ARTICLE 12 　 Royalties 　　1. Royalties arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. 　　2. However, such royalties may also be taxed by the Contracting State in which they arise and according to the laws of that State, but if the recipient is the beneficial owner of the royalties, the tax so charged shall not exceed 12.5 percent of the gross amount of such royalties. The competent authorities of the Contracting States shall by mutual agreement settle the mode of application of this limitation. 　　3. The term ''royalties'' as used in this Article means payment 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 royalties in respect of motion pictures and works on film, tape or other means of reproduction for use in connection with radio or television, any patent, trademark, design or model, plan, secret formula or process, or for information concerning industrial, commercial, or scientific experience. The term royalties also includes gains derived from the alienation of any such right or property which are contingent on the productivity, use or disposition thereof. 　　4. The provisions of paragraphs 1 and 2 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 regular base situated therein, and the right of property in respect of which the royalties are paid is effectively connected with such permanent establishment or regular base. In such case the provisions of Article 7 (Business Profits) or Article 14 (Independent Personal Services), as the case may be, shall apply. 　　5. 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. 　　6. Royalties shall be deemed to be derived from sources within a Contracting State when the payer is that State itself, a political subdivision, a local authority or a resident of that State. Where, however, the person paying the royalties, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or regular base in connection with which the obligation to pay the royalties was incurred, and those royalties are borne by the permanent establishment or regular base, then such royalties shall be deemed to be derived from sources within the Contracting State in which the permanent establishment or regular base is situated. Notwithstanding the preceding provisions of this paragraph, where the royalties are paid for the use of or the right to use a right or property within a Contracting State, the royalties shall be deemed to arise in that State. ARTICLE 13 Gains 　　1. Gains derived by a resident of a Contracting State from the alienation of real property situated in the other Contracting State may be taxed in that other State. 　　2. For the purposes of this Article: 　　a) the term "real property situated in the other Contracting State", where the United States is that other Contracting State, includes a United States real property interest, and real property referred to in Article 6 which is situated in the United States; and b) the term "real property situated in the other Contracting State", where Barbados is that other Contracting State, shall have the meaning which it has under the Laws in force from time to time in Barbados and, without limiting the foregoing, includes: 　　(i) real property referred to in Article 6; 　　(ii) shares or comparable interests in a company, the assets of which consist wholly or principally of real property situated in Barbados; and 　　(iii) an interest in a partnership, trust or estate, the assets of which consist wholly or principally of real property situated in Barbados. 　　3. Gains from the alienation of personal property which are attributable to a permanent establishment which an enterprise of a Contracting State has in the other Contracting State, or which are attributable to a regular base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent personal services, and gains from the alienation of such a permanent establishment (alone or with the whole enterprise) or such a regular base, may be taxed in that other State. 　　4. Gains derived by an enterprise of a Contracting State from the alienation of ships, aircraft, or containers operated in international traffic shall be taxable only in that State. 　　5. Gains described in Article 12 (Royalties) shall be taxable only in accordance with the provisions of Article 12. 　　6. Gains from the alienation of any property other than property referred to in paragraphs 1 through 5 shall be taxable only in the Contracting State of which the alienator is a resident. ARTICLE 14 Independent Personal Services 　　1. Income derived by an individual who is a resident of one of the Contracting States from the performance of personal services in an independent capacity may be taxed by that Contracting State. Except as provided in paragraph 2, such income shall be exempt from tax by the other Contracting State. 　　