Article 1
Personal scope
This Convention shall apply to persons who are residents of one or both of the Contracting States.
Article 2
Taxes covered
1. This Convention shall apply to taxes on income and on capital imposed on behalf of a Contracting State or of its regional 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 Convention shall apply are in particular:
(a) in the case of Norway:
(1) the national, the county and the municipal taxes on income, including the special national tax on income derived from the production and pipeline transportation of petroleum (inntektsskatter til stat, fylker og kommuner, herunder saerskatt til staten på produksjon og rorledningstransport av petroleum);
(2) the national and municipal taxes on capital (formuesskatter til stat og kommune);
(3) the national dues on the profits of non-resident artistes (honoraravgift for utenlandske kunstnere);
(4) the seamen’s tax (sjomannsskatt);
(hereinafter referred to as “Norwegian tax”).
(b) in the case of Luxembourg:
(1) the individual income tax (l’impot sur le revenu des personnes physiques);
(2) the company income tax (l’impot sur le revenu des collectivités);
(3) the special tax on directors’ fees (l’impot spécial sur les tantièmes);
(4) the capital tax (l’impot sur la fortune);
(5) the municipal trade tax on profits and working capital (l’impot commercial communal d’après les bénéfice et capital d’exploitation);
(6) the tax on payroll (l’impot communal sur le total des salaires);
(hereinafter referred to as “Luxembourg tax).
4. The Convention shall apply also to any identical or substantially similar taxes which are imposed after the date of signature of the Convention in addition to, or in place of, the existing taxes.
5. The competent authorities of the Contracting States shall notify each other, if necessary, of essential changes which have been made in their respective taxation laws.
Article 3
General definitions
1. For the purposes of this Convention, unless the context otherwise requires:
(a) the term “Norway” means the Kingdom of Norway including any area outside the territorial waters of Norway where Norway, according to Norwegian legislation and in accordance with international law, may exercise its rights with respect to the sea-bed and subsoil and their natural resources; the term does not comprise Svalbard, Jan Mayen and the Norwegian dependencies (“biland”) outside Europe;
(b) the term “Luxembourg” means the territory of the Grand Duchy of Luxembourg;
(c) the term “person” includes an individual, a company and any other body of persons;
(d) the term “company” means any body corporate or any entity which is treated as a body corporate for tax purposes;
(e) the term “nationals” means all individuals possessing the nationality of a Contracting State and all legal persons, partnerships and associations deriving their status as such from the law in force in a Contracting State;
(f) the terms “enterprise of a Contracting State” and “enterprise of the other Contracting State” mean respectively an enterprise carried on by a resident of a Contracting State and an enterprise carried on by a resident of the other Contracting State;
(g) the term “international traffic” means any transport by a ship or aircraft operated by an enterprise which has its place of effective management in a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State;
(h) the term “competent authority” means:
(1) in the case of Norway, the Minister of Finance and Customs or his duly authorized representative;
(2) in the case of Luxembourg, the Minister of Finance or his duly authorized representative.
2. As regards the application of the Convention by a Contracting State any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the law of that State concerning the taxes to which the Convention applies.
Article 4
Resident
1. For the purposes of this Convention, the term “resident of a Contracting State” means any person who, under the laws of that State, is liable to tax therein by reason of his domicile, residence, place of management or any other criterion of a similar nature. But this term does not include any individual who is liable to tax in that Contracting State in respect only of income from sources in that State or capital situated therein.
2. Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows:
(a) he shall be deemed to be a resident of the Contracting State in which he has a permanent home available to him; if he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closer (centre of vital interests);
(b) if the Contracting State 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 Contracting State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode;
(c) if he has an habitual abode in both Contracting States or in neither of them, he shall be deemed to be a resident of the Contracting State of which he is a national;
(d) if he is a national of both Contracting 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 of this Article, a person other than an individual is a resident of both Contracting States, then it shall be deemed to be a resident of the Contracting State in which its place of effective management is situated.
Article 5
Permanent establishment
1. For the purposes of this Convention, 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. A building site or construction or installation project constitutes a permanent establishment only if it lasts more than twelve 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, 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, advertising, the supply of information, scientific research or any other similar activity of a preparatory or auxiliary character.
