[Title 26 CFR ]
[Code of Federal Regulations (annual edition) - April 1, 1999 Edition]
[From the U.S. Government Printing Office]


          26



          Internal Revenue



[[Page i]]

          PARTS 500 TO 599

                         Revised as of April 1, 1999

          CONTAINING
          A CODIFICATION OF DOCUMENTS
          OF GENERAL APPLICABILITY
          AND FUTURE EFFECT

          AS OF APRIL 1, 1999
          With Ancillaries
          Published by
          the Office of the Federal Register
          National Archives and Records
          Administration

          as a Special Edition of
          the Federal Register



[[Page ii]]

                                      




                     U.S. GOVERNMENT PRINTING OFFICE
                             WASHINGTON: 1999



               For sale by U.S. Government Printing Office
 Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328



[[Page iii]]




                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 26:

          Chapter I--Internal Revenue Service, Department of 
          the Treasury (Continued)............................       3

  Finding Aids:

      Table of CFR Titles and Chapters........................     157

      Alphabetical List of Agencies Appearing in the CFR......     175

      Table of OMB Control Numbers............................     185

      List of CFR Sections Affected...........................     203



[[Page iv]]





                     ----------------------------

                     Cite this Code:  CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus, 26 CFR 502.1 refers 
                       to title 26, part 502, 
                       section 1.

                     ----------------------------

[[Page v]]



                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, April 1, 1999), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
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Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request.

[[Page vi]]

Many agencies have begun publishing numerous OMB control numbers as 
amendments to existing regulations in the CFR. These OMB numbers are 
placed as close as possible to the applicable recordkeeping or reporting 
requirements.

OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 1986, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, or 1973-1985, published in seven separate volumes. For 
the period beginning January 1, 1986, a ``List of CFR Sections 
Affected'' is published at the end of each CFR volume.

CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Statutory 
Authorities and Agency Rules (Table I), and Acts Requiring Publication 
in the Federal Register (Table II). A list of CFR titles, chapters, and 
parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

REPUBLICATION OF MATERIAL

    There are no restrictions on the republication of material appearing 
in the Code of Federal Regulations.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-523-5227 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408 or e-mail 
[email protected].

SALES

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ELECTRONIC SERVICES

    The full text of the Code of Federal Regulations, the LSA (List of 
CFR Sections Affected), The United States Government Manual, the Federal 
Register, Public Laws, Weekly Compilation of Presidential Documents and 
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[email protected].

[[Page vii]]

    The Office of the Federal Register also offers a free service on the 
National Archives and Records Administration's (NARA) World Wide Web 
site for public law numbers, Federal Register finding aids, and related 
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site also contains links to GPO Access.

                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

April 1, 1999.



[[Page ix]]



                               THIS TITLE

    Title 26--Internal Revenue is composed of nineteen volumes. The 
contents of these volumes represent all current regulations issued by 
the Internal Revenue Service, Department of the Treasury, as of April 1, 
1999. The first twelve volumes comprise part 1 (Subchapter A--Income 
Tax) and are arranged by sections as follows: Secs. 1.0-1-1.60; 
Secs. 1.61-1.169; Secs. 1.170-1.300; Secs. 1.301-1.400; Secs. 1.401-
1.440; Secs. 1.441-1.500; Secs. 1.501-1.640; Secs. 1.641-1.850; 
Secs. 1.851-1.907; Secs. 1.908-1.1000; Secs. 1.1001-1.1400 and 
Sec. 1.1401 to end. The thirteenth volume containing parts 2-29, 
includes the remainder of subchapter A and all of Subchapter B--Estate 
and Gift Taxes. The last six volumes contain parts 30-39 (Subchapter C--
Employment Taxes and Collection of Income Tax at Source); parts 40-49; 
parts 50-299 (Subchapter D--Miscellaneous Excise Taxes); parts 300-499 
(Subchapter F--Procedure and Administration); parts 500-599 (Subchapter 
G--Regulations under Tax Conventions); and part 600 to end (Subchapter 
H--Internal Revenue Practice).

    The OMB control numbers for Title 26 appear in Sec. 602.101 of this 
chapter. For the convenience of the user, Sec. 602.101 appears in the 
Finding Aids section of the volumes containing parts 1 to 599.

    For this volume, Melanie L. Marcec was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Frances D. McDonald, assisted by Alomha S. Morris.

[[Page x]]





[[Page 1]]



                       TITLE 26--INTERNAL REVENUE




                  (This book contains Parts 500 to 599)

  --------------------------------------------------------------------
                                                                    Part

Chapter I--Internal Revenue Service, Department of the 
  Treasury (Continued)......................................         502

[[Page 3]]




     CHAPTER 1--INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY 
                               (Continued)



  --------------------------------------------------------------------


  Editorial Note: IRS published a document at 45 FR 6088, Jan. 25, 1980, 
deleting statutory sections from their regulations. In Chapter I cross 
references to the deleted material have been changed to the 
corresponding sections of the IRS Code of 1954 or to the appropriate 
regulations sections. When either such change produced a redundancy, the 
cross reference has been deleted. For further explanation, see 45 FR 
20795, Mar. 31, 1980.

             SUBCHAPTER G--REGULATIONS UNDER TAX CONVENTIONS
Part                                                                Page
500-501         [Reserved]
502             Greece......................................           5
503             Germany.....................................          14
504-507         [Reserved]
509             Switzerland.................................          24
510-512         [Reserved]
513             Ireland.....................................          50
514             France......................................          63
515             [Reserved]
516             Austria.....................................          99
517             Pakistan....................................         111
518-519         [Reserved]
520             Sweden......................................         120
521             Denmark.....................................         133

[[Page 5]]



             SUBCHAPTER G--REGULATIONS UNDER TAX CONVENTIONS





PARTS 500-501  [RESERVED]






PART 502--GREECE--Table of Contents




                       Subpart--Withholding of Tax

Sec.
502.1  Introductory.
502.2  Dividends.
502.3  Interest.
502.4  Natural resource royalties and real property rentals.
502.5  Patent and copyright royalties.
502.6  Private pensions and life annuities.
502.7  Release of excess tax withheld at source.
502.8  Information to be furnished in ordinary course.
502.9  Beneficiaries of a domestic estate or trust.
502.10  Refund of excess tax withheld during 1953.

    Authority: Sec. 7805, 68A Stat. 917; 26 U.S.C. 7805.

    Source: Treasury Decision 6109, 19 FR 6694, Oct. 19, 1954, as 
amended at 25 FR 14021, Dec. 31, 1960, unless otherwise noted.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, part 
502 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 
31, 1998, the effective date was delayed until Jan. 1, 2000.



                       Subpart--General Income Tax



Sec. 502.1  Introductory.

    (a) The income tax convention and protocol between the United States 
and Greece, signed February 20, 1950, and April 20, 1953, respectively, 
and proclaimed by the President of the United States on January 15, 
1954, referred to in this part as the convention, provides in part as 
follows effective January 1, 1953:

                                Article I

    (1) The taxes which are the subject of the present Convention are:
    (a) In the case of the United States of America: the Federal income 
tax, including surtaxes (hereinafter referred to as United States tax).
    (b) In the case of the Kingdom of Greece: the income tax, including 
the schedular or analytical tax, the complementary tax and the 
professional or business tax (hereinafter referred to as Greek tax).
    (2) The present Convention shall also apply to any other taxes of a 
substantially similar character imposed by either Contracting State 
subsequently to the date of signature of the present Convention.

                               Article II

    (1) In the present Convention, unless the context otherwise 
requires--
    (a) The term ``United States'' means the United States of America 
and when used in a geographical sense means the States, the Territories 
of Alaska and Hawaii, and the District of Columbia.
    (b) The term ``Greece'' means the territories of the Kingdom of 
Greece.
    (c) The term ``United States Corporation'' means a corporation, 
association or other like entity created or organized in or under the 
laws of the United States.
    (d) The term ``Greek Corporation'' means a legal entity established 
under the laws of Greece.
    (e) The terms ``corporations of one Contracting State'' and 
``corporation of the other Contracting State'' mean a United States 
corporation or a Greek corporation, as the context requires.
    (f) The term ``United States enterprise'' means an industrial or 
commercial enterprise or undertaking carried on in the United States by 
a citizen or resident of the United States or by a United States 
corporation.
    (g) The term ``Greek Enterprise'' means an industrial or commercial 
enterprise or undertaking carried on in Greece by a subject or resident 
of Greece or by a Greek corporation.
    (h) The terms ``enterprise of one of the Contracting States'' and 
``enterprise of the other Contracting State'' mean a United States 
enterprise or a Greek enterprise, as the context requires.
    (i) The term ``permanent establishment'', when used with respect to 
an enterprise of one of the Contracting States, means a branch, factory 
or other fixed place of business, but does not include an agency unless 
that agent has, and habitually exercises, a general authority to 
negotiate and conclude contracts on behalf of such enterprise or has a 
stock of merchandise from which he regularly fills orders on behalf of 
such enterprise. An enterprise of one of the Contracting States shall 
not be deemed to have a permanent establishment in the other Contracting 
State merely because it carries on business dealings in such other 
Contracting State through a bona fide commission agent, broker or 
custodian acting in the ordinary course of his business as such. The 
fact that an enterprise of one of the Contracting States maintains in 
the other Contracting

[[Page 6]]

State a fixed place of business exclusively for the purchase of goods or 
merchandise shall not of itself constitute such fixed place of business 
a permanent establishment of such enterprise. When a corporation of one 
Contracting State has a subsidiary corporation which is a corporation of 
the other Contracting State or which is engaged in trade or business in 
such other Contracting State, such subsidiary corporation shall not, 
merely because of that fact, be deemed to be a permanent establishment 
of its parent corporation.
    (j) The term ``competent authority'' or ``competent authorities'' 
means, in the case of the United States, the Commissioner of Internal 
Revenue or his duly authorized representative; in the case of Greece, 
the General Director of Direct Taxes, or his duly authorized 
representative.
    (2) In the application of the provisions of the present Convention 
by either of the Contracting States, any term which is not defined in 
the present Convention shall, unless the context otherwise requires, 
have the meaning which that term has under the laws of such Contracting 
State relating to the taxes which are the subject of the present 
Convention.

                                * * * * *

                               Article VI

    (1) Interest (on bonds, securities, notes, debentures, or on any 
other form of indebtedness) received from sources within the United 
States by a resident or corporation of Greece not engaged in trade or 
business in the United States through a permanent establishment therein, 
shall be exempt from United States tax; but such exemption shall not 
apply to such interest paid by a United States corporation to a Greek 
corporation controlling, directly or indirectly, more than 50 percent of 
the entire voting power in the paying corporation.
    (2) Interest (on bonds, securities, notes, debentures, or on any 
other form of indebtedness) received from sources within Greece by a 
resident or corporation of the United States not engaged in trade or 
business in Greece through a permanent establishment therein, shall be 
exempt from Greek tax but only to the extent that such interest does not 
exceed 9 percent per annum; but such exemption shall not apply to such 
interest paid by a Greek corporation to a United States corporation 
controlling, directly or indirectly, more than 50 percent of the entire 
voting power in the paying corporation.

                               Article VII

    Royalties for the right to use copyrights, patents, designs, secret 
processes and formulae, trade marks and other analogous property, and 
royalties (including rentals), (other than those in respect of motion 
picture films) for the use of industrial, commercial or scientific 
equipment, derived from sources within one of the Contracting States by 
a resident or corporation of the other Contracting State not engaged in 
trade or business in the former State through a permanent establishment 
therein, shall be exempt from tax by the former State.

                              Article VIII

    A resident or corporation of one of the Contracting States, deriving 
from sources within the other Contracting State royalties in respect to 
the operation of mines, quarries, or other natural resources, or rentals 
from real property, may elect for any taxable year to be subject to the 
tax of such other Contracting State on the basis of net income as 
determined under the laws of such other Contracting State during such 
taxable year.

                               Article IX

    Dividends and interest paid by a Greek corporation shall be exempt 
from United States tax except where the recipient is a citizen, resident 
or corporation of the United States.

                                * * * * *

                               Article XI

                                * * * * *

    (2) Private pensions and life annuities derived from within one of 
the Contracting States by an individual who is a resident of the other 
Contracting State shall be exempt from taxation by the former 
Contracting State.
    (3) The term ``pensions'' as used in this Article means periodic 
payments made in consideration for services rendered or by way of 
compensation for injuries received.
    (4) The term ``life annuities'' as used in this Article means a 
stated sum payable periodically at stated times during life, or during 
life, an obligation to make the payments in return for adequate and full 
consideration in money or money's worth.

                                * * * * *

                               Article XV

    (1) The authorities of each of the Contracting States, in accordance 
with the practices of that State, may prescribe regulations necessary to 
carry out the provisions of the present Convention.
    (2) With respect to the provisions of the present Convention 
relating to exchange of information and mutual assistance in the 
collection of taxes, the Contracting States may, in accordance with 
their respective

[[Page 7]]

practices, prescribe rules concerning matters of procedure, forms of 
application and replies thereto, conversion of currency, disposition of 
amounts collected, minimum amounts subject to collection, and related 
matters.

                               Article XVI

    (1) The provisions of the present Convention shall not be construed 
to restrict in any manner any exemption, deduction, credit or other 
allowance accorded by the laws of one of the Contracting States in the 
determination of the taxes imposed by such State.
    (2) Should any difficulty or doubt arise as to the interpretation or 
application of the present Convention, the competent authorities of the 
Contracting States shall undertake to settle the question by mutual 
agreement.
    (3) The citizens or subjects of one of the Contracting States shall 
not, while resident in the other Contracting State, be subjected therein 
to other or more burdensome taxes than are the citizens or subjects of 
such other Contracting State residing in its territory. The term 
``citizens'' or ``subjects'', as used in this Article, includes all 
legal persons, partnerships and associations deriving their status from, 
or created or organized under, the laws in force in, the respective 
Contracting States. In this Article the word ``taxes'' means taxes of 
every kind or description whether national, federal, state, provincial 
or municipal.

                                * * * * *

                              Article XVIII

    The competent authorities of the Contracting States shall exchange 
such information (being information which such authorities have at their 
disposal) as is necessary for carrying out the provisions of the present 
Convention or for the prevention of fraud or the administration of 
statutory provisions against legal avoidance in relation to the taxes 
which are the subject of the present Convention. Any information so 
exchanged shall be treated as secret and shall not be disclosed to any 
person other than those concerned with the assessment, and collection of 
the taxes which are the subject of the present Convention. No 
information shall be exchanged which would disclose a technical secret, 
or process relating to trade, industry, business, or a profession.

                                * * * * *

                               Article XX

    (1) In no case shall the provisions of Article XVIII and XIX be 
construed so as to impose upon either of the Contracting States the 
obligation:
    (a) To carry out administrative measures at variance with the 
regulations and practice of either Contracting State, or
    (b) To supply information which is not procurable under its own 
legislation or that of the State making application.
    (2) The State to which application is made for information or 
assistance shall comply as soon as possible with the request addressed 
to it. Nevertheless, such State may refuse to comply with the request 
for reasons of public policy or if compliance would involve disclosure 
of a technical secret or process relating to trade, industry, business, 
or a profession. In such case it shall inform, as soon as possible, the 
State making the application.

                               Article XXI

    (1) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Athens as soon as possible.
    (2) The present Convention shall become effective on the first day 
of January of the year in which the exchange of the instruments of 
ratification takes place. It shall continue effective for a period of 
five years beginning with that date and indefinitely after that period, 
but may be terminated by either of the Contracting States at the end of 
the five-year period or at any time thereafter, provided that at least 
six months' prior notice of termination has been given, the termination 
to become effective on the first day of January following the expiration 
of the six-month period.

                                * * * * *

    (b) As used in this part, any term defined in the convention shall 
have the meaning so assigned to it; any term not so defined shall, 
unless the context otherwise requires, have the meaning which such term 
has under the internal revenue laws.



Sec. 502.2  Dividends.

    (a) Dividends paid on or after January 1, 1953, by a Greek 
corporation are exempt from United States tax under the provisions of 
Article IX of the convention if the recipient is not a citizen, 
resident, or corporation of the United States. Such dividends are, 
therefore, not subject to the withholding of United States tax at 
source.
    (b) The convention does not change the rate of United States tax 
imposed pursuant to sections 871, 881, and 882 of the Internal Revenue 
Code of 1954 upon dividends paid by a corporation other

[[Page 8]]

than a Greek corporation. The withholding of United States tax with 
respect to such dividends derived from sources within the United States 
by nonresident aliens who are residents of Greece, or by Greek 
corporations, is not changed by the convention.



Sec. 502.3  Interest.

    (a) General. (1) Interest paid on or after January 1, 1953, by a 
Greek corporation is exempt from United States tax under the provisions 
of Article IX of the convention if the recipient is not a citizen, 
resident, or corporation of the United States. Interest paid to such 
recipients is, therefore, not subject to the withholding of United 
States tax at source.
    (2) Interest (other than interest falling within the scope of 
paragraph (b) of this section) on bonds, securities, notes, debentures, 
or on any other form of indebtedness, including interest on obligations 
of the United States, obligations of instrumentalities of the United 
States, and mortgages and bonds secured by real property, which is paid 
by a person other than a Greek corporation and which is received from 
sources within the United States on or after January 1, 1953, by a 
nonresident alien (including a nonresident alien individual, fiduciary, 
and partnership) who is a resident of Greece, or by a Greek corporation, 
is exempt from United States tax under the provisions of Article VI (1) 
of the convention if such alien or corporation at no time during the 
taxable year in which such interest is received has engaged in trade or 
business within the United States through a permanent establishment 
situated therein. Such interest is, therefore, not subject to the 
withholding of United States tax at source. As to what constitutes a 
permanent establishment, see Article II (1)(i) of the convention.
    (b) Exemption not applicable to interest paid by subsidiary 
corporation to its parent corporation. Under the exception contained in 
Article VI (1) of the convention any interest received from sources 
within the United States and paid by a domestic corporation to a Greek 
corporation is not exempt from United States tax if such Greek 
corporation controls, directly or indirectly, at the time the interest 
is paid more than 50 percent of the entire voting power of all classes 
of stock of such domestic corporation. The exemption from United States 
tax provided by Article VI (1) of the convention does not, therefore, 
apply to such interest paid by such domestic corporation.
    (c) Application of exemption from withholding. (1) To avoid 
withholding of United States tax at source in the case of coupon bond 
interest to which paragraph (a)(2) of this section is applicable, the 
nonresident alien who is a resident of Greece, or the Greek corporation, 
shall for each issue of bonds file Form 1001-G in duplicate when 
presenting the interest coupons for payment. This form shall be signed 
by the owner of the interest, trustee, or agent and shall show the name 
and address of the obligor, the name and address of the owner of the 
interest, and the amount of the interest. It shall contain a statement 
(i) that the owner is a resident of Greece, or is a Greek corporation, 
(ii) that the owner is not engaged in trade or business within the 
United States through a permanent establishment situated therein, and, 
in the case of interest paid by a domestic corporation to a Greek 
corporation, (iii) that the owner does not control, directly or 
indirectly, more than 50 percent of the entire voting power of all 
classes of stock of the United States domestic corporation.
    (2) The exemption from United States tax contemplated by Article VI 
(1) of the convention, insofar as it concerns coupon bond interest, is 
applicable only to the owner of the interest. The person presenting the 
coupon or on whose behalf it is presented shall, for the purpose of the 
exemption from tax, be deemed to be the owner of the interest only if he 
is, at the time the coupon is presented for payment, the owner of the 
bond from which the coupon has been detached. If the person presenting 
the coupon or on whose behalf it is presented is not the owner of the 
bond, Form 1001, and not Form 1001-G, shall be executed.
    (3) The original and duplicate of Form 1001-G shall be forwarded by 
the withholding agent to the District Director of Internal Revenue, 
Audit Division, Alien Returns Section, Baltimore

[[Page 9]]

2, Maryland, with the quarterly return on Form 1012. Form 1001-G need 
not be listed on Form 1012.
    (4) To avoid withholding of United States tax at source in the case 
of interest, other than coupon bond interest, to which paragraph (a)(2) 
of this section is applicable, the nonresident alien who is a resident 
of Greece, or the Greek corporation, shall notify the withholding agent 
by letter in duplicate that such income is exempt from United States tax 
under the provisions of Article VI (1) of the convention. The letter of 
notification shall be signed by the owner of the interest, trustee, or 
agent and shall show the name and address of the obligor and the name 
and address of the owner of the interest. It shall contain a statement 
(i) that the owner is neither a citizen nor a resident of the United 
States but is a resident of Greece, or, in the case of a corporation, 
that the owner is a Greek corporation, (ii) that the owner has at no 
time during the current taxable year engaged in trade or business within 
the United States through a permanent establishment situated therein, 
and, in the case of interest paid by a domestic corporation to a Greek 
corporation, (iii) that the owner does not control, directly or 
indirectly, more than 50 percent of the entire voting power of all 
classes of stock of the United States domestic corporation.
    (5) This letter of notification, which shall constitute 
authorization for the payment of such interest without withholding of 
United States tax at source, shall be filed with the withholding agent 
for each successive three-calendar-year period during which such income 
is paid. For this purpose, the first such period shall commence with the 
beginning of the calendar year in which such income is first paid on or 
after January 1, 1954. Each such letter filed with any withholding agent 
shall be filed not later than 20 days preceding the date of the first 
payment within each successive period, or, if that is not possible 
because of special circumstances, as soon as possible after such first 
payment.
    (6) If such letter is also to be used as authorization for the 
release, pursuant to Sec. 502.7, of excess tax withheld from interest, 
other than coupon bond interest, it shall also contain a statement (i) 
that, at the time when the interest was received from which the excess 
tax was withheld, the owner was neither a citizen nor a resident of the 
United States but was a resident of Greece, or, in the case of a 
corporation, the owner was a Greek corporation, (ii) that the owner at 
no time during the taxable year in which such interest was received was 
engaged in trade or business within the United States through a 
permanent establishment situated therein, and, in the case of interest 
paid by a domestic corporation to a Greek corporation, (iii) that the 
owner did not control, directly or indirectly, at the time when such 
interest was paid, more than 50 percent of the entire voting power of 
all classes of stock of the United States domestic corporation.
    (7) Once a letter has been filed in respect of any three-calendar-
year period, no additional letter need be filed in respect thereto 
unless the Commissioner of Internal Revenue notifies the withholding 
agent that an additional letter shall be filed by the taxpayer. If, 
after filing a letter of notification, the taxpayer ceases to be 
eligible for the exemption from United States tax granted by the 
convention in respect to such interest, such taxpayer shall promptly 
notify the withholding agent by letter in duplicate. When any change 
occurs in the ownership of the interest as recorded on the books of the 
payer, the exemption from withholding of United States tax shall no 
longer apply unless the new owner of record is entitled to and does 
properly file a letter of notification with the withholding agent.
    (8) Each letter of notification, or the duplicate thereof, shall be 
immediately forwarded by the withholding agent to the District Director 
of Internal Revenue, Audit Division, Alien Returns Section, Baltimore 2, 
Maryland.
    (d) Interest paid by domestic corporation to Greek corporation where 
degree of stock ownership uncertain. (1) In any case in which a Greek 
corporation anticipates the receipt of interest from a domestic 
corporation and the relationship existing between the Greek corporation 
and the domestic corporation is such as to render uncertain whether,

[[Page 10]]

by reason of the exception contained in Article VI (1) of the 
convention, the exemption will apply to such interest, the Greek 
corporation shall not undertake to file any Form 1001-G or letter of 
notification prescribed by paragraph (c) of this section unless it has, 
prior to such filing, applied for and received from the Commissioner of 
Internal Revenue, Washington 25, D.C., a determination that such Greek 
corporation does not control, directly or indirectly, more than 50 
percent of the entire voting power in the paying corporation. The 
application to the Commissioner shall contain a full statement of all 
the facts pertinent to a determination of the question.
    (2) As soon as practicable after the application has been filed, the 
Commissioner of Internal Revenue will determine whether the Greek 
corporation has such control of the domestic corporation as to render 
the exemption provided by Article VI (1) of the convention inapplicable 
to interest paid by such domestic corporation to such Greek corporation 
and shall notify the Greek corporation of his determination. The Greek 
corporation shall forthwith file with the domestic corporation a copy of 
the Commissioner's letter of notification.
    (3) If the Commissioner's determination is that the Greek 
corporation does not control, directly or indirectly, more than 50 
percent of the entire voting power of all classes of stock of the 
domestic corporation, the Greek corporation may thereafter avoid 
withholding at the source with respect to subsequent payments of such 
interest by complying with the provisions of paragraph (c) of this 
section, that is, by submitting Form 1001-G in the case of coupon bond 
interest, or the letter of notification for each three-calendar-year 
period in the case of interest other than interest payable by means of 
coupons.
    (4) A determination of the Commissioner that the Greek corporation 
does not have such control of the domestic corporation as to render the 
exemption provided by Article VI (1) of the convention inapplicable will 
apply until such time as the stock ownership of the domestic corporation 
has changed to the extent that interest to be received from the domestic 
corporation by the Greek corporation is no longer exempt from United 
States tax under Article VI (1) of the convention. If such change in 
stock ownership occurs, the Greek corporation shall promptly notify both 
the Commissioner of Internal Revenue and the domestic corporation of the 
then existing facts with respect to such stock ownership.
    (5) In any case in which a Greek corporation has received on or 
after January 1, 1954, interest from a domestic corporation and the 
relationship existing between the Greek corporation and the domestic 
corporation was at the time the interest was paid such as to render 
uncertain whether, by reason of the exception contained in Article VI 
(1) of the convention, such interest was exempt from United States tax, 
the Greek corporation shall apply to the Commissioner of Internal 
Revenue for a similar determination as to the degree of control at the 
time the interest was paid. If the Commissioner's determination is that 
at such time the degree of control was such as to permit the application 
of the exemption provided by Article VI (1) of the convention, his 
letter of notification may, subject to the provisions of Sec. 502.7(b), 
authorize the release of excess tax withheld with respect to such exempt 
interest.



Sec. 502.4  Natural resource royalties and real property rentals.

    The convention does not change the rate of United States tax imposed 
pursuant to sections 871, 881, and 882 of the Internal Revenue Code of 
1954 upon natural resource royalties and real property rentals. The 
withholding of United States tax with respect to such items derived from 
sources within the United States by nonresident aliens who are residents 
of Greece, or by Greek corporations, is not changed by the convention.



Sec. 502.5  Patent and copyright royalties.

    (a) General. (1) Royalties for the right to use copyrights, patents, 
designs, secret processes and formulae, trade marks, and other analogous 
property, and royalties and rentals for the use of industrial, 
commercial, or scientific equipment, which are derived from

[[Page 11]]

sources within the United States on or after January 1, 1953, by a 
nonresident alien (including a nonresident alien individual, fiduciary, 
and partnership) who is a resident of Greece, or by a Greek corporation, 
are exempt from United States tax under the provisions of Article VII of 
the convention if such alien or corporation at no time during the 
taxable year in which such income is derived has engaged in trade or 
business within the United States through a permanent establishment 
situated therein. Such royalties are, therefore, not subject to the 
withholding of United States tax at source. As to what constitutes a 
permanent establishment, see Article II(1)(i) of the convention.
    (2) The provisions of this section shall have no application to 
rentals or royalties in respect of motion picture films.
    (b) Application of exemption from withholding. (1) To avoid 
withholding of United States tax at source in the case of the income to 
which paragraph (a) of this section is applicable, the nonresident alien 
who is a resident of Greece, or the Greek corporation, shall notify the 
withholding agent by letter in duplicate that such income is exempt from 
United States tax under the provisions of Article VII of the convention. 
The provisions of Sec. 502.3(c) (other than those pertaining to the 
degree of control of voting power) relating to the execution, filing, 
and effective period of the letter of notification prescribed therein 
with respect to interest, including its use for the release of excess 
tax withheld, are equally applicable with respect to the income falling 
within the scope of this section.
    (2) Each letter of notification, or the duplicate thereof, shall be 
immediately forwarded by the withholding agent to the District Director 
of Internal Revenue, Audit Division, Alien Returns Section, Baltimore 2, 
Maryland.



Sec. 502.6  Private pensions and life annuities.

    (a) General. Private pensions and life annuities, as defined in 
Article XI (3) and (4) of the convention, derived from sources within 
the United States on or after January 1, 1953, by a nonresident alien 
individual who is a resident of Greece are exempt from United States tax 
under the provisions of Article XI(2) of the convention. Such items of 
income are, therefore, not subject to the withholding of United States 
tax at source.
    (b) Application of exemption from withholding. (1) To avoid 
withholding of United States tax at source in the case of the items of 
income to which paragraph (a) of this section is applicable, the 
nonresident alien individual who is a resident of Greece shall notify 
the withholding agent by letter in duplicate that such income is exempt 
from United States tax under the provisions of Article XI of the 
convention. The letter of notification shall be signed by the owner of 
the income, shall show the name and address of both the payer and the 
owner of the income, and shall contain a statement that the owner, an 
individual, is neither a citizen nor a resident of the United States but 
is a resident of Greece.
    (2) If such letter is also to be used as authorization for the 
release, pursuant to Sec. 502.7(a), of excess tax withheld from such 
items of income, it shall also contain a statement that the owner was, 
at the time when the income was derived from which the excess tax was 
withheld, neither a citizen nor a resident of the United States but was 
a resident of Greece.
    (3) This letter shall constitute authorization for the payment of 
such items of income without withholding of United States tax at source 
unless the Commissioner of Internal Revenue subsequently notifies the 
withholding agent that the tax shall be withheld with respect to 
payments of such items of income made after receipt of such notice. If, 
after filing a letter of notification, the owner of the income ceases to 
be eligible for the exemption from United States tax granted by the 
convention in respect to such income, he shall promptly notify the 
withholding agent by letter in duplicate. When any change occurs in the 
ownership of such income as recorded on the books of the payer, the 
exemption from withholding of United States tax shall no longer apply 
unless the new owner of record is entitled to and does properly file a 
letter of notification with the withholding agent.

[[Page 12]]

    (4) Each letter of notification, or the duplicate thereof, shall be 
immediately forwarded by the withholding agent to the District Director 
of Internal Revenue, Audit Division, Alien Returns Section, Baltimore 2, 
Maryland.



Sec. 502.7  Release of excess tax withheld at source.

    (a) General. (1) In order to give the convention effective 
application at the earliest practicable date, the exemptions from 
withholding of United States tax at source granted by this part are 
hereby made effective beginning January 1, 1954, contingent upon 
compliance with the applicable provisions of Secs. 502.2 through 502.6.
    (2) In the case of dividends and interest paid by a Greek 
corporation to a recipient other than a citizen, resident, or 
corporation of the United States, if United States tax at the stautory 
rate has been withheld on or after January 1, 1954, there shall be 
released by the withholding agent and paid over to the person from whom 
it was withheld, an amount equal to the tax so withheld from such items.
    (3) In the case of every taxpayer whose address at the time of 
payment was in Greece and who furnishes to the withholding agent the 
letter of notification prescribed in Secs. 502.3(c), 502.5(b), and 
502.6(b) as authorization for the release of excess tax withheld, if 
United States tax at the statutory rate (30 percent as of the date of 
approval of this part) has been withheld on or after January 1, 1954, 
from interest (other than coupon bond interest), copyright royalties and 
other items to which Sec. 502.5(a) is applicable, and from private 
pensions and life annuities as defined in Article XI, there shall be 
released (except as provided in paragraph (b) of this section) by the 
withholding agent and paid over to the person from whom it was withheld 
an amount equal to the tax so withheld from such items.
    (4) In the case of every taxpayer whose address at the time of 
payment was in Greece and who furnishes to the withholding agent Form 
1001-G clearly marked ``Substitute'' and executed in accordance with 
Sec. 502.3(c), if United States tax at the statutory rate has been 
withheld from coupon bond interest on or after January 1, 1954, there 
shall be released (except as provided in paragraph (b) of this section) 
by the withholding agent and paid over to the person from whom it was 
withheld an amount equal to the tax so withheld from such interest. One 
such substitute form shall be filed in duplicate with respect to each 
issue of bonds and will serve with respect to that issue to replace all 
Forms 1001 previously filed by the taxpayer in the calendar year in 
which the excess tax was withheld and with respect to which such excess 
is released.
    (5) The original and duplicate of substitute Form 1001-G shall be 
forwarded by the withholding agent to the District Director of Internal 
Revenue, Audit Division, Alien Returns Section, Baltimore 2, Maryland, 
with the quarterly return on Form 1012. Substitute Form 1001-G need not 
be listed on Form 1012.
    (6) The provisions of this section (other than paragraph (c) of this 
section) shall have no application to excess tax withheld at source 
which has been paid by the witholding agent to the district director of 
internal revenue.
    (b) Interest paid where degree of stock ownership is determined. If 
United States tax at the rate of 28 percent or 30 percent, as the case 
may be, has been withheld on or after January 1, 1954, from interest 
paid by a domestic corporation to a Greek corporation whose address at 
the time of payment was in Greece, and if the relationship existing 
between the Greek corporation and the domestic corporation, was, at the 
time the interest was paid, such as to render uncertain whether, by 
reason of the exception contained in Article VI (1) of the convention, 
such interest was exempt from United States tax, the withholding agent 
shall release and pay over to the Greek corporation an amount equal to 
the tax so withheld only if the Greek corporation (1) furnishes to the 
domestic corporation a copy of the Commissioner's authorization of 
release prescribed in Sec. 502.3 (d) and (2) files the letter of 
notification prescribed in Sec. 502.3(c), or the substitute Form 1001-G 
prescribed in paragraph (a) of this section, whichever is applicable.

[[Page 13]]

    (c) Amounts withheld during 1953. For provisions respecting the 
refund of excess tax withheld during the calendar year 1953, see 
Sec. 502.10.



Sec. 502.8  Information to be furnished in ordinary course.

    (a) General. In compliance with the provisions of Article XVIII of 
the convention the Commissioner of Internal Revenue will transmit to the 
Greek General Director of Direct Taxes, as soon as practicable after the 
close of the calendar year 1954 and of each subsequent calendar year 
during which the convention is in effect, the following information 
relating to such preceding calendar year:
    (1) The duplicate copy of each available Form 1042 Supplement filed 
pursuant to paragraph (b) of this section; and
    (2) The duplicate copy of each available ownership certificate, Form 
1001-G, filed pursuant to Sec. 502.3(c), and substitute Form 1001-G, 
filed pursuant to Sec. 502.7 (a) and (b), in connection with coupon bond 
interest.
    (b) Information return. (1) To facilitate compliance with Article 
XVIII of the convention, every United States withholding agent shall 
make and file in duplicate with the district director of internal 
revenue for the district in which the withholding agent is located an 
information return on Form 1042 Supplement, with respect to Greek 
addressees, which shall be filed for the calendar year 1954 and 
subsequent calendar years. This return shall be filed simultaneously 
with Form 1042.
    (2) There shall be reported on such Form 1042 Supplement all items 
of fixed or determinable annual or periodical income (and, for 1955 and 
subsequent years, amounts described in section 402(a)(2), section 631 
(b) and (c), and section 1235 of the Internal Revenue Code of 1954, 
which are considered to be gains from the sale or exchange of capital 
assets) derived from sources within the United States and paid to 
nonresident aliens (including nonresident alien individuals, 
fiduciaries, and partnerships) and to nonresident foreign corporations, 
whose addresses at the time of payment were in Greece, including such 
items of income upon which, in accordance with this part, no withholding 
of United States tax is required; except that any of such items which 
constitute interest in respect of which Form 1001-G or substitute Form 
1001-G has been filed in duplicate with the withholding agent are not 
required to be reported on such Form 1042 Supplement.



Sec. 502.9  Beneficiaries of a domestic estate or trust.

    A nonresident alien who is a resident of Greece and who is a 
beneficiary of a domestic estate or trust shall be entitled to the 
exemption from United States tax granted by Articles VI, VII, and IX of 
the convention with respect to dividends, interest, and copyright 
royalties and the like, to the extent such item or items are included in 
that portion of the income of such estate or trust which is (or would, 
but for such exemption, be) includible in the gross income of the 
beneficiary, provided that he otherwise satisfies the requirements of 
these respective articles. In order to be entitled in such instance to 
the exemption from withholding of United States Tax such beneficiary 
must otherwise satisfy such requirements and shall, where applicable, 
execute and submit to the fiduciary of such estate or trust in the 
United States the appropriate letter of notification prescribed in 
Secs. 502.3(c) and 502.5(b).



Sec. 502.10  Refund of excess tax withheld during 1953.

    (a) If United States tax withheld at the source during the year 1953 
from dividends, interest, copyright royalties and the like, pensions, or 
life annuities is in excess of the tax imposed under the internal 
revenue laws, as modified by the convention, a claim by the taxpayer for 
the refund of any overpayment resulting therefrom shall be made under 
subchapter B of chapter 66 of the Internal Revenue Code of 1954 by 
filing Form 843 together with Form 1040NB, Form 1040NB-a, Form 1040B, 
Form 1120, or Form 1120NB, whichever is applicable, or with an amended 
return.
    (b) The taxpayer's total gross income from sources within the United 
States, including every item of capital gain subject to tax under the 
provisions of

[[Page 14]]

section 211(a)(1)(B) or 211(c) of the Internal Revenue Code of 1939, 
shall be disclosed on the return. In the event that securities are held 
in the name of a person other than the actual or beneficial owner, the 
name and address of such person shall be furnished with the claim. In 
the case of a claim involving an overpayment of tax upon dividends or 
interest paid by a Greek corporation, a statement that the dividends or 
interest were paid by such a corporation shall be included in the claim. 
If the claim relates to other interest, copyright royalties and the 
like, pensions, or life annuities, there shall also be included in such 
claim:
    (1) A statement that, at the time when such item or items of income 
were derived from which the excess tax was withheld, (i) the taxpayer 
was neither a citizen nor a resident of the United States but was a 
resident of Greece, or, in the case of a corporation, (ii) the taxpayer 
was a Greek corporation;
    (2) A statement that the taxpayer at no time during the taxable year 
in which such income was derived was engaged in trade or business within 
the United States through a permanent establishment situated therein; 
and
    (3) In the case of a claim involving an overpayment of tax upon 
interest paid by a domestic corporation to a Greek corporation, a 
statement that the Greek corporation, at the time when the interest was 
paid, did not control, directly or indirectly, more than 50 percent of 
the entire voting power of all classes of stock of the United States 
domestic corporation. If the relationship existing between the Greek 
corporation and the domestic corporation at the time when such interest 
was paid was such as to render uncertain whether the exemption granted 
by Article VI (1) of the convention is applicable to such interest, 
there shall be furnished a full statement of all the facts pertinent to 
a determination of the question.
    (c) If, however, the taxpayer is an individual who during the 
taxable year derived from sources within the United States income which 
consists exclusively of pensions or life annuities entitled to the 
benefit of Article XI of the convention, the statement specified in 
paragraph (b)(2) of this section shall not be required.



PART 503--GERMANY--Table of Contents




                       Subpart--Withholding of Tax

Sec.
503.1  Introductory.
503.2  Dividends.
503.3  Interest.
503.4  Patent and copyright royalties and film rentals.
503.5  Private pensions and private life annuities.
503.6  Release of excess tax withheld at source.
503.7  Information to be furnished in ordinary course.
503.8  Beneficiaries of a domestic estate or trust.
503.9  Land Berlin.

    Authority: Sec. 7805, 68A Stat. 917; 26 U.S.C. 7805.

    Source: Treasury Decision 6122, 20 FR 682, Feb. 1, 1955, as amended 
at 25 FR 14021, Dec. 31, 1960, unless otherwise noted.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, part 
503 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 
31, 1998, the effective date was delayed until Jan. 1, 2000.



                       Subpart--Withholding of Tax



Sec. 503.1  Introductory.

    (a) The income tax convention between the United States and the 
Federal Republic of Germany, signed on July 22, 1954, and proclaimed by 
the President of the United States on December 24, 1954, referred to in 
this part as the convention, provides in part as follows, effective for 
taxable years beginning on or after January 1, 1954:

                                Article I

    (1) The taxes referred to in this Convention are:
    (a) In the case of the United States of America: The Federal income 
taxes, including surtaxes and excess profits taxes;
    (b) In the case of the Federal Republic: The income tax, the 
corporation tax and the Berlin emergency contribution (Notopfer).
    (2) The present Convention shall also apply to any other income or 
profits tax of a substantially similar character which may be imposed by 
one of the contracting States after the date of signature of the present 
Convention.

[[Page 15]]

                               Article II

    (1) As used in this Convention:
    (a) The term ``United States'' means the United States of America, 
and when used in a geographical sense means the States, the Territories 
of Alaska and Hawaii, and the District of Columbia;
    (b) The term ``Federal Republic'' means the Federal Republic of 
Germany and when used in a geographical sense means the territory over 
which the Basic Law for the Federal Republic of Germany is in effect;
    (c) The term ``permanent establishment'' means a branch, office, 
factory, workshop, warehouse, mine, stone quarry or other place of 
exploitation of the ground or soil, permanent display and sales office, 
or a construction or assembly project or the like the duration of which 
exceeds or will likely exceed twelve months, or other fixed place of 
business; but does not include the casual and temporary use of mere 
storage facilities, nor does it include an agent or employee unless the 
agent or employee has full power for the negotiation and concluding of 
contracts on behalf of the enterprise and also habitually exercises this 
power, or has a stock of merchandise from which he regularly fills 
orders on behalf of the enterprise. An enterprise of one of the 
contracting States shall not be deemed to have a permanent establishment 
in the other State merely because it carries on business dealings in 
such other State through a commission agent, broker, custodian or other 
independent agent, acting in the ordinary course of his business as 
such. The fact that an enterprise of one of the contracting States 
maintains in the other State a fixed place of business exclusively for 
the purchase of goods and merchandise shall not of itself constitute 
such fixed place of business a permanent establishment of the 
enterprise. The fact that a corporation of one contracting State has a 
subsidiary corporation which is a corporation of the other State or 
which is engaged in trade or business in the other State shall not of 
itself constitute that subsidiary corporation a permanent establishment 
of its parent corporation. The maintenance within the territory of one 
of the contracting States by an enterprise of the other contracting 
State of a warehouse for convenience of delivery and not for purposes of 
display shall not of itself constitute a permanent establishment within 
that territory;
    (d) The term ``enterprise of one of the contracting States'' means, 
as the case may be, ``United States enterprise'' or ``German 
enterprise'';
    (e) The term ``United States enterprise'' means an industrial or 
commercial enterprise or undertaking carried on in the United States by 
a resident (including an individual in his individual capacity or as a 
member of a partnership) or a fiduciary of the United States or by a 
United States corporation or other entity; the term ``United States 
corporation or other entity'' means a corporation or other entity 
created or organized under the law of the United States or of any State 
or Territory of the United States;
    (f) The term ``German enterprise'' means an industrial or commercial 
enterprise or undertaking carried on in the Federal Republic by a 
natural person (including an individual in his individual capacity or as 
a member of a partnership) resident in the Federal Republic or by a 
German company; the term ``German company'' means juridical persons 
together with entities treated as juridical persons for tax purposes 
under the laws of the Federal Republic; and
    (g) The term ``competent authorities'' means, in the case of the 
United States, the Commissioner of Internal Revenue as authorized by the 
Secretary of the Treasury; and in the case of the Federal Republic, the 
Federal Ministry of Finance.
    (2) In the application of the provisions of this Convention by one 
of the contracting States any term not otherwise defined shall, unless 
the context otherwise requires, have the meaning which the term has 
under its own applicable laws. For the purposes of this Convention 
``residence'' in the Federal Republic shall include the customary place 
of abode therein.

                                * * * * *

                               Article VI

    (1) The rate of tax imposed by the United States shall not exceed 15 
percent in the case of dividends from sources within the United States 
derived by a German company not having a permanent establishment in the 
United States and owning at least 10 percent of the voting stock of the 
corporation paying such dividend.

                                * * * * *

    (3) If, subsequent to the date of signature of this Convention, the 
percentage of stock ownership provided in section 131(f)(1) of the 
Internal Revenue Code [of 1939] is reduced, the percentage of stock 
ownership provided in paragraphs 1 and * * * of this Article shall 
likewise be deemed to be simultaneously reduced.