2. Income derived by an individual who is a resident of one of the Contracting States from the performance of personal services in an independent capacity in the other Contracting State may be taxed by that other Contracting State, if: 　　a) he has a regular base regularly available to him in the other Contracting State for the purpose of performing his activities; in that case, only so much of the income as is attributable to that regular base may be taxed in that other Contracting State; 　　b) he is present in that other Contracting State for a period or periods aggregating 90 days or more in the taxable year; or 　　c) the net income derived in the taxable year from residents of that other Contracting　State for the performance of such services in the other Contracting State exceeds 5,000 United States dollars or its equivalent in Barbados currency. ARTICLE 15 Dependent Personal Services 　　1. Subject to the provisions of Article 16 (Directors' Fees), 18 (Pensions, Annuities, Alimony and Child Support), and 19 (Government Service), 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: 　　a) the remuneration earned in the other Contracting State in the calendar year concerned does not exceed 5,000 United States dollars or its equivalent in Barbados currency; 　　b) the recipient is present in the other Contracting State for a period or periods not　exceeding in the aggregate 183 days in the calendar year concerned; 　　c) the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State; and 　　d) such remuneration is not borne by a permanent establishment or regular base which　the employer has in the other State. 　　3. Notwithstanding the preceding provisions of this Article, remuneration derived by a resident of a Contracting State in respect of an employment as a member of the regular complement of a ship or aircraft operated in international traffic may be taxed only in that State. ARTICLE 16 Directors' Fees 　　Directors' fees and other similar payments derived by a resident of a Contracting State for services rendered in the other Contracting State in his capacity as a member of the board of directors of a company which is a resident of the other Contracting State may be taxed in that other Contracting State. ARTICLE 17 Artistes and Athletes 　　1. Notwithstanding the provisions of Articles 14 (Independent Personal Services) and 15 (Dependent Personal Services), income derived by a resident of a Contracting State as a public entertainer, such as a theatre, motion picture, radio, or television artiste, or a musician, or as an athlete, from his personal activities as such exercised in the other Contracting State, may be taxed in that other Contracting State, except where the amount of the gross receipts derived by such entertainer or athlete, not including expenses reimbursed to him or borne on his behalf, from such activities does not exceed 250 United States dollars or its equivalent in Barbadian currency per day, or 4,000 United States dollars or its equivalent in Barbadian currency in the taxable year. 　　2. Where income in respect of personal activities of an entertainer or athlete accrues not to that entertainer or athlete himself but to another person, that income may, notwithstanding the provisions of Articles 7 (Business Profits), 14 (Independent Personal Services), and 15 (Dependent Personal Services) be taxed in the Contracting State in which the activities of the entertainer or athlete are exercised, unless it is established that neither the entertainer or athlete nor persons related thereto participate directly or indirectly in the profits of that other person in any manner, including the receipt of deferred remuneration, bonuses, fees, dividends, partnership distributions, or other distributions. 　　3. The provisions of paragraphs 1 and 2 shall not apply 　　a) to income derived from activities performed in a Contracting State by entertainers or athletes if the visit to that Contracting State is substantially supported by public funds of the other Contracting State, including any political subdivision, local authority or statutory body thereof; 　　b) to a nonprofit organization no part of the income of which was payable to, or　otherwise inures to the benefit of, any private proprietor, member or shareholder thereof, or other individual; or c) to an entertainer or athlete in respect of services provided to an organization referred to in subparagraph b). ARTICLE 18 Pensions, Annuities, Alimony, and Child Support 　　1. Subject to the provisions of Article 19 (Government Service) 　　a) pensions and other similar remuneration derived and beneficially owned by a resident of a Contracting State in consideration of past employment shall be taxable only in that State; and 　　b) social security benefits and other public pensions paid by a Contracting State to a resident of the other Contracting State or a citizen of the United States shall be taxable only in the first-mentioned State. 　　2. Annuities derived and beneficially owned by a resident of a Contracting State shall be taxable only in that State. The term "annuities" as used in this paragraph means a stated sum paid periodically at stated times during a specified number of years, under an obligation to make the payments in return for adequate and full consideration (other than services rendered). 　　3. Alimony paid to a resident of a Contracting State shall be taxable only in that State. The term "alimony" as used in this paragraph means periodic payments made pursuant to a written separation agreement or a decree of divorce, separate maintenance, or compulsory support, which payments are taxable to the recipient under the laws of the State of which he is a resident. 　　