Resolução da Assembleia da República n.º 22/2017 — Aprova a Convenção entre a República Portuguesa e o Principado de Andorra para Evitar a Dupla Tributação e Prevenir a…

Subject to the provisions of paragraph 2 of article 18, pensions and other similar remuneration paid to a resident of a Contracting State in consideration of past employment shall be taxable only in that State.

Article 18

Government service

1 - Salaries, wages and other similar remuneration paid by a Contracting State or a political or administrative 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. However, such salaries, wages and other similar 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:

2 - Notwithstanding the provisions of paragraph 1, pensions and other similar remuneration paid by, or out of funds created by, a Contracting State or a political or administrative 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. However, such pensions and other similar remuneration shall be taxable only in the other Contracting State if the individual is a resident of, and a national of, that State.

3 - The provisions of articles 14, 15, 16, and 17 shall apply to salaries, wages, pensions, and other similar remuneration in respect of services rendered in connection with a business carried on by a Contracting State or a political or administrative subdivision or a local authority thereof.

Article 19

Professors and researchers

Subject to the provisions of article 18 an individual who is or was a resident of a Contracting State immediately before visiting the other Contracting State, solely for the purpose of teaching or scientific research at an university, college, school, or other similar educational or scientific research institution which is recognized as non-profitable by the Government of that other State, or under an official programme of cultural exchange, for a period not exceeding two years from the date of his first arrival in that other State, shall be exempt from tax in that other State on his remuneration for such teaching or research.

Article 20

Students

Payments which a student or business apprentice 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 his education or training receives for the purpose of his maintenance, education or training shall not be taxed in that State, provided that 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 and the right or property in respect of which the income is paid is effectively connected with such permanent establishment. In such case the provisions of article 7 shall apply.

3 - Where, by reason of a special relationship between the person referred to in paragraph 1 and some other person, or between both of them and some third person, the amount of the income referred to in paragraph 1 exceeds the amount (if any) which would have been agreed upon between them in the absence of such a relationship, the provisions of this article shall apply only to the last mentioned amount. In such a case, the excess part of the income shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Convention.

CHAPTER IV

Methods for elimination of double taxation

Article 22

Elimination of double taxation

1 - Where a resident of a Contracting State derives income which, in accordance with the provisions of this Convention, may be taxed in the other Contracting State, the first-mentioned Contracting State shall allow as a deduction from the tax on the income of that resident, an amount equal to the income tax paid in that other State. Such deduction shall not, however, exceed that part of the income tax, as computed before the deduction is given, which is attributable to the income which may be taxed in that other State.

2 - Where in accordance with any provision of this Convention income derived by a resident of a Contracting State is exempt from tax in that State, such State may nevertheless, in calculating the amount of tax on the remaining income of such resident, take into account the exempted income.

CHAPTER V

Special provisions

Article 23

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. This provision shall, notwithstanding the provisions of article 1, also apply to persons who are not residents of one or both of the Contracting States.

2 - The taxation on a permanent establishment which 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. This provision shall not 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 which it grants to its own residents.

3 - Except where the provisions of paragraph 1 of article 9, paragraph 7 of article 11, paragraph 6 of article 12, or paragraph 3 of article 21, 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 taxable profits of such enterprise, be deductible under the same conditions as if they had been paid to a resident of the first-mentioned State.

4 - Enterprises 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 which is other or more burdensome than the taxation and connected requirements to which other similar enterprises of the first-mentioned State are or may be subjected.

5 - The provisions of this article shall, notwithstanding the provisions of article 2, apply to taxes of every kind and description.

Article 24

Mutual agreement procedure

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 23, to that of the Contracting State of which he is a national. The case must be presented within three years from the first notification of the action resulting in taxation not in accordance with the provisions of the Convention.

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 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 the Convention. Any agreement reached shall be implemented notwithstanding any time limits in the domestic law of the Contracting States.

3 - The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of the Convention. They may also consult together for the elimination of double taxation in cases not provided for in the Convention.

