PREAMBLE
WHEREAS the Government of the Republic of China and the Governm-
ent of the Republic of Macedonia recognize the friendly relatio-
ns existing between the two Governments and their peoples; and
WHEREAS the Government of the Republic of China and the Governm-
ent of the Republic of Macedonia are desirous of concluding an
agreement for the avoidance of double taxation and the preventi-
on of fiscal evasion with respect to taxes on income;
NOW, THEREFORE, the Government of the Republic of China and the
Government of the Republic of Macedonia have agreed as follows:
Article 1
Personal Scope
This Agreement shall apply to persons who are residents of one
or both of the Contracting States.
Article 2
Taxes Covered
1.This Agreement shall apply to taxes on income imposed an beha-
lf of a Contracting State or of its local authorities, irresp-
ective of the manner in which they are levied.
2.There shall be regarded as taxes on income all taxes imposed
on total income, or on elements of income, including taxes on
gains from the alienation of movable or immovable property, t-
axes on the total amounts of wages or salaries paid by enterp-
rises, as well as taxes on capital appreciation.
3.The existing taxes to which the Agreement shall apply are in
particular:
(a) in the Republic of Macedonia:
(i) the personal income tax;
(ii) the profit tax;
(b) in the Republic of China:
(i) the Profit Seeking Enterprise Income Tax;
(ii) the Individual Consolidated Income Tax.
4.The Agreement shall apply also to any identical or substantia-
lly similar taxes which are imposed after the date of signatu-
re of the Agreement in addition to, or in place of, the exist-
ing taxes. At the end of each year, the competent authorities
of the Contracting States shall notifl each other of changes
which have been made in their respective taxation laws.
Article 3
General Definitions
1.For the purposes of this Agreement, unless the context otherw-
ise requires:
(a) the terms "a Contracting State" and "the other Contracting
State" mean the Republic of Macedonia or the Republic of C-
hina, as the context requires;
(b) the term "Republic of Macedonia" means the territory of the
Republic of Macedonia, and used in a geographical sense me-
ans its land, inland lake water and bottom over which it h-
as jurisdiction or sovereign rights for the purpose of exp-
loring, exploiting, conserving and managing natural resour-
ces, pursuant to internal jurisdiction and international l-
aw;
(c) the term "Republic of China" means the territory of the Re-
public of China and, when used in a geographical sense, in-
cludes the territory and the territorial sea under its jur-
isdiction as well as any areas of outside the territorial
sea in respect of which the Republic of China is entitled,
in accordance with relevant laws, to exercise sovereign ri-
ghts or jurisdiction;
(d) the term "national" means:
(i) any individual possessing the nationality of a Contracti-
ng State;
(ii) any legal person, partnership or association deriving i-
ts status as such from the laws in force in a Contracti-
ng State;
(e) the term "person" includes an individual, a company and any
other body of persons;
(f) the term "company" means any body corporate or any entity
which is treated as a body corporate for tax purposes;
(g) the terms "enterprise of a Contracting State" and "enterpr-
ise of the other Contracting State" mean respectively an e-
nterprise carried on by a resident of a Contracting State
and an enterprise carried on by a resident of the other Co-
ntracting State;
(h) the term "international traffic" means any transport by a
ship or aircraft operated by an enterprise which has its p-
lace of effective management in a Contracting State, except
when the ship or aircraft is operated solely between plac-
es in the other Contracting State;
(i) the term "competent authority" means:
(i) in the Republic of Macedonia, the Ministry of Finance or
his authorized representative;
(ii) in the Republic of China, the Ministry of Finance or his
authorized representative.
2.As regards the application of the Agreement at any time by a
Contracting State, 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 State for the purposes of
the taxes to which the Agreement applies, any meaning under t-
he applicable tax laws of that State prevailing over a meaning
given to the term under other laws of that State.
Article 4
Resident
1.For the purposes of this Agreement, the term "resident of a C-
ontracting State" means any person who, under the laws of that
Statei is liable to tax therein by reason of his domicile, re-
sidence, place of management or incorporation or any other cr-
iterion of a similar nature.