4. Periodic payments for the support of a minor child made pursuant to a written separation agreement or a decree of divorce, separate maintenance, or compulsory support, paid by a resident of a Contracting State to a resident of the other Contracting State, shall be taxable only in the first-mentioned State. ARTICLE 19 Government Service 　　Remuneration, including a pension paid from the public funds of a Contracting State or a political subdivision or local authority thereof to a citizen of that State in respect of services rendered in the discharge of functions of a governmental nature shall be taxable only in that State. However, the provisions of Article 14 (Independent Personal Services), Article 15 (Dependent Per Services) or Article 17 (Artistes and Athletes), as the case may be, shall apply, and the preceding sentence shall not apply, to remuneration paid in respect of services rendered in connection with a business carried on by a Contracting State or a political subdivision or local authority thereof. ARTICLE 20 Students and Apprentices 　　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 who is present in the first-mentioned State for the purpose of his full-time 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 outside that State. 　　2. Notwithstanding Article 4 (Residence), an individual to whom paragraph 1 applies and who immediately before visiting or becoming temporarily present in a Contracting State was a resident of the other Contracting State may elect as an alternative to the provisions of that paragraph to be treated for all tax purposes of the first-mentioned State including this Convention, as resident of that State. The election shall apply to all periods during the taxable year of the election and subsequent taxable years during which the individual qualifies under paragraph 1 and may not be revoked except with the consent of the competent authority of that first-mentioned State. ARTICLE 21 Other Income 　　1. Items of income of a resident of a Contracting State, wherever arising, not dealt within the foregoing Articles of this Convention 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 (Income from Real Property (Immovable Property)), if the beneficial owner of such income, being a resident of a Contracting State, carries on business in the other Contracting State through a permanent establishment situated therein, or performs in that other State independent personal services from a regular base situated therein, and the right or property in respect of which the income is paid is effectively connected with such permanent establishment or regular base. In such case the provisions of Article 7 (Business Profits) or Article 14 (Independent Personal Services), as the case may be, shall apply. 3. Notwithstanding the provisions of paragraphs 1 and 2, items of income of a resident of a Contracting State not dealt with in the foregoing Articles of this Convention and arising in that other Contracting State may be taxed in that other State. ARTICLE 22 　 Limitation on Benefits 　　1. A person which is a resident of a Contracting State and which derives income from sources within the other Contracting State shall not be entitled, in that other Contracting State, to the benefits of Article 6 (Income from Real Property (Immovable Property)) through Article 23 (Relief from Double Taxation) if: 　　a) 50 percent or less of the beneficial interest in such person (or in the case of a company, 50 percent or less of the number of shares of each class of the company's shares) is owned, directly or indirectly, by any combination of one or more individual residents of a Contracting State or citizens of the United States; or 　　b) the income of such person is used in substantial part, directly or indirectly, to meet liabilities (including liabilities for interest or royalties) to persons who are residents of a State other than a Contracting State, or who are not citizens of the United States. 　　2. The provisions of paragraph 1 shall not apply if the income derived from the other Contracting State is derived in connection with, or is incidental to, the active conduct by such person of a trade or business in the first-mentioned Contracting State (other than the business of making or managing investments). The preceding sentence shall not apply with respect to a person engaged in the business of banking or insurance in a Contracting State, if the income of such person is subject to tax in the Contracting State in which it is resident at a rate of tax which is substantially below the rate of tax generally applicable to business income in that State. Notwithstanding the preceding sentence, the income of such a bank which is not derived from the conduct of a banking business (including but not limited to income attributable to the taking of deposits and making of loans, managing of investments and performance of trust or other services as fiduciary), shall be subject to the provisions of the first sentence of this paragraph. 　　3. The provisions of paragraph 1 shall not apply if the person deriving the income is a company which is a resident of a Contracting State in whose principal class of shares there is a substantial and regular trading on a recognized stock exchange. For purposes of the preceding sentence, the term "recognized stock exchange" means: 　　a) The NASDAQ System owned by the National Association of Securities Dealers, Inc. and any stock exchange registered with the Securities and Exchange Commission as a national securities exchange for purposes of the Securities Exchange Act of 1934; and 　　b) any other stock exchange agreed upon by the competent authorities of the Contracting States. 　　