The United States of America and the Republic of Austria, desiring to conclude a convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, have agreed as follows: ARTICLE 1 Personal Scope 1. Except as otherwise provided in this Convention, this Convention shall apply to persons who are residents of one or both of the Contracting States. 　　2. This Convention shall not restrict in any manner any exclusion, exemption, deduction, credit, or other allowance now or hereafter accorded 　　a) by the laws of either Contracting State, or 　　b) by any other agreement between the Contracting States. 　　3. Notwithstanding the provisions of subparagraph 2(b): 　　a) Notwithstanding any other agreement to which the Contracting States may be parties, a dispute concerning whether a measure is within the scope of this Convention shall be considered only by the competent authorities of the Contracting States, as defined in subparagraph 1(e) of Article 3 (General Definitions) of this Convention, and the procedures under this Convention exclusively shall apply to the dispute. b) Unless the competent authorities determine that a taxation measure is not within the scope of　this Convention, the nondiscrimination obligations of this Convention exclusively shall apply with respect to that measure, except for such national treatment or most-favored-nation obligations as may apply to trade in goods under the General Agreement on Tariffs and Trade. No national treatment or most-favorednation obligation under any other agreement shall apply with respect to that measure. 　　c) For the purpose of this paragraph, a "measure" is a law, regulation, rule, procedure, decision,administrative action, or any other form of measure. 　　4. Notwithstanding any provision of this Convention except paragraph 5 of this Article, a Contracting State may tax its residents (as determined under Article 4 (Resident)), and by reason of citizenship may tax its citizens, as if this Convention had not come into effect. For this purpose the term "citizen" shall include a former citizen whose loss of citizenship had as one of its principal purposes the avoidance of tax, but only for a period of 10 years following such loss. 　　5. The provisions of paragraph 4 shall not affect: 　　a) the benefits conferred by a Contracting State under paragraph 2 of Article 9 (Associated Enterprises), paragraph 4 of Article 13 (Capital Gains), subparagraph b) of paragraph 1 and paragraph 3 of Article 18 (Pensions), Articles 22 (Relief from Double Taxation), 23 (Non-Discrimination) and 24 (Mutual Agreement Procedure); and 　　b) the benefits conferred by a Contracting State under Articles 19 (Government Service), 20　(Students and Trainees) and 26 (Diplomatic Agents and Consular Officers), upon individuals who are not citizens of that State, and who, in the case of the United States, do not have immigrant status. ARTICLE 2 Taxes Covered 　　1. This Convention shall apply to taxes on income imposed on behalf of a Contracting State. 　　2. The existing taxes to which this Convention shall apply are: 　　a) In the United States: the Federal income taxes imposed by the Internal Revenue Code (but　excluding social security taxes); 　　b) In Austria: 　　(i) die Einkommensteuer (the income tax); and 　　(ii) die Koerperschaftsteuer (the corporation tax). 　　3. The Convention shall apply also to any identical or substantially similar taxes which are imposed by a Contracting State after the date of signature of this Convention in addition to, or in place of, the existing taxes. The competent authorities of the Contracting States shall notify each other of any significant changes which have been made in their respective taxation laws and shall notify each other of any official published material concerning the application of this Convention, including explanations, regulations, rulings, or judicial decisions. 　　4. For the purpose of Article 23 (Non-Discrimination), this Convention shall also apply to taxes of every kind and description imposed by a Contracting State or a political subdivision or local authority thereof. For the purpose of paragraphs 1 to 5 of Article 25 (Exchange of Information and Administrative Assistance), this Convention shall also apply to taxes of every kind imposed by a Contracting State. ARTICLE 3 General Definitions 　　1. For the purposes of this Convention: 　　a) the term "person" includes an individual, an estate, a trust, a company and any other body of　persons; 　　b) the term "company" means any body corporate or any entity which is treated as a body　corporate for tax purposes; 　　c) 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; 　　d) the term "international traffic" means any transport by a ship or aircraft, except where such transport is solely between places in the other Contracting State; e) the term "competent" authority means: 　　(i) in the United States: the Secretary of the Treasury or his delegate; and　(ii) in Austria: the Federal Minister of Finance or his delegate; 　　6) (i) the term "United States" means the United States of America, but does　not include Puerto Rico, the Virgin Islands, Guam or any other United States possession or territory; 　　(ii) when used in a geographical sense, the term "United States" means the states thereof and the District of Columbia. Such term also includes 　　(A) the territorial sea thereof and 　　(B) the sea bed and subsoil of the submarine areas adjacent to that territorial sea,over which the United States exercises sovereign rights in accordance with international　law for the purpose of exploration for and exploitation of the natural resources of such　areas, but only to the extent that the person, property, or activity to which this Convention is being applied is connected with such exploration or exploitation; 　　g) the term "Austria" means the Republic of Austria; 　　h) the term "nationals" means: 　　(i) all individuals possessing the nationality of a Contracting State; and 　　(ii) all legal persons, partnerships and associations deriving their status as such from the laws in force in a Contracting State. 　　