The Taxation Agency of the Ministry of Finance in Taipei,
Taiwan and the Direct Tax Administration of Luxembourg
Desiring to conclude an Agreement 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:

Article 1
PERSONS COVERED
This Agreement shall apply to persons who are residents of one
or both of the territories referred to in paragraph 3 of
Article 2.

Article 2
TAXES COVERED
1. This Agreement shall apply to taxes on income and on capital
imposed on behalf of each territory 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, taxes
on the total amounts of wages or salaries paid by
enterprises, as well as taxes on capital appreciation.
3. The existing taxes to which the Agreement shall apply are in
particular:
a) in the territory in which the taxation law administered by
the Direct Tax Administration (Administration des
Contributions Directes) of Luxembourg is applied:
(i) the income tax on individuals (l'impot sur le revenu des
personnes physiques);
(ii) the corporation tax (l'impot sur le revenu des
collectivites);
(iii) the capital tax (l'impot sur la fortune); and
(iv) the communal trade tax (l'impot commercial communal);
including the surcharges levied thereon, whether or not
they are collected by withholding at source;
b) in the territory in which the taxation laws administered by
the Taxation Agency of the Ministry of Finance in Taipei,
Taiwan are applied:
(i) the profit-seeking enterprise income tax;
(ii) the individual consolidated income tax; and
(iii) the income basic tax;
including the surcharges levied thereon, whether or not
they are collected by withholding at source.
4. The Agreement shall apply also to any identical or
substantially similar taxes that are imposed after the date
of signature of the Agreement in addition to, or in place
of, the existing taxes. The competent authorities of the
territories shall notify each other of any significant
changes that have been made in their taxation laws.

Article 3
GENERAL DEFINITIONS
1. For the purposes of this Agreement, unless the context
otherwise requires:
a) the term "territory" means the territory referred to in
paragraph 3a) or 3b) of Article 2, as the context requires.
The terms "other territory" and "territories" shall be
construed accordingly;
b) the term "person" includes an individual, a company and any
other body of persons;
c) the term "company" means any body corporate or any entity
that is treated as a body corporate for tax purposes;
d) the terms "enterprise of a territory" and "enterprise of
the other territory" mean respectively an enterprise
carried on by a resident of a territory and an enterprise
carried on by a resident of the other territory;
e) the term "international traffic" means any transport by a
ship or aircraft operated by an enterprise of a territory,
except when the ship or aircraft is operated solely between
places in the other territory;
f) the term "competent authority" means:
(i) in the case of the territory in which the taxation law
administered by the Direct Tax Administration
(Administration des Contributions Directes) of Luxembourg
is applied, the Director of Taxes or his authorised
representative;
(ii) in the case of the territory in which the taxation law
administered by the Taxation Agency of the Ministry of
Finance in Taipei, Taiwan is applied, the Director General
of the Taxation Agency or his authorised representative.
2. As regards the application of the Agreement at any time by a
territory, 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 territory for the purposes
of the taxes to which the Agreement applies, any meaning
under the applicable tax laws of that territory prevailing
over a meaning given to the term under other laws of that
territory.

Article 4
RESIDENT
1. For the purposes of this Agreement, the term "resident of a
territory" means any person who, under the laws of that
territory, is liable to tax therein by reason of his
domicile, residence, place of management,
place of incorporation or any other criterion of a similar
nature, and also includes the authority administering a
territory or any political subdivision or local authority
thereof.
2. A person is not a resident of a territory for the purposes
of this Agreement if that person is liable to tax in that
territory in respect only of income from sources in that
territory or capital situated therein, provided that this
paragraph shall not apply to individuals who are residents
of the territory referred to in paragraph 3b) of Article 2,
as long as resident individuals are taxed only in respect of
income from sources in that territory in accordance with its
Income Tax Act.
3. Where by reason of the provisions of paragraph 1 an
individual is a resident of both territories, then his
status shall be determined as follows:
a) he shall be deemed to be a resident only of the territory
in which he has a permanent home available to him; if he
has a permanent home available to him in both territories,
he shall be deemed to be a resident only of the territory
with which his personal and economic relations are closer
(centre of vital interests);
b) if the territory in which he has his centre of vital
interests cannot be determined, or if he has not a
permanent home available to him in either territory, he
shall be deemed to be a resident only of the territory in
which he has an habitual abode;
c) if he has an habitual abode in both territories or in
neither of them, the competent authorities of the
territories shall settle the question by mutual agreement.
4. Where by reason of the provisions of paragraph 1 a person
other than an individual is a resident of both territories,
the competent authorities of the territories shall endeavour
to determine by mutual agreement the territory of which such
person shall be deemed to be a resident for the purposes of
the Agreement, having regard to its place of effective
management, the place where it is incorporated or otherwise
constituted and any other relevant factors. In the absence
of such agreement, such person shall not be entitled to any
relief or exemption from tax provided by this Agreement
except to the extent and in such manner as may be agreed
upon by the competent authorities of the territories.

