AGREEMENT BETWEEN THE GOVERNMENT OF THE PEOPLE's REPUBLIC OF CHINA AND THE GOVERNMENT OF THE PEOPLE's REPUBLIC OF BULGARIA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WIT
颁布时间:1989-11-06
The Government of the People's Republic of China and the Government of
the People's Republic of Bulgaria, desiring to promote and deepen the
economic cooperation between the People's Republic of China and the
People's Republic of Bulgaria in accordance with the principle of equality
and mutual benefit,
through an Agreement for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on income and on
capital,
Have agreed as follows:
Article 1 Personal Scope
This Agreement shall apply to persons who are residents of one or both
of the Contracting States.
Article 2 Taxes Covered
1. This Agreement shall apply to taxes on income and on capital
imposed on behalf of a Contracting State or of its 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 and on total capital, or on elements of income or
of capital, including taxes on gains from the alienation of movable or
immovable property, as well as taxes on capital appreciation.
3. The existing taxes to which the Agreement shall apply are:
(a) in the People's Republic of China:
(i) the individual income tax;
(ii) the income tax concerning joint ventures with Chinese and
foreign investment;
(iii) the income tax concerning foreign enterprises;
and
(iv) the local income tax,
(hereinafter referred to as "Chinese tax");
(b) in the People's Republic of Bulgaria:
(i) the tax on total income;
(ii) the tax on income of single males and females, divorced persons
and spouses without children;
(iii) the tax on profits;
(iv) the tax on buildings;
(hereinafter referred to as "Bulgarian tax").
4. This Agreement shall also apply to any identical or substantially
similar taxes which are imposed after the date of signature of this
Agreement in addition to, or in place of, the existing taxes referred to
in paragraph 3. The competent authorities of the Contracting States shall
notify each other of any substantial changes which have been made in their
respective taxation laws within a reasonable period of time after such
changes.
Article 3 General Definitions
1. For the purposes of this Agreement, unless the context otherwise
requires:
(a) the term "China" means the People's Republic of China; when used
in geographical sense, means all the territory of the People's Republic of
China, including its territorial sea, in which the Chinese laws relating
to taxation apply, and any area beyond its territorial sea, within which
the People's Republic of China has sovereign rights of exploration for and
exploitation of resources of the seabed and its subsoil and superjacent
water resources in accordance with international law;
(b) the term "Bulgaria" means the People's Republic of Bulgaria; and
when used in geographical sense means the territory over which it
exercises its state sovereignty as well as the continental shelf and the
exclusive economic zone on which it exercises sovereign rights according
to international law;
(c) the terms "a Contracting State" and "the other Contracting State"
mean China or Bulgaria as the context requires;
(d) the term "tax" means Chinese tax or Bulgarian tax, as the context
requires;
(e) the term "person" means an individual, a legal person, including a
company, and any other body of persons;
(f) the term "company" means any body corporate or any entity which is
treated as a body corporate for tax purposes;
(g) 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;
(h) the term "nationals" means all individuals possessing the
nationality of a Contracting State and all juridical persons created or
organized under the laws of that Contracting State, as well as any
organizations without juridical personality treated for tax purposes as
juridical persons created or organized under the laws of that Contracting
State;
(i) the term "international traffic" means any transport by a ship or
aircraft operated by an enterprise which has its head office in a
Contracting State, except when the ship or aircraft is operated solely
between places in the other Contracting State;
(j) the term "competent authority" means, in the case of China, the
Ministry of Finance or its authorized representative, and in the case of
Bulgaria, the Minister of Economy and Planning or his authorized
representative.
2. As regards the application of this Agreement by a Contracting
State, any term not defined therein shall, unless the context otherwise
requires, have the meaning which it has under the laws of that Contracting
State concerning the taxes to which this Agreement applies.