2. As regards the application of this Convention by a Contracting State any term not defined therein shall, unless the context otherwise requires and subject to the provisions of Article 24 (Mutual Agreement Procedure), have the meaning which it has under the laws of that State concerning the taxes to which this 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 the person's domicile, residence, citizenship, place of management, place of incorporation, or any other criterion of a similar nature, provided, however, that: 　　a) this term does not include any person who is liable to tax in that State in respect only of income　from sources in that State; 　　b) in the case of income derived or paid by a partnership, estate, or trust, this term applies only to　the extent that the income derived by such partnership, estate, or trust is subject to tax in that State as the income of a resident, either in its hands or in the hands of its partners, beneficiaries or grantor; 　　c) in the case of an individual who is not a resident of Austria under paragraph 1, this term　includes an individual who is a U.S. citizen or an alien admitted to the United States for permanent　residence (a "green card" holder) only if the individual has a substantial presence, permanent home or　habitual abode in the United States; and d) the term includes a Contracting State or a political subdivision or local authority thereof or any agency or instrumentality of any such State, subdivision or authority. 　　2. Where by reason of the provisions of paragraph 1, an individual is a resident of both Contracting States, then his or her status shall be determined as follows: 　　a) The individual shall be deemed to be a resident of the State in which he or she has a permanent　home available; if such individual has a permanent home available in both States, or in neither State, he or she shall be deemed to be a resident of the State with which his or her personal and economic relations are closer (center of vital interests); 　　b) If the State of the individual's center of vital interests cannot be determined, he or she shall be　deemed to be a resident of the State in which he or she has an habitual abode; 　　c) If the individual has an habitual abode in both States or in neither of them, he or she shall be deemed to be a resident of the State of which he or she is a national; 　　d) If the individual is a national of both States or of neither of them, the competent authorities of　the Contracting States shall endeavor to settle the question by mutual agreement. 　　3. Where by reason of the provisions of paragraph 1 a company is a resident of both Contracting States, then if it is created under the laws of a Contracting State or a political subdivision thereof it shall be deemed to be a resident of that State. 　　4. Where by reason of the provisions of paragraph 1 a person other than an individual or a company is a resident of both Contracting States, the competent authorities of the Contracting States shall settle the question by mutual agreement and determine the mode of application of the Convention to such person. 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" 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, or an installation or drilling rig or ship used for the exploration or development of natural resources, constitutes a permanent establishment only if it has remained in that State 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, display, or delivery of goods or merchandise belonging to the enterprise; 　　b) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the　purpose of storage, display or delivery; 　　c) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the　purpose of processing by another enterprise; 　　d) the maintenance of a fixed place of business solely for the purpose of purchasing goods or　merchandise, or of collecting information, for the enterprise; 　　e) the maintenance of a fixed place of business solely for the purpose of carrying on, for the　enterprise, any other activity of a preparatory or auxiliary character; 　　f) the maintenance of a fixed place of business solely for any combination of the activities　mentioned in subparagraphs a) to e) of this paragraph. 　　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 authority to conclude contracts in the name of the enterprise, that enterprise shall be deemed to have a permanent establishment in that State in respect of any activities which that person undertakes for the enterprise, unless the activities of such person are limited to those mentioned in paragraph 4 which, if exercised through a fixed place of business, would not make this fixed place of business a permanent establishment under the provisions of that paragraph. 　　6. An enterprise shall not be deemed to have a permanent establishment in a 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 Real Property 　　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. The term "real 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 real property, livestock and equipment used in agriculture and forestry, rights to which the provisions of general law respecting landed property apply, usufruct of real 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 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. The provisions of paragraphs 1 and 3 shall also apply to the income from real property of an enterprise and to income from real property used for the performance of independent personal services. 　　5. A resident of one of the Contracting States who is liable to tax in the other Contracting State on income from real property situated in the other Contracting State may elect for any taxable year to compute the tax on such income on a net basis as if such income were attributable to a permanent establishment in such other Contracting State. Any such election shall be binding for the taxable year of the election and all subsequent taxable years unless the competent authorities of the Contracting States, pursuant to a request by the taxpayer made to the competent authority of the Contracting State of which the taxpayer is a resident, agree to terminate the election. ARTICLE 7 Business Profits 　　1. The business 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 business 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 business profits which it might be expected to make if it were a distinct and independent enterprise engaged in the same or similar activities under the same or similar conditions. 　　3. In determining the business profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the permanent establishment, including a reasonable allocation of executive and general administrative expenses, research and development expenses, interest, and other expenses incurred for the purposes of the enterprise as a whole (or the part thereof which includes the permanent establishment), whether incurred in the State in which the permanent establishment is situated or elsewhere. 　　