Article 5
PERMANENT ESTABLISHMENT
1. For the purposes of this Agreement, 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 of
extraction of natural resources.
3. The term “permanent establishment” also encompasses:
a) a building site, a construction, a dredging project or
assembly or installation project or supervisory activities
in connection therewith, but only if such site, project or
activities lasts more than 6 months;
b) the furnishing of services, including consultancy services,
by an enterprise of a territory through employees or other
personnel or persons engaged by the enterprise for such
purpose, but only if activities of that nature continue
(for the same or a connected project) in the other
territory for a period or periods aggregating more than 6
months within any twelvemonth period.
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 carrying on, for the enterprise, any other
activity of a preparatory or auxiliary character;
f) the maintenance of a fixed place of business solely for any
combination of activities mentioned in paragraphs a) to e),
provided that the overall activity of the fixed place of
business resulting from this combination is of a
preparatory or auxiliary character.
5. Notwithstanding the provisions of paragraphs 1 and 2, where
a person - other than an agent of an independent status to
whom paragraph 6 applies - is acting on behalf of an
enterprise and has, and habitually exercises,
in a territory an authority to conclude contracts in the
name of the enterprise, that enterprise shall be deemed to
have a permanent establishment in that territory 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 territory merely because it carries on
business in that territory 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.
7. The fact that a company which is a resident of a territory
controls or is controlled by a company which is a resident
of the other territory, or which carries on business in that
other territory (whether through a permanent establishment
or otherwise), shall not of itself constitute either company
a permanent establishment of the other.

Article 6
INCOME FROM IMMOVABLE PROPERTY
1. Income derived by a resident of a territory from immovable
property (including income from agriculture or forestry)
situated in the other territory may be taxed in that other
territory.
2. The term "immovable property" shall have the meaning which
it has under the law of the territory 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, 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, boats 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 territory shall be taxable
only in that territory unless the enterprise carries on
business in the other territory through a permanent
establishment situated therein. If the enterprise carries on
business as aforesaid, the profits of the enterprise may be
taxed in the other territory 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 territory carries on business in the other
territory through a permanent establishment situated
therein, there shall in each territory 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 same or similar conditions and dealing wholly
independently with the enterprise of which it is a permanent
establishment.
3. In determining the profits of a permanent establishment,
there shall be allowed as deductions expenses which are
incurred for the purposes of the permanent establishment,
including executive and general administrative expenses so
incurred, whether in the territory in which the permanent
establishment is situated or elsewhere.
4. Insofar as it has been customary in a territory to determine
the profits to be attributed to a permanent establishment on
the basis of an apportionment of the total profits of the
enterprise to its various parts, nothing in paragraph 2
shall preclude that territory from determining the profits
to be taxed by such an apportionment as may be customary;
the method of apportionment adopted shall, however, be such
that the result shall be in accordance with the principles
contained in this Article.
5. 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.
6. 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.
7. Where profits include items of income which are dealt with
separately in other Articles of this Agreement, then the
provisions of those Articles shall not be affected by the
provisions of this Article.

Article 8
SHIPPING AND AIR TRANSPORT
1. Profits of an enterprise of a territory from the operation
of ships or aircraft in international traffic shall be
taxable only in that territory.
2. For the purposes of this Article, profits from the operation
of ships or aircraft in international traffic include:
a) profits from the rental on a full (time or voyage) basis or
a bareboat basis of ships or aircraft; and
b) profits from the use, maintenance or rental of containers
(including trailers and related equipment for the transport
of containers) used for the transport of goods or
merchandise; where such rental or such use, maintenance or
rental, as the case may be, is incidental to the operation
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, but only so much of the
profits so derived as is attributable to the participant in
proportion to its share in the joint operation.

