At the signing of the Agreement between the Government of the People's Republic of China and the Government of the State of Israel for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital (hereinafter referred to as "the Agreement"), the undersigned have agreed upon the following provisions which form an integral part to the Agreement. 　　1. In respect of the operation of ships or aircraft in international traffic carried on by an enterprise of a Contracting State, that enterprise, if an enterprise of Israel, shall be exempt from the business tax in China and , if an enterprise of China, shall be exempt from any tax similar to the business tax in china which may hereafter be imposed in Israel. 　　2. In respect of paragraph 2 of Article 12 of this Agreement, it is agreed by both sides that, in the case of royalties paid for the use of, or the right to use, any industrial, commercial or scientific equipment, the tax shall be imposed on 70　percent of the gross amount of such royalties. 　　3. It is understood that notwithstanding the provisions of paragraph 2 of Article 25 of the Agreement, Israel may apply its domestic laws concerning the levying of a tax on dividend equivalent amounts of a permanent establishment, provided that the rate of such branch profits tax on the dividend equivalent amount may not exceed the rate of tax applicable to dividends paid to a resident of the other Contracting State according to Article 10 of the Agreement. 　　4. A competent authority of a Contracting State may, subject to the domestic laws and procedures of that State with respect to the treatment of artificial transactions, deny the benefits of this Agreement to any person, or with respect to any transaction, if in its opinion the granting of those benefits would constitute an abuse of the Agreement according to its purposes. 　　IN WITNESS WHEREOF the undersigned, duly authorized thereto by their respective Governments, have signed this Agreement. 　　DONE at Beijing this 8day of April 1995, which corresponds to the 8 NISSAN, 5755, in duplicate, each in the Chinese, Hebrew and English languages, all three texts being equally authentic. In the case of any divergence of interpretations, the English text shall prevail. For the Government of For the Government of The People's Republic of China the State of Israel