Article 12-17

1.

Royalties derived and beneficially owned by a resident of a Contracting State shall be taxable only in that State.

2.

The term ``royalties'' as used in this Convention 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 computer programs, video cassettes, and cinematograph films and tapes for radio and television broadcasting; any patent, trademark, design or model, plan, secret formula or process, or other like right or property, or information concerning industrial, commercial, or scientific experience (``know-how'').

3.

The provisions of paragraph 1 shall not apply if the beneficial owner of the royalties, 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 royalties 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.

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

1.

Income derived by an individual who is a resident of a Contracting State from the performance of independent personal services shall be taxable only in that State, unless

a)

such services are performed or were performed in the other Contracting State; and

b)

the income is attributable to a fixed base which the individual has or had regularly available to him in that other State; and

c)

such individual is present or was present in that other State for a period or periods exceeding in the aggregate 183 days in the calendar year. In such a case, the income attributable to that fixed base may be taxed in that other State in accordance with principles similar to those of Article 6 (Business Profits) for determining the amount of business profits and attributing business profits to a permanent establishment.

2.

The term ``independent personal services'' includes, in particular, independent scientific, literary, artistic, educational or teaching activities, as well as the independent services of physicians, lawyers, engineers, architects, dentists, and accountants.

1.

Subject to the provisions of Articles 15 (Directors' Fees), 16 (Government Service), and 17 (Pensions), salaries, wages, and other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable 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 that other State.

2.

Notwithstanding the provisions of paragraph 1, remuneration derived 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 all of the following conditions are met:

a)

the recipient is present in the other State for a period or periods not exceeding in the aggregate 153 days in the calendar year concerned;

b)

the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State;

c)

the remuneration is not borne by a permanent establishment or a fixed base which the employer has in the other State.

3.

Remuneration derived by a resident of a Contracting State that would otherwise be taxable in the other Contracting State under the preceding provisions of this Article may be taxed only in the first-mentioned State when the remuneration is in respect of:

a)

employment as a member of the regular complement of a ship or aircraft operated in international traffic, or

b)

employment directly connected with a place of business which is not a permanent establishment under paragraph 3 of Article 5 (Permanent Establishment), but only if such resident is present in the other State for a period not exceeding 12 consecutive months, or

c)

technical services directly connected with the application of a right or property giving rise to a royalty, as defined in paragraph 2 of Article 12 (Royalties), if such services are provided as part of a contract granting the use of the right or property.

Directors' fees and similar payments derived by a resident of a Contracting State in his capacity as a member of the board of directors or similar body of a company which is a resident of the other Contracting State may be taxed in that other State.

1.

Remuneration, excluding a pension, paid from the public funds of a Contracting State, a political subdivision or local authority of the United States or any republic or local authority of Russia to an individual in respect of services rendered in the discharge of functions of a governmental nature shall be taxable only in that State. However, such remuneration shall be taxable only in the other Contracting State if the services are rendered in that State and the individual is a resident of that State who:

a)

is a citizen of that State or

b)

did not become a resident of that State solely for the purpose of rendering the services.

2.

Any pension paid from the public funds of a Contracting State, a political subdivision or local authority of the United States or any republic or local authority of Russia to an individual in respect of services rendered to that State, subdivision, authority or republic shall be taxable only in that Contracting State. However, such pension shall be taxable only in the other Contracting State if the individual is a resident of, and a citizen of, that other Contracting State.

3.

Notwithstanding the provisions of paragraphs 1 and 2, the provisions of Article 13 (Independent Personal Services), Article 14 (Income from Employment), or Article 17 (Pensions), as the case may be, shall apply to remuneration paid in respect of services rendered in connection with a business.

Subject to the provisions of Article 16 (Government Service):

a)

Pensions and other similar remuneration derived and beneficially owned by a resident of a Contracting State in consideration of past employment may be taxed only in that State; and

b)

Social security benefits and other public pensions paid by a Contracting State may be taxed only in that State.

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