Article 9
ASSOCIATED ENTERPRISES
1. Where
a) an enterprise of a territory participates directly or
indirectly in the management, control or capital of an
enterprise of the other territory, or
b) the same persons participate directly or indirectly in the
management, control or capital of an enterprise of a
territory and an enterprise of the other territory, and in
either case conditions are made or imposed between 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 territory includes in the profits of an enterprise
of that territory - and taxes accordingly - profits on which
an enterprise of the other territory has been charged to tax
in that other territory and the profits so included are
profits which would have accrued to the enterprise of the
first-mentioned territory if the conditions made between the
two enterprises had been those which would have been made
between independent enterprises, then that other territory
shall make an appropriate adjustment to the amount of the
tax charged therein on those profits if that other territory
considers the adjustment justified. In determining such
adjustment, due regard shall be had to the other provisions
of this Agreement and the competent authorities of the
territories shall if necessary consult each other.

Article 10
DIVIDENDS
1. Dividends paid by a company which is a resident of a
territory to a resident of the other territory may be taxed
in that other territory.
2. However, such dividends may also be taxed in the territory
of which the company paying the dividends is a resident and
according to the laws of that territory, but if the
beneficial owner of the dividends is a resident of the other
territory, the tax so charged shall not exceed:
a) 15 per cent of the gross amount of the dividends if the
beneficial owner of the dividends is a collective
investment vehicle established in the other territory and
treated as a body corporate for tax purposes in that other
territory;
b) 10 per cent of the gross amount of the dividends in all
other cases.
This paragraph shall not affect the taxation of the company
in respect of the profits out of which the dividends are
paid.
3. The term "dividends" as used in this Article means income
from shares, "jouissance" shares or "jouissance" rights,
mining shares, founders' shares or other rights, not being
debt-claims, participating in profits, as well as income
from other corporate rights which is subjected to the same
taxation treatment as income from shares by the laws of the
territory 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
territory, carries on business in the other territory of
which the company paying the dividends is a resident,
through a permanent establishment situated therein, or
performs in that other territory 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 which is a resident of a territory derives
profits or income from the other territory, that other
territory may not impose any tax on the dividends paid by
the company, except insofar as such dividends are paid to a
resident of that other territory or insofar as the holding
in respect of which the dividends are paid is effectively
connected with such permanent establishment or fixed base
situated in that other territory, nor subject the company's
undistributed profits to a tax on the company's
undistributed profits, even if the dividends paid or the
undistributed profits consist wholly or partly of profits or
income arising in such other territory.

Article 11
INTEREST
1. Interest arising in a territory and paid to a resident of
the other territory may be taxed in that other territory.
2. However, such interest may also be taxed in the territory in
which it arises and according to the laws in force in that
territory, but if the beneficial owner of the interest is a
resident of the other territory, the tax so charged shall
not exceed:
a) 15 per cent of the gross amount of the interest if the
beneficial owner of the interest is a collective investment
vehicle established in the other territory and treated as a
body corporate for tax purposes in that other territory;
b) 10 per cent of the gross amount of the interest in all
other cases.
3. Notwithstanding the provisions of paragraph 2, interest
arising in a territory shall be exempt from tax in that
territory if it is paid:
a) to the other territory, a political subdivision or a local
authority or the Central Bank thereof or any financial
institution wholly owned or controlled by the other
territory;
b) in respect of a loan granted, guaranteed or insured or a
credit extended, guaranteed or insured by an approved
instrumentality of the other territory which aims at
promoting export;
c) on loans made between banks.
4. The term "interest" as used in this Article means income
from debt-claims of every kind, whether or not secured by
mortgage and whether or not carrying a right to participate
in the debtor's profits, and in particular, income from
government securities and income from bonds or debentures,
including premiums and prizes attaching to such securities,
bonds or debentures. Penalty charges for late payment shall
not be regarded as interest for the purpose of this Article.
5. The provisions of paragraphs 1, 2 and 3 shall not apply if
the beneficial owner of the interest, being a resident of a
territory, carries on business in the other territory in
which the interest arises, through a permanent establishment
situated therein, or performs in that other territory
independent personal services from a fixed base situated
therein and the debt-claim in respect of which 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, as the case may be shall apply.
6. Interest shall be deemed to arise in a territory when the
payer is a resident of that territory. Where, however, the
person paying the interest, whether he is a resident of a
territory or not, has in a territory 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 territory in which the permanent establishment or fixed
base is situated.
7. 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, 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 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
territory, due regard being had to the other provisions of
this Agreement.