                               Article VII

    Interest on bonds, notes, debentures, securities or on any other 
form of indebtedness (exclusive of interest on debts secured by 
mortgages on farms, timberlands or real property used wholly or partly 
for housing purposes) derived, bona fide as interest.
    (A) by a natural person resident in the Federal Republic, or by a 
German company, not having a permanent establishment in the

[[Page 16]]

United States, shall be exempt from tax by the United States; or

                                * * * * *

                              Article VIII

    Royalties and other amounts derived as bona fide consideration for 
the right to use copyrights, artistic and scientific works, patents, 
designs, plans, secret processes and formulae, trade-marks and other 
like property and rights (including rentals and like payments in respect 
to motion picture films or for the use of industrial, commercial or 
scientific equipment), derived
    (A) by a natural person resident in the Federal Republic, or by a 
German company, not having a permanent establishment in the United 
States, shall be exempt from tax by the United States; or

                                * * * * *

                               Article IX

    (1) Income from real property situated in one of the contracting 
States (including gains derived from the sale or exchange of such 
property and interest on debts secured by mortgages on farms, 
timberlands, or real property used wholly or partly for housing 
purposes) and royalties in respect of the operation of mines, stone 
quarries or other natural resources derived by a resident or corporation 
or other entity or company of the other contracting State, shall be 
taxable only by the former State.
    (2)(a) A natural person resident in the Federal Republic or a German 
company deriving from sources within the United States any item of 
income coming within the scope of paragraph (1) of this Article, may, 
for any taxable year, elect to be subject to tax by the United States on 
a net income basis as if such resident or company were engaged in trade 
or business within the United States through a permanent establishment 
therein.

                                * * * * *

                               Article XI

    (1)(a) Wages, salaries and similar compensation and pensions paid by 
the United States or by its states, territories or political 
subdivisions, to an individual (other than a German citizen) shall be 
exempt from tax by the Federal Republic.
    (b) Wages, salaries and similar compensation and pensions paid by 
the Federal Republic, Laender or municipalities, or by a public pension 
fund, to an individual (other than a citizen of the United States and 
other than an individual who has been admitted to the United States for 
permanent residence therein) shall be exempt from tax by the United 
States.
    (c) For the purposes of this paragraph the term ``pensions'' shall 
be deemed to include annuities paid to a retired civilian government 
employee.
    (2) Private pensions and private life annuities which are from 
sources within one of the contracting States and are paid to individuals 
residing in the other contracting State shall be exempt from taxation by 
the former State.
    (3) The term ``pensions'', as used in this Article, means periodic 
payments made in consideration for services rendered or by way of 
compensation for injuries received.
    (4) The term ``life annuities'', as used in this Article, means a 
stated sum payable periodically at stated times during life, or during a 
specified number of years, under an obligation to make the payments in 
return for adequate and full consideration in money or money's worth.

                                * * * * *

                               Article XIV

    (1) Dividends and interest paid by a German company (other than a 
United States corporation) shall be exempt from United States tax where 
the recipient is a nonresident alien or a foreign corporation.

                                * * * * *

                               Article XVI

    (1) The competent authorities of the contracting States shall 
exchange such information (being information available under the 
respective taxation laws of the contracting States) as is necessary for 
carrying out the provisions of the present Convention or for the 
prevention of fraud or the like in relation to the taxes which are the 
subject of the present Convention. Any information so exchanged shall be 
treated as secret and shall not be disclosed to any persons other than 
those concerned with the assessment and collection of the taxes which 
are the subject of the present Convention. No information shall be 
exchanged which would disclose any trade, business, industrial or 
professional secret or any trade process.
    (2) Each of the contracting States may collect such taxes imposed by 
the other contracting State as though such taxes were the taxes of the 
former State as will ensure that any exemption or reduced rate of tax 
granted under the present Convention by such other State shall not be 
enjoyed by persons not entitled to such benefits.
    (3) In no case shall the provisions of this Article be construed so 
as to impose upon either of the contracting States the obligation to 
carry out administrative measures at variance with the regulations and 
practice of either contracting State or which would be

[[Page 17]]

contrary to its sovereignty, security or public policy or to supply 
particulars which are not procurable under its own legislation or that 
of the State making application.

                              Article XVII

                                * * * * *

    (2) For the settlement of difficulties or doubts in the 
interpretation or application of the present Convention or in respect of 
its relation to Conventions of the contracting States with third States 
the competent authorities of the contracting States shall reach a mutual 
agreement as quickly as possible.

                              Article XVIII

    (1) The provisions of this Convention shall not be construed to deny 
or affect in any manner the right of diplomatic and consular officers to 
other or additional exemptions now enjoyed or which may hereafter be 
granted to such officers.
    (2) The provisions of the present Convention shall not be construed 
to restrict in any manner any exemption, deduction, credit or other 
allowance now or hereafter accorded, by the laws of one of the 
contracting States in the determination of the tax imposed by such 
State, or by any other agreement between the contracting States.

                                * * * * *

                               Article XIX

    (1) The competent authorities of the two contracting States may 
prescribe regulations necessary to carry into effect the present 
Convention within the respective States.
    (2) The competent authorities of the two contracting States may 
communicate with each other directly for the purpose of giving effect to 
the provisions of this Convention.

                               Article XX

    (1) The present Convention shall also apply from the date specified 
in paragraph (1) of Article XXI to Land Berlin which for the purposes of 
this Convention comprises those areas over which the Berlin Senate 
exercises jurisdiction.
    (2) It is a condition to the application of this Convention to 
Berlin in accordance with the preceding paragraph that the Government of 
the Federal Republic shall previously have furnished to the Government 
of the United States of America a notification that all legal procedures 
in Berlin necessary for the application of this Convention therein have 
been complied with.
    (3) After application of this Convention to Land Berlin in 
accordance with paragraphs (1) and (2) of this Article, references in 
this Convention to the Federal Republic shall also be considered 
references to Land Berlin.

                               Article XXI

    (1) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Bonn as soon as possible. It shall 
have effect for the taxable years beginning on or after the first day of 
January of the year in which such exchange takes place.
    (2) The present Convention shall continue effective for a period of 
five years beginning with the calendar year in which the exchange of the 
instruments of ratification takes place and indefinitely after that 
period, but may be terminated by either of the contracting States at the 
end of the five-year period or at any time thereafter, provided that at 
least six months' prior notice of termination has been given and, in 
such event, the present Convention shall cease to be effective for the 
taxable years beginning on or after the first day of January next 
following the expiration of the six-month period.

                                * * * * *

    (b) As used in this part, any term defined in the convention shall 
have the meaning so assigned to it; any term not so defined shall, 
unless the context otherwise requires, have the meaning which such term 
has under the internal revenue laws.



Sec. 503.2  Dividends.

    (a) General. (1) Dividends paid by a German company (other than a 
United States corporation) and received in taxable years beginning on or 
after January 1, 1954, by a nonresident alien or a foreign corporation 
are exempt from United States tax under the provisions of Article XIV of 
the convention. Such dividends are, therefore, not subject to the 
withholding of United States tax at source.
    (2) The rate of United States tax imposed by the Internal Revenue 
Code upon dividends (other than dividends falling within the scope of 
subparagraph (1) of this paragraph) derived from sources within the 
United States in taxable years beginning on or after January 1, 1954, by 
a German company (other than a United States corporation) shall not 
exceed 15 percent under the provisions of Article VI of the convention 
if (i) such company at no time during the taxable year in which such 
dividends are derived has a permanent

[[Page 18]]

establishment in the United States and (ii) such company owns, at the 
time the dividends are paid, 10 percent or more of the voting stock of 
the paying corporation.
    (b) Application of reduced rate of withholding. (1) To secure 
withholding of United States tax at the rate of 15 percent at source in 
the case of dividends to which paragraph (a)(2) of this section is 
applicable, the German company shall notify the withholding agent by 
letter in duplicate that such income is subject to the reduced rate of 
United States tax under the provisions of Article VI of the convention. 
The letter of notification shall be signed by an officer of the company 
and shall show the name and address of the corporation paying the 
dividend, the name and address of the German company receiving the 
dividend, and the official title of the officer signing the letter. It 
shall contain a statement (i) that the owner of the dividend is a German 
company (other than a United States corporation), (ii) that the owner at 
no time during the current taxable year had a permanent establishment in 
the United States, and (iii) that the German company owns 10 percent or 
more of the voting stock of the corporation paying such dividend.
    (2) This letter of notification, which shall constitute 
authorization for application of the reduced rate of withholding of 
United States tax at source, shall be filed with the withholding agent 
for each successive 3-calendar-year period during which such income is 
paid. For this purpose, the first such period shall commence with the 
beginning of the calendar year in which such income is first paid on or 
after January 1, 1954. Each such letter filed with any withholding agent 
shall be filed not later than 20 days preceding the date of the first 
payment within each successive period, or, if that is not possible 
because of special circumstances, as soon as possible after such first 
payment.
    (3) If such letter is also to be used as authorization for the 
release, pursuant to Sec. 503.6(a)(3), of excess tax withheld from 
dividends, it shall also contain a statement (i) that, at the time when 
the dividends were derived from which the excess tax was withheld, the 
owner was a German company (other than a United States corporation), 
(ii) that the owner at no time during the taxable year in which such 
dividends were derived had a permanent establishment in the United 
States and (iii) that the German company owned, at the time when such 
dividends were paid, 10 percent or more of the voting stock of the 
corporation paying such dividends.
    (4) Once a letter has been filed in respect of any 3-calendar-year 
period, no additional letter need be filed in respect thereto unless the 
Commissioner of Internal Revenue notifies the withholding agent that an 
additional letter shall be filed by the taxpayer. If, after filing a 
letter of notification, the taxpayer ceases to be eligible for the 
reduction in rate of United States tax granted by the convention in 
respect to such dividends, such taxpayer shall promptly notify the 
withholding agent by letter in duplicate. When any change occurs in the 
ownership of the stock as recorded on the books of the payer the 
reduction in the rate of withholding of United States tax shall no 
longer apply unless the new owner of record is entitled to and does 
properly file a letter of notification with the withholding agent.
    (5) Each letter of notification, or the duplicate thereof, shall be 
immediately forwarded by the withholding agent to the District Director 
of Internal Revenue, Audit Division, Alien Returns Section, Baltimore 2, 
Maryland.
    (c) Dividends paid to German company where degree of stock ownership 
uncertain. (1) In any case in which a German company (other than a 
United States corporation) anticipates the receipt of dividends 
described in paragraph (a)(2) of this section and the relationship 
existing between the German company and the paying corporation is such 
as to render uncertain whether, by reason of the requirement as to stock 
ownership, the reduction in rate of United States tax granted by Article 
VI of the convention will apply to such dividends, the German company 
shall not undertake to file the letter of notification prescribed by 
paragraph (b)(1) of this section unless it has, prior to such filing, 
applied for and received from the Commissioner of Internal Revenue, 
Washington 25, D.C., a determination

[[Page 19]]

that such German company owns 10 percent or more of the voting stock of 
the paying corporation. The application to the Commissioner shall 
contain a full statement of all the facts pertinent to a determination 
of the question.
    (2) As soon as practicable after the application has been filed, the 
Commissioner of Internal Revenue will determine whether the German 
company owns sufficient voting stock of the paying corporation to permit 
it to claim the benefit of Article VI of the convention in the case of 
such dividends and shall notify the German company of his determination. 
The German company shall forthwith file with the paying corporation a 
copy of the Commissioner's letter of notification.
    (3) If the Commissioner's determination is that the German company 
does own 10 percent or more of the voting stock of the paying 
corporation, the German company may thereafter, if otherwise qualified, 
secure the reduced rate of withholding at the source with respect to 
subsequent payments of such dividends, by filing the letter of 
notification in accordance with paragraph (b) of this section.
    (4) A determination by the Commissioner that the German company does 
own sufficient voting stock of the paying corporation to permit it to 
claim the benefit of Article VI of the convention will apply until such 
time as the stock ownership of the paying corporation has changed to the 
extent that, because of such change, dividends to be received from the 
paying corporation by the German company no longer qualify for the 
reduced rate of United States tax under Article VI of the convention. If 
such change in stock ownership occurs, the German company shall promptly 
notify both the Commissioner of Internal Revenue and the paying 
corporation of the then existing facts with respect to such stock 
ownership.
    (5) In any case in which a German company (other than a United 
States corporation) has received on or after January 1, 1954, dividends 
described in paragraph (a)(2) of this section and the relationship 
existing between the German company and the paying corporation was, at 
the time the dividends were paid, such as to render uncertain whether, 
by reason of the requirement contained in Article VI of the convention 
as to stock ownership, such dividends qualified for the reduced rate of 
United States tax, the German company shall apply to the Commissioner of 
Internal Revenue for a similar determination as to the degree of stock 
ownership at the time the dividends were paid. If the Commissioner's 
determination is that at such time the degree of stock ownership was 
such as to permit the application of the reduced rate of United States 
tax granted by Article VI of the convention, his letter of notification 
may, subject to the provisions of Sec. 503.6(b), authorize the release 
of excess tax withheld with respect to such dividends.



Sec. 503.3  Interest.

    (a) General. (1) Interest paid by a German company (other than a 
United States corporation) and received in taxable years beginning on or 
after January 1, 1954, by a nonresident alien or a foreign corporation 
is exempt from United States tax under the provisions of Article XIV of 
the convention. Such interest is, therefore, not subject to the 
withholding of United States tax at source.
    (2) Interest (other than interest falling within the scope of 
subparagraph (1) of this paragraph) on bonds, notes, debentures, 
securities, or on any other form of indebtedness, including interest on 
obligations of the United States and of instrumentalities of the United 
States, which is derived, bona fide as interest, in taxable years 
beginning on or after January 1, 1954, by a natural person (other than a 
citizen or resident of the United States) resident in the Federal 
Republic of Germany, or by a German company (other than a United States 
corporation), is exempt from United States tax under the provisions of 
Article VII of the convention if such person or company at no time 
during the taxable year in which such interest is derived has a 
permanent establishment in the United States. Such interest is, 
therefore, not subject to the withholding of United States tax at 
source.

[[Page 20]]

    (3) The provisions of subparagraph (2) of this paragraph shall have 
no application to interest on debts secured by mortgages on farms, 
timberlands, or real property used wholly or partly for housing 
purposes.
    (b) Application of exemption from withholding. (1) To avoid 
withholding of United States tax at source in the case of coupon bond 
interest to which paragraph (a)(2) of this section is applicable, the 
resident of the Federal Republic of Germany or the Germany company 
shall, for each issue of bonds, file Form 1001-GER in duplicate when 
presenting the interest coupons for payment. This form shall be signed 
by the owner of the interest, trustee, or agent and shall show the name 
and address of the obligor, the name and address of the owner of the 
interest, and the amount of the interest. It shall contain a statement 
(i) that the owner is neither a citizen nor a resident of the United 
States but is a resident of the Federal Republic of Germany, or, in the 
case of a company, the owner is a German company (other than a United 
States corporation), and (ii) that the owner has no permanent 
establishment in the United States.
    (2) The exemption from United States tax contemplated by Article VII 
of the convention, insofar as it concerns coupon bond interest, is 
applicable only to the owner of the interest. The person presenting the 
coupon or on whose behalf it is presented shall, for the purpose of the 
exemption from tax, be deemed to be the owner of the interest only if he 
is, at the time the coupon is presented for payment, the owner of the 
bond from which the coupon has been detached. If the person presenting 
the coupon or on whose behalf it is presented is not the owner of the 
bond, Form 1001, and not Form 1001-GER, shall be executed.
    (3) The original and duplicate of Form 1001-GER shall be forwarded 
by the withholding agent to the District Director of Internal Revenue, 
Audit Division, Alien Returns Section, Baltimore 2, Maryland, with the 
quarterly return on Form 1012. Form 1001-GER need not be listed on Form 
1012.
    (4) To avoid withholding of United States tax at source in the case 
of interest, other than coupon bond interest, to which paragraph (a)(2) 
of this section is applicable, the resident of the Federal Republic of 
Germany or the German company shall notify the withholding agent by 
letter in duplicate that such income is exempt from United States tax 
under the provisions of Article VII of the convention. The letter of 
notification shall be signed by the owner of the interest, trustee, or 
agent and shall show the name and address of the obligor and the name 
and address of the owner of the interest. It shall contain a statement 
(i) that the owner is neither a citizen nor a resident of the United 
States but is a resident of the Federal Republic of Germany, or, in the 
case of a company, the owner is a German company (other than a United 
States corporation), and (ii) that the owner has at no time during the 
current taxable year had a permanent establishment in the United States.
    (5) This letter of notification, which shall constitute 
authorization for the payment of such interest without withholding of 
United States tax at source, shall be filed with the withholding agent 
for each successive 3-calendar-year period during which such income is 
paid. For this purpose, the first such period shall commence with the 
beginning of the calendar year in which such income is first paid on or 
after January 1, 1954. Each such letter filed with any withholding agent 
shall be filed not later than 20 days preceding the date of the first 
payment within each successive period, or, if that is not possible 
because of special circumstances, as soon as possible after such first 
payment.
    (6) If such letter is also to be used as authorization for the 
release, pursuant to Sec. 503.6(a)(3), of excess tax withheld from 
interest, other than coupon bond interest, it shall also contain a 
statement (i) that, at the time when the interest was derived from which 
the excess tax was withheld, the owner was neither a citizen nor a 
resident of the United States but was a resident of the Federal Republic 
of Germany, or, in the case of a company, the owner was a German company 
(other than a United States corporation), and (ii) that the owner at no 
time during the taxable year in which such interest was

[[Page 21]]

derived had a permanent establishment in the United States.
    (7) Once a letter has been filed in respect of any 3-calendar-year 
period, no additional letter need be filed in respect thereto unless the 
Commissioner of Internal Revenue notifies the withholding agent that an 
additional letter shall be filed by the taxpayer. If, after filing a 
letter of notification, the taxpayer ceases to be eligible for the 
exemption from United States tax granted by the convention in respect to 
such interest, such taxpayer shall promptly notify the withholding agent 
by letter in duplicate. When any change occurs in the ownership of the 
interest as recorded on the books of the payer, the exemption from 
withholding of United States tax shall no longer apply unless the new 
owner of record is entitled to and does properly file a letter of 
notification with the withholding agent.
    (8) Each letter of notification, or the duplicate thereof, shall be 
immediately forwarded by the withholding agent to the District Director 
of Internal Revenue, Audit Division, Alien Returns Section, Baltimore 2, 
Maryland.



Sec. 503.4  Patent and copyright royalties and film rentals.

    (a) General. (1) Royalties and other amounts derived in taxable 
years beginning on or after January 1, 1954, by a natural person (other 
than a citizen or resident of the United States) resident in the Federal 
Republic of Germany, or by a German company (other than a United States 
corporation), as bona fide consideration for the right to use 
copyrights, artistic and scientific works, patents, designs, plans, 
secret processes and formulae, trade-marks, and other like property and 
rights, are exempt from United States tax under the provisions of 
Article VIII of the convention if such person or company at no time 
during the taxable year in which such income is derived has a permanent 
establishment in the United States. Such items of income, are, 
therefore, not subject to the withholding of United States tax at 
source.
    (2) The provisions of this section shall apply to rentals and like 
payments in respect to motion picture films or for the use of 
industrial, commercial, or scientific equipment.
    (b) Application of exemption from withholding. (1) To avoid 
withholding of United States tax at source in the case of the income to 
which this section is applicable, the resident of the Federal Republic 
of Germany or the German company shall notify the withholding agent by 
letter in duplicate that such income is exempt from United States tax 
under the provisions of Article VIII of the convention. The provisions 
of Sec. 503.3(b) relating to the execution, filing, and effective period 
of the letter of notification prescribed therein with respect to 
interest, including its use for the release of excess tax withheld, are 
equally applicable with respect to the income falling within the scope 
of this section.
    (2) Each letter of notification, or the duplicate thereof, shall be 
immediately forwarded by the withholding agent to the District Director 
of Internal Revenue, Audit Division, Alien Returns Section, Baltimore 2, 
Maryland.



Sec. 503.5  Private pensions and private life annuities.

    (a) General. Private pensions and private life annuities, as defined 
in Article XI (3) and (4) of the convention, which are received from 
sources within the United States in taxable years beginning on or after 
January 1, 1954, by a nonresident alien individual who is a resident of 
the Federal Republic of Germany are exempt from United States tax under 
the provisions of Article XI(2) of the convention. Such items of income 
are, therefore, not subject to the withholding of United States tax at 
source.
    (b) Application of exemption from withholding. (1) To avoid 
withholding of United States tax at source in the case of the items of 
income to which paragraph (a) of this section is applicable, the 
nonresident alien individual who is a resident of the Federal Republic 
of Germany shall notify the withholding agent by letter in duplicate 
that such income is exempt from United States tax under the provisions 
of Article XI of the convention. The letter of notification shall be 
signed by the owner of the income, shall show the name and address of 
both the payer and the owner of the income, and shall contain

[[Page 22]]

a statement that the owner, an individual, is neither a citizen nor a 
resident of the United States but is a resident of the Federal Republic 
of Germany.
    (2) If such letter is also to be used as authorization for the 
release, pursuant to Sec. 503.6(a)(3), of excess tax withheld from such 
items of income, it shall also contain a statement that the owner was, 
at the time when the income was received from which the excess tax was 
withheld, neither a citizen nor a resident of the United States but was 
a resident of the Federal Republic of Germany.
    (3) This letter shall constitute authorization for the payment of 
such items of income without withholding of United States tax at source 
unless the Commissioner of Internal Revenue subsequently notifies the 
withholding agent that the tax shall be withheld with respect to 
payments of such items of income made after receipt of such notice. If, 
after filing a letter of notification, the owner of the income ceases to 
be eligible for the exemption from United States tax granted by the 
convention in respect to such income, he shall promptly notify the 
withholding agent by letter in duplicate. When any change occurs in the 
ownership of such income as recorded on the books of the payer, the 
exemption from withholding of United States tax shall no longer apply 
unless the new owner of record is entitled to and does properly file a 
letter of notification with the withholding agent.
    (4) Each letter of notification, or the duplicate thereof, shall be 
immediately forwarded by the withholding agent to the District Director 
of Internal Revenue, Audit Division, Alien Returns Section, Baltimore 2, 
Maryland.



Sec. 503.6  Release of excess tax withheld at source.

    (a) General. (1) In order to give the convention effective 
application at the earliest practicable date, the exemptions from, and 
reduction in the rate of, withholding of United States tax at source 
granted by this Treasury decision are hereby made effective beginning 
January 1, 1954, contingent upon compliance with the applicable 
provisions of Secs. 503.2 through 503.5.
    (2) In the case of dividends and interest paid by a German company 
(other than a United States corporation) to a nonresident alien or to a 
foreign corporation, if United States tax at the statutory rate has been 
withheld on or after January 1, 1954, there shall be released by the 
withholding agent and paid over to the person from whom it was withheld, 
an amount equal to the tax so withheld from such items.
    (3) In the case of every taxpayer whose address at the time of 
payment was in the Federal Republic of Germany and who furnishes to the 
withholding agent the letter of notification prescribed in 
Secs. 503.2(b), 503.3(b), 503.4(b), and 503.5(b) as authorization for 
the release of excess tax withheld, if United States tax at the 
statutory rate has been withheld on or after January 1, 1954, from the 
items of income in respect of which such letter is prescribed in such 
sections, there shall be released (except as provided in paragraph (b) 
of this section) by the withholding agent and paid over to the person 
from whom it was withheld:
    (i) In the case of dividends, the difference between the tax so 
withheld and the tax required to be withheld pursuant to Sec. 503.2(b); 
and
    (ii) In the case of interest (other than coupon bond interest), 
copyright royalties and other items to which Sec. 503.4 is applicable, 
and private pensions and private life annuities as defined in Article XI 
of the convention, an amount equal to the tax so withheld from such 
items.
    (4) In the case of every taxpayer whose address at the time of 
payment was in the Federal Republic of Germany and who furnishes to the 
withholding agent Form 1001-GER clearly marked ``Substitute'' and 
executed in accordance with Sec. 503.3(b), if United States tax at the 
statutory rate has been withheld from coupon bond interest on or after 
January 1, 1954, there shall be released by the withholding agent and 
paid over to the person from whom it was withheld an amount equal to the 
tax so withheld from such interest. One such substitute form shall be 
filed in duplicate with respect to each issue of bonds and will serve 
with respect to that issue to replace all Forms 1001 previously filed by 
the taxpayer in

[[Page 23]]

the calendar year in which the excess tax was withheld and with respect 
to which such excess is released.
    (5) The original and duplicate of substitute Form 1001-GER shall be 
forwarded by the withholding agent to the District Director of Internal 
Revenue, Audit Division, Alien Returns Section, Baltimore 2, Maryland, 
with the quarterly return on Form 1012. Substitute Form 1001-GER need 
not be listed on Form 1012.
    (b) Interest paid where degree of stock ownership is determined. If 
United States tax at the statutory rate has been withheld on or after 
January 1, 1954, from dividends described in Sec. 503.2(a)(2) and paid 
to a German company (other than a United States corporation), and if the 
relationship existing between the German company and the paying 
corporation was, at the time the dividends were paid, such as to render 
uncertain whether, by reason of the requirement contained in Article VI 
of the convention as to stock ownership, such dividends qualified for 
the reduced rate of United States tax, the withholding agent shall 
release and pay over to the German company the difference between the 
tax so withheld and the tax required to be withheld pursuant to 
Sec. 503.2(b), only if the German company (1) furnishes to the 
withholding agent a copy of the Commissioner's authorization of release 
prescribed in Sec. 503.2(c)(5), and (2) files the letter of notification 
prescribed in Sec. 503.2(b)(1).



Sec. 503.7  Information to be furnished in ordinary course.

    (a) General. In compliance with the provisions of Article XVI of the 
convention the Commissioner of Internal Revenue will transmit to the 
Federal Ministry of Finance, as soon as practicable after the close of 
the calendar year 1955 and of each subsequent calendar year during which 
the convention is in effect, the following information relating to such 
preceding calendar year:
    (1) The duplicate copy of each available Form 1042 Supplement filed 
pursuant to paragraph (b) of this section; and
    (2) The duplicate copy of each available ownership certificate, Form 
1001-GER, filed pursuant to Sec. 503.3(b), and substitute Form 1001-GER, 
filed pursuant to Sec. 503.6(a), in connection with coupon bond 
interest.
    (b) Information return. (1) To facilitate compliance with Article 
XVI of the convention, every United States withholding agent shall make 
and file in duplicate with the District Director of Internal Revenue, 
Baltimore 2, Maryland, an information return on Form 1042 Supplement, 
with respect to persons having addresses in the Federal Republic of 
Germany, which shall be filed for the calendar year 1955 and subsequent 
calendar years. This return shall be filed simultaneously with Form 
1042.
    (2) There shall be reported on such Form 1042 Supplement all items 
of fixed or determinable annual or periodical income (and amounts 
described in section 402(a)(2), section 631 (b) and (c), and section 
1235 of the Internal Revenue Code of 1954, which are considered to be 
gains from the sale or exchange of capital assets) derived from sources 
within the United States and paid to nonresident aliens and to 
nonresident foreign corporations, whose addresses at the time of payment 
were in the Federal Republic of Germany, including such items of income 
upon which, in accordance with this part, no withholding of United 
States tax is required; except that any of such items which constitute 
interest in respect of which Form 1001-GER or substitute Form 1001-GER 
has been filed in duplicate with the withholding agent are not required 
to be reported on such Form 1042 Supplement.



Sec. 503.8  Beneficiaries of a domestic estate or trust.

    A nonresident alien who is a resident of the Federal Republic of 
Germany and who is a beneficiary of a domestic estate or trust shall be 
entitled to the exemption from United States tax granted by Articles 
VII, VIII, and XIV of the convention with respect to dividends, 
interest, and copyright royalties and the like, to the extent such item 
or items are included in that portion of the income of such estate or 
trust which is (or would, but for such exemption, be) includable in the 
gross income of the beneficiary, provided that he

[[Page 24]]

otherwise satisfies the requirements of these respective articles. In 
order to be entitled in such instance to the exemption from withholding 
of United States tax such beneficiary must otherwise satisfy such 
requirements and shall, where applicable, execute and submit to the 
fiduciary of such estate or trust in the United States the appropriate 
letter of notification prescribed in Secs. 503.3(b) and 503.4(b).



Sec. 503.9  Land Berlin.

    The convention shall also apply to Land Berlin effective for taxable 
years beginning on or after January 1, 1954, but only if the 
notification has been furnished to the United States Government in 
accordance with Article XX (2) of the convention. After application of 
the convention to Land Berlin in accordance with Article XX, references 
in the convention and in this part to the Federal Republic of Germany 
shall also be considered references to Land Berlin.



PARTS 504-507  [RESERVED]






PART 509--SWITZERLAND--Table of Contents




                       Subpart--Withholding of Tax

Sec.
509.1  Introductory.
509.2  Dividends.
509.3  Interest.
509.4  Patent and copyright royalties and film rentals.
509.5  Pensions and life annuities.
509.6  Natural resource royalties and real property rentals.
509.7  Release of excess tax withheld at source.
509.8  Addressee not actual owner.
509.9  Return of tax withheld and information return with respect to 
          persons whose addresses are in Switzerland.
509.10  Beneficiaries of a domestic estate or trust.

                       Subpart--General Income Tax

509.101  Introductory.
509.102  Applicable provisions of law.
509.103  Scope of the convention.
509.104  Definitions.
509.105  Industrial and commercial profits.
509.106  Control of a United States enterprise by a Swiss enterprise.
509.107  Income from operation of ships or aircraft.
509.108  Dividends.
509.109  Interest.
509.110  Patent and copyright royalties and film rentals.
509.111  Real property income and natural resource royalties.
509.112  Compensation for labor or personal services.
509.113  Government wages, salaries, and pensions.
509.114  Private pensions and life annuities.
509.115  Visiting professors or teachers.
509.116  Students or apprentices.
509.117  Dividends and interest paid by a foreign corporation.
509.118  Credit against United States tax for Swiss tax.
509.119  Exchange of information.
509.120  Double taxation claims.
509.121  Beneficiaries of an estate or trust.
509.122  Swiss partnerships.

    Authority:  26 U.S.C. 62, 3791 and 7805.



                       Subpart--Withholding of Tax

    Source: Treasury Decision 5867, 16 FR 11910, Nov. 27, 1951, unless 
otherwise noted. Redesignated at 25 FR 14022, Dec. 31, 1960.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, 
Subpart--Withholding of Tax, consisting of Secs. 509.1 through 509.10, 
was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 31, 
1998, the effective date was delayed until Jan. 1, 2000.



Sec. 509.1  Introductory.

    The income tax convention between the United States and the Swiss 
Confederation, signed May 24, 1951, proclaimed by the President of the 
United States on October 1, 1951, and effective as to taxable years 
beginning after December 31, 1950 (referred to in this subpart as the 
convention), provides in part as follows:

                                Article I

    (1) The taxes referred to in this Convention are:
    (a) In the case of the United States of America:
    The Federal income taxes, including surtaxes and excess profits 
taxes.
    (b) In the case of The Swiss Confederation:
    The federal, cantonal and communal taxes on income (total income, 
earned income, income from property, industrial and commercial profits, 
etc.).
    (2) The present Convention shall also apply to any other income or 
profits tax of a substantially similar character imposed by either 
contracting State subsequently to the date of signature of the present 
Convention.

[[Page 25]]

                               Article II

    (1) As used in this Convention:
    (a) The term ``United States'' means the United States of America, 
and when used in a geographical sense means the States, the Territories 
of Alaska and Hawaii, and the District of Columbia.
    (b) The term ``Switzerland'' means The Swiss Confederation.
    (c) The term ``permanent establishment'' means a branch, office, 
factory, workshop, warehouse or other fixed place of business, but does 
not include the casual and temporary use of merely storage facilities, 
nor does it include an agency unless the agent has and habitually 
exercises a general authority to negotiate and conclude contracts on 
behalf of an enterprise or has a stock of merchandise from which he 
regularly fills orders on its behalf. An enterprise of one of the 
contracting States shall not be deemed to have a permanent establishment 
in the other State merely because it carries on business dealings in 
such other State through a commission agent, broker or custodian or 
other independent agent acting in the ordinary course of his business as 
such. The fact that an enterprise of one of the contracting States 
maintains in the other State a fixed place of business exclusively for 
the purchase of goods or merchandise shall not of itself constitute such 
fixed place of business a permanent establishment of such enterprise. 
The fact that a corporation of one contracting State has a subsidiary 
corporation which is a corporation of the other State or which is 
engaged in trade or business in the other State shall not of itself 
constitute that subsidiary corporation a permanent establishment of its 
parent corporation. The maintenance within the territory of one of the 
contracting States by an enterprise of the other contracting State of a 
warehouse for convenience of delivery and not for purposes of display 
shall not of itself constitute a permanent establishment within that 
territory even though offers of purchase have been obtained by an agent 
of the enterprise in that territory and transmitted by him to the 
enterprise for acceptance.
    (d) The term ``enterprise of one of the contracting States'' means, 
as the case may be, ``United States enterprise'' or ``Swiss 
enterprise''.
    (e) The term ``United States enterprise'' means an industrial or 
commercial enterprise or undertaking carried on in the United States by 
a resident (including an individual, fiduciary and partnership) of the 
United States or by a United States corporation or other entity; the 
term ``United States corporation or other entity'' means a corporation 
or other entity created or organized under the law of the United States 
or of any State or Territory of the United States.
    (f) The term ``Swiss enterprise'' means an industrial or commercial 
enterprise or undertaking carried on in Switzerland by an individual 
resident in Switzerland or by a Swiss corporation or other entity; the 
term ``Swiss corporation or other entity'' means a corporation or 
institution or foundation having juridical personality, or a partnership 
(association ``en nom collectif'' or ``en commandite''), or other 
association without juridical personality, created or organized under 
Swiss laws.
    (g) The term ``competent authorities'' means, in the case of the 
United States, the Commissioner of Internal Revenue as authorized by the 
Secretary of the Treasury; and in the case of Switzerland, the Director 
of the Federal Tax Administration as authorized by the Federal 
Department of Finances and Customs.
    (h) The term ``industrial or commercial profits'' includes 
manufacturing, mercantile, mining, financial and insurance profits, but 
does not include income in the form of dividends, interest, rents or 
royalties, or remuneration for personal services: Provided, however, 
that such excepted items of income shall, subject to the provisions of 
this Convention, be taxed separately or together with industrial or 
commercial profits in accordance with the laws of the contracting 
States.
    (2) In the application of the provisions of the present Convention 
by one of the contracting States any term not otherwise defined shall, 
unless the context otherwise requires, have the meaning which such term 
has under its own tax laws.

                                * * * * *

                               Article VI

    (1) The rate of tax imposed by one of the contracting States upon 
dividends derived from sources within such State by a resident or 
corporation or other entity of the other contracting State not having a 
permanent establishment in the former State shall not exceed 15 percent: 
Provided, however, that this paragraph shall have no application to 
Swiss tax in the case of dividends derived from Switzerland by a Swiss 
citizen (who is not also a citizen of the United States) resident in the 
United States.
    (2) It is agreed, however, that such rate of tax shall not exceed 
five percent if the shareholder is a corporation controlling, directly 
or indirectly, at least 95 percent of the entire voting power in the 
corporation paying the dividend, and if not more than 25 percent of the 
gross income of such paying corporation is derived from interest and 
dividends, other than interest and dividends received from its own 
subsidiary corporations. Such reduction of the rate to five percent 
shall not apply if the relationship of the two corporations has been 
arranged or is maintained primarily

[[Page 26]]

with the intention of securing such reduced rate.
    (3) Switzerland may collect its tax without regard to paragraphs (1) 
and (2) of this Article but will make refund of the tax so collected in 
excess of the tax computed at the reduced rates provided in such 
paragraphs.

                               Article VII

    (1) The rate of tax imposed by one of the contracting States on 
interest on bonds, securities, notes, debentures or on any other form of 
indebtedness (including mortgages or bonds secured by real property) 
derived from sources within such contracting State by a resident or 
corporation or other entity of the other contracting State not having a 
permanent establishment in the former State shall not exceed five 
percent: Provided, however, that this paragraph shall have no 
application to Swiss tax in the case of interest derived from 
Switzerland by a Swiss citizen (who is not also a citizen of the United 
States) resident in the United States.
    (2) Switzerland may collect its tax without regard to paragraph (1) 
of this Article but will make refund of the tax so collected in excess 
of the tax computed at the reduced rate provided in such paragraph.

                              Article VIII

    Royalties and other amounts derived, as consideration for the right 
to use copyrights, artistic and scientific works, patents, designs, 
plans, secret processes and formulae, trademarks, and other like 
property and rights (including rentals and like payments in respect to 
motion picture films or for the use of industrial, commercial or 
scientific equipment), from sources within one of the contracting States 
by a resident or corporation or other entity of the other contracting 
State not having a permanent establishment in the former State shall be 
exempt from taxation in such former State.

                               Article IX

    (1) Income from real property (including gains derived from the sale 
or exchange of such property but not including interest from mortgages 
or bonds secured by real property) and royalties in respect of the 
operation of mines, quarries, or other natural resources, shall be 
taxable only in the contracting State in which such property, mines, 
quarries, or other natural resources are situated.
    (2) A resident or corporation or other entity of one of the 
contracting States deriving any such income from such property within 
the other contracting State may, for any taxable year, elect to be 
subject to the tax of such other contracting State, on a net basis, as 
if such resident or corporation or entity were engaged in trade or 
business within such other contracting States through a permanent 
establishment therein during such taxable year.

                                * * * * *

                               Article XI

    (2) Private pensions and life annuities derived from within one of 
the contracting States and paid to individuals residing in the other 
contracting State shall be exempt from taxation in the former State.
    (3) The term ``pensions'', as used in this Article, means periodic 
payments made in consideration for services rendered or by way of 
compensation for injuries received.
    (4) The term ``life annuities'' as used in this Article, means a 
stated sum payable periodically at stated times during life, or during a 
specified number of years, under an obligation to make the payments in 
return for adequate and full consideration in money or money's worth.

                                * * * * *

                               Article XIV

    (1) Dividends and interest paid by a corporation other than a United 
States domestic corporation shall be exempt from United States tax where 
the recipient is a nonresident alien as to the United States resident in 
Switzerland or a Swiss corporation, not having a permanent establishment 
in the United States.
    (2) Dividends and interest paid by a corporation other than a Swiss 
corporation shall be exempt from Swiss tax where the recipient is a 
resident or corporation of the United States, not having a permanent 
establishment in Switzerland.

                                * * * * *

                               Article XVI

    (1) The competent authorities of the contracting States shall 
exchange such information (being information available under the 
respective taxation laws of the contracting States) as is necessary for 
carrying out the provisions of the present Convention or for the 
prevention of fraud or the like in relation to the taxes which are the 
subject of the present Convention. Any information so exchanged shall be 
treated as secret and shall not be disclosed to any person other than 
those concerned with the assessment and collection of the taxes which 
are the subject of the present Convention. No information shall be 
exchanged which would disclose any trade, business, industrial or 
professional secret or any trade process.
    (2) Each of the contracting States may collect such taxes imposed by 
the other contracting State as though such taxes were the taxes of the 
former State as will ensure that

[[Page 27]]

the exemption or reduced rate of tax granted under Articles VI, VII, 
VIII and XI(2) of the present Convention by such other State shall not 
be enjoyed by persons not entitled to such benefits.
    (3) In no case shall the provisions of this Article be construed so 
as to impose upon either of the contracting States the obligation to 
carry out administrative measures at variance with the regulations and 
practice of either contracting State or which would be contrary to its 
sovereignty, security or public policy or to supply particulars which 
are not procurable under its own legislation or that of the State making 
application.

                                * * * * *

                               Article XIX

    (1) The competent authorities of the two contracting States may 
prescribe regulations necessary to carry into effect the present 
Convention within the respective States.
    (2) The competent authorities of the two contracting States may 
communicate with each other directly for the purpose of giving effect to 
the provisions of this Convention.

                               Article XX

    (1) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Berne as soon as possible. It shall 
have effect for the taxable years beginning on or after the first day of 
January of the year in which such exchange takes place: Provided, 
however, that if such exchange takes place on or after October 1 of such 
year, Article VI (except paragraph (2) thereof) and Article VII of the 
Convention shall have effect only for taxable years beginning on or 
after the first day of January of the year immediately following the 
year in which such exchange takes place.
    (2) The present Convention shall continue effective for a period of 
five years beginning with the calendar year in which the exchange of the 
instruments of ratification takes place and indefinitely after that 
period, but may be terminated by either of the contracting States at the 
end of the five-year period or at any time thereafter, provided that at 
least six months' prior notice of termination has been given and, in 
such event, the present Convention shall cease to be effective for the 
taxable years beginning on or after the first day of January next 
following the expiration of the six-month period.

                                * * * * *

    As used in this Treasury decision, unless the context otherwise 
requires, the terms defined in the above articles of the convention 
shall have the meanings so assigned them.



Sec. 509.2  Dividends.

    (a) General. Under Article VI of the convention, the rate of tax 
imposed with respect to dividends by section 211(a) of the Internal 
Revenue Code (relating to nonresident alien individuals not engaged in 
trade or business within the United States) and by section 231(a) of the 
Internal Revenue Code (relating to foreign corporations not engaged in 
trade or business within the United States) is reduced to 15 percent in 
the case of dividends received in taxable years beginning on or after 
January 1, 1951, from sources within the United States by a nonresident 
alien (including a nonresident alien individual, fiduciary, and 
partnership) who is a resident of Switzerland or by a Swiss corporation 
if such alien or corporation at no time during the taxable year had a 
permanent establishment within the United States. As to what is a Swiss 
corporation (see Article II(1)(f) of the convention. Thus, if a 
nonresident alien who is a resident of Switzerland performs personal 
services within the United States during the calendar year 1952, but has 
at no time during such year a permanent establishment within the United 
States, he is entitled to the reduced rate of tax with respect to 
dividends derived in that year from United States sources, as provided 
in Article VI of the convention, even though, by reason of his having 
rendered personal services within the United States, he is engaged in 
trade or business therein in that year within the meaning of section 
211(b) of the Internal Revenue Code. As to what constitutes a permanent 
establishment, see Article II(1)(c) of the convention.
    In the case of dividends paid on or after January 1, 1951, by any 
foreign corporation to a nonresident alien who is a resident of 
Switzerland or to a Swiss corporation, not having a permanent 
establishment in the United States, no withholding of United States tax 
is required. See Article XIV of the convention.
    (b) Dividends paid by a United States subsidiary corporation. Under 
the provisions of Article VI(2) of the convention, dividends from 
sources within the

[[Page 28]]

United States paid by a domestic corporation to a Swiss corporation 
controlling, directly or indirectly, at the time the dividend is paid, 
95 percent or more of the entire voting power in such domestic 
corporation are, when received in taxable years beginning on or after 
January 1, 1951, subject to tax at the rate of only 5 percent, if (1) 
not more than 25 percent of the gross income of such paying corporation 
for the three-year period immediately preceding the taxable year in 
which the dividend is paid consists of dividends and interest (other 
than dividends and interest paid to such domestic corporation by its own 
subsidiary corporations, if any), (2) the relationship between such 
domestic corporation and such Swiss corporation has not been arranged or 
maintained primarily with the intention of securing such reduced rate of 
5 percent, and (3) such Swiss corporation at no time during the taxable 
year had a permanent establishment within the United States.
    Any domestic corporation which claims or contemplates claiming that 
dividends paid or to be paid by it on or after January 1, 1951, are 
subject only to the 5 percent rate shall file, as soon as practicable, 
with the Commissioner of Internal Revenue, the following information: 
(1) The date and place of its organization; (2) the number of 
outstanding shares of stock of the domestic corporation having voting 
power and the voting power thereof; (3) the person or persons 
beneficially owning such stock of the domestic corporation and their 
relationship to the Swiss corporation; (4) the amount of gross income, 
by years, of the paying corporation for the three-year period 
immediately preceding the taxable year in which the dividend is paid; 
(5) the amount of interest and dividends, by years, included in the 
gross income of such domestic corporation and the amount of interest and 
dividends, by years, received by such corporation from its subsidiary 
corporations, if any; and (6) the relationship between the domestic 
corporation and the Swiss corporation to which it pays the dividends.
    As soon as practicable after such information is filed, the 
Commissioner of Internal Revenue will determine whether the dividends 
concerned fall within the provisions of Article VI(2) of the convention 
and may authorize the release of excess tax withheld with respect to 
dividends which come within such provisions. In any case in which the 
Commissioner of Internal Revenue has notified such domestic corporation 
that the dividends come within such provisions, the reduced withholding 
rate of 5 percent will apply to any dividends subsequently paid by such 
corporation to the Swiss corporation unless the stock ownership of the 
domestic corporation, or the character of its income, materially 
changes, or unless the Commissioner of Internal Revenue determines that 
the relationship between the two corporations is being maintained 
primarily with the intention of securing such reduced rate; and, if such 
change in stock ownership or character of income occurs, such 
corporation shall promptly notify the Commissioner of Internal Revenue 
of the then existing facts with respect to such stock ownership or 
income.
    (c) Effect of address in Switzerland on withholding in case of 
dividends. For the purpose of withholding of the tax in the case of 
dividends, every nonresident alien (including a nonresident alien 
individual, fiduciary, and partnership) whose address is in Switzerland 
shall be deemed by United States withholding agents to be a resident of 
Switzerland not having a permanent establishment in the United States; 
and every corporation whose address is in Switzerland shall be deemed by 
such withholding agents to be a Swiss corporation not having a permanent 
establishment in the United States.
    (d) Rate of withholding. On and after January 1, 1951, withholding 
in the case of dividends paid to nonresident aliens (including a 
nonresident alien individual, fiduciary, and partnership) and to foreign 
corporations, whose addresses are in Switzerland, shall be at the rate 
of 15 percent in every case except (1) that in which, prior to the date 
of payment of such dividends, the Commissioner of Internal Revenue has 
notified the paying corporation that such dividends fall within the 
provisions of Article VI (2) of the convention and (2) that in which the 
Commissioner of Internal Revenue has, prior to the date of

[[Page 29]]

payment of such dividends, notified the withholding agent that the 
reduced rate of tax shall not apply.
    The preceding provisions relative to residents of Switzerland and to 
Swiss corporations are based upon the assumption that the payee of the 
dividend is the actual owner of the capital stock from which the 
dividend is derived and consequently is the person liable to the tax 
upon such dividend. As to action by the recipient who is not the owner 
of the dividend, see Sec. 509.8.



