Integral Protocol signed 26 September 2008

## Protocol

- 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, this day concluded between the Government of the Kingdom of the Netherlands and the Government of the United Kingdom of Great Britain and Northern Ireland, the undersigned have agreed that the following provisions shall form an integral part of the Convention.

- (I) With reference to paragraph 3 of Article 2 (Taxes covered):

- It is understood that the inclusion of the petroleum revenue tax and the supplementary charge in respect of ring fence trades in sub-paragraph b) is solely for the purpose of permitting the Netherlands to give relief for these taxes under Article 21.

- (II) With reference to paragraph 1 of Article 4 (Residence):

- It is understood that in the case of an individual living aboard a ship “any other criterion of a similar nature” shall include the home harbour of that ship.

- (III) With reference to paragraph 1, subparagraph (l) of Article 3 (General definitions), paragraph 2, subparagraph a) of Article 4 (Residence) paragraph 2, subparagraph (b) (ii) of Article 10 (Dividends) and paragraph 4, subparagraph (c) of Article 13 (Capital gains):

- It is understood that the term “pension scheme” includes:

- (a) in the case of the Netherlands, a pension fund that is established and regulated as such under the laws of the Netherlands and the income of which is generally exempt from tax in the Netherlands;

- (b) in the case of the United Kingdom, pension schemes (other than a social security scheme) registered under Part 4 of the Finance Act 2004, including pension funds or pension schemes arranged through insurance companies and unit trusts where the unit holders are exclusively pension schemes.

- The competent authorities may agree to include in the above, pension schemes of identical or substantially similar economic or legal nature which are introduced by way of statute or legislation in either State after the date of signature of the Convention.

- (IV) With reference to paragraph 1 of Article 9 (Associated enterprises):

- It is understood that the mere fact that associated enterprises have concluded arrangements such as cost sharing arrangements or general services agreements, for or based on the allocation of executive, general administrative, technical and commercial expenses, research and development expenses and other similar expenses, is not in itself a condition as meant in that paragraph.

- (V) With reference to Articles 10 (Dividends) and 11 (Interest):

- It is understood that an authorised representative of an investment fund established in a Contracting State may submit a claim relating to the benefits afforded by the provisions of these Articles. The competent authorities may consult together with a view to putting arrangements in place which facilitate claims and resolving any doubts concerning eligibility.

- (VI) With reference to Articles 10 (Dividends) and 13 (Capital Gains):

- It is understood that income received in connection with the liquidation (in whole or in part) of a company or a purchase of own shares by a company is treated, for Netherlands tax purposes, as income from shares and not as capital gains.

- (VII) With reference to Articles 11 (Interest) and 12 (Royalties):

- It is understood that no relief under these Articles shall be available where:

- (i) interest or royalties, as the case may be, are paid to a company of the Netherlands;

- (ii) that interest or those royalties are attributable to a permanent establishment of that company located in a third state with whom the Netherlands has a double taxation convention;

- (iii) under that convention, the Netherlands eliminates double taxation by applying the exemption method with respect to such interest or royalties rather than allowing a deduction that would otherwise be granted under its domestic law; and

- (iv) the tax levied in that third state is less than 60 per cent of the tax that would have been levied by the Netherlands had that interest or those royalties not been attributable to that permanent establishment.

- (VIII) With reference to Article 15 (Directors’ fees):

- It is understood that “bestuurder” or “commissaris” of a Netherlands company means persons who are nominated as such by the general meeting of shareholders or by any other competent body of such company and are charged with the general management of the company and the supervision thereof, respectively.

- (IX) With reference to Article 17 (Pensions):

- It is understood that the pensions referred to in section 641(1)(a) to (g) of the Income Tax (Earnings and Pensions) Act 2003 and benefits paid by reason of illness or injury following the termination of service in the armed forces or reserve forces referred to in section 641(1)(h) of the Income Tax (Earnings and Pensions) Act 2003 and injury and disablement pensions payable under any scheme made under the Personal Injuries (Emergency Provisions) Act 1939 shall be exempt from Netherlands tax, regardless of the nationality of the pensioner, so long as they are exempt from United Kingdom tax. It is understood that abovementioned exempted pensions paid to a resident of the Netherlands will be taken into account when granting personal allowances and benefits under the income-related regulations of the Netherlands.

- (X) With reference to paragraph 3 of Article 17 (Pensions):

- It is understood that where a lump sum is paid to a resident of the Netherlands, the amount of the lump sum will be taken into account when granting personal allowances and benefits under the income-related regulations of the Netherlands in the fiscal year in which the lump sum is received.

- (XI) With reference to Article 18 (Government Service):

- It is understood that the provisions of sub-paragraph a) of paragraph 1 of this Article do not prevent the Netherlands from applying paragraph 1 of Article 21 of this Convention.

- (XII) With reference to paragraph 2 of Article 21 (Elimination of double taxation):

- It is understood that if, in the case of a pipeline between the Contracting States, the income relating to such pipeline may, in accordance with the Convention, be taxed in the United Kingdom, the Netherlands shall allow a deduction from its tax with respect to such income according to paragraph 2 of article 21, provided that such income is taxed in the United Kingdom.

- (XIII) With reference to paragraph 3 of Article 30 (Entry into force):

- It is understood that the Netherlands will apply the exemption method as mentioned in paragraph 2 of Article 21 of this Convention to the remuneration referred to in paragraph 3 of Article 30 of this Convention.

In witness whereof the undersigned, duly authorised thereto, have signed this Protocol.

Done at London this 26th day of September 2008, in duplicate, in the Netherlands and English languages, both texts being equally authoritative.

For the Government of the United Kingdom of Great Britain and Northern Ireland For the Government of the Kingdom of the Netherlands

Jim Murphy Laurens Westhoff

UK Minister of State for Europe Deputy Head of Mission of the Netherlands in the United Kingdom