Article 12
ROYALTIES
1. Royalties arising in a territory and paid to a resident of
the other territory may be taxed in that other territory.
2. However, such royalties may also be taxed in the territory
in which they arise and according to the laws of that
territory, but if the recipient is the beneficial owner of
the royalties the tax so charged shall not exceed 10 per
cent of the gross amount of the royalties.
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 cinematograph films and films or
tapes for television or radio broadcasting, any patent,
trade mark, design or model, plan, secret formula or
process, or for information concerning industrial,
commercial or scientific experience.
4. The provisions of paragraphs 1 and 2 shall not apply if the
beneficial owner of the royalties, being a resident of a
territory, carries on business in the other territory in
which the royalties arise, through a permanent establishment
situated therein, or performs in that other territory
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
provisions of Article 7 or Article 14, as the case may be
shall apply.
5. Royalties shall be deemed to arise in a territory when the
payer is a resident of that territory. Where, however, the
person paying the royalties, whether he is a resident of a
territory or not, has in a territory a permanent
establishment or a fixed base in connection with which the
liability 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
territory 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 which 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 territory, due regard being had to the other
provisions of this Agreement.

Article 13
CAPITAL GAINS
1. Gains derived by a resident of a territory from the
alienation of immovable property referred to in Article 6
and situated in the other territory may be taxed in that
other territory.
2. Gains from the alienation of movable property forming part
of the business property of a permanent establishment which
an enterprise of a territory has in the other territory or
of movable property pertaining to a fixed base available to
a resident of a territory in the other territory 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 fixed base, may be taxed in that other territory.
3. Gains derived by an enterprise of a territory from the
alienation of ships or aircraft operated in international
traffic or movable property pertaining to the operation of
such ships or aircraft, shall be taxable only in that
territory.
4. Gains from the alienation of any property other than that
referred to in paragraphs 1, 2 and 3 shall be taxable only
in the territory of which the alienator is a resident.

Article 14
INDEPENDENT PERSONAL SERVICES
1. Income derived by a resident of a territory in respect of
professional services or other activities of an independent
character shall be taxable only in that territory except in
the following circumstances, when such income may also be
taxed in the other territory:
a) if he has a fixed base regularly available to him in the
other territory for the purpose of performing his
activities; in that case, only so much of the income as is
attributable to that fixed base may be taxed in that other
territory; or
b) if his stay in the other territory is for a period or
periods amounting to or exceeding in the aggregate 183 days
in any twelve-month period commencing or ending in the
calendar year concerned; in that case, only so much income
as is derived from his activities performed in that other
territory may be taxed in that other territory.
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
DEPENDENT PERSONAL SERVICES
1. Subject to the provisions of Articles 16, 18 and 19,
salaries, wages and other similar remuneration derived by a
resident of a territory in respect of an employment shall be
taxable only in that territory unless the employment is
exercised in the other territory. If the employment is so
exercised, such remuneration as is derived therefrom may be
taxed in that other territory.
2. Notwithstanding the provisions of paragraph 1, remuneration
derived by a resident of a territory in respect of an
employment exercised in the other territory shall be taxable
only in the first-mentioned territory if:
a) the recipient is present in the other territory for a
period or periods not exceeding in the aggregate 183 days
in any twelve month period commencing or ending in the
calendar year concerned, and
b) the remuneration is paid by, or on behalf of, an employer
who is not a resident of the other territory, and
c) the remuneration is not borne by a permanent establishment
or a fixed base which the employer has in the other
territory.
3. Notwithstanding the preceding provisions of this Article,
remuneration derived in respect of an employment exercised
aboard a ship or aircraft operated in international traffic,
may be taxed in the territory of which the enterprise is a
resident.

Article 16
DIRECTORS' FEES
Directors' fees and other similar payments derived by a
resident of a territory in his capacity as a member of the
board of directors of a company which is a resident of the
other territory may be taxed in that other territory.