Sec. 509.3  Interest.

    (a) General. Interest on bonds, securities, notes, debentures, or 
any other form of indebtedness (including interest on obligations of the 
United States, obligations of instrumentalities of the United States, 
and mortgages and bonds secured by real property) received in taxable 
years beginning on or after January 1, 1951, from sources within the 
United States by a nonresident alien (including a nonresident alien 
individual, fiduciary, and partnership) who is a resident of 
Switzerland, or by a Swiss corporation, is subject to United States tax 
at the reduced rate of 5 percent under the provisions of Article VII of 
the convention if such alien or corporation at no time during the 
taxable year had a permanent establishment in the United States.
    (b) Application of reduced rate at source. To secure the reduced 
rate of tax at the source in the case of coupon bond interest, the 
nonresident alien resident in Switzerland or the Swiss corporation shall 
submit Form 1001-S, in duplicate, to the paying agent with each 
presentation of interest coupons. Such form shall be signed by the owner 
of the interest, trustee, or agent and shall show the name and address 
of the obligor, the name and address of the owner of such interest, and 
the amount of such interest. Such form shall contain a statement that 
the owner is a resident of Switzerland or a Swiss corporation and that 
such owner has no permanent establishment in the United States.
    The reduction in the rate of United States tax contemplated by 
Article VII of the convention, insofar as it concerns coupon bond 
interest, is applicable only to the owner of such interest. The person 
presenting such coupon or on whose behalf it is presented shall, for the 
purpose of the reduction, be deemed to be the owner of the interest only 
if he is, at the time the coupon is presented for payment, the owner of 
the bond from which the coupon has been detached. If the person 
presenting the coupon is not the owner of the bond, Form 1001, and not 
Form 1001-S, shall be executed.
    The original and duplicate ownership certificates, Form 1001-S, must 
be forwarded to the Commissioner of Internal Revenue by the withholding 
agent with the quarterly return, Form 1012, as provided in existing 
regulations with respect to Form 1001. See Sec. 29.143-7 of Regulations 
111 (26 CFR 1949 ed. Supps. 29.143-7) [and Sec. 39.143-7 of Regulations 
118 (26 CFR, Rev. 1953, Parts 1-79, and Supps.)]. Form 1001-S need not 
be listed on Form 1012.
    In the case of interest coupons presented in Switzerland by a 
nonresident alien who is not a resident of Switzerland, or by a foreign 
corporation other than a Swiss corporation, ownership certificates, Form 
1001, shall be filed as provided in existing regulations without 
reference to the provisions of the convention. See Sec. 29.143-4 of 
Regulations 111 (26 CFR 1949 ed. Supps. 29.143-4) [and Sec. 39.143-4 of 
Regulations 118 (26 CFR, Rev. 1953, Parts 1-79, and Supps.)].
    To secure the reduced rate of tax at the source in the case of 
interest, other than interest payable by means of coupons, the 
nonresident alien who is a resident of Switzerland or the Swiss 
corporation shall file Form 1001A-S, in duplicate, with the withholding 
agent in the United States. Such form shall be signed by the owner of 
the interest, trustee, or agent and shall show the name and address of 
the obligor and the name and address of the owner of such interest. Such 
form shall contain a statement that the owner is a resident of 
Switzerland, or is a Swiss corporation, not having a permanent 
establishment in the United States.
    Form 1001A-S must be filed for each three-calendar-year period, and 
the first such form filed by the taxpayer with any withholding agent 
shall be filed not later than 20 days preceding

[[Page 30]]

the date of the first payment of income in such period. If the taxpayer 
files such form with the withholding agent in the calendar year 1951, or 
in any subsequent calendar year, no additional Form 1001A-S need be 
filed prior to the end of the two calendar years immediately following 
the calendar year in which such form is so filed unless the Commissioner 
of Internal Revenue notifies the withholding agent that an additional 
Form 1001A-S must be filed by the taxpayer at any earlier date. If, 
after filing such form, the taxpayer ceases to be eligible for the 
benefit of the convention, he must promptly notify the withholding 
agent. When any change occurs in the ownership of record of the income 
on the books of the payor, the reduction in the rate of United States 
tax will no longer apply unless Form 1001A-S is duly executed and filed 
with the payor by the new owner of record of such income.
    The duplicate of Form 1001A-S must be immediately forwarded by the 
withholding agent to the Commissioner of Internal Revenue, Records 
Division, Washington 25, D.C.
    In the case of interest paid on or after January 1, 1951, by any 
foreign corporation to a nonresident alien who is a resident of 
Switzerland or to a Swiss corporation, not having a permanent 
establishment in the United States, no withholding of United States tax 
is required. See Article XIV of the convention.



Sec. 509.4  Patent and copyright royalties and film rentals.

    Royalties and other amounts received in taxable years beginning on 
or after January 1, 1951, from sources within the United States by a 
nonresident alien (including a nonresident alien individual, fiduciary, 
and partnership) who is a resident of Switzerland or by a Swiss 
corporation, as consideration for the right to use copyrights, artistic 
and scientific works, patents, designs, plans, secret processes and 
formulae, trade-marks, and other like property and rights (including 
rentals and like payments in respect to motion picture films or for the 
use of industrial, commercial, or scientific equipment), are exempt from 
United States tax under the provisions of Article VIII of the convention 
if such alien or corporation at no time during the taxable year in which 
such royalties or other amounts are received has had a permanent 
establishment within the United States. Such items are therefore not 
subject to the withholding provisions of the Internal Revenue Code. As 
to what constitutes a permanent establishment, see Article II(1)(c) of 
the convention.
    To obviate withholding at the source in the case of such items, the 
nonresident alien who is a resident of Switzerland or the Swiss 
corporation shall file Form 1001A-S, in duplicate, with the withholding 
agent in the United States. The provisions of Sec. 509.3(b) relating to 
the execution and effective period of such form with respect to interest 
are equally applicable with respect to the income falling within the 
scope of this section.
    The duplicate of Form 1001A-S must be immediately forwarded by the 
withholding agent to the Commissioner of Internal Revenue, Records 
Division, Washington, D.C.



Sec. 509.5  Pensions and life annuities.

    Article XI(2) of the convention provides that private pensions and 
life annuities derived in taxable years beginning on or after January 1, 
1951, from sources within the United States by a nonresident alien 
individual who is a resident of Switzerland shall be exempt from United 
States tax.
    The person paying such income shall be notified by letter from the 
resident of Switzerland that the income is exempt from taxation under 
the provisions of Article XI (2) and (3) or XI (2) and (4), as the case 
may be, of the convention. Such letter shall contain the address of the 
individual and a statement that such individual is a resident of 
Switzerland. The letter of notification, or a copy thereof, shall be 
immediately forwarded by the recipient to the Commissioner of Internal 
Revenue, Records Division, Washington, D.C. Such letter shall constitute 
authorization to the payor of the income to pay such income without 
deduction of the tax at the source unless the Commissioner subsequently 
notifies such payor that the tax should be withheld with

[[Page 31]]

respect to payments made after such notification.



Sec. 509.6  Natural resource royalties and real property rentals.

    The convention does not change the rate of tax imposed under 
existing law upon natural resource royalties and real property rentals. 
The withholding of the tax with respect to such items derived from 
sources within the United States by nonresident aliens who are residents 
of Switzerland and by Swiss corporations is not affected by the 
convention. See sections 211(a) and 231(a) of the Internal Code and 
Article IX of the convention.



Sec. 509.7  Release of excess tax withheld at source.

    (a) General. In order to bring the convention into force and effect 
at the earliest practicable date, (1) the reduced rate of tax of 15 
percent to be withheld at the source on dividends, (2) the reduced rate 
of tax of 5 percent to be withheld at the source on interest, and (3) 
the exemption from tax otherwise withheld at the source on patent 
royalties, copyright royalties, film rentals, and the like, are hereby 
made effective beginning January 1, 1951, in any case in which such 
dividends, interest, patent royalties, copyright royalties, film 
rentals, and the like, are derived from sources within the United States 
by a nonresident alien (including a nonresident alien individual, 
fiduciary, and partnership) who is a resident of Switzerland or by a 
Swiss corporation.
    In the case of every such taxpayer who furnishes to the withholding 
agent Form 1001A-S, as prescribed in Sec. 509.3(b) or Sec. 509.4, where 
tax at the rate of 30 percent has been withheld on or after January 1, 
1951, there shall be released by the withholding agent and paid over to 
the person from whom withheld (1) in the case of interest (other than 
coupon bond interest), an amount equal to 25 percent of such interest, 
and (2) in the case of patent royalties, copyright royalties, film 
rentals, and the like, an amount equal to the tax so withheld.
    In the case of every such taxpayer who furnishes to the withholding 
agent Form 1001-S, in duplicate, where tax at the rate of 28 percent or 
30 percent, as the case may be, has been withheld on or after January 1, 
1951, from coupon bond interest, there shall be released by the 
withholding agent and paid over to the person from whom it was withheld 
an amount equal to 25 percent of such interest. Form 1001-S, clearly 
marked ``Substitute'' in order to replace any Forms 1001 previously 
filed, is to be used solely for such release of excess tax withheld in 
1951. One Form 1001-S, in duplicate, may be used to replace two or more 
Forms 1001 previously filed in such year. The use of Form 1001-S with 
each presentation of interest coupons for the purpose of securing the 
reduced rate of tax is set forth in Sec. 509.3(b).
    In the case of dividends paid to a nonresident alien (including a 
nonresident alien individual, fiduciary, and partnership) whose address 
at the time of payment was in Switzerland, or to a Swiss corporation 
whose address at the time of payment was in Switzerland, where tax at 
the rate of 30 percent has been withheld on or after January 1, 1951, 
from such dividends, there shall be released by the withholding agent 
and paid over to the person from whom it was withheld an amount equal to 
15 percent of such dividends.
    (b) Private pensions and life annuities paid in 1951 or subsequent 
years. In order to bring the convention into force and effect at the 
earliest practicable date, the exemption from tax otherwise withheld at 
the source on private pensions and life annuities is hereby made 
effective beginning January 1, 1951, in any case in which such pensions 
and life annuities are derived from sources within the United States by 
a nonresident alien individual who is a resident of Switzerland.
    The person paying such income shall be notified by letter from the 
resident of Switzerland that the income is exempt from taxation under 
the provisions of Article XI (2) and (3), or XI (2) and (4), as the case 
may be, of the convention. See Sec. 509.5. Such letter shall constitute 
authorization to the payer of such income, where tax at the rate of 30 
percent has been withheld on or after January 1, 1951, to release and 
pay over to the person from whom it was withheld an amount equal to the 
tax so withheld.

[[Page 32]]

    (c) Subsidiary's dividends. With respect to a dividend paid on or 
after January 1, 1951, by a domestic corporation to a Swiss corporation 
whose address is in Switzerland, tax shall be withheld in accordance 
with the provisions of Sec. 509.2 unless prior to the date of payment of 
such dividend the Commissioner of Internal Revenue has notified the 
paying corporation that such dividend falls within the scope of Article 
VI(2) of the convention. As soon as practicable after information 
required under Sec. 509.2(b) is filed, the Commissioner of Internal 
Revenue will determine whether the dividend involved falls within the 
scope of Article VI(2) and may authorize the release of the excess tax 
withheld with respect to dividends which come within the scope of such 
provision.



Sec. 509.8  Addressee not actual owner.

    If the first recipient with an address in Switzerland of any 
dividend from sources within the United States is a nominee or 
representative through whom the dividend flows to a third person, such 
recipient in Switzerland will withhold an additional amount of United 
States tax equivalent to the difference between the United States tax 
which would have been withheld had the convention not been in effect (30 
percent as at the date of approval of this Treasury decision) and the 15 
percent withheld at the source with respect to such dividend pursuant to 
Sec. 509.2(d).
    In any case in which a fiduciary or a partnership with an address in 
Switzerland receives, otherwise than as a nominee or representative, a 
dividend from United States sources, if a beneficiary of such fiduciary 
or a partner in such partnership is not entitled to the reduced rate of 
tax provided in Article VI of the convention, the fiduciary or 
partnership will withhold an additional amount of United States tax with 
respect to the portion of such dividend included in such beneficiary's 
or partner's net distributive share of the income of such fiduciary or 
partnership, as the case may be. The amount of the additional tax is to 
be calculated in the same manner as under the preceding paragraph.
    The amounts so withheld by such withholding agents in Switzerland, 
as well as the amount of tax released with respect to the calendar year 
1951 by the withholding agent in the United States in the case of a 
dividend flowing to a third person through a nominee or representative 
whose address is in Switzerland, will be deposited by such agents in 
Swiss francs with the Federal Tax Administration, Berne, Switzerland, 
Account: ``Zusatzlicher Steuerruckbehalt USA'' (``Additional tax 
withholdings USA''); and the appropriate Swiss form will be filed 
therewith. The Federal Tax Administration has arranged that the amounts 
so deposited will, after adjustment for tax refunded to persons entitled 
to the reduced rate of 15 percent, be periodically remitted by draft in 
United States dollars to the Collector of Internal Revenue, Baltimore, 
Maryland, U.S.A.



Sec. 509.9  Return of tax withheld and information return with respect to persons whose addresses are in Switzerland.

    Every United States withholding agent shall make and file with the 
collector, in duplicate, an information return on Form 1042F, in 
addition to the withholding return, Form 1042, for the calendar year 
1951 and each subsequent calendar year, with respect to:
    (a) Dividends from which a tax of 15 percent was withheld from 
persons whose addresses are in Switzerland (5 percent in the case of 
dividends falling within the scope of the provisions of Article VI(2) of 
the Convention);
    (b) Interest (other than coupon bond interest reported on Form 1001-
S) from which a tax of 5 percent was withheld from persons who have 
furnished to the withholding agent Form 1001A-S;
    (c) Royalties and like amounts from which no tax was withheld from 
persons who have furnished to the withholding agent Form 1001A-S; and
    (d) All other fixed or determinable annual or periodical income paid 
to such persons.



Sec. 509.10  Beneficiaries of a domestic estate or trust.

    A nonresident alien who is a resident of Switzerland and who is a 
beneficiary

[[Page 33]]

of a domestic estate or trust shall be entitled to the exemption from 
tax, or reduction in the rate of tax, as the case may be, provided in 
Articles VI, VII, and VIII of the convention with respect to dividends, 
interest, and royalties to the extent such item or items are included in 
his distributive share of the income of such estate or trust. In such 
case such beneficiary must, in order to be entitled to the exemption 
from, or reduction in the rate of, tax in the case of interest or 
royalties, execute Form 1001A-S and file such form with the fiduciary of 
such estate or trust in the United States.



                       Subpart--General Income Tax

    Source: Treasury Decision 6149, 20 FR 7587, Oct. 12, 1955; 25 FR 
14022, Dec. 31, 1960, unless otherwise noted.



Sec. 509.101  Introductory.

    The income tax convention between the United States and the Swiss 
Confederation, signed May 24, 1951, and proclaimed by the President of 
the United States on October 1, 1951, subject to the understanding 
expressed in the protocol of exchange, referred to in this part as the 
convention, provides as follows, effective for taxable years beginning 
on or after January 1, 1951:

                                Article I

    (1) The taxes referred to in this Convention are:
    (a) In the case of the United States of America: The Federal income 
taxes, including surtaxes and excess profits taxes.
    (b) In the case of The Swiss Confederation: The federal, cantonal 
and communal taxes on income (total income, earned income, income from 
property, industrial and commercial profits, etc.).
    (2) The present Convention shall also apply to any other income or 
profits tax of a substantially similar character imposed by either 
contracting State subsequently to the date of signature of the present 
Convention.

                               Article II

    (1) As used in this Convention:
    (a) The term ``United States'' means the United States of America, 
and when used in a geographical sense means the States, the Territories 
of Alaska and Hawaii, and the District of Columbia.
    (b) The term ``Switzerland'' means The Swiss Confederation.
    (c) The term ``permanent establishment'' means a branch, office, 
factory, workshop, warehouse or other fixed place of business, but does 
not include the casual and temporary use of merely storage facilities, 
nor does it include an agency unless the agent has and habitually 
exercises a general authority to negotiate and conclude contracts on 
behalf of an enterprise or has a stock of merchandise from which he 
regularly fills orders on its behalf. An enterprise of one of the 
contracting States shall not be deemed to have a permanent establishment 
in the other State merely because it carries on business dealings in 
such other State through a commission agent, broker or custodian or 
other independent agent acting in the ordinary course of his business as 
such. The fact that an enterprise of one of the contracting States 
maintains in the other State a fixed place of business exclusively for 
the purchase of goods or merchandise shall not of itself constitute such 
fixed place of business a permanent establishment of such enterprise. 
The fact that a corporation of one contracting State has a subsidiary 
corporation which is a corporation of the other State or which is 
engaged in trade or business in the other State shall not of itself 
constitute that subsidiary corporation a permanent establishment of its 
parent corporation. The maintenance within the territory of one of the 
contracting States by an enterprise of the other contracting State of a 
warehouse for convenience of delivery and not for purposes of display 
shall not of itself constitute a permanent establishment within that 
territory even though offers of purchase have been obtained by an agent 
of the enterprise in that territory and transmitted by him to the 
enterprise for acceptance.
    (d) The term ``enterprise of one of the contracting States'' means, 
as the case may be, ``United States enterprise'' or ``Swiss 
enterprise''.
    (e) The term ``United States enterprise'' means an industrial or 
commercial enterprise or undertaking carried on in the United States by 
a resident (including an individual, fiduciary and partnership) of the 
United States or by a United States corporation or other entity; the 
term ``United States corporation or other entity'' means a corporation 
or other entity created or organized under the law of the United States 
or of any State or Territory of the United States.
    (f) The term ``Swiss enterprise'' means an industrial or commercial 
enterprise or undertaking carried on in Switzerland by an individual 
resident in Switzerland or by a Swiss corporation or other entity; the 
term ``Swiss corporation or other entity'' means a corporation or 
institution or foundation having juridical personality, or a partnership 
(association ``en nom collectif'' or ``en commandite''), or other 
association without

[[Page 34]]

juridical personality, created or organized under Swiss laws.
    (g) The term ``competent authorities'' means, in the case of the 
United States, the Commissioner of Internal Revenue as authorized by the 
Secretary of the Treasury; and in the case of Switzerland, the Director 
of the Federal Tax Administration as authorized by the Federal 
Department of Finances and Customs.
    (h) The term ``industrial or commercial profits'' includes 
manufacturing, mercantile, mining, financial and insurance profits, but 
does not include income in the form of dividends, interest, rents or 
royalties, or remuneration for personal services: Provided, however, 
that such excepted items of income shall, subject to the provisions of 
this Convention, be taxed separately or together with industrial or 
commercial profits in accordance with the laws of the contracting 
States.
    (2) In the application of the provisions of the present Convention 
by one of the contracting States any term not otherwise defined shall, 
unless the context otherwise requires, have the meaning which such term 
has under its own tax laws.

                               Article III

    (1)(a) A Swiss enterprise shall not be subject to taxation by the 
United States in respect of its industrial and commercial profits unless 
it is engaged in trade or business in the United States through a 
permanent establishment situated therein. If it is so engaged the United 
States may impose its tax upon the entire income of such enterprise from 
sources within the United States.
    (b) A United States enterprise shall not be subject to taxation by 
Switzerland in respect of its industrial and commercial profits except 
as to such profits allocable to its permanent establishment situated in 
Switzerland.
    (2) No account shall be taken in determining the tax in one of the 
contracting States of the mere purchase of merchandise therein by an 
enterprise of the other State.
    (3) Where an enterprise of one of the contracting States is engaged 
in trade or business in the territory of the other contracting State 
through a permanent establishment situated therein, there shall be 
attributed to such permanent establishment the industrial or commercial 
profits which it might be expected to derive if it were an independent 
enterprise engaged in the same or similar activities under the same or 
similar conditions and dealing at arm's length with the enterprise of 
which it is a permanent establishment.
    (4) In the determination of the industrial or commercial profits of 
the permanent establishment there shall be allowed as deductions all 
expenses which are reasonably applicable to the permanent establishment, 
including executive and general administrative expenses so applicable.
    (5) The competent authorities of the two contracting States may lay 
down rules by agreement for the apportionment of industrial and 
commercial profits.

                               Article IV

    Where an enterprise of one of the contracting States, by reason of 
its participation in the management or the financial structure of an 
enterprise of the other contracting State, makes with or imposes on the 
latter, in their commercial or financial relations, conditions different 
from those which would be made with an independent enterprise, any 
profits which would normally have accrued to one of the enterprises, but 
by reason of those conditions have not so accrued, may be included in 
the profits of that enterprise and taxed accordingly.

                                Article V

    Income which an enterprise of one of the contracting States derives 
from the operation of ships or aircraft registered in that State shall 
be taxable only in the State in which such ships or aircraft are 
registered.

                               Article VI

    (1) The rate of tax imposed by one of the contracting States upon 
dividends derived from sources within such State by a resident or 
corporation or other entity of the other contracting State not having a 
permanent establishment in the former State shall not exceed 15 percent: 
Provided, however, that this paragraph shall have no application to 
Swiss tax in the case of dividends derived from Switzerland by a Swiss 
citizen (who is not also a citizen of the United States) resident in the 
United States.
    (2) It is agreed, however, that such rate of tax shall not exceed 
five percent if the shareholder is a corporation controlling, directly 
or indirectly, at least 95 percent of the entire voting power in the 
corporation paying the dividend, and if not more than 25 percent of the 
gross income of such paying corporation is derived from interest and 
dividends, other than interest and dividends received from its own 
subsidiary corporations. Such reduction of the rate to five percent 
shall not apply if the relationship of the two corporations has been 
arranged or is maintained primarily with the intention of securing such 
reduced rate.
    (2) Switzerland may collect its tax without regard to paragraphs (1) 
and (2) of this Article but will make refund of the tax so collected in 
excess of the tax computed at the reduced rates provided in such 
paragraphs.

                               Article VII

    (1) The rate of tax imposed by one of the contracting States on 
interest on bonds, securities, notes, debentures or on any other form of 
indebtedness (including mortgages or

[[Page 35]]

bonds secured by real property) derived from sources within such 
contracting State by a resident or corporation or other entity of the 
other contracting State not having a permanent establishment in the 
former State shall not exceed five percent: Provided, however, that this 
paragraph shall have no application to Swiss tax in the case of interest 
derived from Switzerland by a Swiss citizen (who is not also a citizen 
of the United States) resident in the United States.
    (2) Switzerland may collect its tax without regard to paragraph (1) 
of this Article but will make refund of the tax so collected in excess 
of the tax computed at the reduced rate provided in such paragraph.

                              Article VIII

    Royalties and other amounts derived, as consideration for the right 
to use copyrights, artistic and scientific works, patents, designs, 
plans, secret processes and formulae, trademarks, and other like 
property and rights (including rentals and like payments in respect to 
motion picture films or for the use of industrial, commercial or 
scientific equipment), from sources within one of the contracting States 
by a resident or corporation or other entity of the other contracting 
State not having a permanent establishment in the former State shall be 
exempt from taxation in such former State.

                               Article IX

    (1) Income from real property (including gains derived from the sale 
or exchange of such property but not including interest from mortgages 
or bonds secured by real property) and royalties in respect of the 
operation of mines, quarries, or other natural resources, shall be 
taxable only in the contracting State in which such property, mines, 
quarries, or other natural resources are situated.
    (2) A resident or corporation or other entity of one of the 
contracting States deriving any such income from such property within 
the other contracting State may, for any taxable year, elect to be 
subject to the tax of such other contracting State, on a net basis, as 
if such resident or corporation or entity were engaged in trade or 
business within such other contracting State through a permanent 
establishment therein during such taxable year.

                                Article X

    (1) An individual resident of Switzerland shall be exempt from 
United States tax upon compensation for labor or personal services 
performed in the United States (including the practice of the liberal 
professions and rendition of services as director) if he is temporarily 
present in the United States for a period or periods not exceding a 
total of 188 days during the taxable year and either of the following 
conditions is met:
    (a) His compensation is received for such labor or personal services 
performed as an employee of, or under contract with, a resident or 
corporation or other entity of Switzerland, or
    (b) His compensation received for such labor or personal services 
does not exceed $10,000.
    (2) The provisions of paragraph (1) of this Article shall apply 
mutatis mutandis, to an individual resident of the United States with 
respect to compensation for such labor or personal services performed in 
Switzerland.
    (3) The provisions of this Article shall have no application to the 
income to which Article XI (1) relates.
    (4) The provisions of paragraph (1)(a) of this Article shall not 
apply to the compensation, profits, emoluments or other remuneration of 
public entertainers such as stage, motion picture or radio artists, 
musicians and athletes.

                               Article XI

    (1)(a) Wages, salaries and similar compensation, and pensions paid 
by the United States or by the political subdivisions or territories 
thereof to an individual (other than a Swiss citizen who is not also a 
citizen of the United States) shall be exempt from Swiss tax.
    (b) Wages, salaries and similar compensation and pensions paid by 
Switzerland or by any agency or instrumentality thereof or by any 
political subdivisions or other public authorities thereof to an 
individual (other than a United States citizen who is not also a citizen 
of Switzerland) shall be exempt from United States tax.
    (2) Private pensions and life annuities derived from within one of 
the contracting States and paid to individuals residing in the other 
contracting State shall be exempt from taxation in the former State.
    (3) The term ``pensions'', as used in this Article, means periodic 
payments made in consideration for services rendered or by way of 
compensation for injuries received.
    (4) The term ``life annuities'' as used in this Article, means a 
stated sum payable periodically at stated times during life, or during a 
specified number of years, under an obligation to make the payments in 
return for adequate and full consideration in money or money's worth.

                               Article XII

    A professor or teacher, a resident of one of the contracting States, 
who temporarily visits the other contracting State for the purpose of 
teaching for a period not exceeding two years at a university, college, 
school or other educational institution in the other contracting State, 
shall be exempted in such

[[Page 36]]

other contracting State from tax on his remuneration for such teaching 
for such period.

                              Article XIII

    A student or apprentice, a resident of one of the contracting 
States, who temporarily visits the other contracting State exclusively 
for the purposes of study or for acquiring business or technical 
experience shall not be taxable in the latter State in respect of 
remittances received by him from abroad for the purposes of his 
maintenance or studies.

                               Article XIV

    (1) Dividends and interest paid by a corporation other than a United 
States domestic corporation shall be exempt from United States tax where 
the recipient is a nonresident alien as to the United States resident in 
Switzerland or a Swiss corporation, not having a permanent establishment 
in the United States.
    (2) Dividends and interest paid by a corporation other than a Swiss 
corporation shall be exempt from Swiss tax where the recipient is a 
resident or corporation of the United States, not having a permanent 
establishment in Switzerland.

                               Article XV

    (1) It is agreed that double taxation shall be avoided in the 
following manner:
    (a) The United States in determining its taxes specified in Article 
I of this Convention in the case of its citizens, residents or 
corporations may, regardless of any other provision of this Convention, 
include in the basis upon which such taxes are imposed all items of 
income taxable under the revenue laws of the United States as if this 
Convention had not come into effect. The United States shall, however, 
subject to the provisions of section 131, Internal Revenue Code, as in 
effect on the date of the entry into force of this Convention, deduct 
from its taxes the amount of Swiss taxes specified in Article I of this 
Convention. It is agreed that by virtue of the provisions of 
subparagraph (b) of this paragraph, Switzerland satisfies the similar 
credit requirement set forth in section 131(a)(3), Internal Revenue 
Code.
    (b) Switzerland, in determining its taxes specified in Article I of 
this Convention in the case of its residents, corporations or other 
entities, shall exclude from the basis upon which such taxes are imposed 
such items of income as are dealt with in this Convention, derived from 
the United States and not exempt from, and not entitled to the reduced 
rate of, United States tax under this Convention; but in the case of a 
citizen of the United States resident in Switzerland there shall be 
excluded all items of income derived from the United States. 
Switzerland, however, reserves the right to take into account in the 
determination of the rate of its taxes also the income excluded as 
provided in this paragraph.
    (2) The provisions of this Article shall not be construed to deny 
the exemptions from United States tax or Swiss tax, as the case may be, 
granted by Article XI (1) of this Convention.

                               Article XVI

    (1) The competent authorities of the contracting States shall 
exchange such information (being information available under the 
respective taxation laws of the contracting States) as is necessary for 
carrying out the provisions of the present Convention or for the 
prevention of fraud or the like in relation to the taxes which are the 
subject of the present Convention. Any information so exchanged shall be 
treated as secret and shall not be disclosed to any person other than 
those concerned with the assessment and collection of the taxes which 
are the subject of the present Convention. No information shall be 
exchanged which would disclose any trade, business, industrial or 
professional secret or any trade process.
    (2) Each of the contracting States may collect such taxes imposed by 
the other contracting State as though such taxes were the taxes of the 
former State as will ensure that the exemption or reduced rate of tax 
granted under Articles VI, VII, VIII and XI(2) of the present Convention 
by such other State shall not be enjoyed by persons not entitled to such 
benefits.
    (3) In no case shall the provisions of this Article be construed so 
as to impose upon either of the contracting States the obligation to 
carry out administrative measures at variance with the regulations and 
practice of either contracting State or which would be contrary to its 
sovereignty, security or public policy or to supply particulars which 
are not procurable under its own legislation or that of the State making 
application.

                              Article XVII

    (1) Where a taxpayer shows proof that the action of the tax 
authorities of the contracting States has resulted, or will result, in 
double taxation contrary to the provisions of the present Convention, he 
shall be entitled to present the facts to the State of which he is a 
citizen or a resident, or, if the taxpayer is a corporation or other 
entity, to the State in which it is created or organized. Should the 
taxpayer's claim be deemed worthy of consideration, the competent 
authority of such State shall undertake to come to an agreement with the 
competent authority of the other State with a view to equitable 
avoidance of the double taxation in question.
    (2) Should any difficulty or doubt arise as to the interpretation or 
application of the

[[Page 37]]

present Convention, or its relationship to Conventions between one of 
the contracting States and any other State, the competent authorities of 
the contracting States may settle the question by mutual agreement.

                              Article XVIII

    (1) The provisions of this Convention shall not be construed to deny 
or affect in any manner the right of diplomatic and consular officers to 
other or additional exemptions now enjoyed or which may hereafter be 
granted to such officers.
    (2) The provisions of the present Convention shall not be construed 
to restrict in any manner any exemption, deduction, credit or other 
allowance now or hereafter accorded by the laws of one of the 
contracting States in the determination of the tax imposed by such 
State.
    (3) The citizens of one of the contracting States shall not, while 
resident in the other contracting State, be subjected therein to other 
or more burdensome taxes than are the citizens of such other contracting 
State residing in its territory. The term ``citizens'' as used in this 
Article includes all legal persons, partnerships and associations 
created or organized under the laws in force in the respective 
contracting States. In this Article the word ``taxes'' means taxes of 
every kind or description, whether Federal, State, cantonal, municipal 
or communal.

                               Article XIX

    (1) The competent authorities of the two contracting States may 
prescribe regulations necessary to carry into effect the present 
Convention within the respective States.
    (2) The competent authorities of the two contracting States may 
communicate with each other directly for the purpose of giving effect to 
the provisions of this Convention.

                               Article XX

    (1) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Berne as soon as possible. It shall 
have effect for the taxable years beginning on or after the first day of 
January of the year in which such exchange takes place: Provided, 
however, that if such exchange takes place on or after October 1 of such 
year, Article VI (except paragraph (2) thereof) and Article VII of the 
Convention shall have effect only for taxable years beginning on or 
after the first day of January of the year immediately following the 
year in which such exchange takes place.
    (2) The present Convention shall continue effective for a period of 
five years beginning with the calendar year in which the exchange of the 
instruments of ratification takes place and indefinitely after that 
period, but may be terminated by either of the contracting States at the 
end of the five-year period or at any time thereafter, provided that at 
least six months' prior notice of termination has been given and, in 
such event, the present Convention shall cease to be effective for the 
taxable years beginning on or after the first day of January next 
following the expiration of the six-month period.

    Done at Washington, in duplicate, in the English and German 
languages, the two texts having equal authenticity, this 24th day of 
May, 1951.

    For the President of the United States of America:
    [seal]
                                                           Dean Acheson.
    For the Swiss Federal Council:
    [seal]
                                                      Charles Bruggmann.

Proclamation by the President of the United States Dated October 1, 1951

                                * * * * *

    And whereas the Senate of the United States of America, by their 
resolution of September 17, 1951, two-thirds of the Senators present 
concurring therein, did advise and consent to the ratification of the 
aforesaid convention, subject to a reservation, as follows:
    ``The Government of the United States of America does not accept 
paragraph (4) of Article X of the Convention, relating to the profits or 
remuneration of public entertainers.''
    And whereas the text of the aforesaid reservation was communicated 
by the Government of the United States of America to the Government of 
the Swiss Confederation and the aforesaid reservation was accepted by 
the Government of the Swiss Confederation;
    And whereas the aforesaid convention was duly ratified by the 
President of the United States of America on September 20, 1951, in 
pursuance of the aforesaid advice and consent of the Senate and subject 
to the aforesaid reservation, and the aforesaid convention was duly 
ratified on the part of the Swiss Confederation;
    And whereas the respective instruments of ratification of the 
aforesaid convention were duly exchanged at Bern on September 27, 1951, 
and a protocol of exchange of instruments of ratification, in the 
English and French languages, was signed at that place and on that date 
by the respective Plenipotentiaries of the United States of America and 
the Swiss Confederation, the said protocol containing a statement that 
it is understood by the two Governments that the convention aforesaid, 
upon entry into force in accordance with its provisions, is modified in 
accordance with the aforesaid reservation,

[[Page 38]]

so that, in effect, paragraph (4) of Article X of the convention is 
deemed to be deleted;
    And whereas, so far as appertains to an exchange of instruments of 
ratification prior to October 1 of any year, it is provided in Article 
XX of the aforesaid convention that upon the exchange of instruments of 
ratification the convention shall have effect for the taxable years 
beginning or [sic] or after the first day of January of the year in 
which such exchange takes place;
    Now, therefore, be it known that I, Harry S. Truman, President of 
the United States of America, do hereby proclaim and make public the 
aforesaid convention to the end that the said convention and each and 
every article and clause thereof, subject to the aforesaid reservation, 
may be observed and fulfilled with good faith by the United States of 
America and by the citizens of the United States of America and all 
other persons subject to the jurisdiction thereof.

                                * * * * *



Sec. 509.102  Applicable provisions of law.

    (a) General. The Internal Revenue Code of 1954 provides in part as 
follows:

                        Subtitle A--Income Taxes

                                * * * * *

    Sec. 894. Income exempt under treaty. Income of any kind, to the 
extent required by any treaty obligation of the United States, shall not 
be included in gross income and shall be exempt from taxation under this 
subtitle.

                                * * * * *

                Subtitle F--Procedure and Administration

                                * * * * *

    Sec. 7805. Rules and regulations--(a) Authorization. Except where 
such authority is expressly given by this title to any person other than 
an officer or employee of the Treasury Department, the Secretary or his 
delegate shall prescribe all needful rules and regulations for the 
enforcement of this title, including all rules and regulations as may be 
necessary by reason of any alteration of law in relation to internal 
revenue.
    (b) Retroactivity of regulations or rulings. The Secretary or his 
delegate may prescribe the extent, if any, to which any ruling or 
regulation, relating to the internal revenue laws, shall be applied 
without retroactive effect.

                                * * * * *

    (b) Internal Revenue Code of 1939. Any reference in Secs. 509.101 to 
509.122 to any provision of the Internal Revenue Code of 1954 shall, 
where applicable, be deemed also to refer to the corresponding provision 
of the Internal Revenue Code of 1939.
    (c) Effective date of regulations. Pursuant to sections 894 and 7805 
of the Internal Revenue Code of 1954, Article XIX of the convention, and 
other provisions of the internal revenue laws, Secs. 509.101 to 509.122 
are hereby prescribed effective for taxable years beginning on or after 
January 1, 1951. All regulations inconsistent herewith are modified 
accordingly.



Sec. 509.103  Scope of the convention.

    (a) Purposes of convention. The primary purposes of the convention, 
to be accomplished on a reciprocal basis, are to avoid double taxation 
upon certain items of income derived from sources in one country by 
residents or corporations or other entities of the other country and to 
provide for administrative cooperation between the competent tax 
authorities of the two countries looking to the avoidance of double 
taxation and the prevention of fiscal evasion.
    (b) Exemption from United States tax. The following items of income 
from sources within the United States are exempt from United States tax 
for taxable years beginning on or after January 1, 1951, subject to the 
respective articles of the convention:
    (1) Industrial and commercial profits of a Swiss enterprise having 
no permanent establishment in the United States (Article III);
    (2) Income derived by a Swiss enterprise from the operation of ships 
or aircraft registered in Switzerland (Article V);
    (3) Patent and copyright royalties, and other like amounts, 
including motion picture film rentals, derived by a nonresident alien 
who is a resident of Switzerland, or by a Swiss corporation or other 
entity, if such alien, corporation, or other entity has no permanent 
establishment in the United States (Article VIII);

[[Page 39]]

    (4) Compensation, subject to certain limitations, for personal 
services performed in the United States by a nonresident alien 
individual who is a resident of Switzerland (Article X);
    (5) Compensation and pensions paid by Switzerland to an alien 
individual, and to a citizen of Switzerland who is also a citizen of the 
United States, including such items as are from sources without the 
United States (Article XI);
    (6) Private pensions and life annuities paid to a nonresident alien 
individual who is a resident of Switzerland (Article XI);
    (7) Remuneration derived from certain teaching in the United States 
by a professor or teacher who is a nonresident alien residing in 
Switzerland (Article XII); and
    (8) Dividends and interest paid by a foreign corporation to a 
nonresident alien who is a resident of Switzerland, or to a Swiss 
corporation, if such alien or corporation has no permanent establishment 
in the United States (Article XIV).
    (c) Students or apprentices. Remittances received from abroad for 
the purpose of maintenance or studies by a student or apprentice, a 
nonresident alien residing in Switzerland, who is temporarily present in 
the United States under specified circumstances are also exempt from 
United States tax (Article XIII).
    (d) Reduced rates of United States tax. Dividends and interest 
derived from sources within the United States by a nonresident alien who 
is a resident of Switzerland, or by a Swiss corporation or other entity, 
are subject to United States tax at reduced rates, if such alien, 
corporation, or other entity has no permanent establishment in the 
United States (Articles VI and VII).
    (e) Withholding regulations. For regulations pertaining to the 
release of excess tax withheld, and to exemption from, or reduction in 
the rate of, withholding of United States tax at source, in the case of 
dividends, interest, patent and copyright royalties, film rentals, 
private pensions, and life annuities, received from sources within the 
United States by a nonresident alien who is a resident of Switzerland, 
or by a Swiss corporation or other entity, see Treasury Decision 5867, 
approved November 21, 1951 (Secs. 509.1 to 509.10).
    (f) United States citizens, residents, and corporations. (1) Any 
citizen of Switzerland who is a resident of the United States is liable 
to United States tax as though the convention had not come into effect; 
however, such alien resident of the United States is entitled to the 
foreign tax credit in accordance with Article XV and is also entitled to 
the benefits of Article XI (1) and Article XVIII.
    (2) A citizen of the United States, even though resident in 
Switzerland, or a domestic corporation, even though engaged in trade or 
business in Switzerland through a permanent establishment situated 
therein, is also liable to United States tax as though the convention 
had not come into effect but is entitled to the foreign tax credit and, 
to the extent, applicable, to the benefits of Article XI (1).
    (g) Other provisions applicable to Swiss residents and corporations. 
Except as otherwise expressly provided by the convention, the United 
States tax liability of a nonresident alien who is a resident of 
Switzerland, or of a Swiss corporation or other entity, is determined in 
accordance with the provisions of the Internal Revenue Code of 1954 
relating to nonresident alien individuals and foreign corporations.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, 
Sec. 509.103 was amended by removing and reserving paragraph (e), 
effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 31, 1998, the 
effective date was delayed until Jan. 1, 2000.



Sec. 509.104  Definitions.

