At the moment of signing the Convention for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion, the undersigned have agreed upon the following understandings: 　　It is agreed that the provisions of this Convention do not prejudice the legal rights of residents of a Contracting State concerning the taxation by the other Contracting State of income from the operation of ships or aircraft in international traffic with respect to taxable years beginning before January 1 of the year in which this Convention enters into force. Ad Article 5, paragraph 3 　　It is agreed that for purposes of this paragraph the term "permanent establishment" shall not be deemed to include the use of facilities or the maintenance of a stock of goods or merchandise belonging to the enterprise for the purpose of occasional delivery of such goods or merchandise. Ad Article 11, paragraph 4 　　It is agreed that the tax on interest payments permitted by this paragraph will apply, in the case of the United States, to the excess, if any, of interest deducted in determining the profits of the permanent establishment over the actual payments of interest by the permanent establishment. A permanent establishment may deduct an allocable portion of the interest expense of the home office. Where that deduction exceeds the amount of interest actually paid by the permanent establishment, the excess deduction is treated as if it were remitted to the home office subject to the additional tax under this paragraph. 　　DONE at Jakarta, in duplicate, in the English language, this 11th day of July, 1988. For the Government of the United States of America: 　 　　　　　　　　　　　　　　　　　　　　　　　　　　GEORGE P. SHULTZ. For the Government of the Republic of Indonesia: 　 　　　　　　　　　　　　　　　　　　　　　　　　　　　ALI ALATAS.