5. A person – other than an agent of an independent status to whom paragraph 6 of this Article applies – who acts in a Contracting State on behalf of an enterprise of the other Contracting State and has, and habitually exercises, in the first State an authority to conclude contracts in the name of the enterprise, shall be deemed to be a permanent establishment in that State, unless the activities of such person are limited to the purchasing of merchandise for the enterprise.
6. An enterprise of a Contracting State shall not be deemed to have a permanent establishment in a Contracting State merely because it carries on business in that State 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 Contracting State controls or is controlled by a company which is a resident of the other Contracting State, or which carries on business in that other State (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 from immovable property (including income from agriculture or forestry) may be taxed in the Contracting State where the property is situated.
2. The term “immovable property” shall have the meaning which it has under the law of the Contracting State 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 of this Article 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 of this Article 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 Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State 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 State 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 Contracting State carries on business in the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State 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 of the enterprise (other than expenses which would not be deductible if the permanent establishment were an independent and separate enterprise) which are incurred for the purposes of the permanent establishment, including executive 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 and in accordance with its laws 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 of this Article shall preclude that Contracting State 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 Convention, then the provisions 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 international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated.
2. If the place of effective management of a shipping enterprise is aboard a ship, then it shall be deemed to be situated in the Contracting State in which the home harbour of the ship is situated, or, if there is no such home harbour, in the Contracting State of which the operator of the ship is a resident.
3. The provisions of paragraph 1 shall apply to profits derived by the joint Norwegian, Danish and Swedish air transport consortium, “Scandinavian Airlines System (SAS)”, but only in so far as profits so derived by “Det Norske Luftfartsselskap A/S (DNL)”, the Norwegian partner of the “Scandinavian Airlines System (SAS)”, are in proportion to its share in that organization.
Article 9
Associated enterprises
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 Contracting State and an enterprise of the other Contracting State,
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.
Article 10
Dividends
1. Dividends paid by a company which is a resident of a Contracting 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. Subject to the provisions of paragraph 3, the tax so charged shall not exceed:
(a) 5% of the gross amount of the dividends if the beneficial owner is a company (other than a partnership) which holds directly at least 25% of the capital of the company paying the dividends;
(b) 15% of the gross amount of the dividends in all other cases.
3. Dividends paid by a Norwegian company to a Luxembourg company
(other than a partnership) which holds directly at least 25% of the capital of the Norwegian company may be taxed in Norway at a rate not exceeding 15%. This provision remains in force as long as dividends paid by Norwegian companies are deductible from the profits of such companies for purposes of determining the amount subject to the Norwegian national tax.
4. The competent authorities of the Contracting States shall settle the mode of application of these limitations for purposes of paragraphs 2 and 3.
The provisions of paragraphs 2 and 3 shall not affect the taxation of the company in respect of the profits out of which the dividends are paid.
5. The term “dividends” as used in this Article means income from 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 State of which the company making the distribution is a resident.
6. The provisions of paragraphs 1, 2 and 3 shall not apply if the beneficial owner of the dividends, being a resident of a Contracting State, carries 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 in that other State 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.
7. Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not impose any tax on the dividends paid by the company to persons who are not resident in that other State, 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 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 State.
2. The term “interest” as used in this Article means income from government securities and income from bonds or debentures, whether or not secured by mortgage, and from other debt-claims of every kind as well as all other income which is treated as income from debt-claims by the laws of the State from which the income is derived.
3. The provisions of paragraph 1 of this Article shall not apply if the beneficial owner of the interest, being a resident of a Contracting State, carries on business in the other Contracting State in which the interest arises, through a permanent establishment situated therein, or performs in that other State 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.
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 this Convention.
Article 12
Royalties
1. Royalties arising in a Contracting State and paid to a resident of the other Contracting State shall be taxable only in that other State.
2. 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 and tapes 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 scientific equipment, or for information concerning industrial, commercial or scientific experience.