    (a) General. Any term defined in the convention or Secs. 509.101 to 
509.122 shall have the meaning so assigned to it; any term not so 
defined shall, unless the context otherwise requires, have the meaning 
which such term has under the internal revenue laws of the United 
States.
    (b) Specific terms. As used in Secs. 509.101 to 509.122--
    (1) United States tax. The term ``United States tax'' means the 
Federal income taxes, including surtaxes and excess profits taxes, and 
any other income or profits tax of a substantially

[[Page 40]]

similar character imposed by the United States after May 24, 1951.
    (2) Swiss tax. The term ``Swiss tax'' means the federal, cantonal, 
and communal taxes on income--that is, on total income, earned income, 
income from property, industrial and commercial profits, etc.--and any 
other income or profits tax of a substantially similar character imposed 
by Switzerland after May 24, 1951.
    (3) United States. The term ``United States'' means the United 
States of America; and, when used in a geographical sense, means the 
States, the Territories of Alaska and Hawaii, and the District of 
Columbia.
    (4) Switzerland. The term ``Switzerland'' means the Swiss 
Confederation.
    (5) Permanent establishment--(i) Fixed place of business. The term 
``permanent establishment'' means an office, factory, workshop, 
warehouse, branch, or other fixed place of business, but does not 
include the casual and temporary use of merely storage facilities. It 
implies the active conduct of a business enterprise. The mere ownership, 
for example, of timberlands or a warehouse in the United States by a 
Swiss enterprise does not mean that such enterprise, in the absence of 
any business activity therein, has a permanent establishment in the 
United States. Moreover, the maintenance within the United States by a 
Swiss enterprise of a warehouse for convenience of delivery, and not for 
purposes of display, does not of itself constitute a permanent 
establishment in the United States, even though offers of purchase have 
been obtained by an agent therein of the Swiss enterprise and 
transmitted by him to the Swiss enterprise for acceptance. The fact that 
a Swiss enterprise maintains in the United States an office or other 
fixed place of business used exclusively for the purchase for such 
enterprise of goods or merchandise shall not of itself constitute such 
fixed place of business a permanent establishment of such enterprise.
    (ii) Subsidiary corporation. The fact that a Swiss corporation has a 
domestic subsidiary corporation, or a foreign subsidiary corporation 
which is engaged in trade or business in the United States through a 
permanent establishment situated therein, does not of itself constitute 
either subsidiary corporation the United States permanent establishment 
of the Swiss parent corporation.
    (iii) Agency. A Swiss enterprise which has an agency in the United 
States does not thereby have a permanent establishment in the United 
States, unless the agent has, and habitually exercises, a general 
authority to negotiate and conclude contracts on behalf of such 
enterprise or unless he has a stock of merchandise from which he 
regularly fills orders on its behalf. If the enterprise has an agent in 
the United States who has power to contract on its behalf, but only at 
fixed prices and under conditions determined by such principal, it does 
not thereby necessarily have a permanent establishment in the United 
States. The mere fact that an agent of a Swiss enterprise--assuming he 
has no general authority to negotiate and conclude contracts on behalf 
of his principal--maintains samples, or occasionally fills orders from 
incidental stocks of goods maintained, in the United States does not of 
itself mean that such enterprise has a permanent establishment in the 
United States. The mere fact that salesmen, employees of a Swiss 
enterprise, promote the sale of their employer's products in the United 
States or that a Swiss enterprise transacts business in the United 
States by means of mail order activities does not mean that such 
enterprise has a permanent establishment in the United States. A Swiss 
enterprise shall not be deemed to have a permanent establishment in the 
United States merely because it carries on business dealings in the 
United States through a commission agent, broker, custodian, or other 
independent agent, acting in the ordinary course of his business as 
such.
    (6) Enterprise. The term ``enterprise'' means any commercial or 
industrial enterprise or undertaking carried on by any person, for 
example, by an individual partnership, or corporation. It includes such 
activites as manufacturing, merchandising, mining, processing, banking, 
and insuring. It does not include the rendition of personal services. 
Hence, a nonresident alien individual who is resident of Switzerland and 
who performs personal services is

[[Page 41]]

not, merely by reason of such services, engaged in a Swiss enterprise 
within the meaning of the convention; consequently, his liability to 
United States tax is not determined under Article III of the convention, 
if he has not otherwise carried on a Swiss enterprise.
    (7) Swiss enterprise. The term ``Swiss enterprise'' means an 
enterprise carried on in Switzerland by a nonresident alien individual 
who is a resident of Switzerland, or by a Swiss corporation or other 
entity. Thus, an enterprise carried on wholly outside Switzerland by a 
Swiss corporation is not a Swiss enterprise within the meaning of the 
convention.
    (8) Swiss corporation or other entity. The term ``Swiss corporation 
or other entity'' means a corporation or institution or foundation 
having juridical personality, or a partnership (association ``en nom 
collectif'' or ``en commandite''), or other association without 
juridical personality, created or organized under Swiss laws.
    (9) United States enterprise. The term ``United States enterprise'' 
means an enterprise carried on in the United States by a resident of the 
United States (including an individual, fiduciary, and partnership) or 
by a United States corporation or other entity.
    (10) United States corporation or other entity. The term ``United 
States corporation or other entity'' means a corporation or other entity 
created or organized under the law of the United States or of any State 
or Territory of the United States.
    (11) Industrial and commercial profits. The term ``industrial and 
commercial profits'' means profits arising from industrial, commercial, 
mercantile, manufacturing, and like activities of an enterprise, 
including mining, financial and insurance profits. It does not include 
income in the form of dividends, interests, rents, royalties, or 
remuneration for personal services. In determining the industrial and 
commercial profits from sources within the United States of a Swiss 
enterprise, no profits shall be deemed to arise from the mere purchase 
of goods or merchandise within the United States by such enterprise. 
Moreover, in determining such profits of the United States permanent 
establishment of such enterprise, there shall be allowed as deductions 
all expenses which are reasonably applicable to the permanent 
establishment, including executive and general administrative expenses 
so applicable. See sections 861 through 864, Internal Revenue Code of 
1954, and the regulations thereunder.
    (12) Commissioner. The term ``Commissioner'' means the Commissioner 
of Internal Revenue or his authorized representative.
    (13) Director of the Federal Tax Administration. The term ``Director 
of the Federal Tax Administration'' means the Director of the Federal 
Tax Administration (Direktor der eidgenoessischen Steuerverwaltung) of 
Switzerland.



Sec. 509.105  Industrial and commercial profits.

    (a) General. (1) Article III of the convention adopts the principle 
that an enterprise of one of the contracting States shall not be taxable 
by the other contracting State upon its industrial and commercial 
profits unless it is engaged in trade or business in the latter State 
through a permanent establishment situated therein. Accordingly, a Swiss 
enterprise is subject to United States tax upon its industrial and 
commercial profits, to the extent of such profits from sources within 
the United States, only if it is engaged in trade or business in the 
United States at some time during the taxable year through a permanent 
establishment situated therein.
    (2) From the standpoint of the United States tax the article has 
application only to a Swiss enterprise and its industrial and commercial 
profits from sources within the United States. Thus, a nonresident alien 
individual who is a citizen of Switzerland, or a Swiss corporation or 
other entity, carrying on an enterprise which is not Swiss, is subject 
to tax on such income of such enterprise pursuant to section 871(c) or 
section 882(a), Internal Revenue Code of 1954, if such alien, 
corporation, or other entity has engaged in trade or business in the 
United States at any time during the taxable

[[Page 42]]

year, even though it has not had a permanent establishment therein at 
any time within such year.
    (b) No United States permanent establishment. A Swiss enterprise is 
not subject to United States tax upon its industrial and commercial 
profits from sources within the United States, nor shall such profits be 
included in gross income, if it has not at any time during the taxable 
year engaged in trade or business in the United States through a 
permanent establishment situated therein. For example, if during the 
taxable year an enterprise carried on in Switzerland by a nonresident 
alien individual who is a resident of Switzerland, or by a Swiss 
corporation, were to sell merchandise, such as watches, dairy products, 
or liqueurs, in the United States through a commission agent or broker 
in the United States acting in the ordinary course of his business as 
such agent or broker, the profits arising from such sale would not be 
included in gross income and would be exempt from United States tax 
under Article III of the convention. Similarly, if during the taxable 
year such enterprise were to secure orders in the United States for such 
merchandise through its sales agents whose sole function in the United 
States is sales promotion, the orders being transmitted to Switzerland 
for acceptance, then the profits arising from such sales would not be 
included in gross income and would be exempt from United States tax.
    (c) United States permanent establishment--(1) General. A Swiss 
enterprise is subject to United States tax upon its industrial and 
commercial profits from sources within the United States to the same 
extent as are nonresident aliens or foreign corporations which are 
subject to tax pursuant to section 871(c) or section 882(a), Internal 
Revenue Code of 1954, if such enterprise has at any time during the 
taxable year engaged in trade or business in the United States through a 
permanent establishment situated therein. If it is so engaged, it is 
subject to United States tax upon its entire income from sources within 
the United States except to the extent otherwise exempt from United 
States tax.
    (2) Allocation of profits. In the determination of the income 
taxable to such enterprise for purposes of the United States tax, all 
industrial and commercial profits from sources within the United States 
shall be deemed to be allocable to the permanent establishment in the 
United States. Hence, if a Swiss enterprise which has a permanent 
establishment in the United States at some time during the taxable year 
were to sell in the United States, through a commission agent therein 
acting in the ordinary course of his business as such, merchandise which 
has been produced in Switzerland, the profits arising from such sale 
would be allocable to the permanent establishment to the extent they are 
derived from sources within the United States, even though the sale is 
made independently of the permanent establishment.
    (3) Independent basis. The industrial and commercial profits of the 
permanent establishment in the United States shall be determined as if 
the establishment were an independent enterprise engaged in the same or 
similar activities under the same or similar conditions and dealing at 
arm's length, or on an independent basis, with the enterprise of which 
it is a permanent establishment.



Sec. 509.106  Control of a United States enterprise by a Swiss enterprise.

    In effect, Article IV of the convention provides that, if a Swiss 
enterprise by reason of its control of a United States enterprise 
imposes on the latter enterprise conditions different from those which 
would result from normal business relations between independent 
enterprises, the accounts between the enterprises shall be adjusted in 
order to ascertain the true taxable income of each enterprise. The 
purpose is to place the controlled United States enterprise on a tax 
parity with an uncontrolled United States enterprise by determining, 
according to the standard of an uncontrolled enterprise, the true 
taxable income from the property and business of the controlled 
enterprise. The basic objective of the article is that, if the 
accounting records do not truly reflect the taxable income from the 
property and business of the United States enterprise, the Commissioner

[[Page 43]]

shall intervene and, by making such distributions, apportionments, or 
allocations as he may deem necessary of gross income, deductions, 
credits, or allowances, or of any item or element affecting taxable 
income, between the United States enterprise and the Swiss enterprise by 
which it is controlled or directed, shall determine the true taxable 
income of the United States enterprise. The provisions of section 482 of 
the Internal Revenue Code of 1954, and the regulations thereunder, 
shall, insofar as applicable, be followed in the determination of the 
taxable income of the United States enterprise.



Sec. 509.107  Income from operation of ships or aircraft.

    Under Article V of the convention so much of the income from sources 
within the United States of a Swiss enterprise as consists of earnings 
derived from the operation of ships or aircraft documented or registered 
in Switzerland shall not be included in gross income and shall be exempt 
from United States tax, even though at some time during the taxable year 
such enterprise has engaged in trade or business in the United States 
through a permanent establishment situated therein.



Sec. 509.108  Dividends.

    (a) General. (1) The rate of United States tax imposed by the 
Internal Revenue Code of 1954 upon dividends derived from sources within 
the United States by a nonresident alien individual who is a resident of 
Switzerland, or by a Swiss corporation or other entity, shall not exceed 
15 percent under the provisions of Article VI of the convention, if such 
alien, corporation, or other entity at no time during the taxable year 
in which such dividends are derived has a permanent establishment in the 
United States.
    (2) If, for example, a nonresident alien individual who is a 
resident of Switzerland performs personal services within the United 
States during the taxable year, but has at no time during such year a 
permanent establishment within the United States, he is entitled to the 
reduced rate of tax with respect to dividends derived in that year from 
United States sources, as provided in Article VI of the convention, even 
though under the provisions of section 871(c) of the Internal Revenue 
Code of 1954 he has engaged in trade or business within the United 
States during such year by reason of his having performed personal 
services therein.
    (b) Dividends paid by related corporation. The rate of United States 
tax imposed by the Internal Revenue Code of 1954 upon dividends derived 
from sources within the United States by a Swiss corporation shall not 
exceed 5 percent under the provisions of Article VI (2) of the 
convention if:
    (1) The Swiss corporation is a shareholder which controls, directly 
or indirectly, at the time the dividend is paid 95 percent or more of 
the entire voting power in the corporation paying the dividend;
    (2) Not more than 25 percent of the gross income of the paying 
corporation for the three-year period immediately preceding the taxable 
year in which the dividend is paid consists of dividends and interest 
(other than dividends and interest received by such paying corporation 
from its own subsidiary corporations, if any);
    (3) The relationship between the paying corporation and the Swiss 
corporation has not been arranged or maintained primarily with the 
intention of securing the reduced rate of 5 percent; and
    (4) The Swiss corporation at no time during the taxable year in 
which such dividends are derived has a permanent establishment in the 
United States.



Sec. 509.109  Interest.

    The rate of United States tax imposed by the Internal Revenue Code 
of 1954 upon interest on bonds, securities, notes, debentures, or on any 
other form of indebtedness, including interest on obligations of the 
United States, obligations of instrumentalities of the United States, 
and mortgages and bonds secured by real property, which is derived from 
sources within the United States by a nonresident alien individual who 
is a resident of Switzerland, or by a Swiss corporation or other entity, 
shall not exceed 5 percent under the provisions of Article VII of the 
convention, if such alien, corporation, or other entity at no time 
during the taxable year in which such interest

[[Page 44]]

is derived has a permanent establishment in the United States.



Sec. 509.110  Patent and copyright royalties and film rentals.

    Royalties and other amounts representing consideration for the right 
to use copyrights, artistic and scientific works, patents, designs, 
plans, secret processes and formulae, trademarks, and other like 
property and rights, including rentals and like payments in respect to 
motion picture films or for the use of industrial, commercial, or 
scientific equipment, which are derived from sources within the United 
States by a nonresident alien individual who is a resident of 
Switzerland, or by a Swiss corporation or other entity, are exempt from 
United States tax under the provisions of Article VIII of the convention 
if such alien, corporation, or other entity at no time during the 
taxable year in which such items of income are derived has a permanent 
establishment in the United States.



Sec. 509.111  Real property income and natural resource royalties.

    (a) General. Income of whatever nature derived by a nonresident 
alien who is a resident of Switzerland, or by a Swiss corporation or 
other entity, from real property situated in the United States, 
including gains derived from the sale or exchange of such property, 
rentals from such property, and royalties in respect of the operation of 
mines, quarries, or other natural resources situated in the United 
States, is not exempt from United States tax by the convention. Such 
items of income are subject to taxation under the provisions of the 
Internal Revenue Code of 1954 generally applicable to the taxation of 
nonresident alien individuals and foreign corporations. See Article IX 
of the convention. Interest derived from mortgages and bonds secured by 
real property does not constitute income from real property for purposes 
of this section but is subject to the provisions applicable to interest 
generally. See Sec. 509.109.
    (b) Net basis--(1) General. Notwithstanding the provisions of 
paragraph (a) of this section, a nonresident alien who is a resident of 
Switzerland, or a Swiss corporation or other entity, who during the 
taxable year derives from sources within the United States any income 
from real property as described in such paragraph may elect for such 
taxable year to be subject to United States tax on a net basis as though 
such alien, corporation, or other entity were engaged in trade or 
business in the United States during such year through a permanent 
establishment situated therein.
    (2) Manner of electing. Such nonresident alien (including an 
individual, fiduciary, and member of a partnership) shall signify his 
election to be subject to tax on such a basis by filing Form 104B 
clearly marked at the top of the first page thereof as follows: ``Return 
of Resident of Switzerland Electing to File on a Net Basis Pursuant to 
Article IX of Swiss Income Tax Convention''. Such corporation shall 
signify its election to be subject to tax on such a basis by filing Form 
1120 clearly marked at the top of the first page there of as follows: 
``Return of Swiss Corporation Electing to File on a Net Basis Pursuant 
to Article IX of Swiss Income Tax Convention''. The election so 
signified shall be irrevocable for the taxable year for which such 
election is made. All income from sources within the United States, 
including gains from the sale or exchange of capital assets or of other 
property, shall be disclosed on the return so filed. See sections 871 
and 882 of the Internal Revenue Code of 1954 and the regulations 
thereunder.



Sec. 509.112  Compensation for labor or personal services.

    (a) Exemption from tax. Under Article X of the convention 
compensation received by a nonresident alien individual who is a 
resident of Switzerland for labor or personal services, including the 
practice of the liberal professions and the rendition of services as a 
director, performed in the United States shall not be included in gross 
income and shall be exempt from United States tax in either of the 
following situations:
    (1) Swiss employer. Where such individual is temporarily present in 
the United States for a period or periods not exceeding in the aggregate 
a total of 183 days during a taxable year beginning on or after January 
1, 1951, any

[[Page 45]]

compensation received by him (irrespective of when received, if received 
in taxable years beginning on or after January 1, 1951) for such labor 
or personal services performed in the United States during such year as 
an employee of, or under contract with, a nonresident alien (including a 
nonresident alien individual and fiduciary) who is a resident of 
Switzerland, or a Swiss corporation or other entity, whether or not such 
alien, corporation, or other entity is engaged in trade or business 
within the United States, shall not be included in gross income and 
shall be exempt from United States tax.
    (2) Other employers. Where such individual is temporarily present in 
the United States for a period or periods not exceeding in the aggregate 
a total of 183 days during a taxable year beginning on or after January 
1, 1951, any compensation received by him (irrespective of when 
received, if received in taxable years beginning on or after January 1, 
1951) for such labor or personal services performed in the United States 
during such year shall not be included in gross income and shall be 
exempt from United States tax if such compensation does not exceed 
$10,000 in the aggregate. Thus, if a nonresident alien individual who is 
a resident of Switzerland performs personal services in the United 
States during the taxable year as an employee of a domestic corporation 
for which he receives compensation of $15,000 in the aggregate, none of 
such compensation shall be exempt from United States tax even though 
such individual is present in the United States during such year for a 
period or periods not exceeding a total of 183 days, since the aggregate 
compensation received is in excess of $10,000.
    (b) Definitions. For purposes of this section, the term 
``compensation for labor or personal services'' shall include, but shall 
not be limited to, the compensation, profits, emoluments, or other 
remuneration of public entertainers, such as, stage, motion picture, 
television, or radio artists, musicians, and athletes. For the 
allocation or segregation as between sources within, and sources 
without, the United States in the case of compensation for labor or 
personal services, see sections 861 through 864, Internal Revenue Code 
of 1954, and the regulations thereunder.
    (c) Exception. The provisions of this section have no application to 
the income to which Article XI(1) of the convention relates.



Sec. 509.113  Government wages, salaries, and pensions.

    (a) General. Under Article XI of the convention any wage, salary, or 
similar compensation, or any pension, paid by Switzerland or any agency 
or instrumentality thereof, or by any political subdivisions or other 
public authorities of Switzerland, to any alien individual (whether or 
not a resident of the United States) or to any individual who occupies 
the dual status of a citizen of the United States and a citizen of 
Switzerland shall not be included in gross income and shall be exempt 
from United States tax, even though at some time during the taxable year 
such individual has engaged in trade or business in the United States 
through a permanent establishment situated therein.
    (b) Definition. As used in this section, the term ``pensions'' means 
periodic payments made in consideration for services rendered or by way 
of compensation for injuries received. Under Article XV(2) of the 
convention the exclusion from gross income, and exemption from United 
States tax, provided by this section shall not be denied despite the 
provisions of Article XV. See Sec. 509.118.
    (c) Cross reference. For the taxation generally of compensation of 
alien employees of foreign governments and the consequences of executing 
and filing the waiver provided for in section 247(b) of the Immigration 
and Nationality Act, see section 893 of the Internal Revenue Code of 
1954 and the regulations thereunder.



Sec. 509.114  Private pensions and life annuities.

    (a) General. Private pensions and life annuities derived from 
sources within the United States and paid to a nonresident alien 
individual who is a resident of Switzerland shall not be included in 
gross income and shall be exempt from United States tax, in accordance 
with Article XI of the convention, even though at some time during

[[Page 46]]

the taxable year such individual has engaged in trade or business in the 
United States through a permanent establishment situated therein.
    (b) Definitions. As used in this section, the term ``pensions'' 
means periodic payments made in consideration for services rendered or 
by way of compensation for injuries received; and the term ``life 
annuities'' means a stated sum payable periodically at stated times 
during life, or during a specified number of years, under an obligation 
to make the payments in return for adequate and full consideration in 
money or money's worth.



Sec. 509.115  Visiting professors or teachers.

    (a) General. Pursuant to Article XII of the convention, a professor 
or teacher, a nonresident alien who is a resident of Switzerland, who 
temporarily visits the United States for the purpose of teaching for a 
period not exceeding two years at any university, college, school, or 
other educational institution situated within the United States shall, 
for a period not exceeding two years from the date of his initial 
arrival in the United States, be exempt from United States tax with 
respect to his remuneration earned in taxable years beginning on or 
after January 1, 1951, for such teaching during such period not in 
excess of two years.
    (b) More than two years. The exemption granted by Article XII is 
applicable to remuneration earned during such part of the individual's 
visit as does not exceed two years from the date of arrival even though 
the total period of his presence in the United States may extend beyond 
two years, provided that during such entire period he may be considered 
to be temporarily visiting the United States.
    (c) Residence. Such exemption shall not apply to the remuneration of 
an alien who is a resident of the United States or who is not a resident 
of Switzerland.
    (d) Nonresidence presumed. An individual who otherwise qualifies for 
the exemption from United States tax granted by Article XII shall, for a 
period of not more than two years immediately succeeding the date of his 
arrival within the United States for the purpose of such teaching, be 
deemed to have the tax status of a nonresident alien in the absence of 
proof of his intention to remain indefinitely in the United States. See 
section 871 of the Internal Revenue Code of 1954 and the regulations 
thereunder.



Sec. 509.116  Students or apprentices.

    (a) General. Under Article XIII of the convention, a student or 
apprentice, a nonresident alien who is a resident of Switzerland, who 
temporarily visits the United States exclusively for the purposes of 
study or for acquiring business or technical experience shall not 
include in gross income, and shall be exempt from United States tax with 
respect to, amounts derived by him in taxable years beginning on or 
after January 1, 1951, and received during such years from without the 
United States as remittances for the purposes of his maintenance or 
studies.
    (b) Residence. The exemption shall not apply to remittances received 
by an alien who is a resident of the United States or who is not a 
resident of Switzerland.



Sec. 509.117  Dividends and interest paid by a foreign corporation.

    (a) General--(1) Dividends. A dividend paid by a foreign corporation 
constitutes, in whole or in part, income from sources within the United 
States and is subject to tax by the United States when received by a 
nonresident alien individual or other foreign corporation, if 50 percent 
or more of the gross income of the paying corporation for the statutory 
period was derived from sources within the United States. See section 
861(a)(2)(B), section 872(a), and section 882(b), Internal Revenue Code 
of 1954; and the regulations thereunder.
    (2) Interest. Interest on bonds, notes, and other interest-bearing 
obligations of resident foreign corporations constitutes, in its 
entirety, income from sources within the United States and is subject to 
tax by the United States when received by a nonresident alien individual 
or other foreign corporation, if 20 percent or more of the gross income 
of the paying corporation for the statutory period was derived from 
sources within the United States. See

[[Page 47]]

section 861(a)(1)(B), section 872(a), and section 882(b), Internal 
Revenue Code of 1954; and the regulations thereunder.
    (b) Exemption from United States tax. Notwithstanding the provisions 
of paragraph (a) of this section, Article XIV(1) of the convention 
provides that dividends and interest paid by any foreign corporation and 
derived by a nonresident alien who is a resident of Switzerland, or by a 
Swiss corporation, shall not be included in gross income and shall be 
exempt from United States tax if such alien or corporation at no time 
during the taxable year in which such items of income are derived has a 
permanent establishment in the United States. The exemption so provided 
shall apply even though the corporation paying the dividends or interest 
is a resident foreign corporation at the time of payment and without 
regard to the percentage of its gross income from sources within the 
United States.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, 
Sec. 509.117 was amended by removing and reserving paragaph (a), 
effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 31, 1998, the 
effective date was delayed until Jan. 1, 2000.



Sec. 509.118  Credit against United States tax for Swiss tax.

    (a) General--(1) Taxable as though no convention. Notwithstanding 
any other provision of the convention the United States, in determining 
the United States tax of a citizen or resident of the United States, or 
of a domestic corporation, may, under Article XV(1)(a) of the 
convention, include in the basis upon which such tax is imposed all 
items of income taxable under the revenue laws of the United States, as 
though the convention had not come into effect. For example, despite the 
exemption from United States tax granted by Article VIII of the 
convention with respect to a copyright royalty derived from sources 
within the United States by a resident of Switzerland, such royalty 
shall be included in gross income and is subject to United States tax 
when so derived by a resident of Switzerland who is a citizen of the 
United States, even though such resident has no permanent establishment 
in the United States.
    (2) Exception. Notwithstanding the provisions of subparagraph (1) of 
this paragraph, the exclusion from gross income, and exemption from 
United States tax, granted by Article XI(1) of the convention with 
respect to wages, salaries, and similar compensation, and pensions, paid 
by Switzerland or any agency or instrumentality thereof, or by any 
political subdivisions or other public authorities of Switzerland, shall 
not be denied. See Article XV(2) of the convention.
    (b) Application of credit--(1) General. For the purpose of 
mitigating double taxation, Article XV(1)(a) of the convention provides 
that a citizen or resident of the United States, or a domestic 
corporation, deriving income from sources within Switzerland shall be 
allowed a credit against the United States tax for the amount of Swiss 
tax paid or accrued during the taxable year. This credit shall be made 
in accordance with the provisions of section 131 of the Internal Revenue 
Code of 1939 as in effect on September 27, 1951, but subject to the 
provisions of Article XVIII(2) of the convention.
    (2) Similar credit requirement. (i) Article XV(1)(a) further 
provides that, by virtue of the provisions of Article XV(1)(b) of the 
convention, relating to the exclusion from basis for computing the Swiss 
tax, Switzerland satisfies the similar credit requirement set forth in 
section 901(b)(3), Internal Revenue Code of 1954, relating to alien 
residents of the United States, etc.
    (ii) This provision of Article XV(1)(a) shall be taken to mean that, 
solely by reason of the exclusion granted by it under Article XV(1)(b) 
and without reference to concessions otherwise made by such country, 
Switzerland satisfies the similar credit requirement only with respect 
to taxes paid to Switzerland, and not with respect to taxes paid to 
another foreign country. Nothing in this subdivision shall be construed, 
however, to prevent Switzerland from otherwise satisfying the similar 
credit requirement, in accordance with section 901 of the Internal 
Revenue Code of 1954 and the regulations thereunder, with respect to 
taxes paid to another foreign country. Thus, if pursuant to a convention 
between Switzerland and another foreign country, Switzerland

[[Page 48]]

were to exempt from its income taxes the income received from sources 
within such other foreign country by a United States citizen residing in 
Switzerland, then Switzerland would, in accordance with such regulations 
under section 901, satisfy the similar credit requirement of section 
901(b)(3) with respect to income taxes paid to such other country by a 
Swiss citizen residing in the United States.



Sec. 509.119  Exchange of information.

    (a) General. (1) By Article XVI of the convention the United States 
and Switzerland adopt the principle of exchange of such information as 
is necessary for carrying out the provisions of the convention, 
preventing fraud, or detecting practices which are aimed at the 
reduction of the revenues of either country, but not including 
information which would be contrary to public policy or which would 
disclose any trade, business, industrial, or professional secret or any 
trade process.
    (2) The information and correspondence relative to exchange of 
information may be transmitted directly by the Commissioner to the 
Director of the Federal Tax Administration.
    (b) Return of information by withholding agents. (1) To facilitate 
compliance with Article XVI of the convention, every United States 
withholding agent shall make and file in duplicate with the District 
Director of Internal Revenue, Baltimore 2, Maryland, an information 
return on Form 1042 Supplement, with respect to persons having addresses 
in Switzerland, which shall be filed for the calendar year 1955 and 
subsequent calendar years. This return shall be filed simultaneously 
with Form 1042.
    (2) There shall be reported on such Form 1042 Supplement all items 
of fixed or determinable annual or periodical income (and amounts 
described in section 402(a)(2), section 631(b) and (c), and section 1235 
of the Internal Revenue Code of 1954, which are considered to be gains 
from the sale or exchange of capital assets) derived from sources within 
the United States and paid to nonresident aliens (including nonresident 
alien individuals, fiduciaries, and partnerships) and to nonresident 
foreign corporations, whose addresses at the time of payment were in 
Switzerland, including such items of income upon which, in accordance 
with the withholding regulations under the convention, no withholding of 
United States tax is required; except that any of such items which 
constitute interest in respect of which Form 1001-S or substitute Form 
1001-S has been filed in duplicate with the withholding agent is not 
required to be reported on such Form 1042 Supplement.
    (c) Information to be furnished in ordinary course. In compliance 
with the provisions of Article XVI of the convention the Commissioner 
will transmit to the Director of the Federal Tax Administration, as soon 
as practicable after the close of the calendar year 1955 and of each 
subsequent calendar year during which the convention is in effect, the 
following information relating to such preceding calendar year:
    (1) The duplicate copy of each available Form 1042 Supplement filed 
pursuant to paragraph (b) of this section; and
    (2) The duplicate copy of each available ownership certificate, Form 
1001-S, and substitute Form 1001-S, filed pursuant to the withholding 
regulations under the convention, in connection with coupon bond 
interest.
    (d) Information in specific cases. Under the provisions and 
limitations of Article XVI of the convention and upon request of the 
Director of the Federal Tax Administration, the Commissioner shall 
furnish to the Director information available to, or obtainable by, the 
Commissioner relative to the tax liability of any person under the 
revenue laws of Switzerland in any case in which such information is 
necessary for carrying out the provisions of the convention or for the 
prevention of fraud or the like in relation to the taxes which are the 
subject of the convention.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, 
Sec. 509.119 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 509.120  Double taxation claims.

    (a) General. Under Article XVII of the convention, where the 
taxpayer shows

[[Page 49]]

proof that the action of the tax authorities of the United States or 
Switzerland has resulted, or will result, in double taxation contrary to 
the provisions of the convention, he is entitled to present the facts to 
the country of which he is a citizen; or, if he is not a citizen of 
either country, to the country of which he is a resident; or, if the 
taxpayer is a corporation or other entity, to the country in which it is 
created or organized. The article provides that, should the taxpayer's 
claim be deemed worthy of consideration, the competent authority of the 
country to which the facts are presented shall undertake to come to an 
agreement with the competent authority of the other country with a view 
to equitable avoidance of the double taxation in question.
    (b) Manner of filing claim. Such a claim on behalf of a United 
States citizen, corporation, or other entity, or on behalf of a resident 
of the United States who is not a Swiss citizen, shall be filed with the 
Commissioner. The claim shall be set up in the form of a letter 
addressed to ``The Commissioner of Internal Revenue, Washington, D.C.'' 
and shall show fully all facts and laws on the basis of which the 
claimant alleges that such double taxation has resulted or will result. 
If the Commissioner determines that there is an appropriate basis for 
the claim under the convention, he shall take up the matter with the 
Director of the Federal Tax Administration with a view to arranging an 
agreement of the character contemplated by Article XVII.



Sec. 509.121  Beneficiaries of an estate or trust.

    (a) Qualified beneficiary. If he otherwise satisfies the 
requirements of the respective articles concerned, a nonresident alien 
who is a resident of Switzerland and who is a beneficiary of an estate 
or trust shall be entitled to the exemption from, or reduction in the 
rate of, United States tax granted by Articles VI, VII, VIII, and XIV of 
the convention with respect to dividends, interest, and royalties and 
other like amounts, to the extent that (1) any amount paid, credited, or 
required to be distributed by such estate or trust to such beneficiary 
is deemed to consist of such items and (2) such items would, without 
regard to the convention, be includible in his gross income.
    (b) Amounts otherwise includible in gross income of beneficiary. For 
the determination of amounts which, without regard to the convention, 
are includible in the gross income of the beneficiary, see subchapter J 
of chapter 1 of the Internal Revenue Code of 1954, and the regulations 
thereunder.



Sec. 509.122  Swiss partnerships.

    (a) General. Whether an individual, corporation, or other entity, a 
member of a partnership created or organized under Swiss laws, is 
subject to United States tax upon such person's distributive share of 
the income of such partnership depends upon both the status of the 
partnership and the status of such member.
    (b) Citizen partner. A citizen or resident of the United States, or 
a domestic corporation, is subject to United States tax upon such 
person's distributive share of the income of such partnership as though 
the convention had not come into effect, but subject to the provisions 
of Sec. 509.118; even though other members, by reason of benefits 
granted by the convention, are not subject to United States tax upon 
their distributive share of such income.
    (c) Noncitizen partner. In any case in which income is derived from 
sources within the United States by a partnership created or organized 
under Swiss laws, any member of such partnership who has a permanent 
establishment in the United States or who is either a nonresident alien 
not a resident of Switzerland or is a foreign corporation which is not 
Swiss is not entitled, with respect to such member's distributive share 
of such income, to any benefit granted by the convention solely to 
nonresident aliens residing in Switzerland, or to Swiss corporations or 
other entities, having no permanent establishment in the United States. 
Conversely, any member of such partnership who individually complies 
with the requirements for obtaining any such benefit will be entitled 
thereto with respect to such member's distributive share of such income. 
A member of a Swiss partnership which has a permanent establishment in 
the United

[[Page 50]]

States shall likewise be considered to have a permanent establishment in 
the United States.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, 
Sec. 509.122 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



PARTS 510-512  [RESERVED]






PART 513--IRELAND--Table of Contents




                       Subpart--Withholding of Tax

Sec.
513.1  Introductory.
513.2  Dividends.
513.3  Interest.
513.4  Patent and copyright royalties and film rentals.
513.5  Natural resource royalties and real property rentals.
513.6  Pensions and life annuities.
513.7  Release of excess tax withheld at source.
513.8  Addressee not actual owner.
513.9  Information to be furnished in ordinary course.
513.10  Beneficiaries of a domestic estate or trust.
513.11  Refund of income tax withheld during 1951.

    Authority: 26 U.S.C. 62.

    Source: Treasury Decision 5897, 17 FR 3633, Apr. 24, 1952, unless 
otherise noted. Redesignated at 25 FR 14022, Dec. 31, 1960.



                       Subpart--Withholding of Tax



Sec. 513.1  Introductory.

    (a) The income tax convention between the United States and the 
Republic of Ireland, signed September 13, 1949, proclaimed by the 
President of the United States on December 24, 1951, and effective (as 
respects the United States tax) for taxable years beginning on or after 
January 1, 1951, referred to in this subpart as the convention, provides 
in part as follows:

                                Article I

    (1) The taxes which are the subject of the present Convention are:

    (a) In the United States of America: The Federal income taxes, 
including surtaxes (hereinafter referred to as United States tax).

    (b) In Ireland: The income tax (including surtax) and the 
corporation profits tax (hereinafter referred to as Irish tax).

    (2) The present Convention shall also apply to any other taxes of a 
substantially similar character imposed by either Contracting Party 
subsequently to the date of signature of the present Convention.

                               Article II

    (1) In the present Convention, unless the context otherwise 
requires--

    (a) The term ``United States'' means the United States of America, 
and when used in a geographical sense means the States, the Territories 
of Alaska and of Hawaii, and the District of Columbia.

    (b) The term ``Ireland'' means the Republic of Ireland and the term 
``Irish'' has a corresponding meaning.

    (c) The terms ``territory of one of the Contracting Parties'' and 
``territory of the other Contracting Party'' mean the United States or 
Ireland as the context requires.

    (d) The term ``United States corporation'' means a corporation, 
association or other like entity created or organized in or under the 
laws of the United States.

    (e) The term ``Irish corporation'' means any kind of juridical 
person created under the laws of Ireland.

    (f) The terms ``corporation of one Contracting Party'' and 
``corporation of the other Contracting Party'' mean a United States 
corporation or an Irish corporation as the context requires.

    (g) The term ``resident of Ireland'' means any person (other than a 
citizen of the United States or a United States corporation) who is 
resident in Ireland for the purposes of Irish tax and not resident in 
the United States for the purposes of United States tax. A corporation 
is to be regarded as resident in Ireland if its business is managed and 
controlled in Ireland.

    (h) The term ``resident of the United States'' means any individual 
who is resident in the United States for the purposes of United States 
tax and not resident in Ireland for the purposes of Irish tax, and any 
United States corporation and any partnership created or organized in or 
under the laws of the United States, being a corporation or partnership 
which is not resident in Ireland for the purposes of Irish tax.
    (i) The term ``Irish enterprise'' means an industrial or commercial 
enterprise or undertaking carried on by a resident of Ireland.
    (j) The term ``United States enterprise'' means an industrial or 
commercial enterprise or undertaking carried on by a resident of the 
United States.
    (k) The terms ``enterprise of one of the Contracting Parties'' and 
``enterprise of the

[[Page 51]]

other Contracting Party'' mean a United States enterprise or an Irish 
enterprise, as the context requires.
    (l) The term ``permanent establishment'' when used with respect to 
an enterprise of one of the Contracting Parties means a branch, 
management, factory or other fixed place of business, but does not 
include an agency unless the agent has, and habitually exercises, a 
general authority to negotiate and conclude contracts on behalf of such 
enterprise or has a stock of merchandise from which he regularly fills 
orders on its behalf. An enterprise of one of the Contracting Parties 
shall not be deemed to have a permanent establishment in the territory 
of the other Contracting Party merely because it carries on business 
dealings in the territory of such other Contracting Party through a bona 
fide commission agent or broker acting in the ordinary course of his 
business as such. The fact that an enterprise of one of the Contracting 
Parties maintains in the territory of the other Contracting Party a 
fixed place of business exclusively for the purchase of goods or 
merchandise shall not of itself constitute such fixed place of business 
a permanent establishment of such enterprise. The fact that a 
corporation of one Contracting Party has a subsidiary corporation which 
is a corporation of the other Contracting Party or which is engaged in 
trade or business in the territory of such other Contracting Party 
(whether through a permanent establishment or otherwise) shall not of 
itself constitute that subsidiary corporation a permanent establishment 
of its parent corporation.
    (2) For the purposes of Article VI, VII, VIII, IX and XIV a resident 
of Ireland shall not be deemed to be engaged in trade or business in the 
United States in any taxable year unless such resident has a permanent 
establishment situated therein in such taxable year. The same principle 
shall be applied, mutatis mutandis, by Ireland in the case of a resident 
of the United States.
    (3) In the application of the provisions of the present Convention 
by one of the Contracting Parties any term not otherwise defined shall, 
unless the context otherwise requires, have the meaning which it has 
under the laws of that Contracting Party relating to the taxes which are 
the subject of the present Convention.

                                * * * * *

                               Article VI

    (1) The rate of United States tax on dividends derived from a United 
States corporation by a resident of Ireland who is subject to Irish tax 
on such dividends and not engaged in trade or business in the United 
States shall not exceed 15 per cent: provided that such rate of tax 
shall not exceed five per cent if such resident is a corporation 
controlling, directly or indirectly, at least 95 per cent of the entire 
voting power in the corporation paying the dividend, and not more than 
25 per cent of the gross income of such paying corporation is derived 
from interest and dividends, other than interest and dividends received 
from its own subsidiary corporations. Such reduction of the rate to five 
per cent shall not apply if the relationship of the two corporations has 
been arranged or is maintained primarily with the intention of securing 
such reduced rate.
    (2) Dividends derived from sources within Ireland by an individual 
who is (a) a resident of the United States, (b) subject to United States 
tax with respect to such dividends, and (c) not engaged in trade or 
business in Ireland, shall be exempt from Irish surtax.
    (3) Either of the Contracting Parties may terminate this Article by 
giving written notice of termination to the other Contracting Party, 
through diplomatic channels, on or before the thirtieth day of June in 
any calendar year after the calendar year in which the exchange of the 
instruments of ratification takes place and in such event paragraph (1) 
hereof shall cease to be effective as to United States tax on and after 
the first day of January, and paragraph (2) hereof shall cease to be 
effective as to Irish tax on and after the 6th day of April, in the 
calendar year next following that in which such notice is given.

                               Article VII

    (1) Interest (on bonds, securities, notes, debentures, or on any 
other form of indebtedness) derived from sources within the United 
States by a resident of Ireland who is subject to Irish tax on such 
interest and not engaged in trade or business in the United States, 
shall be exempt from United States tax; but such exemption shall not 
apply to such interest paid by a United States corporation to a 
corporation resident in Ireland controlling, directly or indirectly, 
more than 50 per cent of the entire voting power in the paying 
corporation.
    (2) Interest (on bonds, securities, notes, debentures, or on any 
other form of indebtedness) derived from sources within Ireland by a 
resident of the United States who is subject to United States tax on 
such interest and not engaged in trade or business in Ireland, shall be 
exempt from Irish tax; but such exemption shall not apply to such 
interest paid by a corporation resident in Ireland to a United States 
corporation controlling, directly or indirectly, more than 50 per cent 
of the entire voting power in the paying corporation.

                              Article VIII

    (1) Royalties and other amounts paid as consideration for the use 
of, or for the privilege of using, copyrights, patents, designs,

[[Page 52]]

secret processes and formulas, trade-marks, and other like property, and 
derived from sources within the United States by a resident of Ireland 
who is subject to Irish tax on such royalties or other amounts and not 
engaged in trade or business in the United States, shall be exempt from 
United States tax.
    (2) Royalties and other amounts paid as consideration for the use 
of, or for the privilege of using, copyrights, patents, designs, secret 
processes and formulas, trademarks, and other like property, and derived 
from sources within Ireland by a resident of the United States who is 
subject to United States tax on such royalties or other amounts and not 
engaged in trade or business in Ireland shall be exempt from Irish tax.
    (3) For the purposes of this Article, the term ``royalties'' shall 
be deemed to include rentals in respect of motion picture films.

                               Article IX

    (1) The rate of United States tax on royalties in respect of the 
operation of mines or quarries or of other extraction of natural 
resources, and on rentals from real property or from an interest in such 
property, derived from sources within the United States by a resident of 
Ireland who is subject to Irish tax with respect to such royalties or 
rentals and not engaged in trade or business in the United States, shall 
not exceed 15 per cent; provided that any such resident may elect for 
any taxable year to be subject to United States tax as if such resident 
were engaged in trade or business in the United States.
    (2) Royalties in respect of the operation of mines or quarries or of 
other extraction of natural resources, and rentals from real property or 
from an interest in such property, derived from sources within Ireland 
by an individual who is (a) a resident of the United States, (b) subject 
to United States tax with respect to such royalties and rentals, and (c) 
not engaged in trade or business in Ireland, shall be exempt from Irish 
surtax.

                               Article Xx

    (1) Any salary, wage, similar remuneration, or pension, paid by the 
Government of the United States to an individual (other than a citizen 
of Ireland who is not also a citizen of the United States) in respect of 
services rendered to the United States in the discharge of governmental 
functions, shall be exempt from Irish tax.
    (2) Any salary, wage, similar remuneration, or pension, paid by the 
Government of Ireland to an individual (other than a citizen of the 
United States who is not also a citizen of Ireland) in respect of 
services rendered to Ireland in the discharge of governmental functions, 
shall be exempt from United States tax.
    (3) The provisions of this Article shall not apply to payments in 
respect of services rendered in connection with any trade or business 
carried on by either of the Contracting Parties for purposes of profit.

                                * * * * *

                               Article XII

    (1) Any pension (other than a pension to which Article X applies), 
and any life annuity, derived from sources within the United States by 
an individual who is a resident of Ireland shall be exempt from United 
States tax.
    (2) Any pension (other than a pension to which Article X applies), 
and any life annuity, derived from sources within Ireland by an 
individual who is a resident of the United States shall be exempt from 
Irish tax.
    (3) The term ``life annuity'' means a stated sum payable 
periodically at stated times, during life or during a specified or 
ascertainable period of time, under an obligation to make the payments 
in consideration of money paid.

                                * * * * *

                               Article XV

    (1) Dividends and interest paid, on or after the first day of 
January in the calendar year in which the exchange of instruments or 
ratification takes place, by an Irish corporation shall be exempt from 
United States tax except where the recipient is a citizen of or a 
resident in the United States or a United States corporation.
    (2) Dividends and interest paid, on or after the 6th day of April of 
the first year of assessment specified in Article XXII(2)(b), (i) of 
this Convention, by a United States corporation shall be exempt from 
Irish tax except where the recipient is a resident of Ireland.

                                * * * * *

                               Article XX

    (1) The taxation authorities of the Contracting Parties shall 
exchange such information (being information available under the 
respective taxation laws of the Contracting Parties) as is necessary for 
carrying out the provisions of the present Convention or for the 
prevention of fraud or the administration of statutory provisions 
against legal avoidance in relation to the taxes which are the subject 
of the present Convention. Any information so exchanged shall be treated 
as secret and shall not be disclosed to any person other than those 
concerned with the assessment and collection of the taxes which are the 
subject of the present Convention. No information shall be exchanged 
which would disclose any trade secret or trade process.

[[Page 53]]

    (2) As used in this Article, the term ``taxation authorities'' 
means, in the case of the United States, the Commissioner of Internal 
Revenue or his authorized representative and, in the case of Ireland, 
the Revenue Commissioners or their authorized representative.

                                * * * * *

                              Article XXII

    (1) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Washington, District of Columbia, as 
soon as possible.
    (2) Upon exchange of ratifications, the present Convention shall 
have effect:
    (a) as respects United States tax, for the taxable years beginning 
on or after the first day of January in the calendar year in which the 
exchange of instruments of ratification takes place;
    (b)(i) as respects Irish income tax, for the year of assessment 
beginning on the 6th day of April in the calendar year in which the 
exchange of instruments of ratification takes place and subsequent 
years; (ii) as respects Irish surtax, for the year of assessment 
beginning on the 6th day of April immediately preceding the calendar 
year in which the exchange of instruments of ratification takes place, 
and subsequent years; and (iii) as respects Irish corporation profits 
tax, for any chargeable accounting period beginning on or after the 
first day of April in the calendar year in which the exchange of 
instruments of ratification takes place, and for the unexpired portion 
of any chargeable accounting period current at that date.

                              Article XXIII

    (1) The present Convention shall continue in effect indefinitely but 
either of the Contracting Parties may, on or before the 30th day of June 
in any calendar year following the calendar year in which the exchange 
of instruments of ratification takes place, give to the other 
Contracting Party, through diplomatic channels, notice of termination 
and, in such event, the present Convention shall cease to be effective:
    (a) as respects United States tax, for the taxable years beginning 
on or after the first day of January in the calendar year next following 
that in which such notice is given;
    (b)(i) as respects Irish income tax, for any year of assessment 
beginning on or after the 6th day of April in the calendar year next 
following that in which such notice is given; (ii) as respects Irish 
surtax, for any year of assessment beginning on or after the 6th day of 
April in the calendar year in which such notice is given; and (iii) as 
respects Irish corporation profits tax, for any chargeable accounting 
period beginning on or after the first day of April in the calendar year 
next following that in which such notice is given and for the unexpired 
portion of any chargeable accounting period current at that date.
    (2) The termination of the present Convention or of any Article 
thereof shall not have the effect of reviving any treaty or arrangement 
abrogated by the present Convention or by treaties previously concluded 
between the Contracting Parties.

