
permanent device, and the proportion due to the
dividend paid owns actual relation to the Permanent
the establishment or the permanent devices. In such a case
apply the provisions of article 7 or article 14.
5. If the company resident in one Contracting State acquires
income from the other Contracting State, that other
State does not tax dividends paid by the company, except to the
so far as the dividend is paid to a resident of the other
State or insofar as the percentage due to the dividend payment
paid owns truly connected with a permanent establishment or
permanent device in that other State, nor on
the company's undistributed profits to a tax payable on non-
distributed profits, even if the delivery or the undistributed
profit consists wholly or partly of income arising in
that other State.
6. the provisions of this article shall not apply if the
main purpose or one of the main objectives, in
one of the people who have influence over the formation of the
company or placement of units or other rights of
because of which the dividend is paid, is to achieve the benefits of
This article by such a formation or such placement.
Article 11
Interest rate
1. interest, stemming from a Contracting State and which
paid to a resident of the other Contracting
the State, may be taxed in that other State.
2. interest may be taxed in the Contracting
State from which it is derived, under the laws of this
State, but if the beneficial owner of the interest is a resident of the
other Contracting State, the tax shall not exceed:
a) 5 per cent of the gross amount of the interest if this is due to the
loans granted by the bank or insurance company,
b) 15 per cent of the gross amount of the interest in all other cases.
3. The term "interest" for the purposes of this article the income of
each kind of claim, whether secured by mortgage
in immovable property or not, and in particular, income from securities
issued by the State and bonds or
debentures. The term also includes the income which, in accordance with the
State from which income is derived is treated in
the same way for tax purposes as revenue from lending.
The term "interest" does not include income referred to in article
10.
4. the provisions of paragraphs 1 and 2 of this article shall apply
No, if the beneficial owner of the interest is a resident of a
Contracting State, carries on business in the other
Contracting State, from which the interest arises, from which
permanent establishment situated or exercising independent
professional activities in the other State from where located
permanent device, as well as the claim for the interest rate
paid owns truly connected with the permanent establishment or
the permanent devices. In such a case be applied
the provisions of article 7 or article 14 of this agreement.
5. interest shall be deemed to arise from a Contracting State if
the payer is a resident of this State, If
However, the person paying the interest, whether he is
resident in a Contracting State or not, in a
Contracting State has a permanent establishment or a permanent
device in connection with which the liability is incurred for the
the interest is paid, and the interest rate borne by the permanent establishment
or the permanent devices, considered the interest come from
the State in which the permanent establishment or the Permanent
the device is available.
6. where by reason of a special relationship between the payer and the
the beneficial owner of the interest or between both of them and other
person the amount of the interest, for any reason, exceed the amount
which would have been agreed between the payer and the beneficial owner
the interest rate on such relationships do not exist, the
the provisions of this article only on the latter amount. In
such cases are taxable surplus amount referred to in
the law of each Contracting State in accordance with
the other provisions of this agreement.
7. the provisions of this article shall not apply if the
main purpose or one of the main objectives, in
one of the people who have influence over the creation
or the location of the claim in respect of which the interest is paid, is
to achieve the benefits of this article through such creation
or such placement.
Article 12
Royalty
1. Royalty, as derived from a Contracting State and which
paid to a resident of the other Contracting
the State, may be taxed in that other State.
2. Such royalties may be taxed in the
Contracting State from which it is derived, according to
the laws of that State, but if the beneficial owner of
the royalty is resident in the other Contracting State,
the tax does not exceed:
a) 5 per cent of the gross amount for the use of royaltyns or
the right to use industrial, commercial or scientific
equipment,
b) 10 per cent of the gross amount of the royaltyns in all other cases.
3. The term "royalties" in this article, of course, every kind of
payments received as compensation for the use of, or
for the right to use copyright to literary, artistic
or scientific work, including cinematograph films or
video, tape or other means of image or sound reproduction,
patent, trade mark, design or model, plan, secret
recipe or secret manufacturing process or other intangible
assets, as well as for the use of, or the right to use
industrial, commercial or scientific equipment or
for information concerning industrial, commercial
or scientific nature.
4. the provisions of paragraphs 1 and 2 of this article shall apply
No, if the beneficial owner of royalties is a resident of a
Contracting State, carries on business in the other
Contracting State, from which the royalty arises, from which
permanent establishment situated or exercising independent
professional activities in the other State from where located
permanent device, and the right or property in
respect of which the royalty is paid fair owns the context of the
permanent establishment or permanent device. In
in such cases the provisions of article 7 and
Article 14 of this agreement.
5. Royalties shall be deemed to arise from a Contracting State if
the payer is a resident of this State, If
However, the person paying the royalties, whether he is
resident in a Contracting State or not, in a
Contracting State has a permanent establishment or a permanent
device in connection with which the obligation to pay the royalty
arose, and the royalty charged to the permanent establishment or
the permanent device, are considered royalty come from the
State in which the permanent establishment or the Permanent
the device is available.
6. where by reason of a special relationship between the payer and the
the person entitled to the royalties or between both of them and other
person the amount of the royalties, having regard to the use, the
right or the enlightenment for which royalties are payable,
exceeds the amount which would have been agreed between the payer
and the person entitled to the royalty for such relations not
exist, the provisions of this article shall apply only to
the latter amount. In such a case the taxable surplus amount
According to the law of each Contracting State with
observance of the other provisions of this agreement.
7. the provisions of this article shall not apply if the
main purpose or one of the main objectives, in
one of the people who have influence over the creation
or the placement of the right in respect of which the royalty
paid, is to achieve the benefits of this article through such
creation or placement.
Article 13
Capital gain
1. Profit, as a person resident in one Contracting State
acquires from the alienation of immovable property
situated in the other Contracting State, may be taxed in the
that other State.
2. Gains from the alienation of movable property forming part
of the operating assets of a permanent establishment which an enterprise of the
a Contracting State has in the other Contracting State,
or of movable property, attributable to a permanent device
in order to exercise an independent profession, as a person with
resident of a Contracting State has in the other Contracting
the State, may be taxed in that other State. The same applies to profits
the alienation of such a permanent establishment (alone
or together with the whole enterprise) or of such a
permanent device.
3. Gains from the alienation of ships or aircraft
used in international traffic, or movable property which is
attributable to the use of such ship or aircraft;
shall be taxable only in the Contracting State in which the assignor has
resident.
4. Profit, as a person resident in one Contracting State
acquires from the alienation of shares or other
rights representing the capital of a company
resident in the other Contracting State may be taxed in that
If the other Contracting State,
a) profits derived, directly or indirectly, more than 50
percent from immovable property situated in that other
Contracting State, or
b) recipient of the prize at any time during a
12-month period prior to the transfer, directly or indirectly,
owned the shares or other rights representing at least 20
percent of the company's capital, or
c) recipient of the profit is a natural person who has been
a resident of the other Contracting State, a resident of
the first-mentioned Contracting State and the transfer of
shares or rights occurs at any time during the
ten years immediately after the physical person
ceased to be resident in that other State.
Other profit as a person resident in one Contracting State
acquires from the alienation of shares or other
rights representing the capital of a company established
in the other Contracting State may be taxed in that other
Contracting State, but the tax must not exceed 16 per cent
of the amount.
Notwithstanding other provisions of this paragraph, profits
as pension fund resident in one Contracting State acquires
the alienation of shares or other rights
represents the capital of a company resident in the other
Contracting State, be taxable only in the first-mentioned
Contracting State.
5. Gains from the alienation of property other than that
referred to in the preceding paragraphs, shall be taxable only in the
Contracting State of which the alienator is a resident.
Article 14
Independent professional activities
1. income as a physical person resident in one Contracting
State acquires through the exercise of profession or other
independent operations, be taxable only in that State except in the
the following cases, where the income also may be taxed in the other
Contracting State:
a) if physical person in the other Contracting State has
a permanent device, which are regularly at his
disposal to pursue the activity. In such a case, only
the proportion of income as is attributable to that permanent
device be taxed in that other State;
b) if such natural person resident in the other Contracting
State during the period or periods of time as in all
not less than 183 days during a
12-month period. In such a case, only the portion of the
income derived from activities exercised in the other
State, be taxed in that State.
2. The expression "liberal profession" includes especially independent
scientific, literary and artistic activities,
educational and teaching activities and such
independent operations, as a doctor, lawyer, engineer,
Architect, dentist and an accountant.
Article 15
Single service
1. the provisions of articles 16, 18 and 19 shall give rise
otherwise, taxed salary and other remuneration as a person with
resident in one Contracting State receives due
employment, only in that State unless the work is carried out in
the other Contracting State. If the work is performed in this
other State, compensation received for work are taxed
there.