3. The provisions of paragraph 1 of this Article shall not apply if the beneficial owner of the royalties, being a resident of a Contracting State, carries on business in the other Contracting State in which the royalties arise, through a permanent establishment situated therein, 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 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.
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 this Convention.
Article 13
Capital gains
1. Gains derived from the alienation of immovable property referred to in paragraph 2 of Article 6 may be taxed in the Contracting State in which such property is situated.
2. Gains from the alienation of movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State or of movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting 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 a fixed base, may be taxed in that other State.
3. Notwithstanding the provisions of paragraph 2 of this Article, gains from the alienation of ships and aircraft operated in international traffic and movable goods pertaining to the operation of such ships and aircraft shall be taxable only in the Contracting State where, according to the provisions of Article 8, the income derived from such activities is taxable.
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 Contracting State of which the alienator is a resident.
5. The provisions of paragraph 4 shall not affect the right of Norway to levy a tax, according to its own law, on gains derived from the alienation of shares in a stock corporation which is a resident of Norway, where the shares are owned by an individual who is a resident of Luxembourg but has been a resident of Norway at any time during the five years preceding the alienation of the shares.
6. The provisions of paragraph 4 shall not affect the right of Luxembourg to levy a tax, according to its own law, on gains derived from the alienation of shares in a company which is a resident of Luxembourg or derived from the liquidation of such a company, where the beneficial owner is an individual who has been a resident of Luxembourg for more than 15 years and who became a resident of Norway less than five years before the realization of the gain.
Article 14
Independent personal services
1. Income derived by a resident of a Contracting State in respect of professional services or other independent activities of a similar 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 independent scientific, literary, artistic, educational, sporting or teaching activities as well as the independent activities of physicians, lawyers, engineers, architects, dentists and accountants.
Article 15
Employment income
1. Subject to the provisions of Articles 16, 18, 19 and 20, 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 of this Article, 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:
(a) the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in the fiscal year concerned;
(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, remuneration derived in respect of an employment exercised aboard a ship or aircraft operated in international traffic may be taxed in the Contracting State in which the place of effective management of the enterprise is situated.
Article 16
Directors’ fees
Directors’ fees, attendance fees and other similar payments derived by a resident of a Contracting State in his capacity as a member of the board of directors or supervisory board of a company which is a resident of the other Contracting State may be taxed in that other State.
Article 17
Artistes and athletes
1. Notwithstanding the provisions of Articles 14 and 15, income derived by an entertainer, such as a theatre, motion picture, radio or television artiste, or a musician, or as an athlete, from his personal activities may be taxed in the Contracting State where the activities are exercised.
2. Where income in respect of personal activities exercised by an entertainer or an athlete in his capacity as such accrues not to the entertainer or athlete 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 activities of the entertainer or athlete are exercised.
Article 18
Pensions, life annuities and social security payments
1. Subject to the provisions of paragraph 2 of Article 19, pensions and other similar remuneration paid to a resident of a Contracting State in consideration of past employment and life annuities paid to such resident shall be taxable only in that State.
2. Notwithstanding the provisions of paragraph 1 social security payments derived from a Contracting State in accordance with the laws of that State and paid to a resident of the other Contracting State may be taxed in the first-mentioned State.
Article 19
Government service
1. (a) Remuneration, other than a pension, paid by a Contracting State or a regional or a local authority thereof to any individual in respect of services rendered to that State or authority shall be taxable only in that State.
(b) However, such remuneration shall be taxable only in the other Contracting State if the services are rendered in that State and the recipient of the remuneration 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 Contracting State or a regional or a local authority thereof to an individual in respect of services rendered to that State or authority 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 Articles 15, 16 and 18 shall apply to remuneration and pensions in respect of services rendered in connection with a business carried on by a Contracting State or a regional or a local authority thereof.
Article 20
Students
Payments which a student or business apprentice who is or was immediately before visiting a Contracting State a resident of the other Contracting State and who is present in the first-mentioned Contracting State solely for the purpose of his education or training receives for the purpose of his maintenance, education or training shall not be taxed in that State, provided that such payments arise from sources outside that State.
Article 21
Other income
1. Items of income of a resident of a Contracting State, wherever arising, not dealt with in the foregoing Articles of this Convention shall be taxable only in that State.