4 - The competent authorities of the Contracting States may communicate with each other directly, including through a joint commission consisting of themselves or their representatives, for the purpose of reaching an agreement in the sense of the preceding paragraphs.

Article 25

Exchange of information

1 - The competent authorities of the Contracting States shall exchange such information as is foreseeably relevant for carrying out the provisions of this Convention or to the administration or enforcement of the domestic laws concerning taxes of every kind and description imposed on behalf of the Contracting States, or of their political or administrative subdivisions or local authorities, insofar as the taxation thereunder is not contrary to the Convention. The exchange of information is not restricted by articles 1 and 2.

2 - Any information received under paragraph 1 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) concerned with the assessment or collection of, the enforcement or prosecution in respect of, the determination of appeals in relation to the taxes referred to in paragraph 1, or the oversight of the above. 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. Notwithstanding the foregoing, information received by a Contracting State may be used for other purposes when such information may be used for such other purposes under the laws of both States and the competent authority of the supplying State authorises such use.

3 - In no case shall the provisions of paragraphs 1 and 2 be construed so as to impose on a Contracting State the obligation:

4 - If information is requested by a Contracting State in accordance with this article, the other Contracting State shall use its information gathering measures to obtain the requested information, even though that other State may not need such information for its own tax purposes. The obligation contained in the preceding sentence is subject to the limitations of paragraph 3 but in no case shall such limitations be construed to permit a Contracting State to decline to supply information solely because it has no domestic interest in such information.

5 - In no case shall the provisions of paragraph 3 be construed to permit a Contracting State to decline to supply information solely because the information is held by a bank, other financial institution, nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in a person.

6 - The Contracting States shall comply with the guidelines for the regulation of computer files containing personal data as established by the United Nations General Assembly Resolution A/RES/45/95, adopted on the 14th December 1990.

Article 26

Use and transfer of personal data

1 - The data used and transferred within the framework of this Convention shall, in accordance with the applicable laws, be:

2 - If a person whose data are transferred requests access to them, the requested Contracting State shall grant that person direct access to those data and correct them, except where this request may be refused under the applicable laws.

3 - The data received by the competent authorities of the Contracting States within the framework of this Convention shall not be transferred to a third party without the prior consent of the requested Contracting State and the appropriate legal safeguards for the protection of personal data, in accordance with the applicable laws.

Article 27

Members of diplomatic missions and consular posts

The provisions of the Convention shall not affect the fiscal privileges of members of diplomatic missions or consular posts or permanent delegations to international organizations, under the general rules of international law or under the provisions of special agreements.

Article 28

Entitlement to the benefits of the Convention

1 - The provisions of this Convention shall not be interpreted so as to prevent the application by a Contracting State of the anti-avoidance provisions provided for in its domestic law.

2 - This Convention shall not prevent the Contracting States from applying their domestic rules regarding international fiscal transparency "Controlled Foreign Company (CFC) rules".

3 - The benefits foreseen in this Convention shall not be granted to a resident of a Contracting State which is not the beneficial owner of the income derived from the other Contracting State.

4 - The provisions of this Convention shall not apply if the main purpose or one of the main purposes of any person concerned with the creation or assignment of the property or right in respect of which the income is paid was to take advantage of those provisions by means of such creation or assignment.

5 - Notwithstanding any other provision of this Convention, where this Convention provides that an item of income shall be taxable only in a Contracting State, such item of income may nevertheless be taxed in the other State, but only if such item of income is not subject to tax in the first-mentioned Contracting State.

6 - Notwithstanding any other provision of this Convention, where under any provision of this Convention a Contracting State reduces the rate of tax on, or exempts from tax, an item of income of a resident of the other Contracting State and under the laws in force in that other Contracting State that resident in respect of that item is subject to tax in that other State only on that part of such income and not by reference to the full amount thereof, then the reduction or exemption shall apply only to so much of the income as is subject to tax in that other State.

7 - With respect to the application of the above provisions, the competent authorities of the Contracting States may consult together for the purpose of applying those provisions, taking into account the particular circumstances of the case.