    (b) As used in this subpart, unless the context otherwise requires, 
the terms defined in the above articles of the convention shall have the 
meanings so assigned to them.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, 
Sec. 513.1 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 513.2  Dividends.

    (a) General. (1) Under Article VI of the convention the rate of tax 
imposed with respect to dividends by section 211(a) of the Internal 
Revenue Code (relating to nonresident alien individuals not engaged in 
trade or business within the United States) and by section 231(a) of the 
Internal Revenue Code (relating to foreign corporations not engaged in 
trade or business within the United States) is reduced to 15 percent in 
the case of dividends derived from a United States corporation and 
received in taxable years beginning on or after January 1, 1951, by a 
nonresident alien (including a nonresident alien individual, fiduciary, 
and partnership) who is resident in Ireland for the purposes of Irish 
tax, or by a foreign corporation (whether or not created or organized in 
or under the laws of Ireland) whose business is managed and controlled 
in Ireland, if such alien or corporation is subject to Irish tax on such 
dividends and at no time during the taxable year had a permanent 
establishment within the United States. As to what is a United States 
corporation, see Article II (1)(d) of the convention.
    (2) Thus, if a nonresident alien who is resident in Ireland for the 
purposes of Irish tax performs personal services within the United 
States during the taxable year, has at no time during such year a 
permanent establishment within the United States, and is subject to 
Irish tax on a dividend derived by him in such year from a United States 
corporation, he is entitled to

[[Page 54]]

the reduced rate of tax with respect to such dividend, as provided in 
Article VI of the convention, even though under the provisions of 
section 211(b) of the Internal Revenue Code he has engaged in trade or 
business within the United States during such year by reason of his 
having rendered personal services therein.
    (3) The fact that the payee of the dividend is not required to pay 
Irish tax on such dividend because of the application of reliefs or 
exemptions under Irish revenue laws does not prevent the application of 
the reduction in rate of United States tax with respect to such 
dividend. If the dividend would have been subject to Irish tax had the 
payee thereof derived an income large enough to require payment of tax 
then liability to Irish tax exists for the purpose of the reduction in 
rate of United States tax. As to what constitutes a permanent 
establishment, see Article II (1)(l) of the convention.
    (4) In the case of dividends paid on or after January 1, 1951, by an 
Irish corporation, as defined in Article II (1)(e) of the convention, no 
withholding of United States tax is required. See Article XV (1) of the 
convention.
    (b) Dividends paid by a United States subsidiary corporation. (1) 
Under the proviso of Article VI (1) of the convention dividends derived 
from a domestic corporation by a foreign corporation whose business is 
managed and controlled in Ireland and which controls, directly or 
indirectly, at the time the dividends is paid 95 percent or more of the 
entire voting power in such domestic corporation are, when received in 
taxable years beginning on or after January 1, 1951, subject to tax at 
the rate of only 5 percent, if (i) not more than 25 percent of the gross 
income of such paying corporation for the three-year period immediately 
preceding the taxable year in which the dividend is paid consists of 
dividends and interest (other than dividends and interest paid to such 
domestic corporation by its own subsidiary corporations, if any), (ii) 
the relationship between such domestic corporation and such foreign 
corporation has not been arranged or maintained primarily with the 
intention of securing such reduced rate of 5 percent, (iii) such foreign 
corporation is subject to Irish tax on such dividends, and (iv) such 
foreign corporation at no time during the taxable year had a permanent 
establishment within the United States.
    (2) Any domestic corporation which claims or contemplates claiming 
that dividends paid or to be paid by it on or after January 1, 1951, are 
subject only to the 5 percent rate shall file the following information 
with the Commissioner of Internal Revenue as soon as practicable: (i) 
The date and place of its organization; (ii) the location of the 
management and control of the foreign corporation to which the dividends 
are paid or to be paid; (iii) the number of outstanding shares of stock 
of the domestic corporation having voting power and the voting power 
thereof; (iv) the person or persons beneficially owning such stock of 
the domestic corporation and their relationship to such foreign 
corporation; (v) the amount of gross income by years of the domestic 
corporation for the three-year period immediately preceding the taxable 
year in which the dividend is paid; (vi) the amount of interest and 
dividends by years included in the gross income of the domestic 
corporation, and the amount of interest and dividends by years received 
by such corporation from its subsidiary corporations, if any; and (vii) 
the relationship between the domestic corporation and the foreign 
corporation to which it pays the dividend.
    (3) As soon as practicable after such information is filed, the 
Commissioner of Internal Revenue will determine whether the dividends 
concerned fall within the scope of the proviso of Article VI(1) of the 
convention and may authorize the release of excess tax withheld with 
respect to dividends which come within such proviso. In any case in 
which the Commissioner of Internal Revenue has notified the domestic 
corporation that the dividends fall within the scope of such proviso the 
reduced withholding rate of 5 percent will apply to any dividends 
subsequently paid by such corporation to the foreign corporation, unless 
the stock ownership of the domestic corporation, or the character of its 
income, or the place of management and control of the corporation to 
which the dividend is paid

[[Page 55]]

materially changes; or unless the Commissioner of Internal Revenue 
determines that the relationship between the two corporations is being 
maintained primarily with the intention of securing the reduced rate of 
tax; and, if such change in stock ownership, character of income, or 
place of management and control occurs, the domestic corporation shall 
promptly notify the Commissioner of Internal Revenue of the then 
existing facts with respect thereto. The continued application of the 
reduced withholding rate is also dependent upon the continued 
fulfillment of conditions in subparagraph (1) (iii) and (iv) of this 
paragraph.
    (c) Effect of address in Ireland on withholding in case of 
dividends. For the purpose of withholding of the tax in the case of 
dividends every nonresident alien (including a nonresident alien 
individual, fiduciary, and partnership) whose address is in Ireland 
shall be deemed by United States withholding agents to be a nonresident 
alien who is (1) resident in Ireland for the purposes of Irish tax, (2) 
subject to Irish tax on such dividends, and (3) without a permanent 
establishment in the United States; and every foreign corporation whose 
address is in Ireland shall be deemed by such withholding agents to be a 
foreign corporation whose business is managed and controlled in Ireland 
and which is (i) subject to Irish tax on such dividends and (ii) without 
a permanent establishment in the United States.
    (d) Rate of withholding. (1) Withholding at source in the case of 
dividends derived from a United States corporation and paid on or after 
January 1, 1952, to nonresident aliens (including a nonresident alien 
individual, fiduciary, and partnership) and to foreign corporations, 
whose addresses are in Ireland, shall be at the rate of 15 percent in 
every case except that in which, prior to the date of payment of such 
dividends, the Commissioner of Internal Revenue has notified the 
withholding agent that (i) such dividends fall within the scope of the 
proviso of Article VI(1) of the convention or (ii) the reduced rate of 
tax shall not apply.
    (2) The preceding provisions respecting the application of the 
reduced withholding rate in the case of dividends paid to nonresident 
aliens and foreign corporations with addresses in Ireland are based upon 
the assumption that the payee of the dividend is the actual owner of the 
capital stock from which the dividend is derived and consequently is the 
person liable to United States tax upon such dividend. As to action by 
the recipient who is not the owner of the dividend, see Sec. 513.8.
    (3) The rate at which United States tax has been withheld from any 
dividend paid on and after thirty days from the date on which this 
subpart is filed with the Division of the Federal Register to any person 
whose address is in Ireland at the time the dividend is paid shall be 
shown either in writing or by appropriate stamp on the check, draft, or 
other evidence of payment, or on an accompanying statement.

    Effectve Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, 
Sec. 513.2 was revised, effective Jan. 1, 1999. At 63 FR 2723, Jan. 16, 
1998, Sec. 513.2 was corrected in the fifth line by changing the word 
``does'' to read ``does not'' effective Jan. 1, 1999. By T.D. 8804, 63 
FR 72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 
2000. For the convenience of the user, the revised text is set forth as 
follows:

Sec. 513.2  Dividends.

    The fact that the payee of the dividend is not required to pay Irish 
tax on such dividend because of the application of reliefs or exemptions 
under Irish revenue laws does not prevent the application of the 
reduction in rate of United States tax with respect to such dividend. If 
the dividend would have been subject to Irish tax had the payee thereof 
derived an income large enough to require payment of tax then liability 
to Irish tax exists for the purpose of the reduction in rate of United 
States tax. As to what constitutes a permanent establishment, see 
Article II(1)(i) of the convention.

[62 FR 53497, Oct. 14, 1997; 63 FR 2723, Jan. 16, 1998]



Sec. 513.3  Interest.

    (a) General. (1) Interest (other than interest falling within the 
scope of paragraph (c) of this section) on bonds, securities, notes, 
debentures, or any other form of indebtedness, including interest on 
obligations of the United States, obligations of instrumentalities of 
the United States, and mortgages and bonds secured by real property, 
derived from sources within the

[[Page 56]]

United States and received in taxable years beginning on or after 
January 1, 1951, by a nonresident alien (including a nonresident alien 
individual, fiduciary, and partnership) who is resident in Ireland for 
the purposes of Irish tax, or by a foreign corporation (whether or not 
created or organized in or under the laws of Ireland) whose business is 
managed and controlled in Ireland, is exempt from United States tax 
under the provisions of Article VII(1) of the convention if such alien 
or corporation is subject to Irish tax on such interest and at no time 
during the taxable year had a permanent establishment within the United 
States. Such interest is, therefore, not subject to the withholding 
provisions of the Internal Revenue Code. As to what constitutes a 
permanent establishment, see Article II(1) of the convention.
    (2) The provisions of Sec. 513.2(a) relating to the degree of 
liability to Irish tax in the case of dividends are equally applicable 
with respect to the income falling within the scope of this section.
    (b) Application of exemption from withholding. (1) To obviate 
withholding at the source in the case of coupon bond interest the 
nonresident alien resident in Ireland for the purpose of Irish tax, or 
the foreign corporation whose business is managed and controlled in 
Ireland, shall for each issue of bonds submit Form 1001-IR in duplicate 
to the paying agent with each presentation of interest coupons. Such 
form shall be signed by the owner of the interest, trustee, or agent and 
shall show the name and address of the obligor, the name and address of 
the owner of such interest, and the amount of such interest. Such form 
shall contain a statement that the owner (i) is resident in Ireland for 
the purposes of Irish tax, or is a foreign corporation whose business is 
managed and controlled in Ireland, (ii) has no permanent establishment 
in the United States, and (iii) is subject to Irish tax on such 
interest.
    (2) The exemption from United States tax contemplated by Article 
VII(1) of the convention, insofar as it concerns coupon bond interest, 
is applicable only to the owner of such interest. The person presenting 
such coupon, or on whose behalf it is presented, shall for the purpose 
of the exemption from tax be deemed to be the owner of the interest only 
if he is, at the time the coupon is presented for payment, the owner of 
the bond from which the coupon has been detached. If the person 
presenting the coupon is not the owner of the bond, Form 1001, and not 
Form 1001-IR, shall be executed.
    (3) The original and duplicate ownership certificates, Form 1001-IR, 
must be forwarded to the Commissioner of Internal Revenue by the 
withholding agent with the quarterly return on Form 1012, as provided in 
existing regulations with respect to Form 1001. See Sec. 29.143-7 of 
Regulations 111 (26 CFR 1949 ed. Supps. 29.143-7 [and Sec. 39.143-7 of 
Regulations 118 (26 CFR, Rev. 1953, Parts 1-79, and Supps.)] Form 1001-
IR need not be listed on Form 1012.
    (4) For general provisions pertaining to the use, without reference 
to the provisions of the convention, of ownership certificate, Form 
1001, by nonresident aliens and nonresident foreign corporations, see 
Secs. 29.143-4 and 29.143-6 of Regulations 111 (26 CFR 1949 ed. Supps. 
29.143-4 and 29.143-6) [and Secs. 39.143-4 and 39.143-6 of Regulations 
118 (26 CFR, Rev. 1953, Parts 1-79, and Supps.)]
    (5) To obviate withholding at the source in the case of interest, 
other than interest payable by means of coupons, the nonresident alien 
resident in Ireland for the purposes of Irish tax, or the foreign 
corporation whose business is managed and controlled in Ireland, shall 
notify the withholding agent by letter in duplicate that such income is 
exempt from United States tax under the provisions of Article VII(1) of 
the convention. The letter of notification shall be signed by the owner 
of the interest, trustee, or agent and shall show the name and address 
of the obligor and the name and address of the owner of such interest. 
It shall also contain a statement that the owner (i) is resident in 
Ireland for the purposes of Irish tax, or is a foreign corporation whose 
business is managed and controlled in Ireland, (ii) has no permanent 
establishment in the United States, and (iii) is subject to Irish tax on 
such interest. This letter shall constitute authorization for the 
payment of such interest without deduction of the tax at source.

[[Page 57]]

    (6) The letter of notification in the case of interest, other than 
interest payable by means of coupons, must be filed for each three-
calendar-year period, and the first such letter filed by the taxpayer 
with any withholding agent shall be filed not later than 20 days 
preceding the date of the first payment of interest in such period. If 
the taxpayer files such letter with the withholding agent in the 
calendar year 1952, or in any subsequent calendar year, no additional 
letter need be filed prior to the end of the two calendar years 
immediately following the calendar year in which such letter is so filed 
unless the Commissioner of Internal Revenue notifies the withholding 
agent that an additional letter must be filed by the taxpayer at any 
earlier date. If, after filing a letter of notification, the taxpayer 
ceases to be eligible for the benefit of the convention, he must 
promptly notify the withholding agent by letter in duplicate. When any 
change occurs in the ownership of the interest as recorded on the books 
of the payer, the exemption from United States tax will no longer apply 
unless a letter of notification is duly executed and filed with the 
withholding agent by the new owner of record of such interest.
    (7) Each letter of notification, or the duplicate thereof, must be 
immediately forwarded by the withholding agent to the Commissioner of 
Internal Revenue, Clearing Branch, Washington 25, D.C.
    (8) In the case of interest paid on or after January 1, 1951, by an 
Irish corporation, as defined in Article II(1)(e) of the convention, no 
withholding of United States tax is required. See Article XV(1) of the 
convention.
    (c) Exemption not applicable to interest paid by subsidiary 
corporation to its parent corporation. (1) Under the exception contained 
in Article VII(1) of the convention any interest derived from sources 
within the United States and paid by a domestic corporation to a foreign 
corporation whose business is managed and controlled in Ireland is not 
exempt from United States tax if such foreign corporation controls, 
directly or indirectly, at the time the interest is paid more than 50 
percent of the entire voting power of all classes of stock of such 
domestic corporation. The exemption from United States tax provided by 
Article VII(1) of the convention does not, therefore, apply to such 
interest paid by such domestic corporation.
    (2) In any case in which a foreign corporation whose business is 
managed and controlled in Ireland anticipates the receipt of interest 
from a domestic corporation and the relationship existing between the 
foreign corporation and the domestic corporation is such as to render 
uncertain whether, by reason of the exception contained in Article 
VII(1) of the convention, the exemption will apply to such interest, the 
foreign corporation shall not undertake to file any Form 1001-IR or 
letter of notification prescribed by paragraph (b) of this section 
unless it has, prior to such filing, applied for and received from the 
Commissioner of Internal Revenue, Washington 25, D.C., a determination 
that such foreign corporation does not control, directly or indirectly, 
more than 50 percent of the entire voting power in the paying 
corporation. The application to the Commissioner shall contain a full 
statement of all the facts pertinent to a determination of the question.
    (3) As soon as practicable after the application has been filed, the 
Commissioner of Internal Revenue will determine whether the foreign 
corporation has such control of the domestic corporation as to render 
the exemption provided by Article VII(1) of the convention inapplicable 
to interest paid by such domestic corporation to such foreign 
corporation and shall notify the foreign corporation of his 
determination. The foreign corporation shall forthwith file with the 
domestic corporation a copy of the Commissioner's letter of 
notification.
    (4) If the Commissioner's determination is that the foreign 
corporation does not control, directly or indirectly, more than 50 
percent of the entire voting power of all classes of stock of the 
domestic corporation, the foreign corporation may thereafter obviate 
withholding at the source with respect to subsequent payments of such 
interest by complying with the provisions of paragraph (b) of this 
section, that is, by submitting Form 1001-IR in the case of coupon bond 
interest, or the letter of

[[Page 58]]

notification for each three-calendar-year period in the case of interest 
other than interest payable by means of coupons.
    (5) A determination of the Commissioner that the foreign corporation 
does not have such control of the domestic corporation as to render the 
exemption provided by Article VII(1) of the convention inapplicable will 
apply until such time as the stock ownership of the domestic corporation 
has changed to the extent that interest to be received from the domestic 
corporation by the foreign corporation is no longer exempt from United 
States tax under Article VII(1) of the convention. If such change in 
stock ownership occurs, the foreign corporation shall promptly notify 
both the Commissioner of Internal Revenue and the domestic corporation 
of the then existing facts with respect to such stock ownership.
    (6) In any case in which a foreign corporation whose business is 
managed and controlled in Ireland has received on or after January 1, 
1952, interest from a domestic corporation and the relationship existing 
between the foreign corporation and the domestic corporation was at the 
time the interest was paid such as to render uncertain whether, by 
reason of the exception contained in Article VII(1) of the convention, 
such interest was exempt from United States tax, the foreign corporation 
shall apply to the Commissioner of Internal Revenue for a similar 
determination as to the degree of control at the time the interest was 
paid. If the Commissioner's determination is that at such time the 
degree of control was such as to permit the application of the exemption 
provided by Article VII(1) of the convention, his letter of notification 
may, subject to the provisions of Sec. 513.7(e), authorize the release 
of excess tax withheld with respect to such exempt interest.

    Effective Date Note:  By T.D. 8734, 62 FR 53497, Oct. 14, 1997, 
Sec. 513.3 was revised, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000. 
For the convenience of the user, the revised text is set forth as 
follows:

Sec. 513.3  Interest.

     The provisions of Sec. 513.2 relating to the degree of liability to 
Irish tax in the case of dividends are equally applicable with respect 
to the income falling within the scope of this section.

[62 FR 53497, Oct. 14, 1997]



Sec. 513.4  Patent and copyright royalties and film rentals.

    (a) Royalties and other amounts (including rentals for the use of, 
or for the right to use, motion picture films) derived from sources 
within the United States and received in taxable years beginning on or 
after January 1, 1951, by a nonresident alien (including a nonresident 
alien individual, fiduciary, and partnership) who is resident in Ireland 
for the purposes of Irish tax, or by a foreign corporation (whether or 
not created or organized in or under the laws of Ireland) whose business 
is managed and controlled in Ireland, when paid as consideration for the 
use of, or for the privilege of using, copyrights, patents, designs, 
secret processes and formulae, trade-marks, and other like property, are 
exempt from United States tax under the provisions of Article VIII(1) 
and (3) of the convention if such alien or corporation is subject to 
Irish tax on such income and at no time during the taxable year had a 
permanent establishment within the United States. Such items of income 
are, therefore, not subject to the withholding provisions of the 
Internal Revenue Code. As to what constitutes a permanent establishment, 
see Article II(1)(l) of the convention.
    (b) The provisions of Sec. 513.2(a) relating to the degree of 
liability to Irish tax in the case of dividends are equally applicable 
with respect to the income falling within the scope of this section.
    (c) To obviate withholding at the source in the case of such items 
the nonresident alien resident in Ireland for the purposes of Irish tax, 
or the foreign corporation whose business is managed and controlled in 
Ireland, shall notify the withholding agent by letter in duplicate that 
such income is exempt from United States tax under the provisions of 
Article VIII of the convention. The provisions of Sec. 513.3(b) relating 
to the execution, filing, and effective period of the letter of 
notification prescribed therein with respect to interest are equally 
applicable with

[[Page 59]]

respect to the income falling within the scope of this section.
    (d) Each letter of notification, or the duplicate thereof, must be 
immediately forwarded by the withholding agent to the Commissioner of 
Internal Revenue, Clearing Branch, Washington 25, D.C.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 513.4 was revised, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000. 
For the convenience of the user, the revised text is set forth as 
follows:

Sec. 513.4  Patent and copyright royalties and film rentals.

    The provisions of Sec. 513.2 relating to the degree of liability to 
Irish tax in the case of dividends are equally applicable with respect 
to the income falling within the scope of this section.

[62 FR 53498, Oct. 14, 1997]



Sec. 513.5  Natural resource royalties and real property rentals.

    (a) Under Article IX of the convention the rate of tax imposed with 
respect to natural resource royalties and real property rentals by 
section 211(a) of the Internal Revenue Code (relating to nonresident 
alien individuals not engaged in trade or business within the United 
States) and by section 231(a) of the Internal Revenue Code (relating to 
foreign corporations not engaged in trade or business within the United 
States) is reduced to 15 percent in the case of royalties in respect of 
the operation of mines or quarries or of other extraction of natural 
resources, and in the case of rentals from real property or from an 
interest in such property, derived from sources within the United States 
and received in taxable years beginning on or after January 1, 1951, by 
a nonresident alien (including a nonresident alien individual, 
fiduciary, and partnership) who is resident in Ireland for the purposes 
of Irish tax, or by a foreign corporation (whether or not created or 
organized in or under the laws of Ireland) whose business is managed and 
controlled in Ireland, if such alien or corporation is subject to Irish 
tax on such income and at no time during the taxable year had a 
permanent establishment within the United States. As to what constitutes 
a permanent establishment, see Article II(1)(l) of the convention.
    (b) The provisions of Sec. 513.2(a) relating to the degree of 
liability to Irish tax in the case of dividends are equally applicable 
with respect to the income falling within the scope of this section.
    (c) To secure the reduced rate of tax at the source in the case of 
such items the nonresident alien resident in Ireland for the purposes of 
Irish tax, or the foreign corporation whose business is managed and 
controlled in Ireland, shall notify the withholding agent by letter in 
duplicate that the rate of United States tax with respect to such income 
is reduced to 15 percent under the provisions of Article IX of the 
convention. The provisions of Sec. 513.3(b) relating to the execution, 
filing, and effective period of the letter of notification prescribed 
therein with respect to interest are equally applicable with respect to 
the income falling within the scope of this section.
    (d) Each letter of notification, or the duplicate thereof, must be 
immediately forwarded by the withholding agent to the Commissioner of 
Internal Revenue, Clearing Branch, Washington 25, D.C.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 513.5 was revised, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000. 
For the convenience of the user, the revised text is set forth as 
follows:

Sec. 513.5  Natural resource royalties and real property rentals.

    The provisions of Sec. 513.2 relating to the degree of liability to 
Irsh tax in the case of dividends are equally applicable with respect to 
the income falling within the scope of this section.

[62 FR 53498, Oct. 14, 1997]



Sec. 513.6  Pensions and life annuities.

    (a) Pensions, other than pensions paid by the Government of the 
United States to individuals in respect of services rendered thereto in 
the discharge of governmental functions, and any life annuity, derived 
from sources within the United States in taxable years beginning on or 
after January 1, 1951, by a nonresident alien individual who is resident 
in Ireland for the purposes of Irish tax are exempt from United States 
tax under the provisions of Article XII of the convention.

[[Page 60]]

    (b) To obviate withholding at the source in the case of such exempt 
income the nonresident alien individual who is resident in Ireland for 
the purposes of Irish tax shall notify the withholding agent by letter 
in duplicate that such income is exempt from United States tax under the 
provisions of Article XII of the convention. The letter of notification 
shall be signed by the owner of the income, shall show the name and 
address of both the payer and the owner, and shall contain a statement 
that the owner, an individual, is neither a citizen nor a resident of 
the United States but is resident in Ireland for the purposes of Irish 
tax. This letter shall constitute authorization for the payment of such 
income without deduction of the tax at source unless the Commissioner of 
Internal Revenue subsequently notifies the withholding agent that the 
tax should be withheld from payments of such income made after receipt 
of such notice. If, after filing a letter of notification, the owner of 
the income ceases to be eligible for the benefit of the convention, he 
must promptly notify the withholding agent by letter in duplicate.
    (c) Each letter of notification, or the duplicate thereof, must be 
immediately forwarded by the withholding agent to the Commissioner of 
Internal Revenue, Clearing Branch, Washington 25, D.C.



Sec. 513.7  Release of excess tax withheld at source.

    (a) General. (1) In order to bring the convention into force and 
effect at the earliest practicable date,
    (i) The reduced rate of tax of 15 percent to be withheld at the 
source from dividends, natural resource royalties, and real property 
rentals, and
    (ii) The exemption from tax otherwise withheld at the source from 
interest, patent royalties, copyright royalties, film rentals, and the 
like,

are hereby made effective beginning January 1, 1952, in any case in 
which such natural resource royalties, real property rentals, interest, 
patent royalties, copyright royalties, film rentals, and the like are 
derived from sources within the United States, or in which such 
dividends are derived from a United States corporation, by a nonresident 
alien (including a nonresident alien individual, fiduciary, and 
partnership) who is resident in Ireland for the purposes of Irish tax, 
or by a foreign corporation whose business is managed and controlled in 
Ireland, if such alien or corporation is subject to Irish tax on such 
income and at no time during the taxable year in which such income is so 
derived had a permanent establishment within the United States.
    (2) In the case of every such taxpayer whose address at the time of 
payment was in Ireland and who furnishes to the withholding agent the 
letter of notification prescribed in Secs. 513.3(b), 513.4, or 
Sec. 513.5, where United States tax at the rate of 30 percent has been 
withheld on or after January 1, 1952, there shall be released (except as 
provided in paragraph (e) of this section) by the withholding agent and 
paid over to the person from whom it was withheld:
    (i) In the case of natural resource royalties and real property 
rentals, an amount equal to 15 percent of such royalties and rentals, 
and
    (ii) In the case of interest (other than coupon bond interest), 
patent royalties, copyright royalties, film rentals, and the like, an 
amount equal to the tax so withheld.
    (3) In the case of every such taxpayer whose address at the time of 
payment was in Ireland and who furnishes to the withholding agent Form 
1001-IR in duplicate, where United States tax at the rate of 28 percent 
or 30 percent, as the case may be, has been withheld from coupon bond 
interest on or after January 1, 1952, there shall be released (except as 
provided in paragraph (e) of this section) by the withholding agent and 
paid over to the person from whom it was withheld an amount equal to the 
tax so withheld, if such taxpayer also files in duplicate with the 
withholding agent as authorization for the release of such amount a Form 
1001-IR clearly marked ``Substitute''. One such substitute form shall be 
filed in duplicate with respect to each issue of bonds and will serve 
with respect to that issue to replace all Forms 1001 previously filed by 
such taxpayer in the calendar year in which the excess tax is released. 
The

[[Page 61]]

use of Form 1001-IR with each presentation of interest coupons for the 
purpose of obviating withholding of tax at source is set forth in 
Sec. 513.3(b).
    (4) In the case of dividends derived from a United States 
corporation and paid to a nonresident alien (including a nonresident 
alien individual, fiduciary, and partnership) or to a foreign 
corporation, whose address at the time of payment was in Ireland, where 
United States tax at the rate of 30 percent has been withheld from such 
dividends on or after January 1, 1952, there shall be released (except 
as provided in paragraph (d) of this section) by the withholding agent 
and paid over to the person from whom it was withheld an amount equal to 
15 percent of such dividends.
    (b) Amounts withheld during 1951. For provisions respecting the 
refund of excess tax withheld during the calendar year 1951, see 
Sec. 513.11.
    (c) Pensions and life annuities. (1) In order to bring the 
convention into force and effect at the earliest practicable date the 
exemption from tax otherwise withheld at the source from life annuities 
and pensions, other than pensions paid by the Government of the United 
States to individuals in respect of services rendered thereto in the 
discharge of governmental functions, is hereby made effective beginning 
January 1, 1952, in any case in which such pensions and life annuities 
are derived from sources within the United States by a nonresident alien 
individual who is resident in Ireland for the purposes of Irish tax.
    (2) In the case of every such taxpayer whose address at the time of 
payment was in Ireland and who furnishes to the withholding agent the 
letter of notification prescribed in Sec. 513.6, where United States tax 
at the rate of 30 percent has been withheld on or after January 1, 1952, 
from such pensions or life annuities, as the case may be, there shall be 
released by the withholding agent and paid over to the person from whom 
it was withheld an amount equal to the tax so withheld.
    (d) Subsidiary's dividends. (1) United States tax shall be withheld 
at the rate of 15 percent from any dividend derived from a United States 
corporation and paid on or after January 1, 1952, to a foreign 
corporation whose address is in Ireland unless, prior to the date of 
payment thereof, the Commissioner of Internal Revenue notifies the 
domestic corporation that such dividend falls within the scope of the 
proviso of Article VI(1) of the convention.
    (2) In the case of every domestic corporation receiving notification 
from the Commissioner of Internal Revenue under the provisions of 
Sec. 513.2(b) that dividends paid or to be paid by it fall within the 
scope of the proviso of Article VI(1) of the convention, where United 
States tax in excess of the applicable rate of 5 percent has been 
withheld on or after January 1, 1952, from dividends which come within 
the scope of such proviso, the withholding agent shall, if so authorized 
in such notification, release and pay over to the foreign corporation 
from which it was withheld the excess tax withheld with respect to such 
dividends.
    (e) Interest paid where degree of stock ownership is determined. In 
the case of every foreign corporation whose address at the time of 
payment was in Ireland and which (1) furnishes to the domestic 
corporation a copy of the Commissioner's authorization of release 
prescribed in Sec. 513.3(c) and (2) files the letter of notification 
prescribed in Sec. 513.3(b), or the substitute Form 1001-IR prescribed 
in paragraph (a) of this section, whichever is applicable, where United 
States tax at the rate of 28 percent or 30 percent, as the case may be, 
has been withheld on or after January 1, 1952, the withholding agent 
shall release and pay over to the foreign corporation from which it was 
withheld an amount equal to the tax so withheld.



Sec. 513.8  Addressee not actual owner.

    (a) If any person with an address in Ireland who receives a dividend 
from a United States corporation with respect to which United States tax 
at the rate of only 15 percent has been withheld at source is a nominee 
or representative through whom such dividend flows to a person other 
than one described in Sec. 513.2(a) as being entitled to such reduced 
rate of 15 percent, such recipient in Ireland will withhold an 
additional amount of United States tax equivalent to the difference 
between the United States tax which would have

[[Page 62]]

been withheld had the convention not been in effect (30 percent as of 
the date of approval of this subpart) and the 15 percent withheld at the 
source with respect to such dividend pursuant to Sec. 513.2(d).
    (b) In any case in which a fiduciary or partnership with an address 
in Ireland receives, otherwise than as a nominee or representative, a 
dividend from a United States corporation with respect to which United 
States tax at the rate of only 15 percent has been withheld at source, 
if a beneficiary of such fiduciary or a partner in such partnership is 
not entitled to the reduced rate of tax provided in Article VI(1) of the 
convention, the fiduciary or partnership will withhold an additional 
amount of United States tax with respect to the portion of such dividend 
included in such beneficiary's share of the distributed or distributable 
income, or in such partner's distributive share of the income, of such 
fiduciary or partnership, as the case may be. The amount of the 
additional tax is to be calculated in the same manner as under paragraph 
(a) of this section.
    (c) If any amount of United States tax is released pursuant to 
Sec. 513.7(a) by the withholding agent in the United States with respect 
to a dividend received by such a person with an address in Ireland, the 
latter will also withhold from such released amount any additional 
amount of United States tax, otherwise required to be withheld by the 
preceding provisions of this section in respect of such dividend, in the 
same manner as if at the time of payment of such dividend United States 
tax at the rate of only 15 percent had been withheld at source 
therefrom.
    (d) The amounts so withheld by such withholding agents in Ireland 
will be deposited, without converting such amounts into United States 
dollars, with the Irish Revenue Commissioners on or before the 15th day 
after the close of the calendar year quarter in which such withholding 
in Ireland occurs. Each withholding agent making such deposit will 
render therewith the appropriate Irish form as prescribed in regulations 
made by the Revenue Commissioners. The Revenue Commissioners have 
arranged that the amounts so deposited will be remitted by draft in 
United States dollars to the District Director of Internal Revenue, 
Baltimore, Maryland, U.S.A., on or before the end of the calendar month 
in which the deposits are made, such draft to be accompanied by the 
Irish form rendered by the withholding agents in Ireland in connection 
with such deposits.



Sec. 513.9  Information to be furnished in ordinary course.

    In compliance with the provisions of Article XX of the convention 
the Commissioner of Internal Revenue will transmit to the Irish Revenue 
Commissioners, as soon as practicable after the close of the calendar 
year 1952 and of each subsequent calendar year during which the 
convention is in effect, the following information relating to such 
preceding calendar year:
    (a) The name and address of each person whose address as disclosed 
on each available Form 1042 is in Ireland deriving from sources within 
the United States dividends, interest, rent, royalties, salaries, wages, 
pensions, annuities, and other fixed or determinable annual or 
periodical income; and the amount of such income as disclosed on such 
form with respect to each such person.
    (b) The duplicate copy of each available ownership certificate, Form 
1001-IR, filed pursuant to Sec. 513.3(b), and substitute Form 1001-IR, 
filed pursuant to Sec. 513.7(a), in connection with coupon bond 
interest.



Sec. 513.10  Beneficiaries of a domestic estate or trust.

    A nonresident alien who is resident in Ireland for the purposes of 
Irish tax and who is a beneficiary of a domestic estate or trust shall 
be entitled to the exemption from, or reduction in the rate of, United 
States tax provided in Articles VI, VII, VIII, IX, and XV of the 
convention with respect to dividends, interest, royalties, natural 
resource royalties, and real property rentals to the extent such item or 
items are included in his share of the distributed or distributable 
income of such estate or

[[Page 63]]

trust. In order to be entitled in such instance to the exemption from, 
or reduction in the rate of, tax such beneficiary must otherwise satisfy 
the requirements of these respective Articles of the convention and 
must, where applicable, execute and submit to the fiduciary of such 
estate or trust in the United States the appropriate letter of 
notification prescribed in Secs. 513.3(b), 513.4, and 513.5.



Sec. 513.11  Refund of income tax withheld during 1951.

    (a) If United States tax withheld at the source during the year 1951 
from dividends, interest, royalties, natural resource royalties, real 
property rentals, pensions, or life annuities is in excess of the tax 
imposed by Chapter 1 (relating to the income tax) of the Internal 
Revenue Code, as modified by the convention, claim by the taxpayer for 
the refund of any overpayment shall be made under section 322 of the 
Internal Revenue Code by filing Form 843 together with Form 1040NB, Form 
1040NB-a, Form 1040B, or Form 1120NB, whichever is applicable, or with 
an amended return.
    (b) The taxpayer's total gross income from sources within the United 
States, including every item of capital gain subject to tax under the 
provisions of section 211(a)(1)(B) or 211(c) of the Internal Revenue 
Code, shall be disclosed on the return. In the event that securities are 
held in the name of a person other than the actual or beneficial owner, 
the name and address of such person must be furnished with the claim. 
There shall also be included in such claim for refund a statement:
    (1) That the taxpayer was, at the time when the item or items of 
income were derived, (i) a nonresident alien (including a nonresident 
alien individual, fiduciary, or partnership) who at such time was 
resident in Ireland for the purposes of Irish tax, or (ii) a foreign 
corporation whose business at such time was managed and controlled in 
Ireland.
    (2) That the taxpayer at no time during the taxable year in which 
the income was derived had a permanent establishment in the United 
States.
    (3) That the taxpayer is subject to Irish tax on the item or items 
of income for which the benefit of the convention is claimed.
    (c) If, however, the taxpayer is an individual who during the 
taxable year derived from sources within the United States income which 
consists exclusively of pensions or life annuities entitled to the 
benefit of Article XII of the convention, the statements specified in 
paragraph (b) (2) and (3) of this section will not be required.
    (d) As to additional information required in the case of a foreign 
corporation claiming the benefit of the 5 percent rate on dividends, or 
in certain doubtful cases the benefit of the exemption with respect to 
interest, paid by a domestic corporation, see Sec. 513.2(b) or 
Sec. 513.3(c).



PART 514--FRANCE--Table of Contents




                       Subpart--Withholding of Tax

 Taxable Years Beginning After December 31, 1956, And Before January 1, 
 1967, or Dividends, Interest, And Royalties Paid Before August 11, 1968

Sec.
514.1  Introductory.
514.2  Dividends.
514.3  Dividends received by addressee not actual owner.
514.4  Interest.
514.5  Patent and copyright royalties and film rentals.
514.6  Private pensions and life annuities.
514.7  Beneficiaries of a domestic estate or trust.
514.8  Release of excess tax withheld at source.
514.9  Refund of excess tax withheld.
514.10  Effective date.

Taxable Years Beginning After December 31, 1966, or Dividends, Interest, 
             And Royalties Paid on or After August 11, 1968

514.20  Introductory.
514.21  Dividends.
514.22  Dividends received by persons not entitled to reduced rate of 
          tax.
514.23  Interest.
514.24  Royalties.
514.25  Private pensions, alimony, and annuities.
514.26  Income covered by convention.
514.27  Beneficiaries of domestic estate and trust.
514.28  Release of excess tax withheld at source.
514.29  Refund of excess tax paid to Director of International 
          Operations.

[[Page 64]]

514.30  Information furnished in ordinary course.
514.31  Return required when liability not satisfied by withholding.
514.32  Effective date.

                       Subpart--General Income Tax

                   Regulations Effective Jan. 1, 1945

514.101  Introductory.
514.102  Applicable provisions of the Internal Revenue Code.
514.103  Scope of the convention.
514.104  Definitions.
514.105  Scope of convention with respect to determination of 
          ``industrial and commercial profits'' of a nonresident alien 
          individual resident of France, or of a French corporation or 
          other entity carrying on a French enterprise in the United 
          States.
514.106  Control of a domestic enterprise by a French enterprise.
514.107  Income from operation of ships or aircraft.
514.108  Income from real property, including mineral royalties.
514.110  Government wages, salaries, and similar compensation, pensions, 
          and life annuities.
514.111  Compensation for labor or personal services.
514.112  Stocks, securities, and commodities.
514.113  Remittances to students.
514.114  Credit against United States tax liability for income tax paid 
          to France.
514.115  Adjustment of tax liability of residents of France and French 
          corporations.
514.116  Reciprocal administrative assistance.
514.117  Reciprocal regulations.

    Authority: 26 U.S.C. 7805.



                       Subpart--Withholding of Tax

 Taxable Years Beginning After December 31, 1956, And Before January 1, 
 1967, or Dividends, Interest, And Royalties Paid Before August 11, 1968

    Source: Treasury Decision 6273, 22 FR 9530, Nov. 28, 1957; 25 FR 
14022, Dec. 31, 1960, unless otherwise noted.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, the 
undesignated centerheading preceding Sec. 514.1 was removed, effective 
Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 31, 1998, the effective 
date was delayed until Jan. 1, 2000.



Sec. 514.1  Introductory.

    (a) Applicable provisions of convention. The income tax convention 
between the United States and France, signed on July 25, 1939, and 
October 18, 1946, as modified by the supplemental convention, signed 
June 22, 1956 (the instruments of ratification of which were exchanged 
on June 13, 1957), referred to in this part as the convention, provides 
in part as follows, the quoted articles being effective as indicated:

    Article I(a) of the Supplemental Convention of 1956, on June 13, 
1957.
    Article I(d) of the Supplemental Convention of 1956, on January 1, 
1952.
    Article 7 and the Protocol of the Convention of 1939, on January 1, 
1945.
    The supplemental convention signed June 22, 1956, provides in part 
as follows:

                                Article I

    The provisions of the Convention and Protocol between the United 
States and the French Republic signed at Paris on July 25, 1939 are 
hereby modified and supplemented as follows:
    (a) By striking out Article 1(a) and inserting in lieu thereof the 
following:
    ``(a) In the case of the United States: The Federal income taxes 
(including surtaxes and excess profits taxes) and the documentary taxes 
on sales or transfers of shares or certificates of stock or bonds.''

                                * * * * *

    (d) By adding immediately after Article 6 the following new 
articles:

                              ``Article 6A

    Dividends and interest derived, on or after January 1, 1952, from 
sources within one of the contracting States by a resident or 
corporation or other entity of the other State, not having a permanent 
establishment in the former State shall be subject to tax by such former 
State at a rate not in excess of 15 percent of the gross amount of such 
dividends or interest. Such reduced rate of tax shall not apply to 
dividends or interest paid prior to the calendar year in which are 
exchanged the instruments of ratification of the present Convention if, 
for the taxable year in which such dividends or interest is received, 
penalty for fraud with respect to the taxes which are the subject of the 
present Convention has been imposed against the recipient of such 
dividends or interest.''

                                * * * * *

                               Article III

    (a) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Paris as soon as possible.

[[Page 65]]

    (b) Its provisions shall come into force and shall become effective 
as of the date of the exchange of the instruments of ratification 
subject both to the provisions of Article I (d) and (e) and to the 
provisions set forth herein below.

                                * * * * *

    (c) If refund of any overpayment resulting from the application of 
Article I(d) of the present Convention is prevented on the date of 
exchange of instruments of ratification or within two years from such 
date by the operation of any law, refund of such overpayment (without 
interest) shall nevertheless be made provided that claim for refund is 
filed within two years after the date of the exchange of instruments of 
ratification of the present Convention with the contracting State to 
which such overpayment was made.
    (d) The present Convention shall remain effective so long as the 
Conventions signed July 25, 1939 and October 18, 1946, remain effective.
    The convention of July 25, 1939, provides, in part, as follows:

                                Article 7

                                * * * * *

    Royalties derived from within one of the contracting States by a 
resident, or by a corporation or other entity of the other contracting 
State as consideration for the right to use copyrights, patents, secret 
processes and formulae, trademarks and other analogous rights shall be 
exempt from taxation in the former State, provided such resident, 
corporation or other entity does not have a permanent establishment 
there.

                                Article 8

                                * * * * *

    Private pensions and life annuities derived from within one of the 
contracting States and paid to individuals residing in the other 
contracting State shall be exempt from taxation in the former State.

Protocol:

                                * * * * *

    III. As used in this Convention:
    (a) The term ``permanent establishment'' includes branches, mines 
and oil wells, plantations, factories, workshops, stores, purchasing and 
selling and other offices, agencies, warehouses, and other fixed places 
of business but does not include a subsidiary corporation.
    When an enterprise of one of the contracting States carries on 
business in the other State through an employee or agent, established 
there, who has general authority to negotiate and conclude contracts or 
has a stock of merchandise from which he regularly fills orders which he 
receives, this enterprise shall be deemed to have a permanent 
establishment in the latter State. But the fact that an enterprise of 
one of the contracting States has business dealings in the other State 
through a bona fide commission agent or broker shall not be held to mean 
that such enterprise has a permanent establishment in the latter State.
    Insurance enterprises shall be considered as having a permanent 
establishment in one of the States as soon as they receive premiums from 
or insure risks in the territory of that State.
    IV. The term ``life annuities'' referred to in Article 8 of this 
Convention means a stated sum payable periodically at stated times 
during life, or during a specified number of years to the person who has 
paid the premium or a gross sum for such an obligation.
    The convention of October 18, 1946, provides, in part, as follows:

                                Title III

                        Administrative Assistance

                                * * * * *

                               Article 13

    (1) The competent authorities of the two Contracting States may 
prescribe regulations necessary to interpret and carry out the 
provisions of the present Convention and the Convention of July 25, 
1939.

                                * * * * *

    (b) Definitions--(1) In general. Any term defined in the convention 
or Secs. 514.1 to 514.10 shall have the meaning so assigned to it; any 
term not so defined shall, unless the context otherwise requires, have 
the meaning which such term has under the internal revenue laws of the 
United States.
    (2) France. As used in Secs. 514.1 to 514.10, the term ``France'', 
when used in a geographical sense, means continental France, exclusive 
of Algeria and the Colonies.



Sec. 514.2  Dividends.