2. The provisions of paragraph 1 shall not apply if the recipient of such income, being a resident of a Contracting State, has in the other Contracting State from which the income is derived a permanent establishment, 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 case may be, shall apply.
Article 22
Capital
1. Capital represented by immovable property referred to in paragraph 2 of Article 6 may be taxed in the Contracting State where the property is situated.
2. Capital represented by movable property forming part of the business property of a permanent establishment or by movable property pertaining to a fixed base available for the purpose of performing independent personal services may be taxed in the Contracting State where the permanent establishment or fixed base is situated.
3. Capital 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 the State which has the right, in accordance with Article 8, to tax the income derived from such operation.
4. All other elements of capital of a resident of a Contracting State shall be taxable only in that State.
Article 23
Elimination of double taxation
1. Where a resident of a Contracting State derives income or owns capital which, in accordance with the provisions of this Convention, may be taxed in the other Contracting State, the first-mentioned State shall, subject to the provisions of paragraph 2, exempt such income or capital from tax, but may, in calculating the amount of tax on the remaining income or capital of such resident, apply the same rate as if the income or capital in question had not been exempted.
2. Where a resident of a Contracting State derives items of income which, in accordance with the provisions of Articles 10 and 13, paragraph 5 or 6, may be taxed 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 paid in that other Contracting State. 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 that other Contracting State.
Article 24
Non-discrimination
1. Nationals of a Contracting State, whether they are residents of a Contracting State or not, shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith, which is other or more burdensome than the taxation and connected requirements to which nationals of that other State in the same circumstances are or may be subjected.
2. The taxation on a permanent establishment or a fixed base which an enterprise or a person resident in a Contracting State has in the other Contracting State shall not be less favourably levied in that other State than the taxation levied on enterprises or persons of that other State carrying on the same activities. This provision shall not be construed as obliging a Contracting State to grant to residents of the other Contracting State any personal allowances, reliefs and reductions for taxation purposes on account of civil status or family responsibilities or any other circumstances which it grants to its own residents.
The provisions of this paragraph shall not prevent a Contracting State from taxing the profits derived through a permanent establishment in accordance with the laws of that State, if the permanent establishment belongs to a “societé anonyme” or any similar company of the other Contracting State. The taxation shall not, however, be determined at a rate exceeding the maximum rate applicable to the total or to a portion of the profits of companies which are residents of the first-mentioned Contracting State.
3. Except where the provisions of Article 9, paragraph 4 of Article 11 or paragraph 4 of Article 12 apply, interest, royalties and other disbursements paid by an enterprise of a Contracting State to a resident of the other Contracting State shall, for the purpose of determining the taxable profits of such enterprise, be deductible under the same conditions as if they had been paid to a resident of the first-mentioned State. Similarly, any debts of an enterprise of a Contracting State to a resident of the other Contracting State 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 State.
4. Enterprises of a Contracting State, the capital of which is wholly or partly owned or controlled, directly or indirectly, by one or more residents of the other Contracting State, shall not be subjected in the first-mentioned Contracting State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which other similar enterprises of that first-mentioned State are or may be subjected.
5. The provisions of this Article shall not be interpreted as to oblige Norway to grant to nationals of Luxembourg who are not nationals of Norway the exceptional tax relief which it grants to nationals of Norway and to individuals born in Norway from parents having Norwegian nationality, in accordance with Section 22 of the Norwegian tax law.
6. The term “taxation” in this Article means taxes of every kind and description.
Article 25
Mutual agreement procedure
1. Where a person considers that the actions of one or both of the Contracting States result or will result for him in taxation not in accordance with the provisions of this Convention, he may, irrespective of the remedies provided by the domestic law of those States, present his case to the competent authority of the Contracting State of which he is a resident or, if his case comes under paragraph 1 of Article 24, to that of the Contracting State of which he is a national.
2. That competent authority shall endeavour, if the objection appears to it to be justified and if it is not itself able to arrive at a satisfactory solution, to resolve the case by mutual agreement with the competent authority of the other Contracting State, with a view to the avoidance of taxation not in accordance with the Convention. Any agreement reached shall be implemented notwithstanding any time limits in the domestic laws of the Contracting States.