CHAPTER VI

Final provisions

Article 29

Entry into force

1 - The present Convention shall enter into force thirty days after the date of receipt of the latter of the notifications, in writing, through diplomatic channels, conveying the completion of the internal procedures of each Contracting State required for that purpose.

2 - The provisions of the present Convention shall have effect:

Article 30

Duration and termination

1 - This Convention shall remain in force for an unlimited period of time.

2 - Following the expiration of an initial period of five years, either Contracting State may denounce the present Convention upon notification, in writing, through diplomatic channels, before the first day of July of the current calendar year.

3 - In case of denunciation, the present Convention shall cease to have effect:

Article 31

Registration

The Contracting State in whose territory this Convention is signed shall transmit it to the Secretariat of the United Nations for registration, in accordance with article 102 of the Charter of the United Nations, as soon as possible after its entry into force, and shall notify the other Contracting State of the completion of this procedure, as well as of its registration number.

In witness whereof the undersigned, duly authorized thereto, have signed this Convention.

Done at New York on the 27th Setember of 2015, in two originals, in the Portuguese, Catalan and English languages. In case of any divergence of interpretation, the English text shall prevail.

For The Portuguese Republic:

Rui Chancerelle de Machete, Minister of State and Foreign Affairs.

For The Principality of Andorra:

Gilbert Saboya Sunyé, Minister for Foreign Affairs.

PROTOCOL TO THE CONVENTION BETWEEN THE PORTUGUESE REPUBLIC AND THE PRINCIPALITY OF ANDORRA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME.

On signing the Convention between the Portuguese Republic and the Principality of Andorra for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income (hereinafter referred to as "the Convention"), the signatories have agreed that the following provisions shall form an integral part of the Convention:

I) With reference to article 4 ("Residence"):

Persons under the special regime envisaged in the third transitional provision of the Andorran Law 5/2014 of 24 April 2014, of the personal income tax, are not entitled to the application of the Convention.

II) With reference to article 25 ("Exchange of information"):

1 - As regards the exchange of information upon request, as provided for in article 25 of the Convention, the provisions of the Agreement between the Portuguese Republic and the Principality of Andorra for the exchange of information on tax matters, signed on 30 November 2009, shall apply until the Convention enters into force. From that date on, the provisions of that Agreement shall be superseded by the provisions of the Convention.

2 - Requests for information made under the Convention and those pending on the date of entry into force of the Convention, shall be processed as provided in the Convention, in accordance with the guidelines contained in the following provisions:

Requests for information should be as detailed as possible, including the following information:

ii) The period to which the request of information refers;

iii) A statement of the information sought including its nature and the form in which the requesting State wishes to receive the information;

iv) The tax purpose for which the information is sought;

vi) Grounds for believing that the information requested is held in the requested State or is in the possession or control of a person within the jurisdiction of the requested State or can be obtained by such person;

vii) To the extent possible, the name and address of any person believed to be in possession or having under control the information requested;

viii) A statement that the request is in conformity with the laws and administrative practices of the requesting State, and that the requesting State is authorised to obtain the information under the laws of the requesting State or in the normal course of administrative practice in similar circumstances, in response to a valid request of a Contracting State under the Convention;

ix) A statement that the requesting State has pursued all means available in its own territory to obtain the information, except those that would give rise to disproportionate difficulties.

The above requirements contain procedural requirements that must be interpreted with a view not to frustrate effective exchange of information;

3 - Andorra will be ready to exchange information automatically as soon as it has effectively adopted the common standard of the OECD concerning the automatic exchange of financial information under a bilateral or multilateral agreement for the full implementation of article 25 of the Convention.

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

Done at New York on 27th Setember of 2015, in two originals, in the Portuguese, Catalan and English languages. In case of any divergence of interpretation, the English text shall prevail.

For The Portuguese Republic:

Rui Chancerelle de Machete, Minister of State and Foreign Affairs.

For The Principality of Andorra:

Gilbert Saboya Sunyé, Minister for Foreign Affairs.