    (a) General. (1) The rate of United States tax imposed by the 
Internal Revenue Code upon dividends derived from sources within the 
United States on or after January 1, 1952, by a nonresident alien 
(including a nonresident

[[Page 66]]

alien individual, fiduciary, and partnership) who is a resident of 
France when such dividend is so paid, or by a French corporation, shall 
not exceed 15 percent if such alien or corporation at no time during the 
taxable year in which such dividends are so received has no permanent 
establishment within the United States. Article I(a) of the convention, 
signed June 22, 1956. As to what constitutes a ``permanent 
establishment'' see Protocol III(a), in Sec. 514.1.
    (2) Thus, if a nonresident alien individual who is a resident of 
France performs personal services within the United States during the 
taxable year but has at no time during such year a permanent 
establishment within the United States, he is entitled to the reduced 
rate of tax with respect to dividends derived from United States 
sources, as provided in Article I(d) of the convention even though under 
the provisions of section 871(c) of the Internal Revenue Code of 1954 he 
has engaged in trade or business within the United States during such 
year by reason of his having rendered personal services therein.
    (b) Effect of address in France on withholding in the case of 
dividends. For the purpose of withholding of United States tax in the 
case of dividends, every nonresident alien (including a nonresident 
alien individual, fiduciary, and partnership) whose address is in France 
shall be deemed by United States withholding agents to be a nonresident 
alien who is a resident of France not having a permanent establishment 
in the United States; and every foreign corporation whose address is in 
France shall be deemed by such withholding agents to be a French 
corporation not having a permanent establishment in the United States.
    (c) Rate of withholding. (1) Withholding at source in the case of 
dividends derived from sources within the United States and paid on or 
after January 1, 1957, to nonresident aliens (including a nonresident 
alien individual, fiduciary, and partnership) and to foreign 
corporations, whose addresses are in France, shall be at the rate of 15 
percent in every case except that in which, prior to the date of payment 
of such dividends, the Commissioner of Internal Revenue has notified the 
withholding agent that the reduced rate of withholding shall not apply.
    (2) The preceding provisions respecting the application of the 
reduced withholding rate in the case of dividends paid to nonresident 
aliens and foreign corporations with addresses in France are based upon 
the assumption that the payee of the dividend is the actual owner of the 
capital stock from which the dividend is derived and consequently is the 
person liable to the United States upon such dividend. As to action by 
the recipient who is not the owner of the dividend, see Sec. 514.3.
    (3) The rate at which the United States tax has been withheld from 
any dividend paid at any time after the expiration of the thirtieth day 
after the date on which Secs. 514.1 to 514.10 are published in the 
Federal Register to any person whose address is in France at the time 
the dividend is paid shall be shown either in writing or by appropriate 
stamp on the check, draft, or other evidence of payment or on an 
accompanying statement.



Sec. 514.3  Dividends received by addressee not actual owner.

    (a) Additional tax to be withheld--(1) Nominee or representative. 
The recipient in France of any dividend, paid on or after January 1, 
1957, from which United States tax at the reduced rate of 15 percent has 
been withheld at source pursuant to Sec. 514.2(c)(1), who is a nominee 
or representative through whom the dividend is received by a person 
other than one described in Sec. 514.2(a) as being entitled to the 
reduced rate, shall withhold an additional amount of United States tax 
equivalent to the United States tax which would have been withheld if 
the convention had not been in effect (30 percent as of the date of 
approval of Secs. 514.1 to 514.10) minus the 15 percent which has been 
withheld at the source.
    (2) Fiduciary or partnership. A fiduciary or a partnership with an 
address in France which receives, otherwise than as a nominee or 
representative, a dividend from which United States tax at the reduced 
rate of 15 percent has been withheld at source pursuant to Sec. 514.2 
shall withhold an additional amount of United States tax from the 
portion of the dividend included in the

[[Page 67]]

gross income from sources within the United States of any beneficiary or 
partner, as the case may be, who is not entitled to the reduced rate of 
tax in accordance with Sec. 514.2(c). The amount of the additional tax 
is to be calculated in the same manner as under subparagraph (1) of this 
paragraph.
    (3) Released amounts of tax. If any amount of United States tax is 
released pursuant to Sec. 514.8(a)(1) by the withholding agent in the 
United States with respect to a dividend paid to a nominee, 
representative, fiduciary, or partnership with an address in France, the 
latter shall withhold from such released amount any additional amount of 
United States tax, otherwise required to be withheld from the dividend 
by the provisions of subparagraphs (1) and (2) of this paragraph, in the 
same manner as if at the time of payment of the dividends United States 
tax at the rate of only 15 percent had been withheld at source 
therefrom.
    (b) Returns filed by French withholding agents. The amounts withheld 
pursuant to paragraph (a) of this section by any withholding agent in 
France shall be deposited, without converting the amounts into United 
States dollars, with the Directeur General des Impots of France on or 
before the 15th day after the close of the quarter of the calendar year 
in which the withholding in France occurs. The withholding agent making 
the deposit shall render therewith such appropriate French form as may 
be prescribed by the Directeur General des Impots. The amounts so 
deposited should be remitted by the Directeur General des Impots by 
draft in the United States dollars to the Director, International 
Operations Division, Internal Revenue Service, Washington 25, D. C., U. 
S. A., on or before the end of the calendar month in which the deposit 
is made, and should be accompanied by such French form as may be 
required to be rendered by the withholding agent in France in connection 
with the deposit.



Sec. 514.4  Interest.

    (a) General. The rate of United States tax imposed by the Internal 
Revenue Code upon interest on bonds, securities, notes, debentures, or 
on any other form of indebtedness, including interest on obligations of 
the United States, obligations of instrumentalities of the United 
States, and mortgages and bonds secured by real property, which is 
derived from sources within the United States in taxable years beginning 
on or after January 1, 1952, by a nonresident alien (including a 
nonresident alien individual, fiduciary, and partnership) who is a 
resident of France, or by a French corporation or other entity, shall 
not exceed 15 percent under the provisions of Article I(d) of the 
convention if such alien, corporation, or other French entity at no time 
during the taxable year in which such interest is received has a 
permanent establishment in the United States. As to what constitutes a 
permanent establishment see Article III(a) of the convention.
    (b) Application of reduced rate at source. (1) To secure withholding 
of United States tax at the rate of 15 percent at source in the case of 
coupon bond interest, the nonresident alien who is a resident of France, 
or the French corporation or other entity, shall, for each issue of 
bonds, file Form 1001-F in duplicate when presenting the interest 
coupons for payment. This form shall be signed by the owner of the 
interest, or by his trustee or agent, and shall show the name and 
address of the obligor, the name and address of the owner of the 
interest, and the amount of the interest. It shall contain a statement 
that the owner (i) is a resident of France, or is a French corporation 
or other entity, and (ii) has no permanent establishment in the United 
States.
    (2) The reduction in the rate of United States tax contemplated by 
Article 6A of the convention, insofar as it concerns coupon bond 
interest, is applicable only to the owner of the interest. The person 
presenting the coupon or on whose behalf it is presented shall, for the 
purpose of the reduction in tax, be deemed to be the owner of the 
interest only if he is, at the time the coupon is presented for payment, 
the owner of the bond from which the coupon has been detached. If the 
person presenting the coupon, or on whose behalf it is presented, is not 
the owner of the bond, Form 1001, and not Form 1001-F, shall be 
executed.

[[Page 68]]

    (3) The original and duplicate of Form 1001-F shall be forwarded by 
the withholding agent to the Director, International Operations 
Division, Internal Revenue Service, Washington 25, D. C., with the 
annual return on Form 1042. Form 1001-F shall be listed on Form 1042.
    (4) To secure the reduced rate of United States tax at source in the 
case of interest other than coupon bond interest, the nonresident alien 
individual who is a resident of France, or the French corporation or 
other entity, shall file Form 1001A-F in duplicate with the withholding 
agent in the United States. This form shall be signed by the owner of 
the interest, or by his trustee or agent, and shall show the name and 
address of the obligor and the name and address of the owner of the 
interest. It shall contain a statement that the owner (i) is a resident 
of France, or is a French corporation or other entity, and (ii) has no 
permanent establishment in the United States.
    (5) Form 1001A-F shall be filed with the withholding agent for each 
successive three-calendar-year period during which such interest is 
paid. For this purpose, the first such period shall commence with the 
beginning of the calendar year in which such income is first paid on or 
after January 1, 1957. Each such form filed with any withholding agent 
shall be filed not later than 20 days preceding the date of the first 
payment within each successive period, or, if that is not possible 
because of special circumstances, as soon as possible after such first 
payment. Once such a form has been filed in respect of any three-
calendar-year period, no additional Form 1001A-F need be filed in 
respect thereto unless the Commissioner of Internal Revenue notifies the 
withholding agent that another such form shall be filed by the taxpayer. 
If, after filing such form, the taxpayer ceases to be eligible for the 
reduced rate of United States tax granted by Article 6A of the 
convention in respect to such interest, he shall promptly notify the 
withholding agent by letter in duplicate. When any change occurs in the 
ownership of the interest as recorded on the books of the payer, the 
reduction in rate of withholding of United States tax shall no longer 
apply unless the new owner of record is entitled to and does properly 
file a Form 1001A-F with the withholding agent.
    (6) The duplicate of each Form 1001A-F shall be immediately 
forwarded by the withholding agent to the Director, International 
Operations Division, Internal Revenue Service, Washington 25, D. C.



Sec. 514.5  Patent and copyright royalties and film rentals.

    (a) Exemption from tax. Royalties for the right to use copyrights, 
patents, designs, secret processes and formulae, trademarks, and other 
analogous property, and royalties and rentals in respect of motion 
picture films or for the use of industrial, commercial, or scientific 
equipment, which are derived from sources within the United States on or 
after January 1, 1945, by a nonresident alien individual who is a 
resident of France, or by a French corporation, are exempt from United 
States tax under the provisions of Article 7 of the convention signed 
July 25, 1939, as modified by Article 7(b) of the convention signed 
October 18, 1946, if such alien or corporation at no time during the 
taxable year in which such income is derived has engaged in trade or 
business within the United States through a permanent establishment 
situated therein.
    (b) Exemption from withholding of United States tax. To avoid 
withholding of United States tax at source in the case of items of 
income to which this section applies, the nonresident alien who is a 
resident of France, or the French corporation, shall file Form 1001A-F, 
in duplicate, with the withholding agent in the United States.
    (c) Manner of filing. The provisions of Sec. 514.4 relating to the 
execution, filing, effective period, and disposition of Form 1001A-F, 
are equally applicable with respect to the income falling within the 
scope of this section.
    (d) Revocation of 26 CFR (1939) 7.418 (Treasury Decision 5499). 
Effective January 1, 1957, the provisions of 26 CFR 7.418 (Rev. 1953, 
Parts 1-79, and Supps.) (Treasury Decision 5499, 11 F.R. 2158), approved 
February 27, 1946, are hereby made inapplicable, and the provisions of 
this section are hereby substituted

[[Page 69]]

therefor with respect to payments of royalties and film rentals made on 
or after January 1, 1957.



Sec. 514.6  Private pensions and life annuities.

    (a) Exemption from tax. Private pensions and life annuities as 
defined in paragraph (d) of this section, derived from sources within 
the United States on or after January 1, 1945, and paid to a nonresident 
alien who is a resident of France are exempt from United States tax 
under the provisions of Article 8 of the convention of July 25, 1939.
    (b) Exemption from withholding of United States tax--Form to use. To 
secure exemption from withholding of United States tax at the source in 
the case of private pensions and life annuities, the nonresident alien 
who is a resident of France shall file Form 1001A-F, in duplicate, with 
the withholding agent in the United States.
    (c) Manner of filing. The provisions of Sec. 514.4 relating to the 
execution, filing, effective period, and disposal of Form 1001A-F are 
equally applicable with respect to the income falling within the scope 
of this section.
    (d) Definition. As used in this section, the term ``pensions'' means 
periodic payments made in consideration for services rendered or by way 
of compensation for injuries received, and the term ``life annuities'' 
means a stated sum payable periodically at stated times during life, or 
during a specified number of years, under an obligation to make the 
payments in return for adequate and full consideration in money or 
money's worth. Neither term includes retired pay or pensions paid by the 
United States or by any State or Territory of the United States.



Sec. 514.7  Beneficiaries of a domestic estate or trust.

    (a) Entitled to benefits of convention. If he otherwise satisfies 
the requirements of the respective articles concerned, a nonresident 
alien individual who is a resident of France and who is a beneficiary of 
a domestic estate or trust shall be entitled to the reduction in the 
rate of, or exemption from, United States tax granted by Articles 6A and 
7 of the convention with respect to dividends, interest, and patent 
royalties and other like amounts to the extent that (1) any amount paid, 
credited, or required to be distributed by such estate or trust to such 
beneficiary is deemed to consist of such items, and (2) such items 
would, without regard to the convention, be includible in his gross 
income.
    (b) Withholding of United States tax. In order to be entitled, 
because of the application of paragraph (a) of this section, to the 
reduction in rate of, or exemption from, withholding of United States 
tax the beneficiary must otherwise satisfy the requirements of the 
respective articles concerned, and shall, where applicable, execute and 
submit to the fiduciary of the estate or trust in the United States the 
appropriate form or forms prescribed in Secs. 514.4(b) and 514.6(b).
    (c) Amounts otherwise includible in gross income of beneficiary. For 
the determination of amounts which, without regard to the convention, 
are includible in the gross income of the beneficiary, see subchapter J 
of chapter 1 of the Internal Revenue Code of 1954, and the regulations 
thereunder.



Sec. 514.8  Release of excess tax withheld at source.

    (a) Amounts to be released--(1) Dividends derived from domestic 
corporation. If United States tax has been withheld at the statutory 
rate on or after January 1, 1957, from dividends described in 
Sec. 514.2(a) and derived from a domestic corporation by a nonresident 
alien (including a nonresident alien individual, fiduciary, and 
partnership) or by a foreign corporation, whose address at the time of 
payment was in France, the withholding agent shall release and pay over 
to the person from whom the tax was withheld an amount which is equal to 
the difference between the tax so withheld and the tax required to be 
withheld pursuant to Sec. 514.2(c).
    (2) Coupon bond interest--(i) Substitute form. In the case of every 
taxpayer who furnishes to the withholding agent Form 1001-F clearly 
marked ``Substitute'' and executed in accordance with Sec. 514.4(b)(1), 
where United States tax has been withheld at the statutory rate on or 
after January 1, 1957, from coupon bond interest, the withholding agent 
shall release and pay over to the

[[Page 70]]

person from whom the tax was withheld an amount which is equal to the 
difference between the tax so withheld and the tax required to be 
withheld pursuant to Sec. 514.4(b)(1) if the taxpayer also attaches to 
such form a letter in duplicate, signed by the owner, trustee, or agent 
and containing the following:
    (a) The name and address of the obligor;
    (b) The name and address of the owner from which the excess tax was 
withheld;
    (c) A statement that, at the time when the interest was derived from 
which the excess tax was withheld, the owner was neither a citizen nor a 
resident of the United States but was a resident of France, or, in the 
case of a corporation, the owner was a French corporation; and
    (d) A statement that the owner at no time during the taxable year in 
which the interest was derived was engaged in trade or business within 
the United States through a permanent establishment situated therein.

One such substitute form shall be filed, in duplicate, with respect to 
each issue of bonds and will serve with respect to that issue to replace 
all Forms 1001 previously filed by the taxpayer in the calendar year in 
which the excess tax was withheld and with respect to which such excess 
is released. If the person presenting the coupon, or on whose behalf it 
is presented, is not the owner of the bond, Form 1001, and not Form 
1001-F, shall be executed.
    (ii) Disposition of form. The original and duplicate of substitute 
Form 1001-F (and letter) shall be forwarded by the withholding agent to 
the Director, International Operations Division, Internal Revenue 
Service, Washington, D.C., with the annual return on Form 1042. 
Substitute Form 1001-F need not be listed on Form 1042.
    (3) Noncoupon interest, royalties, private pensions, and life 
annuities. (i) If a taxpayer furnishes to the withholding agent a Form 
1001A-F, properly executed as prescribed by Sec. 514.4(b)(4), and United 
States tax has been withheld at the statutory rate on or after January 
1, 1957, from noncoupon interest payments in respect of which the form 
is filed, the withholding agent should release and pay over to the 
person from whom the tax was withheld an amount which is equal to the 
difference between the tax so withheld and the tax required to be 
withheld pursuant to Sec. 514.4(b)(4).
    (ii) If a taxpayer furnishes to the withholding agent a Form 1001A-
F, properly executed as prescribed by Sec. 514.4(b)(4), and United 
States tax has been withheld at the statutory rate on or after January 
1, 1957, from royalties, private pensions, and life annuities in respect 
of which the form is filed, the withholding agent shall release and pay 
over to the person from whom the tax was withheld an amount which is 
equal to the total tax so withheld.
    (b) Amounts not to be released. The provisions of this section do 
not apply to excess tax withheld at source which has been paid by the 
withholding agent to the internal revenue officer entitled to receive 
payment of the tax withheld under chapter 3 of the Internal Revenue Code 
of 1954.
    (c) Statutory rate. As used in this section, the term ``statutory 
rate'' means the rate prescribed by chapter 3 of the Internal Revenue 
Code of 1954 and the regulations thereunder, as though the convention 
had not come into effect.



Sec. 514.9  Refund of excess tax withheld.

    (a) Years 1952, 1953, 1954, 1955, 1956. Where the tax withheld at 
the source upon dividends and interest paid in any one or more of the 
calendar years 1952, 1953, 1954, 1955, and 1956 is in excess of the tax 
due from the taxpayer under the convention, supplemented as set forth 
above, it will be necessary for the taxpayer to file an income tax 
return (Form 1040NB France for individuals and Form 1120NB France for 
corporations) with respect to such taxable year or years. The return 
shall cover all years for which a refund is claimed. The return must be 
filed on or before June 13, 1959. One return shall cover all years for 
which a refund is claimed. The taxpayer's total fixed or determinable, 
annual or periodical income (other than royalties) from sources within 
the United States should be reported on the return, and the income for 
each taxable year should be shown separately. There shall also be shown 
on such returns the amounts, if any, received in any of such years of 
capital

[[Page 71]]

gains (other than gains from the sale or exchange of stocks, securities 
or commodities) from sources within the United States. For this purpose, 
beginning with the calendar year 1954, certain distributions from 
employees' trusts, and amounts received incident to disposal of timber 
or coal or patent rights shall be included in such capital gains. See 
section 871(a)(1) of the Internal Revenue Code of 1954 for provisions 
pertaining to individual taxpayers and section 881(a) for provisions 
pertinent to corporate taxpayers. There shall be included with the 
return the following statements:
    (1) That the taxpayer was a nonresident alien (including a 
nonresident alien individual, fiduciary, or partnership) resident in 
France or was a French corporation, during the year or years for which 
the return is filed;
    (2) That the taxpayer had no permanent establishment in the United 
States during the respective years in which the income was received;
    (3) That no penalty for fraud has been imposed by the United States 
against the taxpayer claimant with respect to income tax for the year or 
years for which the return is filed.

In addition to the above statements, all information requested on the 
return must be furnished. Any tax paid in excess of that due from the 
owner of the income will be refunded by the United States Government as 
required by law. For the purpose of refund of excess tax withheld 
resulting from the tax convention, a properly executed return on Form 
1040NB France or Form 1120NB France shall constitute a claim for refund 
or credit for the amount of the overpayment disclosed by such return.
    (b) Date of payment of tax. The United States tax withheld from 
dividends and interest derived from sources within the United States by 
nonresident aliens, or by a foreign corporation not engaged in trade or 
business in the United States, is deemed to have been paid on March 15 
of the calendar year immediately succeeding that in which such income 
has been so derived. Section 1461, Internal Revenue Code of 1954. Hence, 
the United States tax withheld from dividends and interest derived by 
such aliens resident in France and such French corporations for the 
years 1952, 1953, 1954, 1955, and 1956 is deemed to have been paid, 
respectively, on March 15, 1953, March 15, 1954, March 15, 1955, March 
15, 1956, and March 15, 1957.



Sec. 514.10  Effective date.

    The provisions of Secs. 514.1 through 517.9 shall be effective with 
respect to taxable years beginning after December 31, 1956, and before 
January 1, 1967, or with respect to dividends, interest, and royalties 
paid before August 11, 1968.

[T.D. 6986, 34 FR 136, Jan. 4, 1969]

Taxable Years Beginning After December 31, 1966, or Dividends, Interest, 
             And Royalties Paid on or After August 11, 1968

    Source: Treasury Decision 6986, 34 FR 136, Jan. 4, 1969, unless 
otherwise noted.



Sec. 514.20  Introductory.

    (a) Applicable provisions of convention. The income tax convention 
between the United States and France, signed on July 28, 1967 (the 
instruments of ratification of which were exchanged on July 11, 1968), 
provides in part as follows, effective for taxable years beginning after 
December 31, 1966, or with respect to the rate of withholding tax, for 
dividends, interest, and royalties paid on or after August 11, 1968:

                        Article 1--Taxes Covered

    (1) The taxes which are the subject of the present Convention are:
    (a) In the case of the United States, the Federal income tax, 
including surtax, imposed by the Internal Revenue Code and
    (b) In the case of France:
    (i) The income tax on the income of physical persons, the 
complementary tax, the corporation tax, including any withholding tax, 
prepayment (precompte) or advance payment with respect to the aforesaid 
taxes, and
    (ii) The tax on Stock Exchange transactions.
    (2) The Convention shall also apply to any documentary taxes on 
sales or transfers of shares or certificates of stock or bonds which are 
subsequently imposed.
    (3) The Convention shall also apply to any identical or 
substantially similar taxes which are subsequently imposed in addition 
to, or in place of, the existing taxes.
    (4) For the purpose of Article 24 (Nondiscrimination), this 
Convention shall also

[[Page 72]]

apply to taxes of every kind and to those imposed at the national, 
State, and local level.

                     Article 2--General Definitions

    (1) In this Convention, unless the context otherwise requires:
    (a) The term ``United States of America'' means the United States of 
America and when used in the geographical sense means the States thereof 
and the District of Columbia. The term ``France'' when used in a 
geographical sense means Metropolitan France and the Overseas 
departments (Guadeloupe, Guyane, Martinique, and Reunion).
    (b) The terms ``a Contracting State'' and ``the other Contracting 
State'' means the United States or France, as the context requires.
    (c) The term ``person'' comprises an individual or a corporation, or 
any other body of individuals or persons.
    (d)(i) The term ``United States corporation'' or ``corporation of 
the United States'' means a corporation, or any entity treated as a 
corporation for U.S. tax purposes, which is created or organized under 
the laws of the United States or any State thereof or the District of 
Columbia; and
    (ii) The term ``French corporation'' or ``corporation of France'' 
means any body corporate or any entity which is treated as a body 
corporate under French tax law, which is resident within France for 
French tax purposes.
    (e) The term ``competent authority'' means:
    (i) In the case of the United States, the Secretary of the Treasury 
or his delegate, and
    (ii) In the case of France, the Minister of Economy and Finance or 
his delegate.
    (2) As regards the application of the Convention by a Contracting 
State any term not otherwise defined shall, unless the context otherwise 
requires, have the meaning which it has under the laws of that 
Contracting State relating to the taxes which are the subject of the 
Convention.

                       Article 3--Fiscal Domicile

    (1) The term ``resident of France'' means:
    (a) A French corporation, and
    (b) Any person (other than a body corporate or any entity which 
under French law is treated as a body corporate) who is resident in 
France for purposes of its tax.
    (2) The term ``resident of the United States'' means:
    (a) A U.S. corporation, and
    (b) Any person (other than a corporation or an entity treated under 
U.S. law as a corporation) who is resident in the United States for 
purposes of its tax, but in the case of a person acting as a partner or 
fiduciary only to the extent that the income derived by such person in 
that capacity is taxed as the income of a resident.
    (3) An individual who is a resident in both Contracting States shall 
be deemed a resident of that Contracting State in which he maintains his 
permanent home. If he has a permanent home in both Contracting States or 
in neither of the Contracting States, he shall be deemed a resident of 
that Contracting State with which his personal and economic relations 
are closest (center of vital interests). If the Contracting State in 
which he has his center of vital interests cannot be determined, he 
shall be deemed a resident of that Contracting State in which he has an 
habitual abode. If he has an habitual abode in both Contracting States 
or in neither of the Contracting States, the competent authorities of 
the Contracting States shall settle the question by mutual agreement. 
For purposes of this Article, a permanent home is the place in which an 
individual dwells with his family. An individual who is deemed to be a 
resident of one Contracting State and not a resident of the other 
Contracting State by reason of the provisions of this paragraph shall be 
deemd a resident only of the former State for all purposes of this 
Convention (including Article 22).

                   Article 4--Permanent Establishment

    (1) For the purposes of this Convention, the term ``permanent 
establishment'' means a fixed place of business through which a resident 
of one of the Contracting States engaged in industrial or commercial 
activity.
    (2) The term ``permanent establishment'' shall include especially:
    (a) A seat of management,
    (b) A branch;
    (c) An office;
    (d) A factory;
    (e) A workshop;
    (f) A warehouse;
    (g) A mine, quarry, or other place of extraction of natural 
resources;
    (h) A building site or construction or assembly project which exists 
for more than 12 months.
    (3) Notwithstanding paragraph (1) of this Article, a permanent 
establishment shall not include a fixed place of business used only for 
one or more of the following activities:
    (a) The use of facilities for the purpose of storage, display, or 
delivery of goods or merchandise belonging to the resident;
    (b) The maintenance of a stock of goods or merchandise belonging to 
the resident for the purpose of storage, display, or delivery;
    (c) The maintenance of a stock of goods or merchandise belonging to 
the resident for the purpose of processing by another person;
    (d) The maintenance of a fixed place of business for the purpose of 
purchasing goods or merchandise, or for collecting information, for the 
resident;

[[Page 73]]

    (e) The maintenance of a fixed place of business for the purpose of 
advertising, for the supply of information, for scientific research, or 
for similar activities which have a preparatory or auxiliary character, 
for the resident.
    (4) A person acting in a Contracting State on behalf of a resident 
of the other Contracting State--other than an agent of an independent 
status to whom paragraph (5) applies--shall be deemed to be a permanent 
establishment in the first-mentioned State if such person:
    (a) Has, and habitually exercises in that State, an authority to 
conclude contracts in the name of that resident, unless the exercise of 
such authority is limited to the purchase of goods or merchandise for 
that resident, or
    (b) Maintains substantial equipment or machinery within the first-
mentioned State for a period of 12 months or more.
    (5) A resident of a Contracting State shall not be deemed to have a 
permanent establishment in the other Contracting State merely because 
such resident carries on business in that other State through a broker, 
general commission agent, or any other agent of an independent status, 
where such persons are acting in the ordinary course of their business.
    (6) The fact that a resident of one of the Contracting States is a 
related person, as defined in Article 8 of this Convention, with respect 
to a resident of the other Contracting State or with respect to a person 
which engages in industrial or commercial activity in that other 
Contracting State (whether through a permanent establishment or 
otherwise) shall not be taken into account in determining whether that 
resident of the first Contracting State has a permanent establishment in 
the other Contracting State.
    (7) An insurance company of one of the Contracting States shall be 
considered as having a permanent establishment in the other Contracting 
State if, through a representative other than one described in paragraph 
(5), such company receives premiums from or insures risks in the 
territory of that other Contracting State.

                                * * * * *

                       Article 6--Business Profits

    (1) Industrial or commercial profits of a resident of one of the 
Contracting States shall be taxable only in that State unless such 
resident is engaged in industrial or commercial activity in the other 
Contracting State through a permanent establishment situated therein. If 
such resident is so engaged, tax may be imposed by such other State on 
the industrial or commercial profits of such resident but only on so 
much of them as are attributable to the permanent establishment.
    (2) Where a resident 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 industrial or commercial profits which would 
be attributable to such permanent establishment if such permanent 
establishment were an independent entity engaged in the same or similar 
activities under the same or similar conditions and dealing at arm's 
length with the resident of which it is a permanent establishment.
    (3) In the determination of the profits of a permanent 
establishment, there shall be allowed as deductions expenses which are 
reasonably connected with such profits including executive and general 
administrative expenses, whether incurred in the State in which the 
permanent establishment is situated or elsewhere.
    (4) No profits shall be attributed to a permanent establishment 
merely by reason of the purchase of goods or merchandise by that 
permanent establishment, or by the resident of which it is a permanent 
establishment, for the account of that resident.
    (5) The term ``industrial or commercial profits of a resident'' 
includes income derived from manufacturing, mercantile, agricultural, 
fishing, or mining activities, from the operation of ships or aircraft, 
from the furnishing of personal services, from the rental of tangible 
personal property, and from insurance activities and rents or royalties 
derived from motion picture films, films or tapes of radio or television 
broadcasting. It also includes income derived from real property and 
natural resources and dividends, interest, royalties (as defined in 
paragraphs (3) and (4) of Article 11), and capital gains but only if the 
right or property giving rise to such income, dividends, interest, 
royalties, or capital gains is effectively connected with a permanent 
establishment which the recipient, being a resident of one Contracting 
State, has in the other Contracting State. It does not include income 
received by an individual as compensation for personal services either 
as an employee or in an independent capacity.

                                * * * * *

                          Article 9--Dividends

    (1) Dividends derived from sources within a Contracting State by a 
resident of the other Contracting State may be taxed in that other 
State.
    (2) Dividends derived from sources within a Contracting State by a 
resident of the other Contracting State may also be taxed by the former 
Contracting State but the tax imposed on such dividends shall not 
exceed--

[[Page 74]]

    (a) 15 percent of the amount actually distributed; or
    (b) When the recipient is a corporation, 5 percent of the amount 
actually distributed if--
    (i) During the part of the paying corporation's taxable year which 
precedes the date of payment of the dividend and during the whole of its 
prior taxable year (if any), at least 10 percent of the outstanding 
shares of the voting stock of the paying corporation was owned by the 
recipient corporation, and
    (ii) Not more than 25 percent of the gross income of the paying 
corporation for such prior taxable year (if any) consisted of interest 
and dividends (other than interest derived in the conduct of a banking, 
insurance, or financing business and dividends or interest received from 
subsidiary corporations, 50 percent or more of the outstanding shares of 
the voting stock of which was owned by the paying corporation at the 
time such dividends or interest were received).
    (3) Paragraph (2) of this Article and, in the case of dividends 
derived by a resident of France, paragraph (1) of this Article, shall 
not apply if the recipient of the dividends has a permanent 
establishment in the other Contracting State and the shares with respect 
to which the dividends are paid are effectively connected with the 
permanent establishment. In such a case, the provisions of Article 6 
shall apply.
    (4)(a) Except as provided in subparagraph (b), dividends paid by a 
corporation of one of the Contracting States shall be treated as income 
from sources within that Contracting State, and dividends paid by any 
other corporation shall be treated as income from sources outside that 
Contracting State.
    (b) Dividends paid by a corporation other than a U.S. corporation 
shall be treated as dividends from sources within the United States if 
such corporation had a permanent establishment in the United States and 
more than 80 percent of its gross income was taxable to such permanent 
establishment for a 3-year period ending with the close of its taxable 
year preceding the declaration of such dividends (or for such portion of 
that period as the corporation has been in existence).
    (5) When the prepayment (precompte) is levied on dividends paid by a 
French corporation to a resident of the United States, such resident 
shall be entitled to the refund of that prepayment, subject to deduction 
of the withholding tax with respect to the refunded amount in accordance 
with paragraph (2) of this Article.

                          Article 10--Interest

    (1) Interest derived from sources within one Contracting State by a 
resident of the other Contracting State may be taxed in that other 
State.
    (2) Interest on bonds, notes, debentures, or any other form of 
indebtedness from sources within the United States and paid to a 
resident of France may also be taxed by the United States at a rate not 
in excess of 10 percent of the amount paid.
    (3) Interest on bonds, notes, debentures, or any other form of 
indebtedness from sources within France and paid to a resident of the 
United States may also be taxed by France at a rate not in excess of 10 
percent of the amount paid except that interest on bonds issued before 
January 1, 1965, may be taxed at a rate not in excess of 12 percent of 
the amount paid.
    (4) Paragraphs (2) and (3) of this Article and, in the case of 
interest derived by a resident of France, paragraph (1) of this Article, 
shall not apply if the recipient of the interest, being a resident of 
one of the Contracting States, has a permanent establishment in the 
other Contracting State and the indebtedness giving rise to the interest 
is effectively connected to such permanent establishment. In such a 
case, the provisions of Article 6 shall apply.
    (5) The term ``interest'' as used in this article means income from 
Government securities, bonds, or debentures, whether or not secured by 
mortgage and whether or not carrying a right to participate in profits, 
and debt-claims of every kind as well as all other income assimilated to 
income from money lent by the taxation law of the State in which the 
income has its source.
    (6) Interest shall be deemed to be 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 interest, whether he is a resident of a Contracting State or 
not, has in a Contracting State a permanent establishment in connection 
with which the indebtedness on which the interest is paid was incurred, 
and such interest is borne by such permanent establishment, then such 
interest shall be deemed to be from sources within the Contracting State 
in which the permanent establishment is situated.
    (7) Where, owing to a special relationship between the payer and the 
recipient or between both of them and some other person, the amount of 
the interest paid, 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 recipient in the absence of such relationship, the provisions of 
this Article shall apply only to the last-mentioned amount. In that 
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 Convention.
    (8) Interest received by one of the Contracting States, or by an 
instrumentality of that State not subject to income tax by such

[[Page 75]]

State, shall be exempt in the State in which such interest has its 
source.

                          Article 11--Royalties

    (1) Royalties derived from sources within one Contracting State by a 
resident of the other Contracting State may be taxed in that other 
State.
    (2) Except as provided in paragraph (3), royalties derived from 
sources within a Contracting State by a resident of the other 
Contracting State may also be taxed by the former Contracting State but 
the tax imposed on such royalties shall not exceed 5 percent of the 
gross amount paid.
    (3) Royalties derived from copyrights of literary, artistic, or 
scientific works (including gain from the sale or exchange of property 
giving rise to such royalties) by a resident of one Contracting State 
shall be taxable only in that Contracting State.
    (4) The term ``royalties'' as used in paragraph (1) of this Article 
means--
    (a) Any royalties, rentals, or other amounts paid as consideration 
for the use of, or the right to use, patents, designs or models, plans, 
secret processes or formulae, trademarks, or other like property or 
rights, or for knowledge, experience, or skill (know-how), and
    (b) Gains derived from the sale or exchange of any such right or 
property, if payment of the amounts realized on such sale or exchange is 
contingent, in whole or in part, on the productivity, use or disposition 
of such right or property. If the amounts derived from the sale or 
exchange of any such right or property are not so contingent, the 
provisions of Article 12 shall apply.
    (5) Paragraphs (2) and (3) of this Article, and, in the case of 
royalties derived by a resident of France, paragraph (1) of this 
Article, shall not apply if the recipient of the royalty, being a 
resident of one of the Contracting States, has in the other Contracting 
State a permanent establishment and the right or property giving rise to 
the royalties is effectively connected with such permanent 
establishment. In such a case, the provisions of Article 6 shall apply.
    (6) Royalties paid for the use of, or the right to use, property 
described in paragraph (4) in a State shall be treated as income from 
sources within that State.
    (7) Where, owing to a special relationship between the payer and the 
recipient, or between both of them and some other person, the amount of 
the royalties paid exceeds the amount which would have been agreed upon 
by the payer and the recipient in the absence of such relationship, the 
provisions of this Article shall only apply to the last-mentioned 
amount. In that 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 Convention.

                                * * * * *

                       Article 13--Branch Profits

    (1)(a) Dividends paid by a French corporation to a person other than 
a citizen, resident, or corporation of the United States shall be exempt 
from tax by the United States unless such French corporation had a 
permanent establishment in the United States and more than 80 percent of 
its gross income was taxable to such permanent establishment for a 3-
year period ending with the close of its taxable year preceding the 
declaration of such dividends (or for such portion of that period as the 
corporation has been in existence).

                                * * * * *

                   Article 16--Governmental Functions

    (1) Remuneration, including pensions, paid by, or out of funds 
created by, a Contracting State or a political subdivision or a local 
authority thereof to any individual who is a national of that State in 
respect of services rendered to that State or a subdivision or local 
authority thereof in the discharge of functions of a governmental nature 
shall be taxable only in that Contracting State.
    (2) The provisions of Articles 15, 19, and 20 shall apply to 
remuneration or pensions in respect of services rendered in connection 
with any industrial or commercial activity carried on by one of the 
Contracting States or a political subdivision or a local authority 
thereof.
    (3) In the case of an individual who is a national of both 
Contracting States, the provisions of Article 22, paragraph (4), shall 
apply to remuneration described in paragraph (1) but such remuneration 
shall be treated as income from sources within the Contracting State 
from which such individual receives such remuneration.

                                * * * * *

               Article 19--Private Pensions and Annuities

    (1) Except as provided in Article 16, pensions and other similar 
remuneration paid to a resident of a Contracting State in consideration 
of past employment shall be taxable only in that Contracting State.
    (2) Alimony and annuities paid to a resident of a Contracting State 
shall be taxable only in that Contracting State.
    (3) The term ``annuities,'' as used in this Article, means a stated 
sum paid periodically at stated times during life, or during a

[[Page 76]]

specified number of years, under an obligation to make the payments in 
return for adequate and full consideration (other than services 
rendered).
    (4) The term ``pensions,'' as used in this Article, means periodic 
payments made after retirement in consideration for, or by way of 
compensation for injuries received in connection with, past employment.

                                * * * * *

                  Article 27--Assistance in Collection

    (1) The two Contracting States undertake to lend assistance and 
support to each other in the collection of the taxes to which the 
present Convention relates, together with interest, costs, and additions 
to the taxes and fines not being of a penal character according to the 
laws of the State requested, in the cases where the taxes are 
definitively due according to the laws of the State making the 
application.
    (2) In the case of an application for enforcement of taxes, revenue 
claims of each of the Contracting States which have been finally 
determined will be accepted for enforcement by the State to which 
application is made and collected in that State in accordance with the 
laws applicable to the enforcement and collection of its own taxes.
    (3) The application will be accompanied by such documents as are 
required by the laws of the State making the application to establish 
that the taxes have been finally determined.
    (4) If the revenue claim has not been finally determined, the State 
to which application is made will take such measures of conservancy 
(including measures with respect to transfer of property of nonresident 
aliens) as are authorized by its laws for the enforcement of its own 
taxes.
    (5) The assistance provided for in this Article shall not be 
accorded with respect to citizens, corporations, or other entities of 
the State to which application is made.

                                * * * * *

                      Article 31--Entry Into Force

    (1) This Convention shall be ratified and instruments of 
ratification shall be exchanged at Washington. It shall enter into force 
1 month after the date of exchange of the instruments of ratification. 
Its provisions shall for the first time have effect:
    (a) In the case of France:
    (i) As respects withholding taxes, to any proceeds payable and 
transactions completed on or after the date on which this Convention 
enters into force;
    (ii) As respects other income taxes, to taxes which are levied for 
the assessment year 1967; and
    (iii) As respects the tax on stock exchange transactions, the date 
on which this Convention enters into force.
    (b) In the case of the United States:
    (i) As respects the rate of withholding tax, to amounts received on 
or after the date on which this Convention enters into force;
    (ii) As respects other income taxes, to taxable years beginning on 
or after January 1, 1967.
    (2) Upon the coming into effect of this Convention, there shall 
terminate:
    (a) The Convention of July 25, 1939, relating to income and other 
taxes.
    (b) The Convention of October 18, 1946, the supplementary Protocol 
of May 17, 1948, and the Convention of June 22, 1956, insofar as they 
concern taxes on income, on capital and tax on stock exchange 
transactions.

The provisions of those Conventions and of that Protocol will cease to 
have effect from the date on which the corresponding provisions of the 
present Convention shall for the first time have effect according to the 
subparagraph (1) above-mentioned.

                         Article 32--Termination

    This Convention shall remain in force until denounced by one of the 
Contracting States. Either Contracting State may denounce the 
Convention, through diplomatic channels, by giving notice of termination 
at least 6 months before the end of any calendar year after the year 
1969. In such event, the Convention shall cease to have effect:
    (1) In the case of France:
    (a) As respects withholding taxes, on January 1 of the year 
following the year in which notice is given.
    (b) As respects other income taxes, for any year of assessment 
beginning on or after January 1 of the year following the year in which 
notice is given; and
    (c) As respects the tax on stock exchange transactions, for any 
transactions occurring on or after January 1 of the year following the 
year in which notice is given.
    (2) In the case of the United States:
    (a) As respects withholding taxes, on January 1 of the year 
following the year in which notice is given;
    (b) As respects other income taxes, for any taxable year beginning 
on or after January 1 of the year following the year in which notice is 
given; and
    (c) As respects taxes referred to in paragraph (2) of Article 1, for 
any transactions occurring on or after January 1 of the year following 
the year in which notice is given.

    (b) Definitions. Any term defined in the convention shall have the 
meaning so assigned to it; any term not so defined shall, unless the 
context otherwise requires, have the meaning which

[[Page 77]]

such term has under the internal revenue laws of the United States.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.20 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.21  Dividends.

    (a) Exemption from or reduction in rate of United States tax--(1) 
Exempt from U.S. tax. Except as provided in subparagraph (2) of this 
paragraph, dividends paid by a French corporation on or after August 11, 
1968, to a nonresident alien individual or foreign corporation are 
exempt from tax by the United States under the provisions of Article 
13(1)(a) of the convention. Such dividends are, therefore, not subject 
to the withholding of U.S. tax at source.
    (2) Exemption and reduced rate of withholding not applicable. 
Dividends paid by a French corporation on or after August 11, 1968, to a 
nonresident alien individual or foreign corporation (other than a 
resident of France or a French corporation) are subject to U.S. tax in 
accordance with the provisions of section 871(a) or 881(a) of the 
Internal Revenue Code and the regulations thereunder if the paying 
corporation has a permanent establishment in the United States and more 
than 80 percent of its gross income was taxable to such permanent 
establishment for a 3-year period ending with the close of its taxable 
year preceding the declaration of such dividends (or for such portion of 
that period as the corporation has been in existence). Such dividends 
are not eligible for the reduced rate of withholding under Article 9(2) 
of the convention or to exemption from tax under Article 13(1)(a) of the 
convention.
    (3) Application of reduced rate--(i) Rate of 15 percent. Except as 
provided in subdivision (ii) of this subparagraph, and subparagraph (4) 
of this paragraph the rate of U.S. tax imposed upon dividends derived 
from sources within the United States on or after August 11, 1968, and 
received by a nonresident alien individual who is a resident of France 
or a French corporation or a person resident in France for French tax 
purposes shall not exceed 15 percent of the gross amount actually 
distributed as provided for in Article 9(2) of the convention. For the 
purposes of this section the gross amount actually distributed includes 
amounts constructively received.
    (ii) Rate of 5 percent. The rate of U.S. tax imposed upon dividends 
derived from sources within the United States on or after August 11, 
1968, and received by a French corporation shall not exceed 5 percent of 
the gross amount actually distributed if--
    (a) During the part of the paying corporation's taxable year which 
precedes the date of payment of the dividend and during the whole of its 
prior taxable year (if any), at least 10 percent of the outstanding 
shares of the voting stock of the paying corporation was owned by the 
recipient corporation, and
    (b) Not more than 25 percent of the gross income of the paying 
corporation for such prior taxable year (if any) consisted of interest 
and dividends (other than interest derived in the conduct of a banking, 
insurance, or financing business and dividends or interest received from 
subsidiary corporations, 50 percent or more of the outstanding shares of 
the voting stock of which was owned by the paying corporation at the 
time such dividends or interest were received).
    (iii) Information to be filed with the Commissioner when claiming a 
5-percent rate. Any paying corporation which claims or contemplates 
claiming that dividends paid or to be paid by it on or after August 11, 
1968, are subject to United States tax at the rate of 5 percent under 
Article 9 of the convention shall file the following information with 
the Commissioner of Internal Revenue, Washington, D.C. 20224, as soon as 
practicable:
    (a) The date and place of its organization;
    (b) The number and a brief description of outstanding shares of 
stock of the paying corporation and the voting power thereof;
    (c) The number of shares of each class of voting stock of the paying 
corporation owned by the recipient corporation and the date the 
recipient corporation acquired such stock;

[[Page 78]]

    (d) The amount of the gross income of the paying corporation for its 
taxable year immediately preceding the taxable year in which the 
dividends are paid;
    (e) The amount of the interest and dividends included in such gross 
income, the amount of such interest derived in the conduct of a banking, 
insurance, or financing business, if any, and the amount of such 
interest and dividends received from a subsidiary corporation in which 
the paying corporation owns at least 50 percent of the voting stock on 
the date of receipt.
    (iv) Notification by Commissioner--5 percent rate. As soon as 
practicable after such information is filed, the Commissioner of 
Internal Revenue will determine whether the dividends concerned qualify 
under Article 9 of the convention for the reduced rate of 5 percent and 
will notify the paying corporation of his determination. If the 
dividends qualify for such reduced rate, this notification may also 
authorize the release, pursuant to Sec. 514.28(a)(1)(ii), of excess tax 
withheld from the dividends concerned. A duplicate copy of such 
notification shall be attached to the Form 1042S filed by the paying 
corporation for the first year of payment. There shall be attached to 
Form 1042S filed by the paying corporation for each subsequent year of 
payment a statement that the conditions upon which the notification was 
issued are applicable to such subsequent year.
    (4) Dividends effectively connected with a permanent establishment. 
The reduction in rate of tax provided in subparagraph (3) of this 
paragraph shall not apply if the owner of the dividends has a permanent 
establishment in the United States and the shares with respect to which 
the dividends are paid are effectively connected with such permanent 
establishment. Such dividends are subject to tax in accordance with the 
provisions of Article 6 of the convention.
    (b) Withholding of tax from dividends-- (1) 15 percent rate--(i) 
Reduction based on address in France. Except as provided in subparagraph 
(2) of this paragraph, withholding of United States tax at source on or 
after August 11, 1968, from dividends derived from sources within the 
United States by a person whose address is in France, shall be at the 
reduced rate of 15 percent in every case except that in which, prior to 
the date of payment of such dividends, the Commissioner of Internal 
Revenue or the owner of the dividends has notified the withholding agent 
that such reduced rate of withholding shall not apply.
    (ii) Reduced rate of 15 percent applicable only to owner of capital 
stock. The reduced rate of 15 percent is available only to the real 
owner of the capital stock from which the dividend is derived. As to 
action by a French addressee who is not the real owner of the capital 
stock, see Sec. 514.22(c).
    (iii) Evidence of rate of tax withheld. The rate at which U.S. tax 
has been withheld from a dividend paid on or after August 11, 1968, to a 
person whose address is in France on the date the dividend is paid to 
such person shall be shown either in writing or by appropriate stamp on 
the check, draft, or other evidence of payment, or on an accompanying 
statement.
    (2) 5-percent rate--(i) Reduction based on notification by 
Commissioner. If, in accordance with paragraph (a)(3)(iv) of this 
section, the Commissioner of Internal Revenue has notified the paying 
corporation that the dividends qualify under Article 9 of the convention 
for the reduced rate of 5 percent, the reduced withholding rate of 5 
percent, to the extent withholding of U.S. tax is required, shall apply 
to any dividends paid by the paying corporation on or after August 11, 
1968.
    (ii) Dividends cease to qualify for 5-percent rate. If, after 
receipt of notification from the Commissioner of Internal Revenue that 
the dividends qualify for the reduced rate of 5 percent, the French 
recipient corporation ceases to be eligible for the reduction in rate 
because one or more of the conditions of subdivision (ii) (a) or (b) of 
paragraph (a)(3) of this section are not satisfied, the reduction in the 
rate of withholding of U.S. tax shall no longer apply. When any change 
occurs in the ownership of stock as recorded on the books of the paying 
corporation or in the percentage of dividends and interest included in 
gross income of the paying corporation, the paying corporation shall 
notify the Commissioner of Internal Revenue as soon as possible.