2.Where by reason of the provisions of paragraph 1 an indiviclu-
alis a resident of both Contracting States, then his status s-
hall be determined as follows:
(a) he shall be deemed to be a resident of the Contracting Sta-
te in which he has a permanent home available to him. If he
has a permanent home available to him in both States, he s-
hall be deemed to be a resident of the State with which his
personal and economic relations are closer (center of vital
interests);
(b) if the State in which he has his center of vital interests
cannot be determined, or if he has not a permanent home av-
ailable to him in either State, he shall be deemed to be a
resident of the State in which he has an habitual abode;
(c) if he has an habitual abode in both States or in neither of
them, he shall be deemed to be a resident of the State of
which he is a national;
(d) if he is a national of both States or of neither of them,
the competent authorities of the Contracting States shall
settle the question by mutual agreement. '
3.Where by reason of the provisions of paragraph 1 a person oth-
er than an individual is a resident of both Contracting States
, then it shall be deemed to be a resident of the State in wh-
ich its place of effective management is situated.
Article 5
Permanent Establishment
1.For the purposes of this Agreement, the term "permanent estab-
lishment" means a fixed place of business through which the b-
usiness of an enterprise is wholly or partly carried on.
2.The term "permanent establishment" shall include 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.A building site or construction or installation project const-
itutes a permanent establishment only if it lasts more than 12
months.
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, d-
isplay or delivery of goods or merchandise belonging to the
enterprise;
(b) the maintenance of a stock of goods or merchandise belongi-
ng to the enterprise solely for the purpose of storage, di-
splay or delivery;
(c) the maintenance of a stock of goods or merchandise belongi-
ng 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 advertising, supply of information, scientific
research or similar activities which have a preparatory or
auxiliary character, for the enterprise;
(f) the maintenance of a fixed place of business solely for any
combination of activities mentioned in subparagraphs (a) to
(e), provided that the overall activity of the fixed place
of business resulting from this combination is of a prepar-
atory 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 Contracting State an auth-
ority to conclude contracts in the name of the enterprise, th-
at enterprise shall be deemed to have a permanent establishme-
nt in that State in respect of any activities which that pers-
on undertakes for the enterprise, unless the activities of su-
ch 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 establi-
shment in a Contracting State merely because it carries on bu-
siness in that State through a broker, general commission age-
nt or any other agent of an independent status, provided that
such persons are acting in the ordinary course of their busin-
ess.
7.The fact that a company which is a resident of a Contracting
State controls or is controlled by a company which is a resid-
ent of the other Contracting State, or which carries on busin-
ess in that other State (whether through a permanent establis-
hment or otherwise), shall not of itself constitute either co-
mpany a permanent establishment of the other.
Article 6
Income from Immovable Property
1.Income derived by a resident of a contracting State from immo-
vable property (including income from agriculture or forestry)
situated in the other contracting State may be taxed in that
other State.
2.The term "immovable property" shall have the meaning which it
has under the law of the Contracting State in which the prope-
rty in question is situated. The term shall in any case inclu-
de property accessory to immovable property, livestock and eq-
uipment used in agriculture and forestry, rights to which the
provisions of general law respecting landed property apply, u-
sufruct 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 f-
rom the direct use, letting, or use in any other form of immo-
vable 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 independe-
nt personal services.
Article 7
Business Profits
1.The profits of an enterprise of a Contracting State shall be
taxable only in that State unless the enterprise carries on b-
usiness in the other Contracting State through a permanent es-
tablishment situated therein. If the enterprise carries on bu-
siness as aforesaid, the profits of the enterprise may be tax-
ed in the other State but only so much of them as is attribut-
able to that permanent establishment.
2.Subject to the provisions of paragraph 3, where an enterprise
of a Contracting State carries on business in the other Contr-
acting State through a permanent establishment situated there-
in, there shall in each Contracting State be attributed to th-
at permanent establishment the proftts which it might be expe-
cted to make if it were a distinct and separate enterprise en-
gaged in the same or similar activities under the same or sim-
ilar conditions and dealing wholly independently with the ent-
erprise 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 execut-
ive and general administrative expenses so incurred, whether
in the State in which the permanent establishment is situated
or elsewhere.