Article 17
ARTISTES AND SPORTSPERSONS
1. Notwithstanding the provisions of Articles 14 and 15, income
derived by a resident of a territory as an entertainer, such
as a theatre, motion picture, radio or television artiste,
or a musician, or as a sportsperson, from his personal
activities as such exercised in the other territory, may be
taxed in that other territory.
2. Where income in respect of personal activities exercised by
an entertainer or a sportsperson in his capacity as such
accrues not to the entertainer or sportsperson himself but
to another person, that income may, notwithstanding the
provisions of Articles 7, 14 and 15, be taxed in the
territory in which the activities of the entertainer or
sportsperson are exercised.
3. The provisions of paragraphs 1 and 2 shall not apply to
income derived from activities exercised in a territory by
an artistes or sportsperson if the visit to that territory
is wholly or mainly supported by public funds of one or both
of the authorities administering a territory or any
political subdivision or local authority thereof. In such
case, the income is taxable only in the territory of which
the artiste or the sportsperson is a resident.

Article 18
PENSIONS AND ANNUITIES
1. Pensions and other similar remuneration paid to a resident
of a territory in consideration of past employment, shall be
taxable only in the territory in which they arise. This
provision shall also apply to annuities and to pensions and
other similar remuneration paid by an entity of a territory
under social security legislation in force in that territory
or under a public scheme organised by that territory in
order to supplement the benefits of that social security
legislation.
2. The term “annuity” means a stated sum payable periodically
at stated times during life or during a specified or
ascertainable period of time under an obligation to make the
payments in return for adequate and full consideration in
money or money’s worth.

Article 19
GOVERNMENT SERVICE
1. a) Salaries, wages and other similar remuneration, other
than a pension or annuity, paid by an authority
administering a territory, a political subdivision or a
local authority thereof to an individual in respect of
services rendered to that territory or subdivision or
authority shall be taxable only in that territory.
b) However, such salaries, wages and other similar
remuneration shall be taxable only in the other territory
if the services are rendered in that territory and the
individual is a resident of that territory who:
(i) is a national of that territory; or
(ii) did not become a resident of that territory solely for
the purpose of rendering the services.
2. The provisions of Articles 15, 16, 17 and 18 shall apply to
salaries, wages, pensions or annuities, and other similar
remuneration in respect of services rendered in connection
with a business carried on by an authority administering a
territory or a political subdivision or a local authority
thereof.

Article 20
STUDENTS
Payments which a student or business apprentice who is or was
immediately before visiting a territory a resident of the other
territory and who is present in the first-mentioned territory
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 territory, provided that such payments
arise from sources outside that territory.

Article 21
OTHER INCOME
1. Items of income of a resident of a territory, wherever
arising, not dealt with in the foregoing Articles of this
Agreement shall be taxable only in that territory.
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 territory, carries on business in the
other territory through a permanent establishment situated
therein, or performs in that other territory independent
personal service 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 of this
Article, items of income of a resident of a territory not
dealt with in the foregoing articles of this Agreement and
arising in the other territory may also be taxed in that
other territory.

Article 22
CAPITAL
1. Capital represented by immovable property referred to in
Article 6, owned by a resident of a territory and situated
in the other territory, may be taxed in that other territory.
2. Capital represented by movable property forming part of the
business property of a permanent establishment which an
enterprise of a territory has in the other territory or by
movable property pertaining to a fixed base available to a
resident of a territory in the other territory for the
purpose of performing independent personal services may be
taxed in that other territory.
3. Capital of an enterprise of a territory represented by ships
and aircraft operated in international traffic, and by
movable property pertaining to the operation of such ships
and aircraft, shall be taxable only in that territory.
4. All other elements of capital of a resident of a territory
shall be taxable only in that territory.