2. Notwithstanding the provisions of paragraph 1 shall be taxable
compensation, as a person resident in one Contracting State
receipt for work performed in the other Contracting State,
only in the first-mentioned State if
a) recipient residing in the other State during the time period or
time periods that in total not exceeding 183 days during a
twelve-month period commencing or ending in the
the tax year in question, and
b) the remuneration is paid by the employer who is not domiciled in
the other State or on his behalf, and
c) compensation does not affect the establishment or
permanent device which the employer has in the other
State.
3. Notwithstanding the preceding provisions of this article
taxable compensation, as a resident of a
Contracting State receives for work on board
ship or aircraft in international traffic,
only in that State.
Article 16
Directors ' fees
Directors ' fees and other compensation, as a resident of
a Contracting State receives as a member of the Board of Directors
or other similar bodies in companies established in other
Contracting State, may be taxed in that other State.
Article 17
Artists and athletes
1. Notwithstanding the provisions of articles 14 and 15,
income, as a resident of a Contracting State
acquire through their personal activities in the other
Contracting State in his capacity as a performer, such as theatre or
movie actor, radio or television artiste, or a musician,
or as athletes, be taxed in that other State.
Income that is subject to the provisions of this paragraph includes
any income that a person receives from personal activities
performed in the other State related to his
renown as an artist or sport enthusiasts.
2. Notwithstanding the provisions of articles 7, 14 and 15 may,
in cases where the income through personal activities as an artist or
athletes engaged in that capacity does not become the property of the artist
or sportutövaren personally, but another person, this
income will be taxed in the Contracting State in which the artist or
sportutövaren conducts business.
Article 18
Pension and alimony
1. Pension derived from a Contracting State and paid
to a resident of the other Contracting State, may
be taxed in that State.
2. Alimony or other allowance payable to
person resident in one Contracting State shall be taxable only in
This State alimony or other allowance payable
by a resident of one of the Contracting States to
a resident of the other Contracting State shall be taxable,
to the extent that the payment is not deductible for the payer,
only in the first State.
Article 19
Public service
1. a) salaries and other remuneration (except for retirement), as
paid by a Contracting State, its political
subdivisions or local authorities, to the natural person on
because of the work done in this State, the section
or governmental service, shall be taxable only in that State.
b) Such salary and other remuneration shall be taxable only in
the other Contracting State if the work is performed in this State
and the person in question is domiciled in this State and
1) is a national of that State, or
2) were not allowed to live in this State solely for the purpose of performing
the work.
2. the provisions of articles 15, 16 and 17 shall apply to salaries
and other compensation paid on the basis of work carried out
in connection with business carried on by a Contracting State, a
of its political subdivisions or local authorities.
Article 20
Students
A student, apprentice or business trainee who is, or
immediately before visiting a Contracting State of residence
in the other Contracting State and who is staying in the
first State exclusively for teaching or
practice, not subject to tax in that State for amounts that he or she
receives for his living, teaching or training, on
amounts derived from sources outside that State.
Article 21
Other income
1. income as a resident of a Contracting State
acquires and which are not dealt with in the foregoing articles of this
Agreement shall be taxable only in that State, regardless of the origin of income
derived.
2. the provisions of paragraph 1 shall not apply to income, with
excluding income from immovable property referred to in article 6
paragraph 2, if the recipient of the income is resident in a
Contracting State, carries on business in the other
Contracting State from where the permanent establishment situated or
exercising independent professional activities in the other State from where
located permanent device, as well as the right or
property in respect of which the income is paid owns real
connected with the permanent establishment or the Permanent
the device. In such cases, apply the provisions of article 7
and article 14.
3. Notwithstanding the provisions of paragraphs 1 and 2,
income as a resident of a Contracting State
acquires and which are not dealt with in the foregoing articles of this
Agreement and arising from the other Contracting State,
be taxed in that other State.
CHAPTER IV
TAXATION OF FORTUNE
Article 22
Fortune
1. Fortune consisting of immovable property the person with
resident in one Contracting State and which is located
in the other Contracting State may be taxed in that other
State.
2. Assets consisting of movable property forming part of the
the operating assets of a permanent establishment which an enterprise of a
Contracting State has in the other Contracting State,
or of movable property pertaining to a permanent device for
to exercise an independent profession, as resident
of a Contracting State has in the other Contracting State,
may be taxed in that other State.
3. wealth consisting of ship and aircraft used in the
international traffic by an enterprise of a Contracting State
and of movable property that is attributable to the use of such
ships and aircraft, shall be taxable only in that State.
4. All other types of wealth, as a resident of a
Contracting State, be taxable only in that State.
5. the provisions of paragraphs 1, 2, 3 and 4 shall be applied in a
Contracting State only if both Contracting States
a general tax on wealth.
CHAPTER V
METHODS TO AVOID DOUBLE TAXATION
Article 23
The Elimination of double taxation
1. in the case of Chile, double taxation shall be avoided in
the following ways:
a) resident in Chile who receives income or
holding assets in accordance with the provisions of this agreement,
taxed in Sweden may, having regard to the provisions of
Chilean law, set off interest from Swedish tax Chilean tax
to be paid in respect of the same income or wealth
and this paragraph apply to all income referred to in the agreement.
b) where a resident of Chile receives income or
holding assets in accordance with the provisions of this agreement are
exempt from taxation in Chile, Chile at
the determination of the tax levy for General income or
fortune of such person, take into account the income or
assets exempt from taxation.
2. in the case of Sweden, double taxation shall be avoided in
the following ways:
a) where a resident of Sweden acquires income according to
Chilean legislation and in accordance with the provisions of this
Agreement may be taxed in Chile, Sweden-with regard to the
the provisions in the Swedish legislation relating to the settlement of
foreign tax (even as they now can get through
to change without the general principle as stated this change)
-from the Swedish tax on income offset an amount
corresponding to the Chilean tax paid on income.
b) where a resident of Sweden acquires income according to
the provisions of this Agreement shall be taxable only in Chile, may
Sweden for the purpose of determining the tax rate for the Swedish
progressive tax, take into account the income which shall be taxable only
in Chile.
c) Notwithstanding the provisions of subparagraph (a)) in this paragraph is
dividends from companies established in Chile to resident companies
in Sweden exempt from Swedish tax according to the provisions of
the Swedish exemption for dividends paid to
Swedish companies by companies abroad.
(d)) where a resident of Sweden owns capital,
in accordance with the provisions of this agreement may be taxed in Chile,
should Sweden from tax on that person's fortune set off
an amount equal to the capital tax paid in
Chile. Settlement amount shall not, however, exceed the
part of the Swedish wealth tax, calculated without such
settlement, charged on the fortune that may be taxed in the
Chile.
CHAPTER VI
SPECIFIC PROVISIONS
Article 24
Prohibition of discrimination
1. nationals of a Contracting State shall not, in the second
Contracting State be subject to taxation or
coherent demands that are of a different kind or more onerous than
the taxation and related requirements as nationals of
the other State under the same conditions, in particular as
relating to residence, are or may be subject to.
2. the taxation on a permanent establishment which businesses in a
Contracting State has in the other Contracting State,
in that other State shall not be less favourable than
taxation of the company in the other State, that carries
activities of the same kind.
3. This article does not entail the obligation for an
Contracting State to grant to a resident of the other
Contracting State such personal deductions for
taxation, such exemptions or reductions for
because of marital status or dependants for family
granted resident in their own State.
4. Except where the provisions of article 9, paragraph 1,
Article 11, paragraph 6, or article 12 paragraph 6 applies, the
interest, royalties and other payments from the company in a
Contracting State to a resident of the other
Contracting State tax deductible in determining the
taxable income of such company on the same terms and conditions
as payment to a resident of the first State.
Similarly, debt as a company of a Contracting State has
to a resident of the other Contracting State
deductible in determining such business
taxable assets on the same terms as the debt to
person resident in that State.
5. Company resident in a Contracting State, whose capital
is wholly or partly owned or controlled, directly or
indirectly, by one or more residents of the other
Contracting State, shall not be in the first State
subject to taxation or related requirements
other or more burdensome than the taxation and thus
coherent requirements as other similar companies resident in the
first State are or may be subjected.
6. for the purposes of this article the term "taxation" taxes
covered by the agreement.
Article 25
The procedure for the mutual agreement
1. If a person believes that a Contracting State or both
Contracting States took measures for the latter entails
or will result in taxation contrary to
the provisions of this agreement, the person may, without
affect the person's right to make use of the legal remedies
available in the domestic legal system of those States, present the thing
for the competent authority of the Contracting State in which the
the person is a resident or, if the question is about the application of
Article 24, paragraph 1, in the Contracting State in which he is
citizens.
2. If the competent authority finds the complaint justified but
Unable to achieve a satisfactory solution,
the authority shall seek to resolve the matter by mutual
agreement with the competent authority of the other
Contracting State in order to avoid taxation which
contrary to the agreement.