4.Insofar as it has been customary in a Contracting State to de-
termine the profits to be attributed to a permanent establish-
ment on the basis of an apportionment of the total profits of
the enterprise to its various parts, nothing in paragraph 2 s-
hall preclude that Contracting State from determining the pro-
fits to be taxed by such an apportionment as may be customary;
the method of apportionment adopted shall, however, be such t-
hat the result shall be in accordance with the principles con-
tained 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 determi-
ned 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 se-
parately in other Articles of this Agreement, then the provis-
ions of those Articles shall not be affected by the provisions
of this Article.
Article 8
Shipping and Air Transport
1.Profits from the operation of ships or aircraft in internatio-
nal traffic shall be taxable only in the Contracting State in
which the place of effective management of the enterprise is
situated.
2.Profits that are mentioned in this Article include profits fr-
om the rental of ships or aircraft in a full (time, voyage or
bareboat) basis and profits from the rental of containers and
related equipment which is incidental to the operation of shi-
ps and 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 internati-
onal operating agency.
Article 9
Associated Enterprises
1.Where
(a) an enterprise of a Contracting State participates directly
or indirectly in the management, control or capital of an
enterprise of the other Contracting State, or
(b) the same persons participate directly or indirectly in the
management, control or capital of an enterprise of a Contr-
acting State and an enterprise of the other Contracting St-
ate, and in either case conditions are made or imposed bet-
ween the two enterprises in their commercial or financial
relations which differ from those which would be made betw-
een independent enterprises, then any profits which would,
but for those conditions, have accrued to one of the enter-
prises, but, by reason of those conditions, have not so ac-
crued, may be included in the profits of that enterprise a-
nd taxed accordingly.
2.Where a Contracting State includes in the profits of an enter-
prise of that State - and taxes accordingly - profits on whic-
h an enterprise of the other Contracting State has been charg-
ed to tax in that other State and the profits so included are
profits which would have accrued to the enterprise of the fir-
st-mentioned State if the conditions made between the two ent-
erprises had been those which would have been made between in-
dependent enterprises, then that other State shall make an ap-
propriate adjustment to the amount of the tax charged therein
on those profits. In determining such adjustment, due regard
shall be had to the other provisions of this Agreement and the
competent authorities of the Contracting States shall if nece-
ssary consult each other.
Article 10
Dividends
1.Dividends paid by a company which is a resident of a Contract-
ing State to a resident of the other Contracting State may be
taxed in that other State.
2.However, such dividends may also be taxed in the Contracting
State of which the company paying the dividends is a resident
and according to the laws of that State, but if the beneficial
owner of the dividends is a resident of the other Contracting
State, the tax so charged shall not exceed 10 percent of the
gross amount of the dividends.
The competent, authorities of the Contracting States shall by
mutual agreement settle the mode of application of this limit-
ation.
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, 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 ta-
xation treatment as income from shares by the laws of the Sta-
te of which the company making the distribution is a resident.
4.The provisions of paragraphs 1 and 2 shall not apply if the b-
eneficial owner of the dividends, being a resident of a Contr-
acting State, carries on business in the other Contracting St-
ate of which the company paying the dividends is a resident,
through a permanent establishment situated therein, or perfor-
ms in that other State independent personal services from a f-
ixed base situated therein, and the holding in respect of whi-
ch the dividends are paid is effectively connected with such
permanent establishment or fixed base. In such case the provi-
sions of Article 7 or Article 14, as the case may be, shall a-
pply.
5.Where a company which is a resident of a Contracting State de-
rives profits or income from the other Contracting State, that
other State may not impose any tax on the dividends paid by t-
he company, except in so far as such dividends are paid to a
resident of that other State or in so far as the holding in r-
espect of which the dividends are paid is effectively connect-
ed with a permanent establishment or a fixed base situated in
that other State, nor subject the company's undistributed pro-
fits to a tax on the company's undistributed profits, even if
the dividends paid or undistributed profits consist wholly or
partly of profits or income arising in such other State.
