(1)
1. Where a person considers that the actions of one or both of the Contracting States result or will result for him in taxation not in accordance with the provisions of this Convention, he may, irrespective of the remedies provided by the domestic law of those States, present his case to the competent authority of the Contracting State of which he is a resident or, if his case comes under paragraph 1 of Article 24 (Non-discrimination), to that of the Contracting State of which he is a national. The case must be presented within four years from the notification of the assessment giving rise to double taxation or to taxation not in accordance with the provisions of this Convention.
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2. The competent authority shall endeavor, 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 mutual agreement with the competent authority of the other Contracting State, with a view to the avoidance of taxation which is not in accordance with this Convention. Any agreement reached shall be implemented notwithstanding any time limits or other procedural limitations in the domestic law of the Contracting States.
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3. The competent authorities of the Contracting States shall endeavor to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of this Convention. In particular the competent authorities of the Contracting States may agree a) to the same attribution of income, deductions, credits, or allowances of an enterprise of a Contracting State to its permanent establishment situated in the other Contracting State; b) to the same allocation of income, deductions, credits, or allowances between associated enterprises and other persons in accordance with the principles of Article 9 (Associated Enterprises); c) to the settlement of conflicting application of this Convention, including conflicts regarding aa) the characterization of particular items of income; bb) the characterization of persons; cc) the application of source rules with respect to particular items of income, and dd) to the treatment of income that is assimilated to income from shares by the taxation law of the State of source and that is treated as a different class of income in the other State; d) to a common meaning of a term; e) to the application of the procedural provisions of domestic law including those regarding penalties, fines, and interest, in a manner consistent with the purposes of this Convention; and f) to increase the amounts referred to in Articles 17 (Artistes and Athletes) and 20 (Visiting Professors and Teachers; Students and Trainees) to reflect economic or monetary developments. They may also consult together for the elimination of double taxation in cases not provided for in this Convention.
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4. The competent authorities of the Contracting States may communicate with each other directly for purposes of reaching an agreement in the sense of the preceding paragraphs. Where the procedure relates to a particular case, the persons concerned shall be permitted to present their views to the competent authority of either or both of the Contracting States. When it seems advisable in order to reach agreement to have an oral exchange of opinions, such exchange may take place through a Commission consisting of representatives of the competent authorities of the Contracting States.
PDF page · 23(5)
5. Where, pursuant to a mutual agreement procedure under this Article, the competent authorities have endeavored but are unable to reach a complete agreement in a case, the case shall be resolved through arbitration conducted in the manner prescribed by, and subject to, the requirements of paragraph 6 and any rules or procedures agreed upon by the Contracting States, if: a) tax returns have been filed with at least one of the Contracting States with respect to the taxable years at issue in the case; b) the case aa) is a case that A) involves the application of one or more Articles that the Contracting States have agreed shall be the subject of arbitration, and B) is not a particular case that the competent authorities agree, before the date on which arbitration proceedings would otherwise have begun, is not suitable for determination by arbitration, or bb) is a particular case that the competent authorities agree is suitable for determination by arbitration; and c) all concerned persons agree according to the provisions of subparagraph d) of paragraph 6.
PDF page · 23(6)
6. For the purposes of paragraph 5 and this paragraph, the following rules and definitions shall apply: a) The term “concerned person” means the presenter of a case to a competent authority for consideration under this Article and all other persons, if any, whose tax liability to either Contracting State may be directly affected by a mutual agreement arising from that consideration; b) The “commencement date” for a case is the earliest date on which the information necessary to undertake substantive consideration for a mutual agreement has been received by both competent authorities; c) Arbitration proceedings in a case shall begin on the later of: aa) Two years after the commencement date of that case, unless both competent authorities have previously agreed to a different date, and bb) The earliest date upon which the agreement required by subparagraph d) has been received by both competent authorities; d) The concerned person(s), and their authorized representatives or agents, must agree prior to the beginning of arbitration proceedings not to disclose to any other person any information received during the course of the arbitration proceeding from either Contracting State or the arbitration board, other than the determination of such board; e) Unless any concerned person does not accept the determination of an arbitration board, the determination shall constitute a resolution by mutual agreement under this Article and shall be binding on both Contracting States with respect to that case; and f) For purposes of an arbitration proceeding under paragraph 5 and this paragraph, the members of the arbitration board and their staffs shall be considered “persons or authorities” to whom information may be disclosed under Article 26 (Exchange of Information and Administrative Assistance) of the Convention.
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