Article 23
ELIMINATION OF DOUBLE TAXATION
1. Subject to the provisions of the law of the territory
referred to in paragraph 3a) of Article 2 regarding the
elimination of double taxation which shall not affect the
general principle hereof, double taxation shall be
eliminated as follows:
a) where a resident of the territory referred to in paragraph
3a) of Article 2 derives income or owns capital which, in
accordance with the provisions of this Agreement, may be
taxed in the other territory, the first-mentioned territory
shall, subject to the provisions of paragraphs b) and c),
exempt such income or capital from tax, but may, in order
to calculate the amount of tax on the remaining income or
capital of the resident, apply the same rates of tax as if
the income or capital had not been exempted;
b) where a resident of the territory referred to in paragraph
3a) of Article 2 derives income which, in accordance with
the provisions of Articles 10, 11, 12, 17 and paragraph 3
of Article 21 may be taxed in the other territory, the
first-mentioned territory shall allow as a deduction from
the income tax on individuals or from the corporation tax
of that resident an amount equal to the tax paid in the
other territory. Such deduction shall not, however, exceed
that part of the tax, as computed before the deduction is
given, which is attributable to such items of income
derived from the other territory;
c) the provisions of paragraph a) shall not apply to income
derived or capital owned by a resident of the territory
referred to in paragraph 3a) of Article 2 where the other \
territory applies the provisions of this Agreement to
exempt such income or capital from tax or applies the
provisions of paragraph 2 of Article 10, 11 or 12 to such
income.
2. Subject to the provisions of the law of the territory
referred to in paragraph 3b) of Article 2 regarding the
elimination of double taxation, double taxation shall be
eliminated as follows:
where a resident of the territory referred to in paragraph
3b) of Article 2 derives income from the other territory,
the amount of tax on that income paid in that other
territory (but excluding, in the case of a dividend, tax
paid in respect of the profits out of which the dividend is
paid) and in accordance with the provisions of this
Agreement, shall be credited against the tax levied in the
first-mentioned territory imposed on that resident. The
amount of credit, however, shall not exceed the amount of
the tax in the first-mentioned territory on that income
computed in accordance with its taxation laws and
regulations.

Article 24
NON-DISCRIMINATION
1. Nationals of a territory shall not be subjected in the other
territory 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 territory 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 territories.
2. The taxation on a permanent establishment which an
enterprise of a territory has in the other territory shall
not be less favourably levied in that other territory than
the taxation levied on enterprises of that other territory
carrying on the same activities. This provision shall not be
construed as obliging a territory to grant to residents of
the other territory 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, or paragraph 6 of Article 12,
apply, interest, royalties and other disbursements paid by
an enterprise of a territory to a resident of the other
territory 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 territory. Similarly, any debts of an
enterprise of a territory to a resident of the other
territory 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 territory.
4. Enterprises of a territory, the capital of which is wholly
or partly owned or controlled, directly or indirectly, by
one or more residents of the other territory, shall not be
subjected in the first-mentioned territory 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
territory are or may be subjected.
5. The provisions of this Article shall apply to taxes which
are the subject of this Agreement.
6. This Article shall not be construed so as to apply to any
provision of the laws of a territory which:
a) does not allow tax rebates, credits or exemption in
relation to dividends paid by a company that is a resident
of that territory for purposes of its tax; or
b) is designed for the purpose of the promotion of economic
development and public policy and is not applicable in the
case of a permanent establishment of an enterprise which is
a resident of the other territory provided that the first
mentioned territory does not impose income tax on the
earnings which are repatriated to that enterprise by its
permanent establishment.

Article 25
MUTUAL AGREEMENT PROCEDURE
1. Where a person considers that the actions of one or both of
the territories result or will result for him in taxation
not in accordance with the provisions of this Agreement, he
may, irrespective of the remedies provided by the domestic
law of those territories, present his case to the competent
authority of the territory of which he is a resident or, if
his case comes under paragraph 1 of Article 24, to that of
the territory 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 Agreement.
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
territory, with a view to the avoidance of taxation which is
not in accordance with the Agreement. Any agreement reached
shall be implemented notwithstanding any time limits in the
domestic law of the territories.
3. The competent authorities of the territories shall endeavour
to resolve by mutual agreement any difficulties or doubts
arising as to the interpretation or application of the
Agreement. They may also consult together for the
elimination of double taxation in cases not provided for in
the Agreement.
4. The competent authorities of the territories 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 territories shall exchange
such information as is foreseeably relevant for carrying out
the provisions of this Agreement or to the administration or
enforcement of the domestic laws concerning taxes covered by
this Agreement imposed on behalf of the territories, or of
their political subdivisions or local authorities, insofar
as the taxation thereunder is not contrary to the Agreement.
The exchange of information is not restricted by Article 1.
2. Any information received under paragraph 1 by a territory
shall be treated as secret in the same manner as information
obtained under the domestic laws of that territory 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.
3. In no case shall the provisions of paragraphs 1 and 2 be
construed so as to impose on a territory the obligation:
a) to carry out administrative measures at variance with the
laws and administrative practice of that or of the other
territory;
b) to supply information which is not obtainable under the
laws or in the normal course of the administration of that
or of the other territory;
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).
4. If information is requested by a territory in accordance
with this Article, the other territory shall use its
information gathering measures to obtain the requested
information, even though that other territory 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 territory 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 territory to decline to supply information upon
request 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.