Article 4 Resident
1. For the purposes of this Agreement, the term "resident" of a
Contracting State means:
(a) In the case of China, any person who, under the laws of China, is
liable to tax therein by reason of his domicile, residence, place of head
office;
(b) In the case of Bulgaria, individuals who are nationals of Bulgaria
and legal persons who have their place of head office or are registered
therein.
2. Where by reason of the provisions of paragraph 1 an individual is a
resident of both Contracting States, then the competent authorities of the
Contracting States shall determine by mutual agreement the Contracting
State of which that individual shall be deemed to be a resident for the
purposes of this Agreement.
3. Where by reason of the provisions of paragraph 1, 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 head
office is situated.
Article 5 Permanent Establishment
1. For the purposes of this Agreement, 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. The term "permanent establishment" likewise encompasses:
(a) a building site, a construction, assembly or installation project
or supervisory activities in connection therewith, but only where such
site, project or activities continue for a period of more than six months;
(b) the furnishing of services, including consultancy services, by an
enterprise of a Contracting State through employees or other engaged
personnel in the other Contracting State, provided that such activities
continue for the same project or a connected project for a period or
periods aggregating more than six months within any twelve-month period.
4. Notwithstanding the provisions of paragraphs 1 to 3, 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 temporary maintenance of a stock of goods displayed by the
enterprise in a stock fair or an exhibition which is to be sold after the
conclusion;
(f) 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;
(g) an assembly services carried on by an enterprise of a Contracting
State in the other Contracting State in connection with the sale of
machinery or equipment to that other Contracting State;
(h) the maintenance of a fixed place of business solely for any
combination of the activities mentioned in subparagraphs (a) to (g),
provided that the overall activity of the fixed place of business
resulting from this combination is of a preparatory or auxiliary
character.
5. Notwithstanding the provisions for paragraphs 1 and 2, where a
person--other than an agent of an independent status to whom the
provisions of paragraph 6 apply--is acting in a Contracting State on
behalf of an enterprise of the other Contracting State, has and habitually
exercises an authority to contracts in the name of the enterprise, that
enterprise shall be deemed to have a permanent establishment in the
first-mentioned Contracting 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 exercises 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 of a Contracting State shall not be deemed to have a
permanent establishment in the other Contracting State merely because it
carries on business in that Contracting 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
participates in the capital of 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 by a resident of a Contracting State from immovable
property situated in the other Contracting State may be taxed in that
other Contracting State.
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 and aircraft
shall not be regarded as immovable property.
3. The provisions of paragraph 1 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 shall also apply to the income
from immovable property of an enterprise and to income from immovable
property used for the performance of independent professional services.
Article 7 Business Profits
1. The profits of an enterprise of a Contracting State shall be
taxable only in that Contracting 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 Contracting 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 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 which are incurred for the
purposes of the business 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 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, 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 paragraphs 1 to 5, 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 Agreement, 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 head office of the enterprise is situated.
2. If the place of head office 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 also apply to profits from the
participation in a pool, a joint business or an international operating
agency.
Article 9 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 Contracting 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 Contracting State, but if the recipient is the beneficial
owner of the dividends the tax so charged shall not exceed 10 per cent of
the gross amount of the dividends.
The provisions of this paragraph shall not affect the taxation of the
company in respect or 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.
4. The provisions of paragraphs 1 and 2 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 Contracting State
independent professional 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 13, as the case may be, shall
apply.
5. Where a company which is a resident of a Contracting State derives
profits or income from the other Contracting State, that other Contracting
State may not impose any tax on the dividends paid by the company, except
insofar as such dividends are paid to a resident of that other Contracting
State or insofar as 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 Contracting State, not 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 Contracting State.
Article 10 Interest
1. Interest arising in a Contracting State and paid to a resident of
the other Contracting State may be taxed in that other Contracting State.
2. However, such interest may also be taxed in the Contracting State
in which it arises and according to the laws of that Contracting State,
but if the recipient is the beneficial owner of the interest the tax so
charged shall not exceed 10 per cent of the gross amount of the interest.