3. the competent authorities of the Contracting States shall
by mutual agreement, seek to determine or
doubts arising concerning the interpretation or
the application of the agreement.
4. the competent authorities of the Contracting States may
enter into direct relations with each other in order to meet
agreement in the cases specified in the preceding paragraphs.
Article 26
Exchange of information
1. the competent authorities of the Contracting States shall
Exchange such information as is necessary to implement the
the provisions of this agreement or of the Contracting
States ' internal legislation concerning taxes covered
by the agreement, insofar as the taxation thereunder
not contrary to the agreement. Exchange of information is limited
not by article 1. Information which a Contracting State
received shall be treated as secret in the same manner as
information obtained in accordance with the internal legislation of the
This State and shall be disclosed only to persons or authorities
(including courts and administrative bodies)
establishes, or collect the taxes which are the subject of
agreement or dealing with criminal charges or complaints regarding these
taxes. Such persons or authorities shall use the
the information only for such purposes. They may disclose
the information in public court proceedings or in
Court decisions.
2. the provisions of paragraph 1 is not considered to entail the obligation for
a Contracting State to
a) take administrative measures derogating from the legislation and
administrative practices in force in that Contracting State, or in the
other Contracting State,
b) provide information that is not available under
legislation or the usual administrative practice in this
Contracting State or of the other Contracting State,
c) supply information which would disclose any trade secret,
industrial, commercial or professional secret, or in
trade used the process or information,
the surrender would be contrary to ordre public considerations (
public).
3. If a Contracting State so requests information under this
Article, the other Contracting State shall obtain the
information which the representation relates in the same way as if it
applied its own taxation, even if the other State at the
This time don't need such information. If the competent
authority of a Contracting State, in particular, shall
the competent authority of the other Contracting State search
provide information under this article in the form
as requested, such as written witness statements and copies of
edited original documents (including books,
documents, reports, records, books of account or
letters) to the same extent as such certificates and
documents can be obtained under the laws and administrative
practice of that other State with respect to its own taxes.
Article 27
Members of the diplomatic mission and consular posts
The provisions of this Agreement shall not affect the privileges at the
taxation which, according to the General rules of international law or
provisions of specific agreements apply members
the diplomatic mission or consular post.
Article 28
Other provisions
1. for the purposes of this agreement, investment funds and
any other kind of Fund managed by the resident in
Chile, taxed in Chile in respect of dividends, interest,
capital gains and other income derived from the property
or investment in Chile.
2. for the purposes of paragraph 3 of article XXII (Consultation) of the
the General Agreement on Trade in Services, they are
Contracting States agree that, notwithstanding that
paragraph, dispute arising between them as to whether a measure
subject to this agreement may, in accordance with paragraph 1,
decided by the Council for Trade in Services only with the
the consent of both Contracting States. Doubt about
the interpretation of this paragraph shall be resolved under article 25, paragraph 3
or, if that fails, according to another procedure that both
Contracting States agree.
3. this agreement does not affect the application of the
provisions of Chilean law DL 600 in the version they have
at the time of signature of this agreement, with the version
they now can get through to change without public
the policy listed here changes.
4. Charges for services performed during a year, and
paid this year by or for an individual with
resident in one Contracting State to a pension plan
recognised for tax purposes in the other Contracting State
shall, during a period of not more than 60 months,
be treated in the same way for tax purposes in the first-mentioned
State that a fee is paid to a pension plan
recognised for tax purposes in that first-mentioned State if
a) payments were made regularly by or for such physical
person to the pension plan during the period immediately before
the person was domiciled in that State, and
(b)), the competent authority of the first State considers that
the pension plan as a whole conform to a pension plan
recognized for tax purposes in that State.
For the purposes of this paragraph includes the phrase
"pension plan" a pension plan which was launched in accordance with
the social security system of a Contracting State.
5. Taking into account that the main objective of the agreement is
to avoid international double taxation is the
Contracting States agree that, in the event that the agreement
rules are applied in such a way that benefits are payable
not been considered or intended, the competent authorities of
the Contracting States shall consult with each other
in accordance with the procedure laid down by mutual agreement according to
Article 25 in order to amend the agreement if deemed necessary.
6. the provisions of this Agreement shall not affect the taxation of the
Chile by resident in Sweden in terms of profit that is
attributable to the permanent establishment in Chile, as regards both the
primary corporate tax ("the first category tax") and
additional tax (the "additional tax") provided that:
the primary corporate tax rate could be offset by additional taxes.
7. with regard to income acquired by the air transport Consortium
Scandinavian Airlines System (SAS) will apply the provisions of
Article 8 paragraph 1 only in terms of the proportion of income that
corresponds to the percentage of the Consortium held by SAS Sweden AB,
the Swedish partner of SAS.
8. with regard to the profit gained by the air transport Consortium
Scandinavian Airlines System (SAS) will apply the provisions of
Article 13 only in respect of the part of the profits as corresponds to the
the share in the Consortium held by SAS Sweden AB, the
Swedish partner of SAS.
9. as regards the wealth held by the air transport Consortium
Scandinavian Airlines System (SAS) will apply the provisions of
Article 22 only in respect of the portion of assets that
corresponds to the percentage of the Consortium held by SAS Sweden AB,
the Swedish partner of SAS.
CHAPTER VII
FINAL PROVISIONS
Article 29
Date of entry into force
1. Each Contracting State shall by diplomatic means
inform the other State when the measures taken under
respective State law required that this agreement
to enter into force. The agreement shall enter into force on the day on which the
the last of these notifications is received.
2. the provisions of this Agreement shall apply:
a) in Chile,
1) in respect of taxes on income as are acquired and the amount
paid, tillgodoförs an account, made available or
recognised as an expense, on 1 January of the calendar year immediately
following the year in which the agreement enters into force or later,
2) in respect of wealth tax, if and to the extent such
tax is introduced in Chile after the signing of this agreement, for
tax levied on assets held on 1 January of the
years following the date on which the wealth tax
introduced or later,
b) in Sweden,
1) in respect of withholding taxes, on amounts paid or
tillgodoförs on 1 January of the year following the
year in which the agreement enters into force or later,
2) in respect of other taxes on income, for income tax
accrual for fiscal years beginning on 1 January of the year
the closest following the year in which the agreement enters into force, or
later,
3) in respect of wealth tax, if and to the extent such
tax is introduced in Chile after the signing of this agreement, for
tax levied on assets held on 1 January of the
years following the date on which the wealth tax
introduced or later.
Article 30
Termination
1. this Agreement shall remain in force indefinitely but either
Contracting State may by 30 June of any
calendar year beginning after the expiration of the year of entry
date of entry into force to terminate the agreement through diplomatic channels
in the other Contracting State.
2. the provisions of this agreement will expire:
a) in Chile,
in the case of tax on income that is acquired, the amounts paid,
tillgodoförs an account, made available or disclosed
that cost, or on capital held, 1 January
the calendar year immediately following the year in which the termination
or later,
b) in Sweden,
1) in respect of withholding taxes, on amounts paid or
tillgodoförs on 1 January of the year immediately following
the end of the six-month period or later,
2) in respect of other taxes on income, for income tax
accrual for the tax year that begins on 1 January of the year
immediately after the end of the six-month period, or
later,
3) in respect of wealth tax, is assessed for tax it
second calendar year that immediately after the end of
the six-month period or later.
In witness whereof the undersigned, being duly
authorised, have signed this agreement.
Done at Stockholm on 4 June 2004, in duplicate in the
Spanish, Swedish and English languages. In the event that
dispute in the interpretation, the English text shall be
seniority.
For the Government of the Kingdom of Sweden
Bosse Ringholm
For the Government of the Republic of Chile
Nicolás Eyzaguirre
Protocol to the agreement between the Kingdom of Sweden and
The Republic of Chile for the avoidance of double taxation and
Prevention of tax evasion with respect to taxes on income and
at Fortune
At the time of signing the agreement for the avoidance of
double taxation and the prevention of fiscal evasion with respect to
taxes on income and on capital between the Kingdom of
Sweden and the Republic of Chile, the Contracting States
agreed that the following provisions shall constitute a
integral part of the agreement:
Articles 10, 11 and 12
On article 10 paragraph 6, article 11, paragraph 7 and article
12 paragraph 7 shall, as a Contracting State contemplates denying
a resident of the other Contracting State
benefits, the competent authorities shall consult each other.
Articles 11 and 12
If an agreement or an agreement between Chile and the
Member State of the Organisation for economic cooperation and
development provides that Chile exempts from taxation
interest or royalty (either generally or in respect of certain
types of interest or royalties) derived from Chile, or
limits the tax on such interest or royalties (either
generally or in respect of certain types of interest or royalty)
at a lower rate than that set out in article 11, paragraph 2
or article 12 paragraph 2 of the agreement, such waiver or
lower rate apply automatically on interest or royalty
(either generally or in relation to specific types of
interest or royalties) derived from Chile and is rightfully
There is a resident of Sweden, as well as interest or
royalties derived from Sweden and is rightfully applies
a resident of Chile under the same conditions as if
the exception or the lower tax rate was provided for in the
those paragraphs. The competent authorities of Chile shall, without
delay, inform the competent authority of Sweden when
the conditions for the application of this paragraph have been met.