4. If one of the Contracting States proposes to deny benefits to a resident of the other Contracting State by reason of this Article, the competent authorities of the Contracting States shall, upon request of the competent authority of the other Contracting State, consult each other. ARTICLE 23 Relief from Double Taxation 　　1. In accordance with the provisions and subject to the limitations of the law of the United States (as it may be amended from time to time without changing the general principle hereof), the United States shall allow to a resident or citizen of the United States as a credit against the United States tax on income: 　　a) the income tax paid to Barbados by or on behalf of such citizen or resident; and 　　b) in the case of a United States company owning at least 10 percent of the voting stock　of a company which is a resident of Barbados and from which the United States company　receives dividends, the income tax paid to Barbados by or on behalf of the distributing company with respect to the profits out of which the dividends are paid. For the purposes of this paragraph, the taxes referred to in paragraphs l b) and 2 of Article 2 (Taxes Covered) shall be considered income taxes. 　　2. In accordance with the provisions and subject to the limitations of the law of Barbados (as it may be amended from time to time without changing the general principle hereof) Barbados shall allow to a resident of Barbados as a credit against the Barbados tax on income: 　　a) the income tax paid to the United States by or on behalf of such resident; and 　　b) in the case of a Barbados company owning at least 10 percent of the voting stock of a company which is a resident of the United States from which it receives dividends the income tax paid to the United States by or on behalf of the distributing company with respect to the profits out of which the dividends are paid. 　　For the purposes of this paragraph, the taxes referred to in paragraphs 1 a) and 2 of Article 2 (Taxes Covered) shall be considered income taxes. Credit allowed solely by reasons of the preceding sentence, when added to otherwise allowable credits for taxes referred to in paragraphs 1 a) and 2 of Article 2, shall not in any taxable year exceed that proportion of the Barbados tax on income which taxable income arising in the United States bears to total taxable income. 　　3. For the purposes of allowing relief from double taxation pursuant to this Article, income shall be deemed to arise exclusively as follows: 　　a) income derived by a resident of a Contracting State which may be taxed in the other Contracting State in accordance with this Convention (other than solely by reason of citizenship in accordance with paragraph 3 of Article 1 (General Scope)) shall be deemed to arise in that other State: 　　b) income derived by a resident of a Contracting State which may not be taxed in the other Contracting State in accordance with the Convention shall be deemed to arise in the firstmentioned State. 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 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. This provision shall apply to persons who are not residents of one or both of the Contracting States. However, for the purposes of United States tax, a United States national who is not a resident of the United States and a Barbados national who is not a resident of the United States are not in the same circumstances. 　　2. The taxation on a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall 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 other Contracting State any personal allowances, reliefs, and reductions for taxation purposes on account of civil status or family responsibilities which it grants to its own residents. The provisions of this paragraph shall not be construed to prevent Barbados from applying its tax on branch profits, and its tax on the premium income of nonresident insurers or foreign insurance companies at the rates prescribed under the Income Tax Act, nor to prevent the United States from imposing an additional tax on the income of a permanent establishment maintained by a resident of Barbados in the United States. 　　3. Except where the provisions of paragraph 1 of Article 9 (Associated Enterprises), paragraph 6 of Article II (Interest). or paragraph 5 of Article 12 (Royalties) apply, interest, royalties, and other disbursements paid by a resident of a Contracting State to a resident of the other Contracting State shall, for the purposes of determining the taxable profits of the first-mentioned resident, be deductible under the same conditions as if they had been paid 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 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 the firstmentioned State are or may be subjected. 　　5. In this Article the term "taxation" means taxes which are the subject of this Agreement. 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. The 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 which is not in accordance with the Convention. Any agreement reached shall be implemented notwithstanding any time limits or other procedural limitations in the domestic law 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. In particular the competent authorities of the Contracting States may agree 　　a) to the same attribution of income, deductions, credits, or allowances of an enterprise of a Contracting State to its permanent establishment situated in the other Contracting State; b) to the same allocation of income, deductions, credits, or allowances between persons; 　　c) to the same characterization of particular items of income; 　　d) to the same application of source rules with respect to particular items of income; 　　e) to a common meaning of a term; 　　f) to increases in any specific dollar amounts referred to in the Convention to reflect economic or monetary developments; and 　　g) to the application of the provisions of domestic law regarding penalties, fines, and interest in a manner consistent with the purposes 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. 