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 Sta-
te.
2.However, such interest may also be taxed in the Contracting S-
tate in which it arises and according to the laws of that Sta-
te, but if the beneficial owner of the interest is a resident
of the other Contracting State, the tax so charged shall not
exceed 10 percent of the gross amount of the interest. The co-
mpetent authorities of the Contracting States shall by mutual
agreement settle the mode of application of this limitation.
3.Notwithstanding the provisions of paragraph 2, interest arisi-
ng in a Contracting State shall be exempt from tax in that St-
ate if it is derived by the Government of the other Contracti-
ng State or a local authority thereof, or any agency wholly o-
wned and controlled by that Government or local authority.
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 deb-
tor's profits, and in particular, income from government secu-
rities 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 int-
erest for the purpose of this Article.
5.The provisions of paragraphs 1 and 2 shall not apply if the b-
eneficial owner of the interest, being a resident of a Contra-
cting State, carries on business in the other Contracting Sta-
te in which the interest arises, through a permanent establis-
hment situated therein, or performs in that other State indep-
endent 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 fi-
xed 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 Contracting State when
the payer is that State itself, a local authority or a reside-
nt of that State. Where, however, the person paying the inter-
est, whether he is a resident of a Contracting State or not,
has in a Contracting State a permanent establishment or a fix-
ed 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 deermed to arise in the State 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 oth-
er person, the amount of the interest, having regard to the d-
ebt-claim for which it is paid, exceeds the amount which would
have been agreed upon by the payer and 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 Contracting State, due regard being had to
the other provisions of this Agreement.
Article 12
Royalties
1.Royalties arising in a Contracting State and paid to a reside-
nt of the other Contracting State may be taxed in that other
State.
2.However, such royalties may also be taxed in the Contracting
State in which they arise and according to the laws of that
State, but if the beneficial owner of the royalties is a resi-
dent of the other Contracting State, the tax so charged shall
not exceed 10 per cent of the gross amount of the royalties.
The competent authorities of the Contracting States shall by
mutual agreement settle the mode of application of this limit-
ation.
3.The term "royalties" as used in this Article means payments of
any kind received as a consideration for the use of, or the r-
ight to use, any copyright of literary, artistic or scientific
work including cinematograph films or films or tapes or discs
used for radio or television broadcasting, any patent, trade
mark, design or model, plan, secret formula or process, or for
the use of, or the right to use, industrial, commercial, or s-
cientific equipment, or for information concerning industrial,
commercial or scientific experience.
4.The provisions of paragraphs 1 and 2 shall not apply if the b-
eneficial owner of the royalties, being a resident of a Contr-
acting State, carries on business in the other Contracting St-
ate in which the royalties arise, through a permanent establi-
shment situated therein, or performs in that other State inde-
pendent personal services from a fixed base situated therein,
and the right or property in respect of which the royalties a-
re paid is effectively connected with such permanent establis-
hment 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 Contracting State when
the payer is that State itself, a local authority or a reside-
nt of that State. Where, however, the person paying the royal-
ties, whether he is a resident of a Contracting State or not,
has in a Contracting State a permanent establishment or a fix-
ed base in connection with which the liability to pay the roy-
alties was incurred, and such royalties are borne by such per-
manent establishment or fixed base, then such royalties shall
be deemed to arise in the State in which the permanent establ
ishment 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 oth-
er 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 pro-
visions of this Article shall apply only to the last-mentioned
amount. In such case, the excess part of the payments shall r-
emain taxable according to the laws of each Contracting State,
due regard being had to the other provisions of this Agreement
.
Article 13
Capital Gains
1.Gains derived by a resident of a Contracting State from the a-
lienation of immovable property referred to in Article 6 and
situated in the other Contracting State may be taxed in that
other State.