In witness whereof the undersigned, being duly
authorised, have signed this Protocol.
Done at Stockholm on 4 June 2004, in duplicate in the
Spanish, Swedish and English languages. In the event that
dispute in the interpretation, the English text shall be
seniority.
For the Government of the Kingdom of Sweden
Bosse Ringholm
For the Government of the Republic of Chile
Nicolás Eyzaguirre
Convention between the Kingdom of Sweden and the Republic of
Chile for the avoidance of double taxation and the prevention
of fiscal evasion with respect to taxes on income and on
capital
The Kingdom of Sweden and the Republic of Chile, desiring to
conclude a Convention for the avoidance of double taxation and
the prevention of fiscal evasion with respect to taxes on
income and on capital;
Have agreed as follows:
CHAPTER IN
SCOPE OF THE CONVENTION
Article 1
Persons covered
This Convention shall apply to persons who are residents of one
or both of the Contracting States.
Article 2
Taxes covered
1. This Convention shall apply to taxes on income and on
capital imposed on behalf of a Contracting State or of its
political subdivisions or local authorities, irrespective of
the manner in which they are levied.
2. There shall be regarded as taxes on income and on capital
all taxes imposed on total income, on total capital, or on
elements of income or of capital, including taxes on gains from
the alienation of movable or immovable property, as well as
taxes on capital appreciation.
3. The existing taxes to which the Convention shall apply are,
in particular:
(a) in Chile, the taxes imposed under the Income Tax Act ("Ley
sobre Impuesto a la Renta ") (hereinafter referred to as
"Chilean tax"); and
(b) in Sweden,
(i) the national income tax ("State income tax");
(ii) the withholding tax on dividends ("withholding tax");
(iii) the income tax on non-residents ("the Special
income tax for non-residents ");
(iv) the income tax on non-resident artistes and athletes ("the
Special income tax for non-resident artists
etc. ");
(v) the municipal income tax (' the municipal income tax ");
and
(vi) the net wealth tax ("the State property tax")
(hereinafter referred to as "Swedish tax").
4. The Convention shall apply also to any identical or
substantially similar taxes and to taxes on capital which are
imposed after the date of signature of the Convention in
addition to, or in place of, the existing taxes. The competent
authorities of the Contracting States shall, at the end of each
year, notify each other of any significant changes which have
been made in their respective taxation laws.
CHAPTER II
DEFINITION
Article 3
General definition
1. For the purposes of this Convention, unless the context
otherwise requires:
(a) the term "Chile" means the Republic of Chile and includes,
In addition to the national territory, any other maritime areas
over which the Republic of Chile exercises sovereign rights or
jurisdiction in accordance with international law;
(b) the term "Sweden" means the Kingdom of Sweden and includes
the national territory, the territorial sea of Sweden as well
as other maritime areas over which Sweden in accordance with
international law exercises sovereign rights or jurisdiction;
(c) the terms "a Contracting State" and "the other Contracting
State "mean, as the context requires, Chile or Sweden;
(d) the term "person" includes an individual, a company and any
other body of persons;
(e) the term "company" means any body corporate or any entity
which is treated as a body corporate for tax purposes;
(f) the terms "enterprise of a Contracting State" and
"enterprise of the other Contracting State" mean respectively
an enterprise carried on by a resident of a Contracting State
and an enterprise carried on by a resident of the other
Contracting State;
(g) the term "international traffic" means any transport by a
ship or aircraft operated by an enterprise of a Contracting
State, except when such carriage is solely between places in
the other Contracting State;
(h) the term "competent authority" means:
(i) in the case of Chile, the Minister of Finance or the
Minister's authorised representative, and
(ii) in the case of Canada, the Minister of Finance, his
authorised representative or the authority which is designated
as a competent authority for the purposes of this Convention;
(i) the term "national" means:
(i) any individual possessing the nationality of a Contracting
State, or
(ii) any legal person or association constituted in accordance
with the laws in force in a Contracting State.
2. As regards the application of the Convention at any time by
a Contracting State, any term not defined therein shall, unless
the context otherwise requires, have the meaning that it has at
that time under the law of that State for the purposes of the
taxes to which the Convention applies, any meaning under the
applicable tax laws of that State prevailing over a meaning
given to the term under other laws of that State.
Article 4
Resident
1. For the purposes of this Convention, the term "resident of a
Contracting State "means any person who, under the laws of that
State, is liable to tax therein by reason of the person's
domicile, residence, place of management, place of
incorporation or any other criterion of a similar nature and
also includes that State and any political subdivision, local
authority, governmental body or agency thereof. This term,
However, does not include any person who is liable to tax in
that State in respect only of income from sources in that State
or of capital situated therein.
An item of income, profit or gain derived through a person that
is fiscally transparent under the laws of either Contracting
State shall be considered to be derived by a resident of a
Contracting State to the extent that the item is treated for
the purposes of the taxation law of that Contracting State as
the income, profit or gain of a resident.
2. Where by reason of the provisions of paragraph 1 an
individual is a resident of both Contracting States, then the
individual's status shall be determined as follows:
(a) the individual shall be deemed to be a resident only of the
State in which the individual has a permanent home available;
If the individual has a permanent home available in both
States, the individual shall be deemed to be a resident only of
the State with which the individual's personal and economic
relations are closer (centre of vital interests);
(b) if the State in which the individual's centre of vital
interests cannot be determined, or if there is not a permanent
Home available to the individual in either State, the
individual shall be deemed to be a resident only of the State
in which the individual has an habitual abode;
(c) if the individual has an habitual abode in both States or
in neither of them, the individual shall be deemed to be a
resident only of the State of which the individual is a
National;
(d) if the individual is a national of both States or of
Neither of them, the competent authorities of the Contracting
States shall settle the question by mutual agreement procedure.
3. Where by reason of the provisions of paragraph 1 a person
other than an individual is a resident of both Contracting
States, then it shall be deemed to be a resident only of the
State of which it is a national. If the person is a national of
both Contracting States or of neither of them, the Contracting
States shall by mutual agreement procedure endeavour to settle
the question. In the absence of a mutual agreement by the
competent authorities of the Contracting States, the person
shall not be entitled to any relief or exemption from tax
provided by the Convention.
Article 5
Permanent establishment
1. For the purposes of this Convention, the term "permanent
establishment "means a fixed place of business through which
the business of an enterprise is wholly or partly carried on.
2. The term "permanent establishment" includes especially:
(a) a place of management;
(b) a branch;
(c) an office;
(d) a factory;
(e) a workshop; and
(f) a mine, an oil or gas well, a quarry or any other place
relating to the exploration for or the exploitation of natural
resources.
3. The term "permanent establishment" shall also include:
(a) a building site or construction or installation project and
the supervisory activities in connection therewith, but only if
such building site, project or activities last more than six
months, and
(b) the furnishing of services, including consultancy services,
by an enterprise through employees or other individuals engaged
by the enterprise for such purpose, where the activities of that
nature continue within a Contracting State for a period or
periods exceeding in the aggregate 183 days within any twelve
month period.
For the purposes of computing the time limits in this
paragraph, activities carried on by an enterprise associated
with another enterprise within the meaning of Article 9 of this
Convention shall be aggregated with the period during which
the activities are carried on by the last mentioned enterprise if
the activities of the associated enterprises are identical or
substantially similar.
4. Notwithstanding the preceding provisions of this Article,
the term "permanent establishment" shall be deemed not to
include:
(a) the use of facilities solely for the purpose of storage,
display or delivery of goods or merchandise belonging to the
Enterprise;
(b) the maintenance of a stock of goods or merchandise
belonging to the enterprise solely for the purpose of storage,
display or delivery;
(c) the maintenance of a stock of goods or merchandise
belonging to the enterprise solely for the purpose of
processing by another enterprise;
(d) the maintenance of a fixed place of business solely for the
purpose of purchasing goods or merchandise or of collecting
information, for the enterprise;
(e) the maintenance of a fixed place of business solely for the
purpose of advertising, supplying information or carrying out
scientific research for the enterprise, if such activity is of
a preparatory or auxiliary character.
5. Notwithstanding the provisions of paragraphs 1 and 2 of this
Article where a person (other than an agent of an independent
status to whom paragraph 6 of this Article applies) is acting
on behalf of an enterprise and has and habitually exercises in
a Contracting State an authority to conclude contracts on
behalf of the enterprise, that enterprise shall be deemed to
have a permanent establishment in that State in respect of any
activities which that person undertakes for the enterprise,
unless the activities of such person are limited to those
mentioned in paragraph 4 which, if exercised through a fixed
place of business, would not make this fixed place of business
a permanent establishment under the provisions of that
paragraph.