3. The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of the Convention. They may also consult together for the elimination of double taxation in cases not provided for in the Convention.
4. The competent authorities of the Contracting States may communicate with each other directly for the purpose of reaching an agreement in the sense of the preceding paragraphs. When it seems advisable in order to reach agreement to have an oral exchange of opinions, such exchange may take place through a Commission consisting of representatives of the competent authorities of the Contracting States.
Article 26
Exchange of information
1. The competent authorities of the Contracting States shall exchange such information as is necessary for carrying out the provisions of this Convention and of the domestic laws of the Contracting States concerning taxes covered by the Convention insofar as the taxation thereunder is not contrary to the Convention as well as for preventing tax fraud in the field of the taxes specified in this Convention. The exchange of information is not restricted by Article 1. Any information so exchanged shall be treated as secret and shall be disclosed only to persons or authorities (including courts and administrative bodies) involved in the assessment or collection of the taxes covered by this Convention, or involved in public court proceedings or in judicial decisions pertaining to such taxes.
2. In no case shall the provisions of paragraph 1 be construed so as to impose on a Contracting State the obligation:
(a) to carry out administrative measures at variance with the laws or the administrative practice of that or of the other Contracting State;
(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 Contracting State;
(c) to supply information which would disclose any trade, business, industrial, or professional secret or trade process, or information, the disclosure of which would be contrary to public policy (ordre public).
Article 27
Assistance in collection
1. The Contracting States undertake to assist each other in the collection of the taxes referred to in this Convention, together with interest, costs and additional amounts and fines which do not have a penal character.
2. The request drawn up for such purpose shall be accompanied by the documents required under the laws of the requesting State as evidence that the amounts to be collected are finally due.
3. On receipt of these documents, writs to pay shall be served and measures of recovery and collection shall be taken in the requested State in accordance with the laws relating to the recovery and collection of its own taxes. Writs for collection, in particular, shall be carried out in the manner provided in the laws of that State.
4. Tax claims shall not enjoy priority in the requested State.
5. With respect to tax claims which can be appealed against, the creditor State may, in order to protect its rights, request the other State to serve the taxpayer a warrant or precautionary collection. Appeals against the soundness of the complaints which were the motive of the notification may only be lodged with the competent court of the requesting State.
Article 28
Diplomatic agents and consular officers
Nothing in this Convention shall affect the fiscal privileges of diplomatic agents or consular officers under the general rules of international law or under the provisions of special agreements.
Article 29
Exclusion of certain companies
This Convention shall not apply to holding companies within the meaning of the special Luxembourg legislation (currently the Law of 31 July 1929 and the Grand Ducal Decree of 17 December 1938). Neither shall it apply to income which a resident of Norway derives from such companies nor to shares or other rights in the capital of such companies belonging to such a person.
Article 30
Territorial extension
1. This Convention may be extended, either in its entirety or with any necessary modifications to any territory which is excluded from the application of the Convention in accordance with the provisions of paragraph 1, letter a of Article 3, and which imposes taxes substantially similar in character to those to which the Convention applies. Any such extension shall take effect from such date and subject to such modifications and conditions, including conditions as to termination, as may be specified and agreed between the Contracting States in notes to be exchanged through diplomatic channels.
2. Unless otherwise agreed by both Contracting States, in case the Convention is terminated, it shall cease to apply to any territory to which it has been extended under this Article.
Article 31
Entry into force
1. This Convention shall be ratified and the instruments of ratification shall be exchanged at Luxembourg as soon as possible.
2. This Convention shall enter into force upon the exchange of instruments of ratification and its provisions shall have effect:
(1) in Norway:
(a) in respect of taxes withheld at the source, to income paid or payable on or after 1 January of the year following that in which the instruments of ratification are exchanged;
(b) in respect of other taxes, to income of taxable periods ending on or after 1 January of the year following that in which the instruments of ratification are exchanged;
(c) in respect of taxes on capital, to capital existing on 1 January of the year following that in which the instruments of ratification are exchanged or on the last day of an accounting period ending during the year in which the instruments of ratification are exchanged.