2.Gains from the alienation of movable property forming part of
the business property of a permanent establishment which an e-
nterprise of a Contracting State has in the other Contracting
State or of movable property pertaining to a fixed base avail-
able to a resident of a Contracting State in the other Contra-
cting State 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 State.
3.Gains from the alienation of ships or aircraft operated in in-
ternational traffic or movable property pertaining to the ope-
ration of such ships or aircraft, shall be taxable only in the
Contracting State in which the place of effective management
of the enterprise is situated.
4.Gains from the alienation of any property other than that ref-
erred to in paragraphs 1, 2 and 3, shall be taxable only in t-
he Contracting State of which the alienator is a ra resident.
Article 14
Independent Personal Services
I.Income derived by a resident of a Contracting State in respect
of professional services or other activities of an independent
character shall be taxable only in that State unless he has a
fixed base regularly available to him in the other Contracting
State for the purpose of performing his activities. If he has
such a fixed base, the income may be taxed in the other State
but only so much of it as is attributable to that fixed base.
2.The term "professional services" includes especially independ-
ent scientific, literary, artistic, educational or teaching a-
ctivities 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 Contracting State in respect of an employment shall be taxa-
ble only in that State unless the employment is exercised in
the other Contracting State. If the employment is so exercised
, such remuneration as is derived therefrom may be taxed in t-
hat other State.
2.Notwithstanding the provisions of paragraph 1, remuneration d-
erived by a resident of a Contracting State in respect of an
employment exercised in the other Contracting State shall be
taxable only in the first-mentioned State if:
(a) the recipient is present in the other State for a period or
periods not exceeding in the aggregate 183 days in any twe-
lve month period commencing or ending in the fiscal year c-
oncerned, and
(b) the remuneration is paid by, or on behalf of, an employer
who is not a resident of the other State, and
(c) the remuneration is not borne by a permanent establishment
or a fixed base which the employer has in the other State.
3.Notwithstanding the preceding provisions of this Article, rem-
uneration derived in respect of an employment exercised aboard
a ship or aircraft operated in international traffic may be t-
axed in the Contracting State in which the place of effective
management of the enterprise is situated.
Article 16
Directors' Fees
Directors' fees and other similar payments derived by a resident
of a Contracting State in his capacity as a member of the board
of directors of a company which is a resident of the other Cont-
racting State may be taxed in that other State.
Article 17
Artistes and Sportsmen
1.Notwithstanding the provisions of Articles 14 and 15, income
derived by a resident of a Contracting State as an entertainer
, such as a theater, motion picture, radio or television arti-
ste, or a musician, or as a sportsman, from his personal acti-
vities as such exercised in the other Contracting State, may
be taxed in that other Contracting State.
2.Where income in respect of personal activities exercised by an
entertainer or a sportsman in his capacity as such accrues not
to the entertainer or sportsman himself but to another person,
that income may, notwithstanding the provisions of Articles 7,
14 and 15, be taxed in the Contracting State in which the act-
ivities of the entertainer or sportsman are exercised.
3.Notwithstanding the provisions of paragraphs 1 and 2, income
derived from activities referred to in paragraph 1 performed
under a cultural agreement or arrangement between both author-
ities of the Contracting States shall be exempt from tax in t-
he Contracting State in which the activities are exercised if
the visit to that State is wholly or substantially supported
by funds of one or both Contracting States, a local authority
or public institution thereof.
Article 18
Pensions
Subject to the provisions of paragraph 2 of Artide 19, pensions
and other similar remuneration paid to a resident of a Contract-
ing State in consideration of past employment shall be taxable
only in that State.
Article 19
Government Service
1. (a) Salaries, wages, and other similar remuneration, other t-
han a pension, paid by a Contracting State or a local au-
thority thereof to an individual in respect of services
rendered to that State or authority shall be taxable only
in that State.
(b) However, such salaries, wages and other similar remunera-
tion shall be taxable only in the other Contracting State
if the services are rendered in that State and the indiv-
idual is a resident of that State who:
(i) is a national of that State; or
(ii) did not become a resident of that State solely for the
purpose of rendering the services.