6. An enterprise shall not be deemed to have a permanent
establishment in a Contracting State merely because it carries
on business in that State through a broker, general commission
agent or any other agent of an independent status, provided
that such persons are acting in the ordinary course of their
business, and that the conditions that are made or imposed in
their commercial or financial relations with the enterprise do
not differ from those which would generally be agreed with
independent brokers or agents.
7. The fact that a company which is a resident of a Contracting
State controls or is controlled by a company which is a
resident of the other Contracting State, or which carries on
business in that other State (whether through a permanent
establishment or otherwise), shall not of itself constitute
either company a permanent establishment of the other.
CHAPTER III
TAXATION OF INCOME
Article 6
Income from immovable property
1. Income derived by a resident of a Contracting State from
immovable property (including income from agriculture or
forestry) situated in the other Contracting State may be taxed
in that other State.
2. For the purposes of this Convention, the term "immovable
property "shall have the meaning which it has under the law of
the Contracting State in which the property in question is
situated. The term shall in any case include property accessory
to immovable property, livestock and equipment used in
Agriculture and forestry, rights to which the provisions of
general law respecting landed property apply, buildings,
usufruct of immovable property and rights to variable or fixed
payments as consideration for the working of, or the right to
work, mineral deposits, sources and other natural resources.
Ships and aircraft shall not be regarded as immovable property.
3. The provisions of paragraph 1 shall apply to income derived
from the direct use, letting, or use in any other form of
immovable property.
4. The provisions of paragraphs 1 and 3 shall also apply to the
income from immovable property of an enterprise and to income
from immovable property used for the performance of independent
personal services.
Article 7
Business profits
1. The profits of an enterprise of a Contracting State shall be
taxable only in that State unless the enterprise carries on
business in the other Contracting State through a permanent
establishment situated therein. If the enterprise carries on or
has carried on business as aforesaid, the profits of the
the enterprise may be taxed in the other State but only so much of
them as is attributable to that permanent establishment.
2. Subject to the provisions of paragraph 3, where an
Enterprise of a Contracting State carries on business in the
other Contracting State through a permanent establishment
situated therein, there shall in each Contracting State be
attributed to that permanent establishment the profits which it
might be expected to make if it were a distinct and separate
enterprise engaged in the same or similar activities under the
the same or similar conditions and dealing wholly independently
with the enterprise of which it is a permanent establishment
and with all other persons.
3. In determining the profits of a permanent establishment,
There shall be allowed as deductions necessary expenses which
are incurred for the purposes of the permanent establishment,
including executive and general administrative expenses so
incurred, whether in the State in which the permanent
establishment is situated or elsewhere.
4. No profits shall be attributed to a permanent establishment
by reason of the mere purchase by that permanent establishment
of goods or merchandise for the enterprise.
5. For the purposes of the preceding paragraphs, the profits to
be attributed to the permanent establishment shall be
determined by the same method year by year unless there is good
and sufficient reason to the contrary.
6. Where profits include items of income which are dealt with
separately in other Articles of this Convention, then the
the provisions of those Articles shall not be affected by the
the provisions of this Article.
Article 8
Shipping and air transport
1. Profits derived by an enterprise of a Contracting State from
the operation of ships or aircraft in international traffic
shall be taxable only in that State.
2. For the purposes of this Article:
(a) the term "profits" includes:
(i) gross revenues derived directly from the operation of ships
or aircraft in international traffic, and
(ii) interest on amounts derived directly from the operation of
ships or aircraft in international traffic, but only if such
interest is incidental to the operation;
(b) the expression "operation of ships or aircraft" by an
Enterprise, also includes:
(i) the charter or rental on a bare boat basis of ships and
aircraft, and
(ii) the rental of containers and related equipment;
If that charter or rental is incidental to the operation by the
Enterprise of ships or aircraft in international traffic.
3. The provisions of paragraph 1 shall also apply to profits
from the participation in a pool, a joint business or an
international operating agency.
Article 9
Associated enterprises
1. The Where clause
(a) an enterprise of a Contracting State participates directly
or indirectly in the management, control or capital of an
Enterprise of the other Contracting State, or
(b) the same persons participate directly or indirectly in the
management, control or capital of an enterprise of a
Contracting State and an enterprise of the other Contracting
State,
and in either case conditions are made or imposed between the
the two enterprises in their commercial or financial relations
which differ from those which would be made between independent
enterprises, then any profits which would, but for those
conditions, have accrued to one of the enterprises, but, by
reason of those conditions, have not so accrued, may be included
in the profits of that enterprise and taxed accordingly.
2. Where a Contracting State includes in the profits of an
Enterprise of that State-and taxes accordingly-profits on
which an enterprise of the other Contracting State has been
charged to tax in that other State and the profits so included
are profits which would have accrued to the enterprise of the
the first-mentioned State if the conditions made between the two
enterprises had been those which would have been made between
independent enterprises, then that other State shall, if it
agrees, make an appropriate adjustment to the amount of tax
charged therein on those profits. In determining such
adjustment, due regard shall be had to the other provisions of
This Convention and the competent authorities of the
Contracting States shall if necessary consult each other.
Article 10
Dividends
1. Dividends paid by a company that is a resident of a
Contracting State to a resident of the other Contracting State
may be taxed in that other State.
2. Such dividends may also be taxed in the Contracting State of
which the company paying the dividends is a resident and
According to the laws of that State. However, if the beneficial
owner of the dividends is a resident of the other Contracting
State, the tax so charged shall not exceed:
(a) 5 per cent of the gross amount of the dividends if the
beneficial owner is a company that controls directly or
indirectly at least 20 per cent of the voting power in the
company paying the dividends, and
(b) 10 per cent of the gross amount of the dividends, in all
other cases.
The provisions of this paragraph shall not affect the taxation
of the company in respect of the profits out of which the
dividends are paid.
The provisions of this paragraph shall not limit the
application of the additional tax to be paid in Chile provided
that the first category tax is fully creditable in computing
the amount of additional tax. In addition, from such time as
This condition ceases to exist the Contracting States shall
consult with each other with a view to amending the Convention
to re-establish the balance of benefits under the Convention.
3. The term "dividends" as used in this Article means income
from shares or other rights, not being debt-claims,
participating in profits, as well as income from other rights
which is subjected to the same taxation treatment as income
from shares by the laws of the State of which the company
making the distribution is a resident.
4. The provisions of paragraphs 1 and 2 shall not apply if the
beneficial owner of the dividends, being a resident of a
Contracting State, carries on business in the other Contracting
State of which the company paying the dividends is a resident,
through a permanent establishment situated therein, or performs
in that other State independent personal services from a fixed
base situated therein, and the holding in respect of which the
dividends are paid is effectively connected with such permanent
establishment or fixed base. In such case the provisions of
Article 7 or Article 14, as the case may be, shall apply.
5. Where a company that is a resident of a Contracting State
derives profits or income from the other Contracting State,
that other State may not impose any tax on the dividends paid
by the company, except insofar as such dividends are paid to a
the resident of that other State or insofar as the holding in
respect of which the dividends are paid is effectively
connected with a permanent establishment or a fixed base
situated in that other State, nor subject the company's
undistributed profits to a tax on undistributed profits, even
If the dividends paid or the undistributed profits consist
wholly or partly of profits or income arising in such other
State.
6. The provisions of this Article shall not apply if it was the
the main purpose or one of the main purposes of any person
concerned with the creation or assignment of the shares or
other rights in respect of which the dividend is paid to take
advantage of this Article by means of that creation or
assignment.
Article 11
Interest
1. Interest arising in 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 it arises and according to the laws of that
State, but if the beneficial owner of the interest is a
resident of the other Contracting State, the tax so charged
shall not exceed:
(a) 5 per cent of the gross amount of the interest derived from
loans granted by banks and insurance companies;
(b) 15 per cent of the gross amount of the interest in all
other cases.
3. The term "interest" as used in this Article means income
from debt-claims of every kind, whether or not secured by
mortgage, and in particular, income from government securities
and income from bonds or debentures, as well as income which is
subjected to the same taxation treatment as income from money
lent by the laws of the State in which the income arises. The
the term "interest" shall not include income dealt with in Article
10.
4. The provisions of paragraphs 1 and 2 of this Article shall
not apply if the beneficial owner of the interest, being a
the resident of a Contracting State, carries on business in the
other Contracting State in which the interest arises through a
permanent establishment situated therein, or performs in that
other State independent personal services from a fixed base
situated therein, and the debt-claim in respect of which the
the interest is paid is effectively connected with such permanent
establishment or fixed base. In such case the provisions of
Article 7 or Article 14 of this Convention, as the case may be,
shall apply.