3. Notwithstanding the provisions of paragraph 2, interest arising in
a Contracting State and derived by the Government of the other Contracting
State, a local authority and the Central Bank thereof or any financial
institution wholly owned by that Government, or by any other resident of
that other Contracting State with respect to debt-claims indirectly
financed by the Government of that Contracting State, a local authority,
and the Central bank thereof or any financial institution wholly owned by
that Government, shall be exempt from tax in the first-mentioned State.
4. The term "interest" as used in this Article means income from
debt-claims of every kind, whether or not secured by mortgage and whether
or not carrying a right to participate in the debtor's profits, and in
particular, income from government securities and income from bonds or
debentures, including premiums and prizes attaching to such securities,
bonds or debentures. Penalty charges for late payment shall not be
regarded as interest for the purpose of this Article.
5. The provisions of paragraphs 1, 2 and 3 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 Contracting State independent professional 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 13, as the case may be, shall apply.
6. Interest shall be deemed to arise in a Contracting State when the
payer is the Government of that Contracting State, a local authority
thereof or a resident of that contracting State. Where, however, the
person paying the interest, whether he is a resident of a Contracting
State or not, has in a Contracting State a permanent establishment or a
fixed base in connection with which the indebtedness on which the interest
is paid was incurred, and such interest is borne by such permanent
establishment or fixed base, then such interest shall be deemed to arise
in the Contracting State in which the permanent establishment or fixed
base is situated.
7. 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 Agreement.
Article 11 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 in the Contracting State
in which they arise, and according to the laws of that Contracting State,
but if the recipient is the beneficial owner of the royalties, the tax so
charged shall not exceed:
(a) 7 per cent of the gross amount of the royalties in the case of the
use, or the right to use industrial, commercial or scientific equipment;
(b) 10 per cent of the gross amount of the royalties in all other
cases.
3. 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 or tapes for radio or television broadcasting, any patent
(certificate of invention), know-how, 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.
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 Contracting State independent professional 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 13, as the case may be, shall apply.
5. Royalties shall be deemed to arise in a Contracting State when the
payer is the Government of that Contracting State, a local authority there
of or a resident of that Contracting 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 a fixed base
in connection with which the liability to pay the royalties was incurred,
and such royalties are borne by such permanent establishment or fixed
base, then such royalties shall be deemed to arise in the Contracting
State in which the permanent establishment or fixed base is situated.
6. Where, by reason of a special relationship between the payer and
the benefical 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 Agreement.
Article 12 Capital Gains
1. Gains derived by a resident of a Contracting State from the
alienation of immovable property referred to in Article 6 and situated in
the other Contracting State may be taxed in that other Contracting State.
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 professional services, including such gains from
the alienation of such a permanent establishment (alone or together with
the whole enterprise) or of such a fixed base, may be taxed in that other
Contracting State.
3. Gains from the alienation of ships or aircraft operated in
international traffic or movable property pertaining to the operation of
such ships or aircraft shall be taxable only in the Contracting State in
which the place of head office of the enterprise is situated.
4. Gains from the alienation of shares of the capital stock of a
company the property of which consists directly or indirectly principally
of immovable property situated in a Contracting State may be taxed in that
Contracting State.
Article 13 Income from Independent Professional Services
1. Income derived by a resident of a Contracting State in respect of
professional services or other activities of an independent character
shall be taxable only in that Contracting State except in one of following
circumstances, when such income may also be taxed in the other Contracting
State:
(a) if he has a fixed 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 fixed base may
be taxed in that other Contracting State;
(b) if his stay in the other Contracting State is for a period or
periods exceeding in the aggregate 183 days in the calendar year
concerned; in that case, only so much of the income as is derived from his
activities performed in that other Contracting State may be taxed in that
other Contracting State.
2. The term "professional services" includes especially independent
scientific, literary, artistic, educational or teaching activities as well
as the independent activities of physicians, lawyers, engineers,
architects, dentists and accountants.