2. (a) Any Pension paid by, or Out of funds created by, a Contr-
acting State or a local authority thereof to an individu-
al in respect of services rendered to that State or auth-
ority shall be taxable only in that State.
(b) However, such pension 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 Article 15, 16, 17 and 18 shall apply to sa-
laries, wages and other similar remuneration, and to pensions,
in respect of services rendered in connection with a business
carried an by a Contracting State or a local authority thereof
.
Article 20
Students
1.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-m-
entioned State solely for the purpose of his education or tra-
ining receives for the purpose of his maintenance, education
or training shall not be taxed in that State, provided that s-
uch payments arise from sources outside that State.
2.In respect of grants and scholarships not covered by paragraph
1, a student or business apprentice referred to in paragraph 1
shall, in addition, be entitled during such education or trai-
ning to the same exemptions, relieves or reductions in respect
of taxes available to residents of the Contracting State which
he is visiting.
Article 21
Professors and Teachers
1.An individual who visits a Contracting State at the invitation
of that State or of a university, college, school, museum or
other cultural institution of that State or under an official
program of cultural exchange for a period not exceeding two y-
ears solely for the purpose of teaching, giving lectures or c-
arrying out research at such institution and who is, or was i-
mmediately before that visit, a resident of the other Contrac-
ting State shall be exempt from tax in the first-mentioned St-
ate on his remuneration for such activity, provided that such
remuneration is derived by him from outside that State.
2.The provisions of paragraph 1 of this Article shall not apply
to income from research if such research is undertaken not in
the public interest but primarily for the private benefit of a
specific person or persons.
Article 23
Other Income
1.Items of income of a resident of a Contracting State, wherever
arising, not dealt with in the foregoing Articles of this Agr-
eement 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 reside-
nt of a Contracting State, carries on business in the other C-
ontracting State through a permanent establishment situated t-
herein, or performs in that other State independent personal
services 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 c-
ase may be, shall apply.
Article 23
Elimination of Double Taxation
1.Where a resident ofa Contracting State derives income which,
in accordance with the provisions of this Agreement, may be t-
axed in the other Contracting State, the first-mentioned State
shall allow as a deduction from the tax on the income of that
resident, an amount equal to the tax on income paid in that o-
ther State. Such a deduction in either case shall not, however
, exceed that part of the income tax as computed before the d-
eduction is given, which is attributable, as the case may be,
to the income which may be taxed in that other State.
2.Where in accordance with any provision of the Agreement income
derived by a resident of a Contracting State is exempt from t-
ax in that State, such State may nevertheless, in calculating
the amount of tax on the remaining income of such resident, t-
ake into account the exempted income.
Article 24
Non-discrimination
1.Nationals of a Contracting State shall not be subjected in the
other Contracting State to any taxation or any requirement co-
nnected 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 res-
pect toresidence, are or may be subjected.
2.The taxation on a permanent establishment which an enterprise
of a Contracting State has in the other Contracting State sha-
ll not be less favorably 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 oth-
er Contacting State any personal allowances, reliefs and redu-
ctions for taxation purposes on account of civil status or fa-
mily responsibilities which it grants to its own residents.
3.Except where the provisions paragraph 1 of Article 9, paragra-
ph 7 of Article 11, or paragraph 6 of Article 12 apply, inter-
est, 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 profi-
ts of such enterprise, be deductible under the same conditions
as if they had been paid to a resident of the first-mentioned
Stater
4.Enterprises of a Contracting State, the capital of which is w-
holly 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 wh-
ich other similar enterprises of the first-mentioned State are
or may be subjected.
5.The provisions of this Article shall apply to the taxes refer-
red to in Article 2 of this Agreement.
Article 25
Mutual Agreement Procedure
1.Where a person considers that the actions of one orboth of the
Contracting States result or will result for him in taxation
not in accordance with the provisions of this Agreement, he m-
ay, 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. The case
must be presented within three years from the first notificat-
ion of the action resulting in taxation not in accordance with
the provisions of this Agreement.