5. Interest shall be deemed to arise in a Contracting State
When the payer is a resident of that State. Where, however, the
the person paying the interest, whether a resident of a Contracting
State or not, has in a Contracting State a permanent
establishment or a fixed base in connection with which the
indebtedness on which the interest is paid was incurred, and
such interest is borne by such permanent establishment or fixed
base, then such interest shall be deemed to arise in the State
in which the permanent establishment or fixed base is situated.
6. Where, by reason of a special relationship between the payer
and the beneficial owner or between both of them and some other
person, the amount of the interest exceeds, for whatever
reason, the amount that would have been agreed upon by the
payer and the beneficial owner in the absence of such
relationship, the provisions of this Article shall apply only
to the last-mentioned amount. In such case, the excess part of
the payments shall remain taxable according to the laws of each
Contracting State, due regard being had to the other provisions
of this Convention.
7. The provisions of this Article shall not apply if it was the
the main purpose or one of the main purposes of any person
concerned with the creation or assignment of the debt-claim in
respect of which the interest is paid to take advantage of this
Article by means of that creation or assignment.
Article 12
Royalties
1. Royalties arising in a Contracting State and paid to a
resident of the other Contracting State may be taxed in that
other State.
2. However, such royalties may also be taxed in the Contracting
State in which they arise and according to the laws of that
State, but if the beneficial owner of the royalties is a
resident of the other Contracting State, the tax so charged
shall not exceed:
(a) 5 per cent of the gross amount of the royalties for the use
of, or the right to use, industrial, commercial or scientific
equipment,
(b) 10 per cent of the gross amount of the royalties in all
other cases.
3. The term "royalties" as used in this Article means payments
of any kind received as a consideration for the use of, or the
right to use, any copyright of literary, artistic or scientific
work, including cinematographic films or films, tapes or other
means of image or sound reproduction, 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.
4. The provisions of paragraphs 1 and 2 of this Article shall
not apply if the beneficial owner of the royalties, being a
the resident of a Contracting State, carries on business in the
other Contracting State in which the royalties arise, through a
permanent establishment situated therein, or performs in that
other State independent personal services from a fixed base
situated therein, and the right or property in respect of which
the royalties are paid is effectively connected with such
permanent establishment or fixed base. In such case the
the provisions of Article 7 or Article 14 of this Convention, as
the case may be, shall apply.
5. Royalties shall be deemed to arise in a Contracting State
When the payer is a resident of that State. Where, however, the
the person paying the royalties, whether a resident of a
Contracting State or not, has in a Contracting State (a)
permanent establishment or a fixed base in connection with
which the obligation to pay the royalties was incurred, and
such royalties are borne by such permanent establishment or
fixed base, then such royalties shall be deemed to arise in the
State in which the permanent establishment or fixed base is
situated.
6. Where, by reason of a special relationship between the payer
and the beneficial owner or between both of them and some other
person, the amount of the royalties, having regard to the use,
right or information for which they are paid exceeds the amount
that would have been agreed upon by the payer and the
beneficial owner in the absence of such relationship, the
the provisions of this Article shall apply only to the last-
mentioned amount. In such case, the excess part of the payments
shall remain taxable according to the laws of each Contracting
State, due regard being had to the other provisions of this
Convention.
7. The provisions of this Article shall not apply if it was the
the main purpose or one of the main purposes of any person
concerned with the creation or assignment of the rights in
respect to which the royalties are paid to take advantage of
This Article by means of that creation or assignment.
Article 13
Capital gains
1. Gains derived by a resident of a Contracting State from the
alienation of immovable property situated in the other
Contracting State may be taxed in that other State.
2. Gains from the alienation of movable property forming part
of the business property of a permanent establishment that an
Enterprise of a Contracting State has in the other Contracting
State or of movable property pertaining to a fixed base
available to a resident of a Contracting State in the other
Contracting State for the purpose of performing independent
personal services, including such gains from the alienation of
such a permanent establishment (alone or with the whole
Enterprise) or of such a fixed base, may be taxed in that other
State.
3. Gains from the alienation of ships or aircraft operated in
international traffic or from movable property pertaining to
the operation of such ships or aircraft shall be taxable only
in the Contracting State of which the alienator is a resident.
4. Gains derived by a resident of a Contracting State from the
alienation of shares or other rights representing the capital
of a company that is a resident of the other Contracting State
may be taxed in that other Contracting State if,
(a) the gains derive more than 50 per cent of their value
directly or indirectly from immovable property situated in that
other Contracting State; or
(b) the recipient of the gain at any time during the 12-month
period preceding such alienation owned, directly or indirectly,
shares or other rights consisting of 20 per cent or more of the
capital of that company; or
(c) the recipient of the gain is an individual who has been a
the resident of that other Contracting State and who has become a
resident of the first-mentioned Contracting State and the
alienation of the shares or other corporate rights occurs at
any time during the ten years next following the date on which
the individual has ceased to be a resident of that other State.
Any other gains derived by a resident of a Contracting State
from the alienation of shares or other rights representing the
capital of a company resident in the other Contracting State
may be taxed in that other Contracting State but the tax so
charged shall not exceed 16 per cent of the amount of the gain.
Notwithstanding any other provision of this paragraph, gains
derived by a pension fund that is a resident of a Contracting
State from the alienation of shares or other rights
representing the capital of a company that is a resident of the
other Contracting State shall be taxable only in the first-
mentioned Contracting State.
5. Gains from the alienation of any property other than that
referred to in the above mentioned paragraphs, shall be taxable
only in the Contracting State of which the alienator is a
resident.
Article 14
Independent personal services
1. Income derived by an individual who is a resident of a
Contracting State in respect of professional services or other
the activities of an independent character shall be taxable only in
that State except in the following circumstances, when such
income may also be taxed in the other Contracting State:
(a) if such individual has a fixed base regularly available in
the other Contracting State for the purpose of performing the
activities; in that case, only so much of the income as is
attributable to that fixed base may be taxed in that other
State;
(b) if such individual stays in the other Contracting State for
(a) the period or periods amounting to or exceeding in the aggregate
183 days in any twelve month period; in that case, only so much
of the income as is derived from the activities performed in
that other State may be taxed in that State.
2. The term "professional services" includes especially
independent scientific, literary, artistic, educational or
teaching activities as well as the independent activities of
physicians, lawyers, engineers, architects, dentists and
Accountants.
Article 15
Income from employment
1. Subject to the provisions of Articles 16, 18 and 19,
salaries, wages and other remuneration derived by a resident of
a Contracting State in respect of an employment shall be
taxable only in that State unless the employment is exercised
in the other Contracting State. If the employment is so
exercised, such remuneration as is derived therefrom may be
taxed in that other State.
2. Notwithstanding the provisions of paragraph 1, remuneration
derived by a resident of a Contracting State in respect of an
the employment exercised in the other Contracting State shall be
taxable only in the first-mentioned State if:
(a) the recipient is present in the other State for a period or
period not exceeding in the aggregate 183 days in any twelve
month period commencing or ending in the fiscal year concerned,
and
(b) the remuneration is paid by, or on behalf of, a person
being an employer who is not a resident of the other State, and
(c) the remuneration is not borne by a permanent establishment
or a fixed base that the person being an employer has in the
other State.
3. Notwithstanding the preceding provisions of this Article,
remuneration derived by a resident of a Contracting State in
respect of an employment exercised aboard a ship or aircraft
operated in international traffic shall be taxable only in that
State.
Article 16
Directors ' fees
Directors ' fees and other payments derived by a resident of a
Contracting State in the capacity as a member of the board of
Directors or a similar organ of a company which is a resident
of the other Contracting State may be taxed in that other
State.
Article 17
Artistes and sportspersons
1. Notwithstanding the provisions of Articles 14 and 15, income
derived by a resident of a Contracting State as an artiste,
such as a theatre, motion picture, radio or television artiste,
or a musician, or as a sportsperson, from that resident's
personal activities as such exercised in the other Contracting
State, may be taxed in that other State. The income referred to
in this paragraph shall include any income derived from any
personal activity exercised in the other State related with
that person's renown as an artiste or sportsperson.
2. Notwithstanding the provisions of Articles 7, 14 and 15,
where income in respect of personal activities exercised by an
artiste or a sportsperson in that capacity as such accrues not
to the artiste or sportsperson personally but to another
person, that income may be taxed in the Contracting State in
which the activities of the artiste or sportsperson are
exercised.
Article 18
Pensions and alimony
1. the Pensions arising in a Contracting State and paid to a
resident of the other Contracting State may be taxed in the
the first-mentioned State.
2. Alimony and other maintenance payments paid to a resident of
a Contracting State shall be taxable only in that State.