4. No business 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. 　　5. For the purposes of the preceding paragraphs, the business 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. 　　6. Where business 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. 　　7. For the purposes of this Convention, "business profits" includes income derived from the rental of tangible personal property. 　　8. The provisions of paragraphs 1 to 7 shall also apply to income derived by a sleeping partner in a sleeping partnership (Stille Gesellschaft) under Austrian law. 　　9. In applying paragraphs 1 and 2 of Article 7 (Business Profits), paragraph 4 of Article 10 (Dividends), paragraph 3 of Article 11 (Interest), paragraph 4 of Article 12 (Royalties) , paragraph 3 of Article 13 (Capital Gains), Article 14 (Independent Personal Services) and paragraph 2 of Article 21 (Other Income), any income earned during the existence of, and attributable to, a permanent establishment or fixed base is taxable in the Contracting State in which such permanent establishment or fixed base is situated even if the payments in respect of such income are deferred until such permanent establishment or fixed base has ceased to exist. ARTICLE 8 Shipping and Air Transport 　　1. Profits of an enterprise of a Contracting State from the operation in international traffic of ships or aircraft shall be taxable only in that State. 　　2. For purposes of this Article, profits from the operation in international traffic of ships or aircraft include profits derived from the rental on a full or bareboat basis of ships or aircraft if operated in international traffic by the lessee or if such rental profits are incidental to other profits described in paragraph 1. 　　3. Profits of an enterprise of a Contracting State from the use, rental or maintenance of containers (including trailers, barges, and related equipment for the transport of containers) used in international traffic shall be taxable only in that State. 　　4. The provisions of paragraph 1 shall also apply to profits from the participation in a pool, a joint business or an international 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 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. 　　It is understood, however, that the fact that associated enterprises have concluded arrangements, such as cost sharing arrangements or general services agreements, for or based on the allocation of executive, general administrative, technical and commercial expenses, research and development expenses and other similar expenses, is not in itself a condition as meant in the preceding sentence. 　　2. Where a Contracting State includes in the profits of an enterprise of that State, and taxes accordingly, profits on which an enterprise of the other Contracting State has been charged to tax in that other State, and the profits so included are profits which would have accrued to the enterprise of the first-mentioned State if the conditions made between the two enterprises had been those which would have been made between independent enterprises, then that other State shall make an appropriate 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 Convention and the competent authorities of the Contracting States shall if necessary consult each other. 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, but if the beneficial owner of the dividends is a resident of the other Contracting State, the tax so charged shall not exceed: 　　a) 5 percent of the gross amount of the dividends if the beneficial owner is a company (other than　a partnership) which owns directly at least 10 percent of the voting stock of the company paying the　dividends; 　　b) 15 percent of the gross amount of the dividends in all other cases. Subparagraph b) and not subparagraph a) shall apply in the case of dividends paid by a United States person that is a Regulated Investment Company. Subparagraph a) shall not apply to dividends paid by a United States person that is a Real Estate Investment Trust, and subparagraph b) shall apply only if the dividend is beneficially owned by an individual holding less than a 10 percent interest in the Real Estate Investment Trust. 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; and income from arrangements, including debt obligations, carrying the right to participate in, or determined with reference to, profits, to the extent so characterized under the law of the Contracting State in which the income arises. 　　4. The provisions of paragraphs 1 and 2 shall not apply if the recipient 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 a case, the provisions of Article 7 (Business Profits) or Article 14 (Independent Personal Services), as the case may be, shall apply. 　　5. Where a company is a resident of a Contracting State, the other Contracting State may not impose any tax on the dividends paid by the company, except insofar as　 　　a) such dividends are paid to a resident of that other State; or 　　b) the holding in respect of which the dividends are paid is effectively connected with a permanent　establishment or a fixed base situated in that other State. 　　6. A company which is a resident of Austria and which has a permanent establishment in the United States or which is subject to tax on a net basis in the United States on items of income that may be taxed in the United States under Article 6 (Income from Real Property) or under paragraph 1 of Article 13 (Capital Gains), may be subject in the United States to a tax in addition to the tax allowable under the other provisions of this Convention. Such tax, however, may be imposed only on: 　　a) the portion of the business profits of the company attributable to the permanent establishment;and 　　b) the portion of the income referred to in the preceding sentence which is subject to tax under　Article 6 (Income From Real Property) or Article 13 (Capital Gains), which represents the "dividend　equivalent amount" as that term is defined under the laws of the United States as it may be amended from time to time without changing the general principle thereof. 　　7. The tax referred to in paragraph 6 shall not be imposed at a rate exceeding the rate specified in subparagraph a) of paragraph 2.