Article 27
LIMITATION ON BENEFITS
Notwithstanding the provisions of any other Article of this
Agreement, a resident of a territory shall not receive the
benefit of any reduction in or exemption from tax provided for
in the Agreement by the other territory if as a result of
consultations between the competent authorities of both
territories it is established that the conduct of operations by
such resident had for the main purpose or one of the main
purposes to obtain the benefits of this Agreement.

Article 28
STAFF OF REPRESENTATIVE OFFICES
The provisions of Article 19 are applicable to staff of the
Luxembourg Trade and Investment Office, Taipei and staff of the
representative office responsible for relations with Luxembourg
sent by the governing authorities of Taiwan.

Article 29
ENTRY INTO FORCE
1. The Agreement shall be approved in accordance with the
internal legal procedures under the laws in force of both
territories. The Agreement shall enter into force on the
date of the later notification of the competent authorities
that the internal legal procedures have been completed.
2. The Agreement shall have effect:
a) in respect of taxes withheld at source, to income payable
on or after 1st January of the calendar year next following
the year in which the Agreement enters into force;
b) in respect of other taxes on income, and taxes on capital,
to taxes chargeable for any taxable year beginning on or
after 1st January of the calendar year next following the
year in which the Agreement enters into force.

Article 30
TERMINATION
1. The Agreement shall be applicable indefinitely in each
territory. The competent authorities of the territories may
communicate with each other for the purpose of the
termination of this Agreement. In that event, the
information of termination to the other territory shall be
given at least six months before the end of any calendar
year beginning after the expiration of a period of five
years from the date of the entry into force of this
Agreement.
2. The Agreement shall cease to have effect:
a) in respect of taxes withheld at source, to income payable
on or after 1st January of the calendar year next following
the year in which the information of termination is given;
b) in respect of other taxes on income, and taxes on capital,
to taxes chargeable for any taxable year beginning on or
after 1st January of the calendar year next following the
year in which information of termination is given.

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

Done in duplicate at Luxembourg this day of 19th December 2011,
in the English language.

For the Taxation Agency of For the Direct Tax Administration
the Ministry of Finance in of Luxembourg
Taipei, Taiwan

Sheu, Yu-jer Guy Heintz
Director-General Director of Taxes

PROTOCOL
At the moment of the signing of the Agreement between the
Taxation Agency of the Ministry of Finance in Taipei, Taiwan
and the Direct Tax Administration of Luxembourg for the
avoidance of double taxation and the prevention of fiscal
evasion with respect to taxes on income and on capital, both
sides have agreed upon the following provisions, which shall
form an integral part of the Agreement:
I. With reference to Article 4:
A collective investment vehicle which is established in a
territory and that is treated as a body corporate for tax
purposes in this territory shall be considered as a resident
of the territory in which it is established and as the
beneficial owner of the income it receives.
II. With reference to Article 26:
The competent authority of the requesting territory shall
provide the following information to the competent authority
of the requested territory when making a request for
information under the Agreement to demonstrate the
foreseeable relevance of the information to the request:
a) the identity of the person under examination or
investigation;
b) a statement of the information sought including its nature
and the form in which the requesting territory wishes to
receive the information from the requested territory;
c) the tax purpose for which the information is sought;
d) grounds for believing that the information requested is
held in the requested territory or is in the possession or
control of a person within the jurisdiction of the
requested territory;
e) to the extent known the name and address of any person
believed to be in possession of the requested information;
f) a statement that the requesting territory has pursued all
means available in its own territory to obtain the
information, except those that would give rise to
disproportionate difficulties.

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

Done in duplicate at Luxembourg this day of 19th December 2011,
in the English language.

For the Taxation Agency of For the Direct Tax Administration
of the Ministry of Finance Luxembourg
in Taipei, Taiwan.

Sheu, Yu-jer Guy Heintz
Director-General Director of Taxes