2.The competent authority shall endeavor, if the objection appe-
ars to it to be justified and if it is not itself able to arr-
ive at a satisfactory solution, to resolve the case by mutual
agreement with the competent authority of the other Contracti-
ng State, with a view to the avoidance of taxation which is n-
ot in accordance with the Agreement. Any agreement reached sh-
all be implemented notwithstanding any time limits in the dom-
estic law of the Contracting States.
3.The competent authorities of the Contracting States shall end-
eavor to resolve by mutual agreement any difficulties or doub-
ts arising as to the interpretation or application of this Ag-
reement. 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 Contracting States may commu-
nicate with each other directly for the purpose of reaching a-
n agreement in the sense of the preceding paragraphs.
Article 26
Exchange ofInformation
1.The competent authorities of the Contracting States shall exc-
hange such information as is necessary for carrying out the p-
rovisions of this Agreement or of the domestic laws of the Co-
ntracting States concerning taxes covered by the Agreement in-
sofar as the taxation thereunder is not contrary to the Agree-
ment.
The exchange of information is not restricted by Article 1. A-
ny information received by a Contracting State shall be treat-
ed 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 b-
odies) concerned with the assessment or collection of, the en-
forcement or prosecution in respect of, or the determination
of appeals in relation to, the taxes covered by the Agreement.
Such persons or authorities shall use the information only for
such purposes. They may disclose the information in public co-
urt proceedings or in judicial decisions.
2.In no case shall the provisions of paragraph 1 be construed so
as to impose on the competent authority ofa Contracting State
the obligation:
(a) to carry out administrative measures at variance with the
laws and administrative practice of that or of the other C-
ontracting State;
(b) to supply information which is not obtainable under the la-
ws or in the normal course of the administration of that or
of the other Contracting State;
(c) to supply information which would disclose any trade, busi-
ness, industrial, commercial or professional secret or tra-
de process, or information, the disclosure of which would
be contrary to public policy (ordre public).
Article 27
Members of Diplomatic Missions and Consular Posts
Nothing in this Agreement shall affect the fiscal privileges of
members of diplomatic missions or consular posts under the gene-
ral rules of international law or under the provisions of speci-
al agreements.
Article 28
Entry into Force
This Agreement shall enter into force upon the date of the sign-
ature. Each Contracting State shall notify the other through di-
plomatic channels that the necessary procedure, according to the
domestic legislative, has been fulfilled. Tne Agreement shall h-
ave effect:
(a) in respect of taxes withheld at source, for amounts paid or
credited on or after the first day of the second month next
following the date on which the Agreement enters into force
; and
(b) in respect of other taxes on income, for taxable years beg-
inning on or after the frrst day of January in the year ne-
xt following that in which the Agreement enters into force.
Article 29
Termination
This Agreement shall remain in force until terminated by a Cont-
racting State.
Either Contracting State may terminate the Agreement, by giving
written notice of termination on or before the thirtieth day of
June of any calendar year following after the period of five ye-
ars from the year in which the Agreement enters into force. In
such case the Agreement shall cease to have effect:
(a) in respect of taxes withheld a source, for amounts pad or
credited on or affaj the first day of January in the year
next following that in which the notice of termination is
given; and
(b) in respect other taxes on income, for taxable years beginn-
ing on or after the first day of January in the year next
following that in which the notice of termination is given.
IN WITNESS whereof the undersigned, being duly authorized there-
to, by their respective governments have signed this Agreement.
DONE in duplicate in Taipei on the 9" of June 1999, in the Mace-
donian, Chinese and English languages, all texts being eqsllllly
authentic. In the case of divergence of interpretation, then the
English text shall prevail.
FOR THE GOVERNMENT OF FOR THE GOVERNMENT OF
THE REPUBLIC OF CHINA THE REPUBLIC OF MACEDONL4
Paul C. H. CHIU Nikola GRUEVSKI
Minister ofFinance Minister of Trade