Article 8-11

1.

Income of a resident of a Contracting State from the operation of ships or aircraft in international traffic shall be taxable only in that State.

2.

Income of a resident of a Contracting State from the following activities shall be taxable only in

a)

income from the rental of ships or aircraft operated in international traffic by the ;

b)

income from the rental of ships and aircraft, whether or not operated in international traffic, if such rental activity is incidental to the operation of ships or aircraft in international traffic by the lessor; and

c)

income (including demurrage) from the use, or rental for use, of containers in international traffic (including trailers, barges, and related equipment for the transport of containers).

3.

The provisions of paragraphs 1 and 2 shall also apply to income from participation in a pool, a joint business, or an international transportation agency.

1.

Income derived by a resident of a Contracting State from real property (including income from agriculture or forestry) situated in the other Contracting State may be taxed in that other State.

2.

For purposes of this Convention, the term ``real property'' includes any interest owned or held in tenancy by any individual or any legal entity in land, unsevered products of land as well as any fixture built on that land (buildings, structures, etc.) and other property considered real property under the law of the Contracting State in which the property in question is situated. ships, boats and aircraft shall not be regarded as real property.

3.

The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use in any other form of real property.

4.

A resident of a Contracting State who is liable to tax in the other Contracting State on income from real property situated in that other State may elect, subject to the procedures of the domestic law of that other State, to compute the tax on such income on a net basis as if such income were attributable to a permanent establishment in that other State. Any such election shall be binding for the taxable year of the election and all subsequent taxable years unless revoked pursuant to the procedures under the domestic law of the Contracting State in which the property is situated.

1.

Dividends that are paid by a company which is a resident of a Contracting State and that are beneficially owned by a resident of the other Contracting State may be taxed in that other State.

2.

However, such dividends may also be taxed in the first Contracting State, and according to the laws of that State, but the tax so charged shall not exceed:

a)

5 percent of the gross amount of the dividends if the beneficial owner is a company which owns at least 10 percent of the voting stock (or, in the case of Russia, if there is no voting stock, at least 10 percent of the statutory capital) of the company paying the dividends; and

b)

10 percent 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 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 State of which the company making the distribution is a resident. The term ``dividends'' also includes income from arrangements, including debt obligations, carrying the right to participate in profits, to the extent so characterized under the law of the Contracting State in which the income arises. In the case of Russia, this term includes income transmitted abroad to the foreign participants of an enterprise with foreign investments created under the laws of the Russian Federation.

4.

The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends, being a resident of a Contracting State, carries on or has carried on business in the other Contracting State, of which the company paying the dividends is a resident, through a permanent establishment situated therein, or performs or has performed in that other State independent personal services from a fixed base situated therein, and the dividends are attributable to such permanent establishment or fixed base. In such case the provisions of Article 6 (Business Profits) or Article 13 (Independent Personal Services), as the case may be, shall apply.

5.

A company which is a resident of a Contracting State and which has a permanent establishment in the other Contracting State or which is subject to tax on a net basis in that other State under Article 9 (Income from Real Property) or paragraph 3 of Article 19 (Other Income) may be subject in that other State to a tax in addition to the tax on profits. Such tax, however, may not exceed 5 percent of the portion of the profits of the company subject to tax in the other Contracting State which represents the ``dividend equivalent amount'' of such profits.

1.

Interest derived and beneficially owned by a resident of a Contracting State may be taxed only in that State.

2.

The term ``interest'' as used in this Convention means income from debt-claims of every kind, unless described in paragraph 3 of Article 10 (Dividends), and in particular, income from government securities, and income from bonds or debentures, including premiums or prizes attaching to such securities, bonds, or debentures as well as all other income that is treated as income from money lent by the taxation law of the Contracting State in which the income arises.

3.

The provisions of paragraph 1 shall not apply if the beneficial owner of the interest, being a resident of a Contracting State, carries on or has carried on business in the other Contracting State through a permanent establishment situated therein, or performs or has performed in that other State independent personal services from a fixed base situated therein, and the interest is attributable to such permanent establishment or fixed base. In such case the provisions of Article 6 (Business Profits) or Article 13 (Independent Personal Services), as the case may be, shall apply.

4.

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 Contracting State, due regard being had to the other provisions of the Convention.

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