(2) in Luxembourg:
(a) in respect of taxes withheld at the source, to income paid or payable on or after 1 January of the year following that in which the instruments of ratification are exchanged;
(b) in respect of other taxes, to taxes relating to the tax year bearing the number of the calendar year following that in which the instruments of ratification are exchanged, and any subsequent year.
Article 32
Termination
This Convention shall remain in force until terminated by a Contracting State. Either Contracting State may – not later than 30 June of a calendar year, except during the 5 years following the year at the end of which the Convention has entered into force – terminate the Convention in writing through diplomatic channels. In such case the Convention shall cease to have effect:
(1) in Norway:
(a) in respect of taxes withheld at the source, to income paid or payable on or after 1 January of the year following that of termination;
(b) in respect of other taxes on income, to income of taxable periods ending on or after 1 January of the year following that of termination;
(c) in respect of taxes on capital, to capital existing on 1 January of the year directly following that of termination or on the last day of an accounting period ending in the year of determination.
(2) in Luxembourg:
(a) in respect of taxes withheld at the source, to income paid or payable on or after 1 January of the year following that of termination;
(b) in respect of other taxes, to taxes relating to the tax year bearing the number of the calendar year following that of termination.
In witness whereof, the Plenipotentiaries of the two States have signed this Convention and have affixed thereto their seals.
Done at Oslo, on 6 May 1983, in two copies, in the French and Norwegian languages, each text being equally authentic.
PROTOCOL
At the moment of signing the Convention for the avoidance of double taxation and the prevention of tax evasion with respect to taxes on income and on capital, concluded this day between the Kingdom of Norway and the Grand Duchy of Luxembourg, the undersigned Plenipotentiaries have agreed upon the following provisions which constitute an integral part of the Convention.
1. At the request of Norway, which will be done through diplomatic channels, Article 23 shall be replaced by the following text, which shall enter into force on the 30th day after the exchange of notes and which shall apply for the first time:
(a) with respect to taxes on income, to taxes on income relating to the calendar year following that of the exchange of notes and to accounting periods ending in the course of the calendar year following that of the exchange of notes;
(b) with respect to taxes on capital, to taxes relating to the second year following that of the exchange of notes.
“Article 23
1. Where a resident of Luxembourg derives income or owns capital which, in accordance with the provisions of this Convention, may be taxed in Norway, Luxembourg shall, subject to the provisions of paragraph 2, exempt such income or capital from tax, but may, in calculating the amount of tax on the remaining income or capital of such resident, apply the same rate as if the income or capital so exempted had not been exempted.
2. Where a resident of Luxembourg derives income which, in accordance with the provisions of Article 10 and paragraph 5 of Article 13, may be taxed in Norway, then Luxembourg shall allow as a deduction from the tax on the income of that resident an amount equal to the tax paid in Norway. Such deduction shall not, however, exceed that part of the Luxembourg tax as computed before the deduction is given, which is attributable to the income derived from Norway.
3. Where a resident of Norway derives income or owns capital which, in accordance with the provisions of this Convention, may be taxed in Luxembourg, Norway shall allow as a deduction from the tax on income or on capital of that resident an amount equal to the tax paid in Luxembourg. Such deduction shall not, however, exceed that part of the Norwegian tax as computed before the deduction is given, which is attributable to the income derived from Luxembourg or the capital owned in Luxembourg.”
2. Where Norway makes use, or has made use, of its right laid down in 1 of this Protocol, Luxembourg retains the right to apply the method of calculation in a similar way. For this purpose, Article 23 shall, at the request of Luxembourg through diplomatic channels, be replaced by the following text, which shall enter into force on the 30th day after the exchange of notes and which shall apply for the first time:
(a) with respect to taxes on income, to taxes on income relating to the calendar year following that of the exchange of notes and to accounting periods ending in the course of the calendar year following that of the exchange of notes;
(b) with respect to taxes on capital, to taxes relating to the second year following that of the exchange of notes.