[[Page 79]]

    (iii) Evidence of tax withheld. The rate at which U.S. tax has been 
withheld from a dividend paid on or after August 11, 1968, to a French 
corporation shall be shown either in writing or by appropriate stamp on 
the check, draft, or other evidence of payment, or on an accompanying 
statement.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.21 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.22  Dividends received by persons not entitled to reduced rate of tax.

    (a) General. Article 27(1) of the convention provides that each 
Contracting State shall undertake to lend assistance and support to the 
other Contracting State in the collection of taxes covered by the 
convention.
    (b) Additional French tax to be withheld in the United States--(1) 
By a nominee or representative. The recipient in the United States of 
any dividend from which French tax has been withheld at the reduced rate 
of 15 percent, who is a nominee or representative through whom the 
dividend is received by a person who is not a resident of the United 
States, shall withhold an additional amount of French tax equivalent to 
the French tax which would have been withheld if the convention had not 
been in effect (25 percent as of the date of approval of this Treasury 
decision) minus the 15 percent which has been withheld at the source.
    (2) By a fiduciary or partnership. A fiduciary or partnership with 
an address in the United States which receives, otherwise than as a 
nominee or representative, a dividend from sources within France from 
which French tax has been withheld at the reduced rate of 15 percent, 
shall withhold an additional amount of French tax from the portion of 
the dividend included in the gross income from sources within France of 
any beneficiary or partner, as the case may be, who is not entitled to 
the reduced rate of tax in accordance with the applicable provisions of 
the convention. The amount of the additional tax is to be calculated in 
the same manner as under subparagraph (1) of this paragraph.
    (3) Withholding additional French tax from amounts released or 
refunded. If any amount of French tax is released by the withholding 
agent in France with respect to a dividend received by a nominee, 
representative, fiduciary, or partnership in the United States, the 
recipient shall withhold from such released amount any additional amount 
of French tax otherwise required to be withheld from the dividend by the 
provisions of subparagraphs (1) and (2) of this paragraph, in the same 
manner as if at the time of payment of the dividends French tax at the 
rate of 15 percent had been withheld therefrom.
    (4) Return of French tax by U.S. withholding agents. Amounts of 
French tax withheld pursuant to this paragraph by withholding agents in 
the United States shall be deposited in U.S. dollars with the Director, 
Office of International Operations, Internal Revenue Service, 
Washington, D.C. 20225, on or before the 16th day after the close of the 
quarter of the calendar year in which the withholding occurs. Such 
withholding agent shall also submit such appropriate forms as may be 
prescribed by the Commissioner of Internal Revenue.
    (c) Additional U.S. tax to be withheld in France--(1) By a nominee 
or representative. The recipient in France of any dividend from which 
U.S. tax has been withheld at the reduced rate of 15 percent pursuant to 
Sec. 514.21(b)(1), who is a nominee or representative through whom the 
dividend is received by a person who is not entitled to the reduced rate 
in accordance with Sec. 514.21(a)(3)(i), shall withhold an additional 
amount of U.S. tax equivalent to the U.S. tax which would have been 
withheld if the convention had not been in effect (30 percent as of the 
date of approval of this Treasury decision) minus the 15 percent which 
has been withheld at the source.
    (2) By a fiduciary or partnership. A fiduciary or partnership with 
an address in France which receives, otherwise than as a nominee or 
representative, a dividend from which U.S. tax has been withheld at the 
reduced rate of 15 percent pursuant to Sec. 514.21(b)(1) shall withhold 
an additional amount of U.S. tax from the portion of the dividend 
included in the gross income from

[[Page 80]]

sources within the United States of any beneficiary or partner, as the 
case may be, who is not entitled to the reduced rate of tax in 
accordance with Sec. 514.21(a)(3)(i). The amount of the additional tax 
is to be calculated in the same manner as under subparagraph (1) of this 
paragraph.
    (3) Released amounts of tax. If any amount of U.S. tax is released 
pursuant to Sec. 514.28 by the withholding agent in the United States 
with respect to a dividend received by a nominee, representative, 
fiduciary, or partnership with an address in France, the recipient shall 
withhold from such released amount any additional amount of U.S. tax, 
otherwise required to be withheld from the dividend by the provisions of 
subparagraphs (1) and (2) of this paragraph, in the same manner as if at 
the time of payment of the dividends U.S. tax at the rate of 15 percent 
has been withheld at source therefrom.
    (4) Return of U.S. tax by French withholding agents. Amounts of U.S. 
tax withheld pursuant to this paragraph by withholding agents in France 
shall be deposited without converting the amounts into U.S. dollars, 
with the Directeur General des Impots of France on or before the 16th 
day after the close of the quarter of the calendar year in which the 
withholding occurs. The withholding agent making the deposit shall 
render therewith such appropriate French form as may be prescribed by 
the Directeur General des Impots. The amounts so deposited should be 
remitted by the Directeur General des Impots by draft in United States 
dollars to the director, Office of International Operations, Internal 
Revenue Service, Washington, D.C. 20225, and should be accompanied by 
such French form as may be required to be rendered by the withholding 
agent in France in connection with the deposit.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.22 was amended by removing paragraph (c), effective Jan. 1, 
1999. By T.D. 8804, 63 FR 72183, Dec. 31, 1998, the effective date was 
delayed until Jan. 1, 2000.



Sec. 514.23  Interest.

    (a) Not subject to U.S. tax. Interest derived from sources within 
the United States on or after August 11, 1968, by the French Government 
or by an instrumentality of the French Government and which is not 
subject to income tax in France is exempt from U.S. tax under the 
provisions of Article 10(8). Such interest is not subject to withholding 
of U.S. tax at source.
    (b) Application of reduced rate--(1) In general. Except as provided 
in subparagraph (2) of this paragraph, the rate of U.S. tax imposed by 
the Internal Revenue Code upon interest derived from sources within the 
United States on or after August 11, 1968, by a nonresident alien 
individual who is a resident of France, or French corporation or person 
resident in France for French tax purposes shall not exceed 10 percent 
under the provisions of Article 10(2) of the convention.
    (2) Definitions. As used in this paragraph, the term ``interest'' 
means income from Government securities, bonds, or debentures, whether 
or not secured by mortgage and whether or not carrying a right to 
participate in profits, and debt-claims of every kind as well as all 
other income assimilated to income from money lent by the taxation law 
of the United States, including interest on certain deferred payments 
described in section 483 of the Internal Revenue Code and original issue 
discount described in section 1232(b) of the Internal Revenue Code.
    (3) Interest effectively connected with a permanent establishment. 
The reduction in rate of tax provided in subparagraph (1) of this 
paragraph shall not apply if the owner thereof has a permanent 
establishment in the United States and the indebtedness giving rise to 
the interest is effectively connected to such permanent establishment. 
Such interest is subject to tax in accordance with the provisions of 
Article 6 of the convention.
    (c) Withholding of tax from interest--(1) Coupon bond interest--(i) 
Form to use. To secure withholding of U.S. tax at the rate of 10 percent 
in the case of coupon bond interest, the nonresident alien individual 
who is a resident of France, or French corporation or person resident in 
France for French tax purposes shall, for each issue of bonds, file Form 
1001-F in duplicate when presenting the interest coupons for payment. 
This form shall be signed by the owner of the interest, or by his 
trustee or agent,

[[Page 81]]

and shall show the information required by paragraph (d) of Sec. 1.1461-
1 of this chapter. It shall contain a statement that at the time the 
interest is derived the owner (a) if an individual, is neither a citizen 
nor resident of the United States, but is a resident of France, or is a 
French corporation or person resident in France for French tax purposes, 
and (b) has no permanent establishment in the United States, or if the 
owner does have such a permanent establishment, the indebtedness giving 
rise to the interest is not effectively connected to such permanent 
establishment.
    (ii) Reduction in rate applicable only to owner. The reduction in 
the rate of U.S. tax contemplated by Article 10(2) of the convention, 
insofar as it concerns coupon bond interest, is applicable only to the 
owner of the interest. The person presenting the coupon or on whose 
behalf it is presented, shall, for the purpose of the reduction in tax, 
be deemed to be the owner of the interest only if he is, at the time the 
coupon is presented for payment, the owner of the bond from which the 
coupon has been detached. If the person presenting the coupon, or on 
whose behalf it is presented, is not the owner of the bond, Form 1001, 
and not Form 1001-F, shall be used, and U.S. tax shall be withheld at 
the statutory rate.
    (iii) Disposition of Form 1001-F. The original and duplicate of Form 
1001-F shall be forwarded by the withholding agent to the Director, 
Office of International Operations, Internal Revenue Service, 
Washington, D.C. 20225, in accordance with paragraph (b)(2) of 
Sec. 1.1461-2 of this chapter, with the annual return on Form 1042. A 
summary of the Form 1001 or 1001-F shall be reported on Form 1042 as 
provided by instructions thereto.
    (2) Other interest--(i) Letter of notification. To secure the 
reduced rate of U.S. tax at source in the case of interest other than 
coupon bond interest, the nonresident alien individual who is a resident 
of France, or French corporation or person resident in France for French 
tax purposes, shall notify the withholding agent by letter in duplicate 
that the interest is taxable at the reduced rate of tax provided in 
Article 10(2) of the convention. The letter of notification shall be 
signed by the owner of the interest, or by his trustee or agent, shall 
show the name and address of the obligor and the name and address of the 
owner of the interest, and shall indicate the dates on which the taxable 
years of the owner to which the letter is applicable begin and end. The 
letter shall contain a statement that the owner (a) if an individual, is 
neither a citizen nor a resident of the United States but is a resident 
of France, or is a French corporation or other entity resident in France 
for French tax purposes, and (b) does not have a permanent establishment 
in the United States or, if the owner does have such a permanent 
establishment, a statement that the indebtedness giving rise to the 
income is not effectively connected to such permanent establishment. If 
the interest is taxable at the reduced rate of tax, the letter of 
notification may also authorize the release, pursuant to Sec. 514.28, of 
excess tax withheld from the interest concerned.
    (ii) Manner of filing letter. The letter of notification, which 
shall constitute authorization for the withholding of U.S. tax at source 
at the reduced rate of 10 percent, shall be filed with the withholding 
agent as soon as practicable for each successive 3-calendar-year period 
during which the income is paid. Once a letter has been filed in respect 
of any 3-calendar-year period, no additional letter need be filed in 
respect thereto unless the Commissioner of Internal Revenue notifies the 
withholding agent that an additional letter shall be filed by the owner 
of the interest. If, after filing a letter of notification, the taxpayer 
ceases to be eligible for the exemption from U.S. tax granted by Article 
10(2) of the convention, he shall promptly notify the withholding agent 
by letter in duplicate. When any change occurs in the ownership of the 
income as recorded on the books of the payer, the reduction in rate of 
withholding of U.S. tax shall no longer apply unless the new owner of 
record is entitled to such reduced rate and promptly files a letter of 
notification with the withholding agent.
    (iii) Disposition of letter. The original of each letter of 
notification filed pursuant to this subparagraph shall be retained by 
the withholding agent and

[[Page 82]]

the duplicate shall be immediately forwarded by the withholding agent to 
the Director, Office of International Operations, Internal Revenue 
Service, Washington, D.C. 20225.
    (3) Change in circumstances. If the owner of the interest acquires a 
permanent establishment in the United States after filing a letter of 
notification referred to in subparagraph (2) of this paragraph, such 
owner shall file a new letter of notification even though the 
indebtedness giving rise to the income to which such document relates is 
not effectively connected to such permanent establishment

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.23 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.24  Royalties.

    (a) Exemption from U.S. tax--(1) Copyright royalties. Except as 
provided in subparagraph (2) of this paragraph royalties or other 
amounts paid as consideration for the use of, or for the right to use 
copyrights of literary, artistic, or scientific works (including gain 
from the sale or exchange of property giving rise to such royalties) 
which are derived from sources within the United States on or after 
August 11, 1968, by a nonresident alien individual who is a resident of 
France, or by a French corporation or a person resident in France for 
French tax purposes are exempt from U.S. tax under the provisions of 
Article 11(3) of the convention.
    (2) Copyright royalties effectively connected with a permanent 
establishment. The exemption from tax provided in subparagraph (1) of 
this paragraph shall not apply if the owner of such royalties, or of 
gain from the sale or exchange of property giving rise to such 
royalties, has a permanent establishment in the United States and the 
property giving rise to such royalties or gain is effectively connected 
with such permanent establishment. Such royalties are subject to tax in 
accordance with the provisions of Article 6.
    (3) Exemption from withholding of tax--(i) Use of letter of 
notification. To avoid withholding of U.S. tax at source with respect to 
copyright royalties to which this paragraph applies, the nonresident 
alien who is a resident of France or French corporation or person 
resident in France for French tax purposes, shall notify the withholding 
agent by letter in duplicate that the royalty is exempt from U.S. tax 
under Article 11(3) of the convention. The letter of notification shall 
be signed by the owner of the royalty or of the gain from the sale or 
exchange of property giving rise to such royalty, or by the trustee or 
agent of such owner, and shall show the name and address of the owner. 
The letter shall contain a statement that at the time the royalty is 
derived the owner (a) if an individual, is neither a citizen nor a 
resident of the United States but is a resident of France or, if a 
corporation or other entity is resident in France for French tax 
purposes, and (b) has no permanent establishment in the United States 
or, if the owner does have such a permanent establishment, a statement 
that the property or right giving rise to such royalty is not 
effectively connected with such permanent establishment. If the royalty 
is exempt from U.S. tax, the letter of notification may also authorize 
the release, pursuant to Sec. 514.28 of excess tax withheld from the 
royalty concerned.
    (ii) Manner of filing letter of notification. The provisions of 
Sec. 514.23(c)(2)(ii) and (iii) relating to the execution, filing, and 
effective period of the letter of notification prescribed therein with 
respect to interest, including its use for the release of excess tax 
withheld and Sec. 514.23(c)(3) relating to change of circumstances, are 
equally applicable with respect to the income falling within the scope 
of this section.
    (b) Reduction in rate of United States tax--(1) Industrial 
royalties. Except as provided in subparagraph (3) of this paragraph, the 
rate of U.S. tax imposed on royalties, derived from sources within the 
United States on or after August 11, 1968, by a nonresident alien 
individual who is a resident of France, or by a French corporation shall 
not, under Article 11(2) of the convention, exceed 5 percent of the 
gross amount paid.
    (2) Definitions. As used in this paragraph, the term ``royalty'' 
means royalties, rentals, or other amounts (other than royalties 
described in paragraph

[[Page 83]]

(a)(1) of this section) paid as consideration for the use of or the 
right to use patents, designs or models, plans, secret processes or 
formulae, trademarks, or other like property or rights, or for 
knowledge, experience, or skill (know-how) and gains derived from the 
sale or exchange of such right or property if payment is contingent, in 
whole or in part, on the productivity use, or disposition of the 
property or rights sold. The term ``royalty'' does not include natural 
resource royalties which are subject to tax in accordance with the 
provisions of Article 5 of the convention.
    (3) Industrial royalties effectively connected with a permanent 
establishment. The reduction in rate of tax provided in subparagraph (1) 
of this paragraph shall not apply if the owner of the royalties or of 
the gain from the sale or exchange of the property or right giving rise 
to such royalties has a permanent establishment in the United States and 
the property or right giving rise to such royalties or gain is 
effectively connected with such permanent establishment. Such royalties 
are subject to tax in accordance with the provisions of Article 6 of the 
convention.
    (4) Withholding of U.S. tax from industrial royalties. In order to 
secure the reduced rate of U.S. tax at source as provided in 
subparagraph (1) of this paragraph, the nonresident alien individual who 
is a resident of France or French corporation or person resident in 
France for French tax purposes shall notify the withholding agent by 
letter in duplicate that the royalty qualifies for the reduced rate of 
U.S. tax granted by Article 11(2) of the convention. The letter of 
notification shall be signed by the owner of the royalty, or by the 
trustee or agent of such owner, and shall show the name and address of 
the owner. The provisions of subparagraph (3) of paragraph (a) of this 
section relating to the form, content, execution, filing, and effective 
period of the letter of notification prescribed therein with respect to 
copyright royalties, including its use for the release of excess tax 
withheld and relating to change of circumstances, are equally applicable 
with respect to industrial royalties.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.24 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.25  Private pensions, alimony, and annuities.

    (a) Exemption from U.S. tax--(1) Requirements. Any pension (other 
than one paid by the United States or a political subdivision or a local 
authority thereof to an individual who is a citizen of the United States 
for the discharge of governmental functions), alimony, or annuity 
derived from sources within the United States by a nonresident alien 
individual who is a resident of France and received in a taxable year of 
the recipient beginning after December 31, 1966, shall be exempt from 
U.S. tax under the provisions of Article 19 of the convention.
    (2) Definitions--(i) Pension. As used in this paragraph, the term 
``pension'' means periodic payments made after retirement in 
consideration of past employment or as compensation for injuries 
received in connection with past employment. The term ``pension'' does 
not include retirement pay or pensions paid by the United States or by 
any State or local authority of the United States which are subject to 
tax in accordance with the provisions of Article 16 of this convention.
    (ii) Annuity. The term ``annuity'' means a stated sum paid 
periodically at stated times during life, or during a specified number 
of years, under an obligation to make the payments in return for 
adequate and full consideration (other than services rendered), but not 
including retirement pay or pensions paid by the United States or by any 
State or territory of the United States.
    (b) Exemption from withholding tax--(1) Use of letter of 
notification. To avoid withholding of U.S. tax at source with respect to 
pensions, alimony, or annuities which are exempt from U.S. tax in 
accordance with paragraph (a) of this section, the nonresident alien 
individual who is a resident of France shall notify the withholding 
agent by letter in duplicate that the pension, alimony, or annuity is 
exempt from U.S. tax under Article 19 of the convention. The letter of 
notification shall be signed by the owner of the income, shall show the 
name and address of both the payer

[[Page 84]]

and the owner of the income, and shall contain a statement that at the 
time the income is received, the owner is neither a citizen nor a 
resident of the United States but is a resident of France.
    (2) Manner of filing letter. The provisions of Sec. 514.23(c)(2)(ii) 
and (iii) relating to the execution, filing, and effective period of the 
letter of notification prescribed therein with respect to interest, 
including its use for the release of excess tax withheld and 
Sec. 514.23(c)(3) relating to change of circumstances, are equally 
applicable with respect to the income falling within the scope of this 
section.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.25 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.26  Income covered by convention.

    (a) Exemption from or reduction in rate of tax--(1) Request for 
ruling. If a nonresident alien individual who is a resident of France or 
French corporation or person resident in France for French tax purposes 
claims or contemplates claiming that an item of income (including income 
referred to in Secs. 514.21 through 514.25) is exempt from, or subject 
to a reduced rate of, U.S. tax under the convention, such owner of the 
income may request a ruling to that effect from the Commissioner of 
Internal Revenue, Washington, D.C. 20224, by filing a statement setting 
forth all the facts pertinent to a determination of the question.
    (2) Notification of applicant. As soon as practicable after such 
information is filed, the Commissioner will determine whether the income 
concerned qualifies under the convention for exemption from or reduced 
rate of, U.S. tax and will notify the applicant of his ruling. If income 
qualifies for such benefit, this notification may also authorize the 
release, pursuant to Sec. 514.28(a)(2), of excess tax withheld from the 
income concerned.
    (b) Exemption from, or reduction in rate of, withholding--(1) 
Notification of withholding agent. If the Commissioner rules that income 
received by such applicant qualifies for exemption from, or reduction in 
rate of, U.S. tax under the convention, and the applicant sends a copy 
of such ruling to the withholding agent, the income designated in such 
ruling shall be exempt, or subject to a reduced rate of, withholding of 
U.S. tax unless the Commissioner or the applicant notifies the 
withholding agent that such income ceases to qualify for such benefit. A 
duplicate copy of such notification shall be attached to the Form 1042S 
filed by the withholding agent with respect to the income concerned.
    (2) Change in circumstances. If during the period covered by the 
ruling letter, any fact upon which the ruling letter is based materially 
changes, the applicant shall immediately notify the withholding agent 
and the Commissioner of such change.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.26 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.27  Beneficiaries of domestic estate and trust.

    A nonresident alien individual who is a resident of France and a 
beneficiary of a domestic estate or trust shall be entitled to the 
exemption from, or reduction in rate of, United States tax granted by 
Articles 9, 10, 11, 13(1)(a), and 19 of the convention with respect to 
dividends, interest, royalties, and pensions, annuities, and alimony if 
he otherwise satisfies the requirements for exemption or reduction 
specified in the articles concerned, to the extent that (a) any amount 
paid, credited, or required to be distributed by the estate or trust to 
the beneficiary is deemed to consist of those items and (b) the items so 
deemed to be included in such amount would, without regard to the 
convention, be includible in his gross income. However, such beneficiary 
is not entitled to the exemption from, or reduction in the rate of, U.S. 
tax granted by such articles to the extent that the trust conduit rules 
are not applicable to any payment received by the beneficiary such as, 
for example, a payment made out of the income of a trust established for 
the support and maintenance of a wife pursuant to a divorce decree. To 
obtain the exemption from,

[[Page 85]]

or reduction in the rate of, withholding of U.S. tax where permitted by 
this section, the beneficiary must, where applicable, execute and submit 
to the fiduciary of the estate or trust in the United States the 
appropriate letter of notification in the form prescribed in 
Sec. 514.23(c) (2) and (3), modified where necessary to indicate the 
type of income involved.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.27 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.28  Release of excess tax withheld at source.

    (a) Amounts to be released--(1) Tax withheld from dividends--(i) 
Dividends subject to 15-percent rate. If U.S. tax has been withheld on 
or after August 11, 1968, at a rate in excess of 15 percent from 
dividends described in Sec. 514.21(a)(3)(i) received by a nonresident 
alien individual who is a resident of France or French corporation or 
person resident in France for French tax purposes whose address at the 
time of payment was in France, the withholding agent shall release and 
par over to the person from whom the tax was withheld an amount which is 
equal to the difference between the tax so withheld and the tax required 
to be withheld pursuant to Sec. 514.21(b)(1).
    (ii) Dividends subject to 5-percent rate. If U.S. tax has been 
withheld at a rate in excess of 5 percent on or after August 11, 1968, 
from dividends which qualify for the reduced rate of 5 percent under 
Sec. 514.21(a)(3)(ii), the withholding agent shall, if so authorized in 
accordance with Sec. 514.21(a)(3)(iv) release and pay over to the 
corporation from which the tax was withheld an amount which is equal to 
the difference between the tax so withheld and the tax required to be 
withheld pursuant to Sec. 514.21(b)(2)(i).
    (2) Tax withheld from coupon bond interest--(i) Substitute ownership 
certificate. If U.S. tax has been withheld at a rate in excess of 10 
percent on or after August 11, 1968, from coupon bond interest described 
in Sec. 514.23(c)(1), the owner of the interest shall furnish the 
withholding agent a Form 1001-F clearly marked ``Substitute'' and 
executed in accordance with Sec. 514.23(c). Upon receipt of such 
substitute Form 1001-F the withholding agent shall release and pay over 
to the person from whom the tax was withheld an amount which is equal to 
the difference between the tax so withheld and the tax required to be 
withheld pursuant to Sec. 514.23(b)(1).
    (ii) Filing and disposition of substitute ownership certificate. One 
substitute Form 1001-F shall be filed in duplicate with respect to each 
issue of bonds and will serve with respect to that issue to replace all 
Forms 1001 or 1001-F previously filed by the owner of the interest in 
the calendar year in which the excess tax was withheld and with respect 
to which the excess is released. Such forms shall be disposed of in 
accordance with the rules of Sec. 514.23(c)(1)(iii).
    (3) Tax withheld from other income covered by convention. If the 
owner of the other income furnishes to the withholding agent the letter 
of notification prescribed in Sec. 514.24(a)(3) or (b)(4), 
Sec. 514.25(b)(1), or the authorization for release of tax prescribed in 
Sec. 514.26(a)(2), and U.S. tax has been withheld at a rate in excess of 
the rate provided in the convention with respect to payments of income 
to which such letter of authorization is applicable, made on or after 
August 11, 1968, or received in the taxable year of the owner beginning 
after December 31, 1966 (whichever is applicable), the withholding agent 
shall release and pay to the person from whom the tax was withheld an 
amount which is equal to the tax so withheld from such income, or to the 
difference between the tax so withheld and the tax required to be 
withheld, as the case may be.
    (b) Amounts not to be released. The provisions of this section do 
not apply to any excess tax withheld at the source subsequent to the due 
date for filing Form 1042.
    (c) Statutory rate. As used in this paragraph, the term ``statutory 
rate'' means the rate of tax (30 percent as of the date of approval of 
this Treasury decision) prescribed by subchapter A of chapter 3 
(relating to the withholding of tax on nonresident alien individuals and 
foreign corporations) of the Internal Revenue Code as though the 
convention has not come into effect.

[[Page 86]]


    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.28 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.29  Refund of excess tax paid to Director of International Operations.

    (a) In general. Where U.S. tax withheld at the source on items of 
income covered by the convention is in excess of the tax imposed under 
subtitle A (relating to the income tax) of the Internal Revenue Code, as 
modified by the convention, and such withheld amounts have been paid to 
the Director of International Operations, a claim by the owner of such 
income for refund of any resulting overpayment may be made under section 
6402 of such Code, and the regulations thereunder.
    (b) Form of claim--(1) Where return previously filed. If the owner 
of the income has previously filed an income tax return with the 
Internal Revenue Service for the taxable year in which an overpayment 
has resulted because of the application of the convention, he should 
make a claim for refund of the overpayment by filing Form 843 or an 
amended return.
    (2) Where no return previously filed. If the owner of the income has 
not previously filed an income tax return with the Internal Revenue 
Service for the taxable year in which an overpayment has resulted 
because of the application of the convention, he should make a claim for 
refund of the overpayment by filing Form 1040NR or Form 1120-F, 
whichever is applicable, showing the overpayment. Such return will serve 
as a claim for refund, and it is not necessary for the taxpayer to file 
Form 843.
    (c) Information required. If the owner's total gross income 
(including every item of capital gain subject to tax) from sources 
within the United States for the taxable year in which such overpayment 
resulted has not been disclosed in an income tax return filed with the 
Internal Revenue Service prior to the time the claim for refund is made, 
such owner shall disclose such total gross income with his claim. In the 
event that securities are held in the name of a person other than the 
actual or beneficial owner, the name and address of such person shall be 
furnished with the claim. In addition to such other information as may 
be required to establish the overpayment, there shall also be included 
in such claim for refund:
    (1) A statement that, at the time when the items of income were 
received from which the excess tax was withheld, the owner was neither a 
citizen nor a resident of the United States but was a resident of 
France, a French corporation or person resident in France for French tax 
purposes.
    (2) If the owner's claim is based on exemption from, or reduction in 
rate of, tax for dividends, interest, or royalties, a statement that the 
owner does not have a permanent establishment in the United States, or, 
if the owner does have such a permanent establishment, that the holding 
from which such income was derived was not effectively connected with 
such permanent establishment.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.29 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.30  Information furnished in ordinary course.

    For provisions relating to the exchange of information under Article 
30 of the convention, see paragraph (d) of Sec. 1.1461-2 of this 
chapter.

    Effective Date Note: By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.30 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.31  Return required when liability not satisfied by withholding.

    For action by a nonresident alien individual who is a resident of 
France or a French corporation or person resident in France for French 
tax purposes in a case where such individual's or corporation's or 
person's U.S. income tax liability is not satisfied by withholding of 
U.S. tax at source, see paragraph (b) of Sec. 1.6012-1 of this chapter 
and paragraph (b) of Sec. 1.6012-2 of this chapter.

    Effective Date Note: By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.31 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183,

[[Page 87]]

Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



Sec. 514.32  Effective date.

    (a) In general. Except as provided in paragraph (b) of this section, 
the provisions of this Treasury decision shall be effective with respect 
to the rate of withholding tax, to amounts derived from sources within 
the United States on or after August 11, 1968, and with respect to all 
other taxes covered by the convention to amounts received in a taxable 
year of the recipient beginning after December 31, 1966.
    (b) Withholding of additional French tax. The provisions of 
Sec. 514.22 shall be effective with respect to income derived from 
sources within France on or after August 11, 1968.

    Effective Date Note: By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Sec. 514.32 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 
72183, Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.



                       Subpart--General Income Tax

    Authority: 53 Stat. 32, 467; 26 U.S.C. 62, 3791.

    Source: Treasury Decision 5499, 11 FR 2154, Mar. 2, 1946, as amended 
by T.D. 6273, 22 FR 9529, Nov. 28, 1957, unless otherwise noted. 
Redesignated at 25 FR 14022, Dec. 31, 1960.

    Effective Date Note:  By T.D. 8734, 62 FR 53498, Oct. 14, 1997, 
Subpart--General Income Tax, consisting of Secs. 514.101 through 
514.117, was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, 
Dec. 31, 1998, the effective date was delayed until Jan. 1, 2000.

                   Regulations Effective Jan. 1, 1945



Sec. 514.101  Introductory.

    The tax convention and protocol between the United States and France 
(referred to in this subpart as the convention) proclaimed by the 
President of the United States on January 5, 1945, and effective January 
1, 1945, provide in part as follows:

                        Title I--Double Taxation

                                Article 1

    The taxes referred to in this Convention are:
    (a) In the case of the United States of America: The federal income 
taxes, including surtaxes and excess-profits taxes;
    (b) In the case of France:
    (1) The real estate tax;
    (2) The industrial and commercial profits tax;
    (3) The annual tax on undistributed profits;
    (4) The agricultural profits tax;
    (5) The tax on salaries, allowances and emoluments, wages, pensions 
and annuities;
    (6) The professional profits tax;
    (7) The tax on income from securities and movable capital;
    (8) The general income tax.

                                Article 2

    Income from real property, including income from agricultural 
undertakings, shall be taxable only in the State in which such real 
property is situated.

                                Article 3

    An enterprise of one of the contracting States is not subject to 
taxation by the other contracting State in respect of its industrial and 
commercial profits except in respect of such profits allocable to its 
permanent establishment in the latter State.
    No account shall be taken, in determining the tax in one of the 
contracting States, of the purchase of merchandise effected therein by 
an enterprise of the other State for the purpose of supplying 
establishments maintained by such enterprise in the latter State.
    The competent authorities of the two contracting States may lay down 
rules by agreement for the apportionment of industrial and commercial 
profits.
    The term ``industrial and commercial profits'' shall not include the 
following:
    (a) Income from real property;
    (b) Income from mortgages, from public funds, securities (including 
mortgage bonds), loans, deposits and current accounts;
    (c) Dividends and other income from shares in a corporation;
    (d) Rentals or royalties arising from leasing personal property or 
from any interest in such property, including rentals or royalties for 
the use of, or for the privilege of using, patents, copyrights, secret 
processes and formulae, good-will, trade marks, trade brands, franchises 
and other like property;
    (e) Profit or loss from the sale or exchange of capital assets.
    Subject to the provisions of this Convention the income referred to 
in paragraphs (a), (b), (c), (d) and (e) shall be taxed separately or 
together with industrial and commercial profits in accordance with the 
laws of the contracting States.

                                Article 4

    American enterprises having permanent establishments in France are 
required to submit to the French fiscal administration

[[Page 88]]

the same declarations and the same justifications, with respect to such 
establishments, as French enterprises.
    The French fiscal administration has the right, within the 
provisions of its national legislation and subject to the measures of 
appeal provided in such legislation, to make such corrections in the 
declaration of profits realized in France as may be necessary to show 
the exact amount of such profits.
    The same principle applies mutatis mutandis to French enterprises 
having permanent establishments in the United States.

                                Article 5

    When an American enterprise, by reason of its participation in the 
management or capital of a French enterprise, makes or imposes on the 
latter, in their commercial or financial relations, conditions different 
from those which would be made with a third enterprise, any profits 
which should normally have appeared in the balance sheet of the French 
enterprise, but which have been in this manner, diverted to the American 
enterprise, are, subject to the measures of appeal applicable in the 
case of the tax on industrial and commercial profits, incorporated in 
the taxable profits of the French enterprise.
    The same principle applies mutatis mutandis, in the event that 
profits are diverted from an American enterprise to a French enterprise.

                                Article 6

    Income derived by navigation enterprises of one of the contracting 
States from the operation of ships documented under the laws of that 
State shall continue to benefit in the other State by the reciprocal tax 
exemptions accorded by the exchange of notes of June 11 and July 8, 1927 
between the United States of America and France.
    Income which an enterprise of one of the contracting States derives 
from the operation of aircraft registered in that State shall be exempt 
from taxation in the other State.

                                Article 7

    Royalties from real property or in respect of the operation of 
mines, quarries or other natural resources shall be taxable only in the 
contracting State in which such property, mines, quarries or other 
natural resources are situated.
    Royalties derived from within one of the contracting States by a 
resident or by a corporation or other entity of the other contracting 
State as consideration for the right to use copyrights, patents, secret 
processes and formulae, trademarks and other analogous rights shall be 
exempt from taxation in the former State, provided such resident, 
corporation or other entity does not have a permanent establishment 
there.

                                Article 8

    Wages, salaries and similar compensation and pensions paid by one of 
the contracting States or by a political subdivision thereof to 
individuals residing in the other State shall be exempt from taxation in 
the latter State.
    Private pensions and life annuities derived from within one of the 
contracting States and paid to individuals residing in the other 
contracting State shall be exempt from taxation in the former State.

                                Article 9

    Income from labor or personal services shall be taxable only in the 
State in which the taxpayer carries on his personal activity.
    This provision does not apply to the income referred to in Article 
8.

                               Article 10

    Income from the exercise of a liberal profession shall be taxable 
only in the State in which the professional activity is exercised.
    There is the exercise of a liberal profession in one of the two 
contracting States only when the professional activity has a fixed 
center in that country.

                               Article 11

    Gains derived in one of the contracting States from the sale or 
exchange of stocks, securities or commodities by a resident or a 
corporation or other entity of the other contracting State shall be 
exempt from taxation in the former State, provided such resident or 
corporation or other entity has no permanent establishment in the former 
State.

                               Article 12

    Students from one of the contracting States residing in the other 
contracting State exclusively for the purpose of study shall not be 
taxable by the latter State in respect of remittances received from 
within the former State for the purpose of their maintenance or studies.

                               Article 13

    In the calculation of taxes established in one of the contracting 
States on the use of property or increment of property of an enterprise 
of the other State, account shall be taken only of that portion of the 
capital situated or employed and allocable to a permanent establishment 
within the former State.
    The foregoing provision shall apply to the French ``patent'' tax and 
the United States capital stock tax even though these two taxes have not 
been referred to in Article 1 of the present Convention.
    In the application of the present Article navigation enterprises of 
one of the contracting States, enjoying in the other State

[[Page 89]]

the benefits of Article 6 of the present Convention, shall not be 
considered as having a permanent establishment in the latter State 
insofar as shipping activities are concerned.

                               Article 14

    It is agreed that double taxation shall be avoided in the following 
manner:
    A. As regards the United State of America. Notwithstanding any other 
provision of this Convention, the United States of America in 
determining the income and excess-profits taxes, including all surtaxes, 
of its citizens, or residents, or corporations, may include in the basis 
upon which such taxes are imposed, all items of income taxable under the 
Revenue Laws of the United States of America, as though this Convention 
had not come into effect. The United States of America shall, however, 
deduct from the taxes thus computed the amount of French income tax 
paid. This deduction shall be made in accordance with the benefits and 
limitations of Section 131 of the United States Internal Revenue Code 
relating to credit for foreign taxes.
    B. As regards France--(a) Schedular taxes. Income from securities, 
debts and trusts having its source in the United States of America shall 
be subject in France to the tax on income from securities; but this tax 
shall be reduced by the amount of the tax already paid in the United 
States of America on the same income. In consideration of the fiscal 
regime to which the legislation of the United States of America subjects 
the income of nonresident aliens and foreign corporations or other 
entities, the deduction of the tax paid in the United States of America 
shall be effected in a lump sum through a reduction of 12 in the rate of 
the tax established by the French law.
    The income other than that indicated in the preceding paragraph 
shall not be subject to any schedular tax in France when, according to 
this Convention, it is taxable in the United States of America.
    (b) General tax on revenue. Notwithstanding any other provision of 
the present Convention, the general income tax can be determined 
according to all the elements of taxable income as imposed by French 
fiscal legislation.
    However, the provisions of the first paragraph of Article 114 of the 
French Code on direct taxation relative to the taxation of aliens 
domiciled or resident in France shall continue to be applied.

                               Article 15

    In derogation of Article 3 of the Decree of December 6, 1872, 
American corporations which maintain in France permanent establishments 
shall be liable to the tax on income from securities on three-fourths of 
the profits actually derived from such establishments, the industrial 
and commercial profits being determined in accordance with Articles 3 
and 4 of this Convention.
    The remaining one-fourth shall, in all cases, be taken as the basis 
of the annual tax on undistributed profits applicable to the same 
corporations.

                               Article 16

    An American corporation shall not be subject to the obligations 
prescribed by Article 3 of the Decree of December 6, 1872, by reason of 
any participation in the management or in the capital of, or any other 
relations with, a French corporation. In such case, the tax on income 
from securities continues to be levied, in conformity with French 
legislation, on the dividends, interest and all other distributions made 
by the French enterprise; but it is moreover collectible, if the 
occasion arises, and subject to the measures of appeal applicable in the 
case of the tax on income from securities, with respect to the profits 
which the American corporation derives from the French corporation under 
the conditions prescribed in Article 5.

                               Article 17

    The American corporations subject to the provisions of Article 3 of 
the Decree of December 6, 1872 who were not placed under the special 
regime established by Articles 5 and 6 of the Convention for the 
avoidance of double income taxation between the United States of America 
and France, signed April 27, 1932, may, during a new period of six 
months from the date of the entry into force of the present Convention, 
exercise with reference to past years, the option provided in those two 
articles under the conditions which they prescribe.
    Moreover, the American corporations contemplated in the third 
paragraph of Article 10 of the Convention of April 27, 1932, may be 
admitted to benefit from the provisions of that paragraph, when the tax 
has not yet been paid, if the latter was not found to be payable, prior 
to May 1, 1930, by a definitive judicial decision or if such decision 
has been the subject of an appeal in cassation.

                               Article 18

    Any United States income tax liability remaining unpaid as at the 
effective date of this Convention for years beginning prior to January 
1, 1936 of any individual resident of France (other than a citizen of 
the United States of America) or of a French corporation may be adjusted 
by the Commissioner of Internal Revenue of the United States of America, 
on the basis of the provisions of the United States Revenue Act of 1936. 
However, no adjustment will be made more than two years subsequent to 
the effective date of this Convention unless the taxpayer files a 
request with the Commissioner of Internal Revenue prior to such date.

[[Page 90]]

                               Article 19

    Notwithstanding any other provision of this Convention, in order to 
avoid double taxation on public servants, employees of one of the 
contracting States being citizens of that State and remunerated by it, 
who have been received by the other State to perform services in such 
State shall be exempt in their principal place of residence from direct 
and personal taxes whether national, State or local.
    Such employees who own real property in the State in which they 
perform services shall not benefit from the above exemptions with 
respect to the taxes levied on such real property. Employees who engage 
in any private gainful occupation in such State shall not be entitled to 
any exemption under this Article.

                       Title II--Fiscal Assistance

                               Article 20

    With a view to the more effective imposition of the taxes to which 
the present Convention relates, the contracting States undertake, on 
condition of reciprocity, to furnish information of a fiscal nature 
which the authorities of each State concerned have at their disposal, or 
are in a position to obtain under their own laws, that may be of use to 
the authorities of the other State in the assessment of the said taxes.
    Such information shall be exchanged between the competent 
authorities of the contracting States in the ordinary course or on 
request.

                               Article 21

    In accordance with the preceding Article, the competent authorities 
of the United States of America will transmit to the competent 
authorities of France, as regards any person, corporation or other 
entity (other than a citizen, corporation or other entity of the United 
States of America) having an address in France and deriving from sources 
within the United States of America rents, dividends, interest, 
royalties, income from trusts, wages, salaries, pensions, annuities, or 
other fixed or determinable periodical income, the name and address of 
such person, corporation or other entity as well as the amount of such 
income.
    The competent authorities of France will transmit to the competent 
authorities of the United States of America, as regards any person, 
corporation or other entity (other than a citizen, corporation or other 
entity of France) having an address in the United States of America and 
deriving from sources within France rents, dividends, interest, 
royalties, income from trusts, wages, salaries, pensions, annuities, or 
other fixed or determinable periodical income, the name and address of 
such person, corporation or other entity as well as the amount of such 
income.
    The information relating to each year will be transmitted as soon as 
possible after December 31.

                               Article 22

    The competent authorities of each of the contracting States shall be 
entitled to obtain, through diplomatic channels, from the competent 
authorities of the other contracting States, except with respect to 
citizens, corporations or other entities of the State to which 
application is made, particulars in concrete cases necessary for the 
establishment of the taxes to which the present Convention relates.
    However, the competent authorities of each State shall not be 
prevented from transmitting to the competent authorities of the other 
State information relating to their own nationals (citizens, 
corporations or other entities) if they deem it opportune for the 
prevention of fiscal evasion.

                               Article 23

    Each contracting State undertakes to lend assistance and support in 
the collection of the taxes to which the present Convention relates, 
together with interest, costs, and additions to the taxes and fines not 
being of a penal character according to the laws of the State requested, 
in the cases where the taxes are definitively due according to the laws 
of the State making the application.
    In the case of an application for enforcement of taxes, revenue 
claims of each of the contracting States which have been finally 
determined shall be accepted for enforcement by the State to which 
application is made and collected in that State in accordance with the 
laws applicable to the enforcement and collection of its own taxes.
    The application shall be accompanied by such documents as are 
required by the laws of the State making the application, to establish 
that the taxes have been finally determined.
    If the revenue claim has not been finally determined, the State to 
which application is made may, at the request of the State making the 
application, take such measures of conservancy as are authorized by the 
laws of the former State for the enforcement of its own taxes.
    The assistance provided for in this Article shall not be accorded 
with respect to the citizens, corporations or other entities of the 
State to which application is made.