However, any alimony or other maintenance payments paid by a
resident of one of the Contracting States to a resident of the
other Contracting State shall, to the extent it is not
allowable as a relief to the payer, be taxable only in the
the first-mentioned State.
Article 19
Government service
1. (a) Salaries, wages and other remuneration, other than a
pension, paid by a Contracting State or a political subdivision
or a local authority thereof to an individual in respect of
services rendered to that State or subdivision or authority
shall be taxable only in that State.
(b) However, such salaries, wages and other remuneration shall
be taxable only in the other Contracting State if the services
are rendered in that State and the individual is a resident of
that State who:
(i) is a national of that State; or
(ii) did not become a resident of that State solely for the
purpose of rendering the services.
2. The provisions of Articles 15, 16 and 17 shall apply to
salaries, wages and other remuneration in respect of services
rendered in connection with a business carried on by a
Contracting State or a political subdivision or a local
authority thereof.
Article 20
The student's
Payments which a student, apprentice or business trainee who
is, or was, immediately before visiting a Contracting State, (a)
resident of the other Contracting State and who is present in
the first-mentioned State solely for the purpose of that
individual's education or training receives for the purpose of
that individual's maintenance, education or training shall not
be taxed in that State, if such payments arise from sources
outside that State.
Article 21
Other income
1. Items of income of a resident of a Contracting State,
wherever arising, not dealt with in the foregoing Articles of
This Convention shall be taxable only in that State.
2. The provisions of paragraph 1 shall not apply to income,
other than income from immovable property as defined in
paragraph 2 of Article 6, if the recipient of such income,
being a resident of a Contracting State, carries on business in
the other Contracting State through a permanent establishment
situated therein, or performs in that other State independent
personal services from a fixed base situated therein, and the
right or property in respect of which the income is paid is
effectively connected with such permanent establishment or
fixed base. In such case the provisions of Article 7 or Article
14, as the case may be, shall apply.
3. Notwithstanding the provisions of paragraphs 1 and 2, items
of income of a resident of a Contracting State not dealt with
in the foregoing Articles of this Convention and arising in the
other Contracting State may also be taxed in that other State.
CHAPTER IV
TAXATION OF CAPITAL
Article 22
Capital
1. Capital represented by immovable property owned by a
the resident of a Contracting State and situated in the other
Contracting State, may be taxed in that other State.
2. Capital represented by movable property forming part of the
business property of a permanent establishment which an
Enterprise of a Contracting State has in the other Contracting
State or by movable property pertaining to a fixed base
available to a resident of a Contracting State in the other
Contracting State for the purpose of performing independent
personal services, may be taxed in that other State.
3. Capital represented by ships and aircraft operated in
international traffic by an enterprise of a Contracting State
and by movable property pertaining to the operation of such
ships and aircraft, shall be taxable only in that State.
4. All other elements of capital of a resident of a Contracting
State shall be taxable only in that State.
5. The provisions of paragraphs 1, 2, 3 and 4 shall apply in a
Contracting State only if both Contracting States levy a
General tax on capital.
CHAPTER V
METHODS FOR THE AVOIDANCE OF DOUBLE TAXATION
Article 23
Avoidance of double taxation
1. In the case of Chile, double taxation shall be avoided as
follows:
(a) residents in Chile, obtaining income or owning capital
which may, in accordance with the provisions of this
Convention, be subject to taxation in Sweden, may credit the
Swedish tax so paid against any Chilean tax payable in respect
of the same income or capital, subject to the applicable
provisions of the law of Chile, this paragraph shall apply to
all income referred to in the Convention;
(b) where, in accordance with any provision of the Convention,
income derived or capital owned by a resident of Chile is
exempt from tax in Chile, Chile may nevertheless, in
calculating the amount of tax on other income or capital, take
into account the exempted income or capital.
2. In the case of Sweden, double taxation shall be avoided as
follows:
(a) Where a resident of Sweden derives income which under the
laws of Chile and in accordance with the provisions of this
Convention may be taxed in Chile, Sweden shall allow-subject
to the provisions of the laws of Sweden concerning credit for
foreign tax (as it may be amended from time to time without
changing the general principle hereof)-as a deduction from
the tax on such income, an amount equal to the Chilean tax paid
in respect of such income.
(b) Where a resident of Sweden derives income which, in
accordance with the provisions of this Convention, shall be
taxable only in Chile, Sweden may, when determining the
graduated rate of Swedish tax, take into account the income
which shall be taxable only in Chile.
(c) Notwithstanding the provisions of sub-paragraph (a) of this
paragraph, dividends paid by a company which is a resident of
Chile to a company which is a resident of Sweden shall be
exempt from Swedish tax according to the provisions of Swedish
law governing the exemption of tax on dividends paid to Swedish
companies by companies abroad.
(d) Where a resident of Sweden owns capital which, in
accordance with the provisions of this Convention, may be taxed
in Chile, Sweden shall allow as a deduction from the tax on the
the capital of that resident an amount equal to the capital tax
paid in Chile. Such deduction shall not, however, exceed that
part of the Swedish capital tax, as computed before the
deduction is given, which is appropriate to the capital which
may be taxed in Chile.
CHAPTER VI
SPECIAL PROVISIONS
Article 24
Non-discrimination
1. Nationals of a Contracting State shall not be subjected in
the other Contracting State to any taxation or any requirement
connected therewith, which is other or more burdensome than the
taxation and connected requirements to which nationals of that
other State in the same circumstances, in particular with
respect to residence, are or may be subjected.
2. The taxation on a permanent establishment that an enterprise
of a Contracting State has in the other Contracting State shall
not be less favourably levied in that other State than the
taxation levied on enterprises of that other State carrying on
the same activities.
3. Nothing in this Article shall be construed as obliging a
Contracting State to grant to residents of the other
Contracting State any personal allowances, reliefs and
reductions for taxation purposes on account of civil status or
family responsibilities that it grants to its own residents.
4. Except where the provisions of paragraph 1 of Article 9,
paragraph 6 of Article 11, or paragraph 6 of Article 12, apply,
interest, royalties and other disbursements paid by an
Enterprise of a Contracting State to a resident of the other
Contracting State shall, for the purpose of determining the
the taxable profits of such enterprise, be deductible under the
same conditions as if they had been paid to a resident of the
the first-mentioned State. Similarly, any debts of an enterprise of
a Contracting State to a resident of the other Contracting
State shall, for the purpose of determining the taxable capital
of such enterprise, be deductible under the same conditions as
If they had been contracted to a resident of the first-
mentioned State.
5. Companies which are residents of a Contracting State, the
capital of which is wholly or partly owned or controlled,
directly or indirectly, by one or more residents of the other
Contracting State, shall not be subjected in the first-
mentioned State to any taxation or any requirement connected
therewith that is other or more burdensome than the taxation
and connected requirements to which other similar companies of
the first-mentioned State are or may be subjected.
6. In this Article, the term "taxation" means taxes that are
the subject of this Convention.
Article 25
Mutual agreement procedure
1. Where a person considers that the actions of one or both of
the Contracting States result or will result for that person in
taxation not in accordance with the provisions of this
Convention, that person may, irrespective of the remedies
provided by the domestic law of those States, present the case
to the competent authority of the Contracting State of which
that person is a resident or, if that person's case comes under
paragraph 1 of Article 24, to that of the Contracting State of
which that person is a national.
2. The competent authority shall endeavour, if the objection
appears to it to be justified and if it is not itself able to
arrive at a satisfactory solution, to resolve the case by a
mutual agreement procedure with the competent authority of the
other Contracting State, with a view to the avoidance of
taxation not in accordance with the Convention.
3. The competent authorities of the Contracting States shall
endeavour to resolve by mutual agreement any (a) procedure
difficulties or doubts arising as to the interpretation or
application of the Convention.
4. The competent authorities of the Contracting States may
communicate with each other directly for the purpose of
reaching an agreement in the sense of the preceding paragraphs.
Article 26
Exchange of information
1. The competent authorities of the Contracting States shall
Exchange such information as is necessary for carrying out the
the provisions of this Convention or of the domestic laws in the
Contracting States concerning taxes covered by the Convention
insofar as the taxation thereunder is not contrary to the
Convention. The exchange of information is not restricted by
Article 1. Any information received by a Contracting State
shall be treated as secret in the same manner as information
obtained under the domestic laws of that State and shall be
disclosed only to persons or authorities (including courts and
administrative bodies) involved in the assessment or collection
of, the enforcement or prosecution in respect of, or the
determination of appeals in relation to, the taxes covered by
This Convention. Such persons or authorities shall use the
information only for such purposes. They may disclose the
information in public court proceedings or in judicial
decisions.