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 or of the domestic laws of the Contracting States concerning taxes covered by the Convention insofar as the taxation thereunder is in accordance with this Convention, in particular for the prevention of fraud and evasion of such taxes. The exchange of information is not limited by Article 1 (General Scope). Any information received by a Contracting State shall be treated 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 bodies) involved in the assessment, collection, or administration of, the enforcement or prosecution in respect of, or the determination of appeals in relation to, the taxes covered by the Convention. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions. The competent authorities shall, through consultations, develop appropriate conditions, methods, and techniques concerning the matters respecting which such exchange shall be made, as well as exchanges of information regarding avoidance of tax where appropriate. Information shall not be disclosed to any third jurisdiction for any purpose without the consent of the Contracting State originally furnishing the information. 　　2. If information is requested by a Contracting State in accordance with this Article, the other Contracting State shall endeavour to obtain the information to which the request relates in the same manner and to the same extent as if the tax of the first-mentioned State were the tax of that other State and were being imposed by that other State. If specifically requested by the competent authority of the other Contracting State, the competent authority of the other Contracting State shall endeavour to provide information under this Article in the form of depositions of witnesses and authenticated copies of unedited original documents (including books, papers, statements, records, accounts and writings) to the same extent such depositions and documents can be obtained under the laws and administrative practices of that other State with respect to its own taxes. 　　3. In no case shall the provisions of paragraphs 1 and 2 be construed so as to impose on a Contracting State the obligationa) to carry out administrative measures at variance with the laws and 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,commercial, or professional secret or trade process, or information the disclosure of which would be contrary to public policy (ordre public). 　　4. For the purposes of this Article, the Convention shall apply: 　　a) in the case of Barbados to the taxes covered by the Convention; and 　　b) in the case of the United States to the 　　(i) Federal income taxes; 　　(ii) Federal taxes on self-employment income; 　　(iii) Federal taxes on transfers to avoid income tax, 　　(iv) Federal estate and gift taxes; and 　　(v) Federal excise taxes. ARTICLE 27 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 28 Entry into Force 　　1. This Convention shall be ratified and instruments of ratification shall be exchanged as soon as possible. 　　2. The Convention shall enter into force upon the exchange of instruments of ratification and its provisions shall have effect 　　a) in the United States: 　　(i) in respect of tax withheld at the source for amounts paid or credited on or after the first day of the second month following the date on which this Convention enters into force; (ii) in respect of other taxes, for taxable years beginning on or after January 1,1984. b) in Barbados: (i) in respect of income tax and corporation tax for the income year beginning January 1, 1984; 　　(ii) in respect of petroleum winning operations tax for any accounting year　beginning on or after January 1, 1984; and 　　(iii) in respect of tax on branch profits and tax on premium income of insurance companies for the income year beginning January 1, 1984. ARTICLE 29 Termination 　　1. This Agreement shall continue in effect indefinitely but either Contracting State may, on or before June 30 in any calendar year after the year 1988, give notice of termination to the other Contracting State and in such event this Agreement shall cease to have effect: 　　a) in the United States: 　　(i) in respect of taxes withheld at source on amounts paid or credited to nonresidents on or after the first day of January in the calendar year next following that in which the notice is given: and 　　(ii) in respect of other United States tax, for taxable years beginning on or after the first day of January in the calendar year following that in which the notice is given; b) in Barbados: 　　(i) in respect of income tax, corporation tax, tax on branch profits and tax on premium income of insurance companies for the income year beginning the first day of January in the calendar year next following that in which such notice is given; and 　　(ii) in respect of the petroleum wining operations tax, for any accounting period beginning on or after the first day of January in the calendar year next following that in　which such notice is given. DONE at Bridgetown in duplicate, this 31st day of December, 1984. FOR THE GOVERNMENT FOR THE GOVERNMENT OF OF BARBADOS: THE UNITED STATES OF AMERICA: (s) Louis R. Tull (s) Kenneth A. Kurze