DEPARTMENT OF STATE, 　 　　　　　　　　　　　　　　　　　　　　　　　Washington, July 11, 1988. His Excellency ALI ALATAS, Minister of Foreign Affairs of Indonesia. 　　EXCELLENCY, I have the honor to refer to the Convention Between the Government of the United States of America and the Government of the Republic of Indonesia for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income, which was signed today. 　　In signing this Convention, it is the understanding of the Government of the United States of America that: 　　The United States recognizes the archipelagic States principles as applied by Indonesia on the understanding that they are applied in accordance with the provisions of Part IV of the 1982 United Nations Convention on the Law of the Sea and that Indonesia respects international rights and obligations pertaining to transit of the Indonesian archipelagic waters in accordance with international law as reflected in that Part. 　　The confirmation of this understanding by the Government of the Republic of Indonesia will constitute the agreed interpretation of Article 3(1)(a) of the Convention. 　　Accept, Excellency, the renewed assurances of my highest consideration. 　　　　　　　　　　　　　　　　　　　　　　　　　　　GEORGE P. SHULTZ. REPUBLIC OF INDONESIA, CITY OF JAKARTA, EMBASSY OF THE UNITED STATES OF AMERICA, ss: 　　I certify that this document is a true and faithful copy of the original and that it has been carefully examined by me, compared with the said original, and found to agree with it. ANN SHERIDAN, Consul of the United States of America. JULY 11, 1988. MINISTER FOR FOREIGN AFFAIRS, REPUBLIC OF INDONESIA, Jakarta, July 11, 1988. H.E. GEORGE P. SHULTZ, Secretary of State of the United States of America. EXCELLENCY, The Government of the Republic of Indonesia confirms the understanding　of the Government of the United States of America that: "In signing this Convention, it is the understanding of the Government of the United States of America that: 　　The United States recognizes the archipelagic States principles as applied by Indonesia on the understanding that they are applied in accordance with the provisions of Part IV of the 1982 United Nations Convention on the Law of the Sea and that Indonesia respects international rights and obligations pertaining to the transit of the Indonesian archipelagic waters in accordance with international law as reflected in that Part. 　　The confirmation of this understanding by the Government of the Republic of Indonesia will constitute the agreed interpretation of Article 3(1)(a) of the Convention, constitutes the agreed interpretation of Article 3(l)(a) of the Convention." 　　Accept, Excellency the renewed assurances of my highest consideration. 　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 　ALI ALATAS.