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Note: This Treaty may be impacted by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (MLI). MLI impact on Tax Treaties is available with the Orbitax International Tax Research & Compliance Expert.

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 where it arises and according to the laws of that State, but if the recipient of such interest is the beneficial owner and subject to taxation on such interest, the tax so charged shall not exceed 15 percent of the gross amount of such interest.

(3) The term "interest" as used in this Article means income from debt-claims of any kind, whether or not secured by mortgage and whether or not carrying a right to participate in debtors profits, and in particular, income from government securities and income from bonds or debentures including premiums or prizes attached to such securities, bonds or debentures.

(4) The provisions of paragraphs (1) and (2) of this Article shall not apply if the beneficial owner of the interest, being a 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 interest is paid is effectively connected to 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) Interest shall be deemed to arise in a Contracting State when the payer is that State itself, one of its political subdivisions, local authorities or statutory bodies or a resident of that State. However, where the individual paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or 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 Contracting State in which the permanent establishment or fixed base is situated.

(6) Where by reason of a special relationship, either between the payer and the beneficial owner of the interest or between both of them and some other person, the amount of interest, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such special 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.