“Article 23
1. Where a resident of a Contracting State derives income or owns capital which, in accordance with the provisions of this Convention, may be taxed in the other Contracting State, the first-mentioned State shall allow:
(a) from the tax it collects on income of that resident, a deduction of an amount equal to the tax on income paid in that other State;
(b) from the tax it collects on the capital of that resident, a deduction of an amount equal to the tax on capital paid in that other State.
In both cases, such deduction shall not exceed that part of the tax on income or on capital, as computed before the deduction is given, which is attributable to the income on the capital which is taxable in the other State.
2. Where, in accordance with the provisions of Article 19 of the Convention, income which a resident of a Contracting State receives is exempt from tax in that State, it may nevertheless, in calculating the amount of tax on the remaining income of that resident, take the exempted income into account.”
Done at Oslo, in two original copies, in the French and Norwegian languages, each text being equally authentic.
PROTOCOL
Activities at sea
At the moment of signing the Convention for the avoidance of double taxation and the prevention of tax evasion with respect to taxes on income and on capital, concluded this day between the Kingdom of Norway and the Grand Duchy of Luxembourg, the undersigned Plenipotentiaries have agreed upon the following provisions which shall constitute an integral part of the Convention:
Notwithstanding any provision to the contrary in this Convention:
1. A person who is a resident of Luxembourg and carries on offshore activities in connection with the exploration or exploitation of the sea bed and sub-soil and their natural resources situated in the areas over which Norway, in accordance with international law, has jurisdiction shall, subject to the provisions of paragraphs 2 and 3 of this Protocol, be deemed to be carrying on an activity in Norway through a permanent establishment or fixed base situated therein.
2. The provisions of paragraph 1 shall not apply if such activities are carried out during a period or periods not exceeding 30 days in the course of a twelve-month period.
However, for the application of this paragraph:
(a) the activities of an enterprise which is associated with another enterprise shall be considered to be carried out by the enterprise with which it is associated if the activities in question are fundamentally identical to those in which the last-mentioned enterprise is engaged;
(b) two enterprises are deemed to be associated if one of them is controlled directly or indirectly by the other, or if the two are directly or indirectly controlled by a third person or third persons.
3. Profits derived from the transportation of supplies to a location where activities in connection with the exploration or exploitation of the sea bed or sub-soil and their natural resources in areas over which Norway has, in accordance with international law, jurisdiction, or from the operation of tug boats and similar vessels in connection with such activities, shall be taxable only in the Contracting State where the place of effective management is situated.
4. Subject to he provisions of paragraph 5 of this Protocol, salaries, wages and similar remuneration derived by a resident of Luxembourg in respect of an employment related to the exploration or exploitation of the sea bed and sub-soil and their natural resources situated in areas over which Norway, in accordance with international law, has jurisdiction, may be taxed in Norway, but only to the extent that such employment is performed offshore in areas over which Norway has, in accordance with international law, jurisdiction, during a period or periods exceeding in the aggregate 30 days during a twelve-month period.
5. Remuneration which a resident of a Contracting State derives in respect of an employment exercised aboard a ship or aircraft engaged in the transportation of supplies to a location – in areas over which Norway, in accordance with international law, has jurisdiction – where activities connected with the exploration or exploitation of the sea bed, and sub-soil and their natural resources are carried out, or in respect of an employment exercised aboard a tug boat or similar vessel in connection with such activities shall be taxable in the Contracting State where the place of effective management of the transport or tug boat enterprise is situated.
6. Where a resident of Luxembourg derives income which in accordance with the provisions of this Protocol is taxable in Norway, Luxembourg may tax such income, but shall allow from the tax it collects on income of that resident a deduction of an amount equal to the tax paid on such income in Norway. Such deduction shall not, however, exceed that portion of tax, calculated before the deduction is given, which is attributable to such income.
7. This Additional Protocol shall remain in force as long as the Convention, signed today, between the Kingdom of Norway and the Grand Duchy of Luxembourg, for the avoidance of double taxation and the prevention of tax evasion with respect to taxes on income and on capital, shall remain in force.
Done at Oslo, in two original copies, in the French and Norwegian languages, each text being equally authentic.
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