2. In no case shall the provisions of paragraph 1 be construed
so as to impose on a Contracting State the obligation:
(a) to carry out administrative measures at variance with the
the laws and the administrative practice of that or of the other
Contracting State;
(b) to supply information that is not obtainable under the laws
or in the normal course of the administration of that or of the
other Contracting State;
(c) to supply information which would disclose any trade,
business, industrial, commercial or professional secret or
trade process, or information, the disclosure of which would be
contrary to public policy (ordre public).
3. If information is requested by a Contracting State in
accordance with this Article, the other Contracting State shall
obtain the information to which the request relates in the same
way as if its own taxation were involved even though the other
The State does not, at that time, need such information. If
specifically requested by the competent authority of a
Contracting State, the competent authority of the other
Contracting State shall endeavour to provide information under
This Article in the form requested, such as depositions of
witnesses and copies of unedited original documents (including
books, papers, statements, records, accounts or writings), to
the same extent such depositions and documents can be obtained
under the laws and administrative practices of that other State
with respect to its own taxes.
Article 27
Members of diplomatic missions and consular posts
Nothing in this Convention shall affect the fiscal privileges
of members of diplomatic missions or consular posts under the
General rules of international law or under the provisions of
Special agreements.
Article 28
Miscellaneous rules
1. For the purposes of this Convention, investment funds or any
other fund of any kind, which are being administered by a
person resident in Chile, may be taxed in Chile in respect of
dividends, interest, capital gains and other income derived
from property or investment in Chile.
2. For the purposes of paragraph 3 of Article XXII
(Consultation) of the General Agreement on Trade in Services,
the Contracting States agree that, notwithstanding that
paragraph, any dispute between them as to whether a measure
falls within the scope of this Convention may be brought before
the Council for Trade in Services, as provided by that
paragraph, only with the consent of both Contracting States.
Any doubt as to the interpretation of this paragraph shall be
resolved under paragraph 3 of Article 25 or, failing agreement
under that procedure, pursuant to any other procedure agreed to
by both Contracting States.
3. Nothing in this Convention shall affect the application of
the existing provisions of the Chilean legislation DL 600 as
they are in force at the time of signature of this Convention
and as they may be amended from time to time without changing
the general principle hereof.
4. Contributions in a year in respect of services rendered in
that year paid by, or on behalf of, an individual who is a
the resident of a Contracting State to a pension plan that is
recognised for tax purposes in the other Contracting State
shall, during a period not exceeding in the aggregate 60
months, be treated in the same way for tax purposes in the
the first-mentioned State as a contribution paid to a pension plan
that is recognised for tax purposes in that first-mentioned
State, if
(a) contributions were made by, or on behalf of, such
individual on a regular basis to the pension plan for a period
ending immediately before that individual became a resident of
the first-mentioned State; and
(b) the competent authority of the first-mentioned State agrees
that the pension plan generally corresponds to a pension plan
recognised for tax purposes by that State.
For the purposes of this paragraph, "pension plan" includes (a)
pension plan created under the social security system into a
Contracting State.
5. Considering that the main aim of the Convention is to avoid
international double taxation, the Contracting States agree
that, in the event the provisions of the Convention are used in
such a manner as to provide benefits not contemplated or not
intended, the competent authorities of the Contracting States
shall in an expeditious manner, consult according to the mutual
agreement procedure of Article 25 with a view to amending the
Convention, where necessary.
6. Nothing in this Convention shall affect the taxation in
Chile of a resident in Sweden in respect of profits
attributable to a permanent establishment situated in Chile,
under both the first category tax and the additional tax but
only as long as the first category tax is deductible in
computing the additional tax.
7. With respect to profits derived by the air transport
Consortium Scandinavian Airlines System (SAS) the provisions of
Article 8, paragraph 1 shall apply only to such part of the
profits as corresponds to the participation held in that
Consortium by SAS Sweden AB, the Swedish partner of SAS.
8. With respect to gains derived by the air transport
Consortium Scandinavian Airlines System (SAS), the provisions
of Article 13 shall apply only to such part of the gains as
corresponds to the participation held in that consortium by SAS
Sweden AB, the Swedish partner of SAS.
9. With respect to capital owned by the air transport
Consortium Scandinavian Airlines System (SAS), the provisions
of Article 22 shall apply only to such part of the capital as
corresponds to the participation held in that consortium by SAS
Sweden AB, the Swedish partner of SAS.
CHAPTER VII
FINAL PROVISIONS
Article 29
Entry into force
1. Each of the Contracting States shall notify the other
through diplomatic channels of the completion of the procedures
required by law for the bringing into force of this Convention.
This Convention shall enter into force on the date of the
receipt of the later of these notifications.
2. The provisions of this Convention shall have effect:
(a) in Chile,
(i) in respect of taxes on income obtained and amounts paid,
credited to an account, put at the disposal or accounted as an
expense, on or after the first day of January in the calendar
year next following that in which this Convention enters into
force;
(ii) in respect of taxes on capital, if and to the extent such
the tax will be imposed by Chile after the date of signature of
This Convention, for tax levied in relation to capital owned on
or after the first day of January of the year next following
the date on which the tax on capital has been introduced; and
(b) in Sweden,
(i) in respect of taxes withheld at source, for amounts paid or
credited on or after the first day of January of the year next
following the date on which the Convention enters into force;
(ii) in respect of other taxes on income, on income tax
chargeable for any tax year beginning on or after the first day
of January of the year next following the date on which the
Convention enters into force;
(iii) in respect of taxes on capital, if and to the extent such
the tax will be imposed by Chile after the date of signature of
This Convention, for tax levied in relation to capital owned on
or after the first day of January of the year next following
the date on which the tax on capital has been introduced.
Article 30
Termination
1. This Convention shall continue in effect indefinitely but
either Contracting State may, on or before the thirtieth day of
June in any calendar year beginning after the year in which the
Convention enters into force, give to the other Contracting
State a notice of termination in writing through diplomatic
channels.
2. The provisions of this Convention shall cease to have
effect:
(a) in Chile,
in respect of taxes on income obtained and amounts paid,
credited to an account, put at the disposal or accounted as an
expense, or on capital owned, on or after the first day of
January in the calendar year next following that in which the
the notice is given; and
(b) in Sweden,
(i) in respect of taxes withheld at source, for amounts paid or
credited on or after the first day of January of the year next
following the end of the six month period;
(ii) in respect of other taxes on income, on income tax
chargeable for any tax year beginning on or after the first day
of January of the year next following the end of the six month
period;
(iii) in respect of taxes on capital, for taxes which is assessed
on or after the second calendar year next following the end of
the six month period.
In WITNESS WHEREOF the undersigned, duly authorised to that
effect, have signed this Convention.
DONE in duplicate at Stockholm this 4th day of June 2004, in
the Spanish, Swedish and English languages. In case of
divergence between the texts the English text shall prevail.
For the Government of the Kingdom of Sweden
Bosse Ringholm
For the Government of the Republic of Chile
Nicolás Eyzaguirre
Protocol to the Convention between the Kingdom of Sweden and
the Republic of Chile for the avoidance of double taxation and
the prevention of fiscal evasion with respect to taxes on
income and on capital
At the moment of signing the Convention for the avoidance of
double taxation and the prevention of fiscal evasion with
respect to taxes on income and on capital between the Kingdom
of Sweden and the Republic of Chile, the Contracting States
have agreed that the following provisions shall form an
integral part of the Convention:
Articles 10, 11 and 12
In respect of paragraph 6 of Article 10, paragraph 7 of Article
11 and paragraph 7 of Article 12, it is agreed that when a
Contracting State contemplates to deny benefits to a resident
of the other Contracting State, the competent authorities
should consult with each other.
Articles 11 and 12
It is agreed that if any agreement or convention between Chile
and a member state of the Organisation for Economic Co-
operation and Development provides that Chile shall exempt from
tax interest or royalties (either generally or in respect of
specific categories of interest or royalties) arising in Chile,
or limit the tax charged in Chile on such interest or royalties
(either generally or in respect of specific categories of
interest or royalties) to a rate lower than that provided for
in paragraph 2 of Article 11 or paragraph 2 of Article 12 of
the Convention, such exemption or lower rate shall
automatically apply to interest or royalties (either generally
or in respect of those specific categories of interest or
royalty payments) arising in Chile and beneficially owned by (a)
resident of Sweden and interest or royalties arising in Sweden
and beneficially owned by a resident of Chile under the same
conditions as if such exemption or lower rate had been
specified in those paragraphs. The competent authority of Chile
shall inform the competent authority of Sweden without delay
that the conditions for the application of this paragraph have
been met.
In WITNESS WHEREOF the undersigned, duly authorised to that
effect, have signed this Protocol.
DONE in duplicate at Stockholm this 4th day of June 2004, in
the Spanish, Swedish and English languages. In case of
divergence between the texts the English text shall prevail.
For the Government of the Kingdom of Sweden
Bosse Ringholm
For the Government of the Republic of Chile
Nicolás Eyzaguirre