                               Article 24

    In no case shall the provisions of Article 22 relating to 
particulars in concrete cases, or of Article 23 relating to mutual 
assistance in the collection of taxes, be construed so as to impose upon 
either of the contracting States

[[Page 91]]

the obligation to carry out administrative measures at variance with the 
regulations and practice of either contracting State, or to supply 
particulars which are not procurable under the law of the State to which 
application is made, or that of the State making application.
    The State to which application is made for information or assistance 
shall comply as soon as possible with the request addressed to it. 
Nevertheless, such State may refuse to comply with the request for 
reasons of public policy or if compliance would involve violation of a 
business, industrial or trade secret. In such case it shall inform, as 
soon as possible, the State making the application.

                               Article 25

    Any taxpayer who shows proof that the action of the revenue 
authorities of the contracting States has resulted in double taxation in 
his case in respect of any of the taxes to which the present Convention 
relates, shall be entitled to lodge a claim with the State of which he 
is a citizen or, if the taxpayer is a corporation or other entity, with 
the State in which it is created or organized. Should the claim be 
upheld, the competent authority of such State may come to an agreement 
with the competent authority of the other State with a view to equitable 
avoidance of the double taxation in question.

                               Article 26

    The competent authorities of the two contracting States may 
prescribe regulations necessary to interpret and carry out the 
provisions of this Convention. With respect to the provisions of this 
Convention relating to exchange of information and mutual assistance in 
the collection of taxes, such authorities may, by common agreement, 
prescribe rules concerning matters of procedure, forms of application 
and replies thereto, rates of conversion of currencies, transfer of sums 
collected, minimum amounts subject to collection, payment of costs of 
collection, and related matters.

                      Title III--General Provisions

                               Article 27

    The present Convention shall be ratified, in the case of the United 
States of America by the President, by and with the advice and consent 
of the Senate, and in the case of France, by the President of the French 
Republic with the consent of the Parliament.
    This Convention shall become effective on the first day of January 
following the exchange of the instruments of ratification.
    The Convention shall remain in force for a period of five years and 
indefinitely thereafter but may be terminated by either contracting 
State at the end of the five-year period or at any time thereafter, 
provided six months' prior notice of termination has been given, the 
termination to become effective on the first day of January following 
the expiration of the six-month period.
    Upon the coming into effect of this Convention, the Convention for 
the avoidance of double income taxation between the United States of 
America and France, signed April 27, 1932 shall terminate.
    Done at Paris, in duplicate, in the English and French languages, 
this 25th day of July, 1939.
    [seal]
                                                      William C. Bullitt
    [seal]
                                                          Georges Bonnet

                                Protocol

    At the moment of signing the present Convention for the avoidance of 
double taxation and the establishment of rules of reciprocal 
administrative assistance in the case of income and other taxes, the 
undersigned Plenipotentiaries have agreed that the following provisions 
shall form an integral part of the Convention:
    I. The present Convention is concluded with reference to American 
and French law in force on the day of its signature.
    Accordingly, if these laws are appreciably modified the competent 
authorities of the two States will consult together.
    II. The income from real property referred to in Article 2 of the 
present Convention shall include profits from the sale or exchange of 
the said property, but shall not include interest on mortgages or 
obligations secured by the said property.
    III. As used in this Convention:
    (a) The term ``permanent establishment'' includes branches, mines 
and oil wells, plantations, factories, workshops, stores, purchasing and 
selling and other offices, agencies, warehouses, and other fixed places 
of business but does not include a subsidiary corporation.
    When an enterprise of one of the contracting States carries on 
business in the other State through an employee or agent, established 
there, who has general authority to negotiate and conclude contracts or 
has a stock of merchandise from which he regularly fills orders which he 
receives, this enterprise shall be deemed to have a permanent 
establishment in the latter State. But the fact that an enterprise of 
one of the contracting States has business dealings in the other State 
through a bona fide commission agent or broker shall not be held to mean 
that such enterprise has a permanent establishment in the latter State.
    Insurance enterprises shall be considered as having a permanent 
establishment in one of the States as soon as they receive premiums from 
or insure risks in the territory of that State.

[[Page 92]]

    (b) The term ``enterprise'' includes every form of undertaking 
whether carried on by an individual, partnership, corporation, or any 
other entity.
    (c) The term ``enterprise of one of the contracting States'' means, 
as the case may be, ``United States enterprise'' or ``French 
enterprise''.
    (d) The term ``United States enterprise'' means an enterprise 
carried on in the United States of America by a resident of the United 
States of America or by a United States corporation or other entity.
    The term ``United States corporation or other entity'' means a 
partnership, corporation or other entity created or organized in the 
United States of America or under the law of the United States of 
America or of any State or Territory of the United States of America.
    (e) The term ``French enterprise'' is defined in the same manner, 
mutatis mutandis, as the term ``United States enterprise''.
    IV. The term ``life annuities'' referred to in Article 8 of this 
Convention means a stated sum payable periodically at stated times 
during life, or during a specified number of years to the person who has 
paid the premiums or a gross sum for such an obligation.
    V. Citizens and corporations or other entities of one of the 
contracting States within the other contracting State shall not be 
subjected as regards the taxes referred to in the present Convention, to 
the payment of higher taxes than are imposed upon the citizens or 
corporations or other entities of such latter State.
    VI. The provisions of the present Convention shall not be construed 
to restrict in any manner any exemption, deduction, credit, allowance, 
or other advantage accorded by the laws of one of the contracting States 
in the determination of the tax imposed by such State.
    VII. Documents and information contained therein, transmitted under 
the provisions of this Convention by one of the contracting States to 
the other contracting State shall not be published, revealed or 
disclosed to any person except to the extent permitted under the laws of 
the latter State with respect to similar documents or information.
    VIII. As used in this Convention the terms ``competent authority'' 
or ``competent authorities'' means, in the case of the United States of 
America, the Secretary of the Treasury and in the case of France, the 
Minister of Finance.
    IX. The term ``United States of America'' as used in this Convention 
in a geographic sense includes only the States, the Territories of 
Alaska and Hawaii, and the District of Columbia.
    X. The term ``France'', when used in a geographic sense, indicates 
continental France, exclusive of Algeria and the Colonies.
    XI. Should any difficulty or doubt arise as to the interpretation or 
application of the present Convention, or its relationship to 
Conventions between one of the contracting States and any other State, 
the competent authorities of the contracting States may settle the 
question by mutual agreement.
    Done in duplicate at Paris, this 25th day of July, 1939.
                                                      William C. Bullitt
                                                      Georges Bonnet    



Sec. 514.102  Applicable provisions of the Internal Revenue Code.

    (a) The Internal Revenue Code provides in part as follows:

    Sec. 22. Gross income. * * *
    (b) Exclusions from gross income. The following items shall not be 
included in gross income and shall be exempt from taxation under this 
chapter:

                                * * * * *

    (7) Income exempt under treaty.--Income of any kind, to the extent 
required by any treaty obligation of the United States;

                                * * * * *

    Sec. 62. Rules and regulations.
    The Commissioner, with the approval of the Secretary, shall 
prescribe and publish all needful rules and regulations for the 
enforcement of this chapter.

    (b) Pursuant to section 62 of the Internal Revenue Code, Article 26 
of the convention, and other provisions of the internal revenue laws, 
Secs. 514.103-514.117 are hereby prescribed and all regulations 
inconsistent herewith are modified accordingly.



Sec. 514.103  Scope of the convention.

    (a) The primary purposes of the convention are to avoid double 
taxation upon certain classes of income, and to inaugurate fiscal 
cooperation between the two States with respect to reciprocal disclosure 
of information and to the collection of the taxes enumerated in Article 
1 of the convention.
    (b) The specific classes of income from sources within the United 
States exempt under the convention from United States income taxes are:
    (1) Industrial and commercial profits of a French enterprise having 
no permanent establishment in the United States (Article 3);

[[Page 93]]

    (2) Income derived by a French enterprise from the operation of 
ships documented under the laws of, or aircraft registered in, France 
(Article 6);
    (3) Royalties derived by a nonresident alien who is a resident of 
France or by a French corporation or other French entity (having no 
permanent establishment within the United States), for the right to use 
copyrights, patents, secret processes and formulae, trademarks and other 
analogous rights (Article 7);
    (4) Compensation and pensions paid by France or by a political 
subdivision of France to individuals (other than citizens of the United 
States) for services rendered to France whether within or without the 
United States (Article 8);
    (5) Private pensions and life annuities derived from within the 
United States and paid to nonresident alien individuals (whether or not 
such individuals are citizens of France) residing in France during the 
year in which such amounts are paid (Article 8);
    (6) Earned income of a doctor, lawyer, engineer, or other member of 
a liberal profession who is a nonresident alien individual and is a 
resident of France and does not maintain within the United States an 
office, establishment, installation, or other fixed center related to 
the practice of his profession within the United States (Article 10);
    (7) Gains from sources within the United States arising from the 
sale or exchange of stocks, securities, or commodities by a resident of 
France (other than a citizen of the United States) or a French 
corporation or other French entity unless such resident, corporation, or 
other entity has, at any time during the taxable year in which such sale 
takes place, a permanent establishment within the United States (Article 
11).
    (c) Except as expressly provided by the convention, the tax 
liability of nonresident aliens who are residents of France or of French 
corporations or other French entities is determined in accordance with 
the provisions of the laws and of the regulations thereunder applicable 
generally to nonresident alien individuals and to foreign corporations.
    (d) The convention shall not be construed to affect the liability to 
United States income taxation of citizens of France who are resident in 
the United States except to the extent that such individuals are 
entitled to the benefits of Articles 8, 14A, and 19 and to paragraph V 
of the protocol of the convention. The tax liability of a United States 
citizen or a resident of the United States, a member of a French 
partnership carrying on a French enterprise is not affected by Article 3 
of the convention. Such citizen or resident is subject to United States 
income tax upon his distributive share of the net income of such 
partnership even though the other members of such partnership are not 
subject to tax upon their share of the partnership's industrial and 
commercial profits from sources within the United States where the 
enterprise has no permanent establishment within the United States. The 
convention shall not be construed to affect the liability to United 
States income taxation of citizens of the United States or residents of 
the United States who are not citizens of France.
    (e) The convention has no reference to rates of taxation imposed by 
the respective States but is concerned with the exempting of income 
arising in one of the contracting States when such income is derived 
from sources within such contracting State by a resident or corporation 
or other entity of the other contracting State and meets the conditions 
upon which such exemption depends as prescribed in the convention. This 
subpart is not concerned with the provisions of Articles 14B, 15, 16, 
and 17 of the convention since such articles affect only the allowance 
against the taxes imposed by France of income and excess profits taxes 
paid to the United States or the application of French revenue laws and 
decrees.



Sec. 514.104  Definitions.

    (a) Any word or term used in this subpart which is defined in the 
convention shall be given the definition assigned to such word or term 
in such convention. Any word or term used in this subpart which is not 
defined in the convention but is defined in the Internal Revenue Code 
shall be given the definition contained therein.

[[Page 94]]

    (b) As used in this subpart:
    (1) The term ``permanent establishment'' includes branches, mines 
and oil wells, plantations, factories, workshops, stores, purchasing and 
selling and other offices, agencies, warehouses and other fixed places 
of business. A French parent corporation having a domestic or foreign 
subsidiary corporation in the United States shall not be deemed by 
reason of such fact to have a permanent establishment in the United 
States. The mere fact that a foreign subsidiary corporation of a French 
parent corporation has a permanent establishment in the United States 
does not mean that such French parent corporation has a permanent 
establishment in the United States. The fact that a French enterprise 
carries on business dealings in the United States through a bona fide 
commission agent or broker shall not be held to mean that such 
enterprise has a permanent establishment in the United States. If, 
however, a French enterprise carries on business in the United States 
through an employee or agent established there who has general authority 
to negotiate and conclude contracts or has a stock of merchandise from 
which he regularly fills orders, such enterprise shall be deemed to have 
a permanent establishment in the United States. Thus, if a French 
enterprise has a full time employee or full time agent who for such 
enterprise maintains in the United States a stock of merchandise from 
which orders are filled, such enterprise has a permanent establishment 
in the United States even though such employee or agent has no general 
authority to negotiate and conclude contracts on behalf of such 
enterprise. However, the mere fact that a commission agent or broker 
through whom a French enterprise carries on business in the United 
States maintains a small stock of goods in the United States from which 
occasional orders are filled shall not be construed as meaning that such 
enterprise has a permanent establishment in the United States. The mere 
fact that salesmen, employees of a French enterprise, promote the sale 
of its products in the United States does not mean that such enterprise 
has a permanent establishment therein. However, a French insurance 
enterprise which insures risks within the United States or receives 
premiums from sources within the United States is deemed to have a 
permanent establishment within the United States.
    (2) The term ``enterprise'' means any commercial or industrial 
undertaking, whether conducted by an individual, partnership, 
corporation, or other entity. It includes such activities as 
manufacturing, merchandising, mining, banking, and insurance. It does 
not include the operation of, or the trading in, real property located 
in the United States. It does not include the rendition of personal 
services. Hence, a nonresident alien individual who is a resident of 
France, rendering personal services within the United States is not, 
merely by reason of such services, engaged in an enterprise within the 
meaning of the convention, and his liability to United States income tax 
is unaffected by Article 3 of the Convention.
    (3) The term ``French enterprise'' means an enterprise carried on in 
France by a nonresident alien individual resident of France or by a 
French corporation or other French entity. The term ``corporation or 
other entity'' means a partnership, corporation, or other entity created 
or organized in France or under the laws of France. For example, an 
enterprise carried on wholly outside France by a French corporation is 
not a French enterprise within the meaning of the convention. Whether a 
French entity is a corporation, a partnership, or a trust is to be 
determined in accordance with the principles of existing law relating to 
the taxation of nonresident aliens and foreign corporations.
    (4) The term ``industrial and commercial profits'' means the profits 
arising from the industrial, mercantile, manufacturing, or like 
activities of a French enterprise as defined in this section. Such term 
does not include income from real property, interest, dividends, rentals 
and royalties, gains from the sale or exchange of capital assets, or 
compensation for labor or personal service. Such enumerated items of 
income are not governed by the provisions of Article 3 but, to the 
extent covered by the convention, are subject

[[Page 95]]

to the rules elsewhere set forth therein and in this subpart.
    (5) The term ``Secretary'' means the Secretary of the Treasury and 
the term ``Minister'' means the Minister of Finance of France.




Sec. 514.105  Scope of convention with respect to determination of ``industrial and commercial profits'' of a nonresident alien individual resident of France, 
          or of a French corporation or other entity carrying on a 
          French enterprise in the United States.

    (a) General. Article 3 of the convention adopts the principle that 
an enterprise of one of the contracting States shall not be taxable in 
the other contracting State in respect of its industrial and commercial 
profits unless it has a permanent establishment in the latter State. 
Hence, a French enterprise is subject to United States tax upon its 
industrial and commercial profits from sources within the United States 
only if it has a permanent establishment within the United States. From 
the standpoint of Federal income taxation, the article has application 
only to a French enterprise and to the industrial and commercial income 
thereof from sources within the United States. It has no application, 
for example, to compensation for labor or personal services performed in 
the United States, to income derived from real property located in the 
United States or any interest therein, including rentals and royalties, 
to gains from the sale or other disposition of such real property or 
interest, to dividends and interest, to rentals and royalties arising 
from leasing personal property or any interest in such property, 
including rentals and royalties for the use of patents, copyrights, 
secret processes and formulae, good will, trade marks, trade brands, 
franchises, and other like property, or to profits from the sale or 
exchange of capital assets. Such enumerated items of income, to the 
extent covered by the convention, are treated separately elsewhere in 
this subpart and are subject to the rules laid down in the sections 
having specific references to the respective items of income.
    (b) No United States permanent establishment. A nonresident alien 
individual who is a resident of France, or a French corporation or other 
French entity carrying on a French enterprise, but having no permanent 
establishment in the United States, is not subject to United States 
income tax upon industrial and commercial profits from sources within 
the United States. For example, if such French corporation sells stock 
in trade, such as wines or perfumery or cheese, through a bona fide 
commission agent or broker in the United States, the resulting profit 
is, under the terms of Article 3 of the convention, exempt from United 
States income tax. Such French corporation, however, remains subject to 
tax upon all other items of income from sources within the United States 
which are not expressly exempted from such tax under the convention.
    (c) United States permanent establishment. A nonresident alien 
individual who is a resident of France, or a French corporation or other 
entity, carrying on a French enterprise having a permanent establishment 
in the United States is subject to tax upon his or its industrial and 
commercial profits from sources within the United States. In the 
determination of the income of such resident of France or French 
corporation or other entity from sources within the United States, all 
industrial and commercial profits from such sources shall be deemed to 
be allocable to the permanent establishment within the United States. 
Hence, for example, if a French enterprise, having a permanent 
establishment in the United States, sells directly in the United States 
through a commission agent or broker therein goods produced in France, 
the resulting profits derived from United States sources from the latter 
transactions are allocable to such permanent establishment. The net 
income from sources within the United States, including the industrial 
and commercial profits, shall be determined in accordance with the 
provisions of section 119 of the Internal Revenue Code and the 
regulations thereunder. In determining industrial and commercial profits 
no account shall be taken of the mere purchase of merchandise effected 
in the

[[Page 96]]

United States by such French enterprise. A nonresident alien who is a 
resident of France, a member of a French partnership having a permanent 
establishment within the United States, shall by reason of such fact be 
deemed to have a permanent establishment within the United States.



Sec. 514.106  Control of a domestic enterprise by a French enterprise.

    Article 5 of the convention provides that if a French enterprise by 
reason of its control of a domestic business imposes conditions 
different from those which would result from normal business relations 
between independent enterprises, the accounts between the enterprises 
will be adjusted so as to ascertain the true net income of the domestic 
enterprise. The purpose is to place the controlled domestic enterprise 
on a tax parity with an uncontrolled domestic enterprise by determining, 
according to the standard of an uncontrolled enterprise, the true net 
income from the property and business of the controlled enterprise. The 
convention contemplates that if the accounting records do not truly 
reflect the net income from the property and business of such domestic 
enterprise the Commissioner of Internal Revenue shall intervene and, by 
making such distributions, apportionments, or allocations as he may deem 
necessary of gross income or deductions of any item or element affecting 
net income as between such domestic enterprise and the French enterprise 
by which it is controlled or directed, determine the true net income of 
the domestic enterprise. The provisions of Sec. 29.45-1 of Regulations 
111 (26 CFR 1949 ed. Supps. 29.45-1) [and Sec. 39.45-1 of Regulations 
118 (26 CFR, Rev. 1953, Parts 1-79, and Supps.)], shall, in so far as 
applicable, be followed in the determination of the net income of the 
domestic business.



Sec. 514.107  Income from operation of ships or aircraft.

    The income derived by a French enterprise from the operation of 
ships documented under the laws of France, or of aircraft registered in 
France, is under Article 6 of the convention exempt from United States 
income tax. However, the profits derived by such enterprise from the 
operation of ships or aircraft, if any, not so documented or registered 
are treated as are industrial and commercial profits generally. See 
Article 3 of the convention and Sec. 514.105.



Sec. 514.108  Income from real property, including mineral royalties.

    Income of whatever nature derived by a nonresident alien individual 
who is a resident of France, or by a French corporation or other French 
entity from real property situated in the United States, including gains 
derived from the sale of such property and royalties in respect of the 
operation of mines, quarries, or other natural resources situated in the 
United States, is not exempted from taxation by the convention. The 
treatment of such income for taxation purposes is governed by those 
provisions of the Internal Revenue Code applicable generally to the 
taxation of nonresident aliens and foreign corporations.



Sec. 514.110  Government wages, salaries, and similar compensation, pensions, and life annuities.

    (a) Under Article 8 of the convention, wages, salaries, and similar 
compensation, and pensions paid by France, or by a political subdivision 
thereof, to individuals residing in the United States are exempt from 
Federal income tax. However, under the provisions of Article 14A of the 
convention, such exemption shall not be construed as applying to 
recipients of such income who are citizens of the United States or alien 
residents who are not citizens of France.
    (b) Under the provisions of the same article of the convention 
private pensions and life annuities derived from sources within the 
United States by nonresident alien individuals who are residents of 
France are exempt from Federal income tax. Such items of income are 
therefore not subject to the withholding provisions of the Internal 
Revenue Code. See paragraph IV of the protocol to the convention as to 
what constitutes life annuities. See, also, Sec. 514.109 1 
with respect to patent and

[[Page 97]]

copyright royalties as to the requirements necessary to avoid 
withholding of the tax at the source, which requirements are also 
applicable for the purposes of this section.
---------------------------------------------------------------------------

    1 Section 514.109 (formerly Sec. 7.418) was revoked by 
T.D. 6273, 22 F.R. 9529, Nov. 28, 1957.
---------------------------------------------------------------------------



Sec. 514.111  Compensation for labor or personal services.

    (a) General. In general and subject to the provisions of Article 8 
and Article 10 of the convention and paragraph (b) of this section, 
compensation for labor or personal services derived from sources within 
the United States by a nonresident alien who is a resident of France, is 
subject to tax in accordance with the provisions of the Internal Revenue 
Code applicable generally to nonresident aliens. The provisions of 
Article 9 do not disturb either the provisions of section 119(a)(3) of 
the Internal Revenue Code, relating to source of compensation for labor 
or personal services, or the provisions of the Internal Revenue Code 
relating to the taxation of such compensation in the hands of a 
nonresident individual who is a resident of France.
    (b) Professional earnings. Article 10 of the convention provides a 
special rule of taxation with respect to professional fees constituting 
income derived from sources within the United States by a resident of 
France who is a nonresident alien. Under such rule, such nonresident 
alien rendering professional services, such as medical, legal, 
engineering, and scientific services, is not subject to United States 
tax with respect to such compensation unless he has an office or other 
fixed place situated in the United States during the taxable year. Thus, 
such alien present in the United States during any part of the taxable 
year and rendering professional advice as a medical doctor or as a 
lawyer or as an engineer, is not subject to Federal income tax on fees 
derived by him in such taxable year by reason of such services unless he 
maintains at some time during such taxable year an office or other fixed 
place in the United States incident to the practice of his profession. 
The exemption applies regardless of the length of time spent within the 
United States during the taxable year and regardless of the amount of 
the fees or professional charges resulting to such alien from such 
services. As to when an alien is regarded as a resident of the United 
States and hence outside the scope of the exemption, see Sec. 29.211-2 
of Regulations 111 (26 CFR 1949 ed. Supps. 29.211-2) [and Sec. 39.211-2 
of Regulations 118 (26 CFR, Rev. 1953, Parts 1-79, and Supps.)].



Sec. 514.112  Stocks, securities, and commodities.

    Under Article 11 of the convention, gains derived from the sale or 
exchange within the United States of stocks, securities, or commodities 
(if of a kind customarily dealt in on an organized commodity exchange) 
by a nonresident alien individual resident in France, or by a French 
corporation or other French entity, is exempt from Federal income tax 
unless such individual, corporation, or other entity has a permanent 
establishment in the United States. If, however, a permanent 
establishment is maintained in the United States, such gains are not so 
exempt even though the sales or exchanges resulting in such gains were 
carried on directly from the home office of the taxpayer and not through 
the permanent establishment in the United States. As to what constitutes 
a permanent establishment, see Sec. 514.104(b)(1).



Sec. 514.113  Remittances to students.

    Under Article 12 of the convention, nonresident alien individuals 
who are residents of France and who are temporarily residing in the 
United States for the purposes of studying or for acquiring business 
experience, are exempt from Federal income tax upon amounts representing 
remittances from France for the purposes of their maintenance and 
studies.



Sec. 514.114  Credit against United States tax liability for income tax paid to France.

    For the purpose of avoidance of double taxation, Article 14A of the 
convention provides that, on the part of the United States, there shall 
be allowed against the United States income and excess profits tax 
liabilities a credit for any income, war-profits or excess profits taxes 
paid to France by United

[[Page 98]]

States citizens or domestic corporations. Such principle also applies in 
the case of a citizen of France residing in the United States. Such 
credit, however, is subject to the limitations provided in section 131 
of the Internal Revenue Code (relating to the credit for foreign taxes) 
and section 729 of such Code (relating to laws applicable). See 
Secs. 29.131-1 to 29.131-10 of Regulations 111 (26 CFR 1949 ed. Supps. 
29.131-1 to 29.131-10), [Secs. 39.131(a)-1 to 39.131(j)-1 of Regulations 
118 (26 CFR, Rev. 1953, Parts 1-79, and Supps.)], and Secs. 35.729-1 to 
35.729-3 Regulations 112 (26 CFR 1938 ed. Supps. 35.729-1 to 35.729-3).



Sec. 514.115  Adjustment of tax liability of residents of France and French corporations.

    Article 18 of the convention confers upon the Commissioner authority 
to adjust under the Revenue Act of 1936 the tax liability for taxable 
years beginning prior to January 1, 1936, of nonresident alien residents 
of France, and French corporations, in any case in which such tax 
liability remained unpaid on January 1, 1945. Such provision, however, 
will not apply in any case unless:
    (a) The Commissioner is satisfied that the additional income tax 
involved did not arise by reason of fraud with intent to evade the tax 
on the part of the taxpayer concerned; and
    (b) The taxpayer files, prior to January 1, 1947, with the 
Commissioner a sworn statement showing for each year involved and for 
such other years as the Commissioner may require, (1) by items and 
classes of income the amounts of interest, dividends, rents, salaries, 
wages, premiums, annuities, compensations, remunerations, emoluments, or 
other fixed or determinable annual or periodical income, gains, profits, 
and income derived from sources within the United States; (2) the 
business transactions, if any, carried on in the United States by or in 
behalf of the taxpayer during each of such years; and (3) such further 
information as the Commissioner may require in the particular case.



Sec. 514.116  Reciprocal administrative assistance.

    (a) General. (1) By Article 20 of the convention, the United States 
and France adopt the principle of exchange of information for use in the 
determination and assessment of the taxes with which the convention is 
concerned. Pursuant to such principle, every United States withholding 
agent shall make and file with the collector, in duplicate, an 
information return on Form 1042C for the calendar year 1945 and each 
subsequent calendar year in addition to withholding return Form 1042, 
with respect to dividends, interest, royalties, rents, salaries, wages, 
pensions, and annuities, or other fixed or determinable annual or 
periodical income paid to persons whose addresses are in France whether 
or not tax has been withheld with respect to such income. There shall be 
reported on Form 1042C not only such items of income listed on Form 
1042, but also such items of interest listed on monthly returns, Form 
1012, and there shall be shown on such return items of income paid to 
such addressees even though such items are exempt from tax under the 
convention, as, for example, certain royalties.
    (2) The information and correspondence relating to exchange of 
information may be transmitted direct by the Secretary to the Minister.
    (b) Information to be furnished in due course. In accordance with 
the provisions of Article 21 of the convention, the Secretary shall 
forward to the Minister as soon as practicable after the close of the 
calendar year 1945 and of each calendar year thereafter during which the 
convention is in effect, the names and addresses of all persons whose 
addresses are within France and who derive from sources within the 
United States, dividends, interest, rents, royalties, salaries, wages, 
pensions, and annuities, or other fixed or determinable annual or 
periodical profits and income showing the amounts of such profits and 
income in the case of each addressee. For these purposes, the 
transmission to the Minister of information return, Form 1042C, as 
provided in paragraph (a) of this section for the

[[Page 99]]

calendar year 1945 and subsequent calendar years shall constitute a 
compliance with the provisions of Article 21 of the convention and of 
this subpart.
    (c) Information in specific cases. Under the provisions of Article 
22 of the convention, the Secretary shall furnish (if request therefor 
is made by the Minister through diplomatic channels) to the Minister 
such information, relative to the tax liability to France of any person 
(other than a citizen of the United States or a United States domestic 
corporation or other United States domestic entity), as is available to, 
or may be obtained by, the Secretary under the revenue laws of the 
United States.



Sec. 514.117  Reciprocal regulations.

    Article 26 of the convention provides that the United States and 
France may prescribe (a) regulations for the purpose of carrying the 
convention into effect within the respective countries and (b) 
reciprocal rules relating to the exchange of information.



PART 515  [RESERVED]






PART 516--AUSTRIA--Table of Contents




                       Subpart--Withholding of Tax

Sec.
516.1  Introductory.
516.2  Dividends; general rules.
516.3  Dividends received by addressee not actual owner.
516.4  Interest.
516.5  Patent and copyright royalties and film rentals.
516.6  Private pensions and private life annuities.
516.7  Sources of income.
516.8  Beneficiaries of an estate or trust.
516.9  Release of excess tax withheld at source.
516.10  Refund of excess tax withheld during 1957.
516.11  Information to be furnished in ordinary course.
516.12  Taxable years beginning in 1956 and ending in 1957.

    Authority: Sec. 7805, 68A Stat. 917; 26 U.S.C. 7805.

    Source: Treasury Decision 6322, 23 FR 7841, Oct. 10, 1958; 25 FR 
14022, Dec. 31, 1960, unless otherwise noted.

    Effective Date Note:  By T.D. 8732, 62 FR 53498, Oct. 14, 1997, part 
516 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 
31, 1998, the effective date was delayed until Jan. 1, 2000.



                       Subpart--Withholding of Tax



Sec. 516.1  Introductory.

    (a) Pertinent provisions. The income tax convention between the 
United States and the Republic of Austria, signed on October 25, 1956, 
referred to in this part as the convention, provides in part as follows, 
effective on and after January 1, 1957:

                                Article I

    (1) The taxes referred to in this Convention are:
    (a) In the case of the United States of America: The federal income 
taxes, including surtaxes.
    (b) In the case of the Republic of Austria: The Einkommensteuer 
(income tax), the Koerperschaftsteuer (corporation tax) and the Beitrag 
vom Einkommen zur Foerderung des Wohnbaues und fuer Zwecke des 
Familienlastenausgleiches (housing reconstruction and family allowance 
contribution).
    (2) The present Convention shall also apply to any other income or 
profits tax of a substantially similar character which may be imposed by 
one of the contracting States after the date of signature of the present 
Convention.

                               Article II

    (1) As used in this Convention:
    (a) The term ``United States'' means the United States of America, 
and when used in a geographical sense means the States, the Territories 
of Alaska and Hawaii, and the District of Columbia;
    (b) The term ``Austria'' means the Republic of Austria;
    (c) The term ``enterprise of one of the contracting States'' means, 
as the case may be, a United States enterprise or an Austrian 
enterprise;
    (d) The term ``United States enterprise'' means an industrial or 
commercial enterprise or undertaking carried on in the United States by 
a natural person (including an individual in his individual capacity or 
as a member of a partnership) resident in the United States or by a 
United States corporation or other entity; the term ``United States 
corporation or other entity'' means a corporation or other entity 
created or organized under the law of the United States or of any State 
or Territory of the United States;
    (e) The term ``Austrian enterprise'' means an industrial or 
commercial enterprise or

[[Page 100]]

undertaking carried on in Austria by a natural person (including an 
individual in his individual capacity or as a member of a partnership) 
resident in Austria or by an Austrian corporation; the term ``Austrian 
corporation'' means a corporation or other entity created or organized 
under the law of Austria;
    (f) The term ``permanent establishment'' means a branch, office, 
factory, workshop, a warehouse, a merchandising establishment, a mine, 
oil well or other place of exploitation of the ground or soil, a 
construction or assembly project or the like, the duration of which 
exceeds or will likely exceed twelve months, or other fixed place of 
business; but does neither include the casual and temporary use of mere 
storage facilities, nor an agent or employee unless the agent or 
employee has full power for the negotiation and concluding of contracts 
on behalf of an enterprise and also habitually exercises this power in 
that other State or has a stock of merchandise belonging to the 
enterprise of the other State from which he regularly fills orders on 
behalf of the enterprise. An enterprise of one of the contracting States 
shall not be deemed to have a permanent establishment in the other State 
merely because it carries on business dealings in such other State 
through a commission agent, broker, custodian or other independent 
agent, acting in the ordinary course of his business as such. The fact 
that an enterprise of one of the contracting States maintains in the 
other State a fixed place of business exclusively for the purchase of 
goods and merchandise shall not of itself constitute such fixed place of 
business a permanent establishment of the enterprise. The maintenance 
within the territory of one of the contracting States by an enterprise 
of the other contracting State of a warehouse for convenience of 
delivery and not for purposes of display shall not of itself constitute 
a permanent establishment within that territory. The fact that a 
corporation of one contracting State has a subsidiary corporation which 
is a corporation of the other State or which is engaged in trade or 
business in the other State shall not of itself constitute that 
subsidiary corporation a permanent establishment of its parent 
corporation;
    (g) The term ``competent authorities'' means, in the case of the 
United States, the Commissioner of Internal Revenue as authorized by the 
Secretary of the Treasury; and in the case of Austria, the Federal 
Ministry of Finance.
    (2) For the purpose of the present Convention:
    (a) Dividends paid by a corporation of one of the contracting States 
shall be treated as income from sources within such State.
    (b) Interest paid by one of the contracting States, including any 
local government thereof, or by an enterprise of one of the contracting 
States not having a permanent establishment in the other contracting 
State shall be treated as income from sources within the former State.
    (c) Income from real property (including gains derived from the sale 
or exchange of such property, but not including interest from mortgages 
or bonds secured by real property) and royalties in respect of the 
operation of mines, oil wells, or other natural resources shall be 
treated as income derived from the contracting State in which such real 
property, mines, oil wells or other natural resources are situated.
    (d) Compensation for labor or personal services (including the 
practice of liberal professions) shall be treated as income from sources 
within the contracting State where are rendered the services for which 
such compensation is paid.
    (e) Royalties for using, or for the right to use, in one of the 
contracting States, patents, copyrights, designs, trademarks and like 
property shall be treated as income from sources within such State.
    (3) In the application of the provisions of this Convention by one 
of the contracting States any term not otherwise defined shall, unless 
the context otherwise requires, have the meaning which the term has 
under its own tax laws. For the purposes of this Convention the term 
``residence'' in Austria shall include the customary place of abode 
therein.

                                * * * * *

                               Article VI

    The rate of tax imposed by one of the contracting States upon 
dividends received from sources within such State by a resident or 
corporation or other entity of the other contracting State not having a 
permanent establishment in the former State shall not exceed 50 percent 
of the statutory rate of tax imposed on such dividends by such former 
State but such rate of tax shall not exceed 5 percent if the shareholder 
is a corporation controlling, directly or indirectly, at least 95 
percent of the entire voting power in the corporation paying the 
dividend, and if not more than 25 percent of the gross income of such 
paying corporation is derived from interest and dividends, other than 
interest and dividends received from its own subsidiary corporations. 
Such reduction of the rate to five percent shall not apply if the 
relationship of the two corporations has been arranged or is maintained 
primarily with the intention of securing such reduced rate.

                               Article VII

    Interest received from sources within one of the contracting States, 
on bonds, notes, debentures, securities or on any other form of 
indebtedness (exclusive of interest on

[[Page 101]]

debts secured by mortgages) by a resident or corporation or other entity 
of the other contracting State shall, in an amount not exceeding fair 
and reasonable consideration on indebtedness, be exempt from tax by the 
former State if such resident, corporation or other entity has no 
permanent establishment in such former State.

                              Article VIII

    (1) Royalties and other amounts received as consideration for the 
right to use literary, musical or other copyrights, artistic and 
scientific works, patents, designs, plans, secret processes and 
formulae, trademarks, and other like property and rights (including 
rentals and like payments for the use of industrial, commercial or 
scientific equipment but not including motion picture film rentals) by a 
resident or a corporation or other entity of one of the contracting 
States from sources within the other contracting State shall, in an 
amount not exceeding fair and reasonable consideration for such right to 
use, be exempt from taxation by such other State if the recipient has no 
permanent establishment situated in such other State.
    (2) The rate of tax imposed by one of the contracting States upon 
motion picture film rentals received from sources within such 
contracting State by a resident or corporation or other entity of the 
other contracting State not having a permanent establishment in the 
former State shall not exceed 50 percent of the statutory rate of tax 
imposed on such rentals but in any case shall not exceed 10 percent of 
the amount of such rentals.

                               Article IX

    (1) Income from real property (including gains derived from the sale 
or exchange of such property and interest on mortgages secured by such 
property) and royalties in respect of the operation of mines, oil wells 
or other natural resources shall be taxable in the contracting State in 
which such property, mines, oil wells or other natural resources are 
situated.
    (2) Where a resident or corporation or other entity of one of the 
contracting States derives any income coming within the scope of 
paragraph (1) from property within the other contracting State, the 
recipient may, for any taxable year, elect to be subject to the tax of 
such other contracting State on a net basis as if such resident, 
corporation or other entity were engaged in trade or business within 
such other State through a permanent establishment therein.

                                * * * * *

                               Article XI

                                * * * * *

    (2) Private pensions and private life annuities which are from 
sources within one of the contracting States and are paid to individuals 
residing in the other contracting State shall be exempt from taxation by 
the former State.
    (3) The term ``pensions'', as used in this Article, means periodic 
payments made in consideration for services rendered or by way of 
compensation for injuries received.
    (4) The term ``life annuities'', as used in this Article, means a 
stated sum payable periodically at stated times during life, or during a 
specified number of years, under an obligation to make the payments in 
return for adequate and full consideration in money or money's worth.

                                * * * * *

                               Article XIV

    (1) Dividends and interest paid by an Austrian corporation (other 
than a United States corporation) shall be exempt from United States tax 
where the recipient is a nonresident alien or a foreign corporation.

                                * * * * *

                               Article XVI

    (1) The competent authorities of the contracting States shall 
exchange such information (being information available under the 
respective taxation laws of the contracting States) as is necessary for 
carrying out the provisions of the present Convention or for the 
prevention of fraud or the like in relation to the taxes which are the 
subject of the present Convention. Any information so exchanged shall be 
treated as secret and shall not be disclosed to any persons other than 
those concerned with the assessment and collection of the taxes which 
are the subject of the present Convention. No information shall be 
exchanged which would disclose any trade, business, industrial or 
professional secret or any trade process.
    (2) In no case shall the provisions of this Article be construed so 
as to impose upon either of the contracting States the obligation to 
carry out administrative measures at variance with the regulations and 
practice of either contracting State or which would be contrary to its 
sovereignty, security or public policy or to supply particulars which 
are not procurable under its own legislation or that of the State making 
application.

                              Article XVII

                                * * * * *

    (2) Should any difficulty or doubt arise as to the interpretation or 
application of the present Convention or its relationship to Conventions 
of the contracting States with

[[Page 102]]

third States the competent authorities of the contracting States may 
settle the question by mutual agreement.

                              Article XVIII

    (1) The provisions of this Convention shall not be construed to deny 
or affect in any manner the right of diplomatic and consular officers to 
other or additional exemptions now enjoyed or which may hereafter be 
granted to such officers.
    (2) The provisions of the present Convention shall not be construed 
to restrict in any manner any exemption, deduction, credit or other 
allowance now or hereafter granted by the laws of one of the contracting 
States in the determination of the tax imposed by such State.

                                * * * * *

                               Article XIX

    (1) The competent authorities of the two contracting States may 
prescribe regulations necessary to carry into effect the present 
Convention within the respective States.
    (2) The competent authorities of the two contracting States may 
communicate with each other directly for the purpose of giving effect to 
the provisions of this Convention.

                               Article XX

    (1) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Vienna as soon as possible. The 
Convention shall have effect on and after the first day of January of 
the calendar year in which such exchange takes place.
    (2) The present Convention shall remain in force indefinitely, but 
may be terminated by either of the contracting States, provided that at 
least six months' prior notice of termination has been given through 
diplomatic channels. In such event, the present Convention shall cease 
to be effective for the taxable years beginning on or after the first 
day of January next following the expiration of the six-month period.

    (b) Meaning of terms. As used in Secs. 516.1 to 516.12, any term 
defined in the convention shall have the meaning so asigned to it; any 
term not so defined shall, unless the context otherwise requires, have 
the meaning which such term has under the internal revenue laws of the 
United States.



Sec. 516.2  Dividends; general rules.

    (a) Paid by an Austrian corporation. Dividends paid on or after 
January 1, 1957, by an Austrian corporation which is not a United States 
corporation are exempt from United States tax under the provisions of 
Article XIV (1) of the convention if the recipient is a nonresident 
alien or a foreign corporation.
    (b) 50 percent of statutory rate--(1) In general. Article VI of the 
convention provides that the rate of United States tax imposed upon 
dividends received from sources within the United States on or after 
January 1, 1957, by a nonresident alien individual who is a resident of 
Austria, or by an Austrian corporation or other entity, shall not exceed 
50 percent of the statutory rate of tax imposed on such dividends by the 
United States if such alien, corporation, or other entity has not had a 
permanent establishment in the United States at any time during the 
taxable year in which such dividends are received. This subparagraph 
does not apply to dividends falling within the scope of paragraph (a) or 
(c) of this section.
    (2) Personal services. If a nonresident alien individual who is a 
resident of Austria performs personal services within the United States 
during the taxable year, but has at no time during such year a permanent 
establishment within the United States, he is entitled to the reduced 
rate of tax on dividends prescribed by subparagraph (1) of this 
paragraph, even though under the provisions of section 871(c) of the 
Internal Revenue Code of 1954 he has engaged in trade or business within 
the United States during such year by reason of his having performed 
personal services therein.
    (c) Dividends paid by a related corporation--(1) Rate of 5 percent. 
Under the provisions of Article VI of the convention, dividends received 
from sources within the United States on or after January 1, 1957, by an 
Austrian corporation which controls, directly or indirectly, at the time 
the dividend is paid, 95 percent or more of the entire voting power in 
the corporation paying the dividend are subject to United States tax at 
a rate not in excess of 5 percent if (i) not more than 25 percent of the 
gross income of the paying corporation for the 3-year period immediately 
preceding the taxable year in which the dividend is paid consists of 
dividends and interest (other than dividends and interest received by 
such

[[Page 103]]

paying corporation from its own subsidiary corporations, if any), (ii) 
the relationship between the paying corporation and the Austrian 
corporation has not been arranged or maintained primarily with the 
intention of securing the reduced rate of 5 percent, and (iii) the 
Austrian corporation at no time during the taxable year in which such 
dividends are received has had a permanent establishment within the 
United States. This subparagraph does not apply to dividends falling 
within the scope of paragraph (a) of this section.
    (2) Information to be filed with Commissioner. Any corporation 
(hereinafter referred to as the claimant) which claims or contemplates 
claiming that dividends paid or to be paid by it are subject to a rate 
of United States tax not in excess of 5 percent shall file the following 
information with the Commissioner of Internal Revenue as soon as 
practicable: (i) the date and place of its organization; (ii) the number 
of outstanding shares of stock of the claimant having voting power and 
the voting power thereof; (iii) the person or persons beneficially 
owning such stock of the claimant and their relationship to the Austrian 
corporation; (iv) the amounts by years (for the 3-year period 
immediately preceding the taxable year in which the dividend is paid) of 
the gross income of the claimant, of the interest and dividends included 
in such gross income, and of the interest and dividends received by the 
claimant from its own subsidiary corporations, if any; and (v) the 
relationship between the claimant and the Austrian corporation receiving 
the dividend.
    (3) Notification by Commissioner. As soon as practicable after such 
information is filed, the Commissioner will determine whether the 
dividends concerned qualify under Article VI of the convention for a 
rate of tax not in excess of 5 percent and will notify the claimant of 
his determination. If the dividends do qualify for such reduced rate, 
this notification may also authorize the release, pursuant to 
Sec. 516.9(a)(3), of excess tax withheld from the dividends concerned.
    (d) Withholding of United States tax from dividends--(1) Exempt from 
withholding. No withholding of United States tax is required in the case 
of dividends paid by an Austrian corporation which, in accordance with 
paragraph (a) of this section, are exempt from United States tax.
    (2) 50 percent of statutory rate--(i) In general. Withholding of tax 
at source on or after January 1, 1958, in the case of dividends (other 
than dividends falling within the scope of subparagraph (1) or (3) of 
this paragraph) received from sources within the United States by a 
nonresident alien or by a foreign corporation or other entity, whose 
address is in Austria, shall, to the extent withholding of United States 
tax is required, be at the rate of 50 percent of the statutory rate in 
every case except that in which, prior to the date of payment of such 
dividends, the Commissioner of Internal Revenue has notified the 
withholding agent that the reduced rate of withholding shall not apply.
    (ii) Effect of address in Austria. For the purposes of this 
subparagraph, every nonresident alien whose address is in Austria shall 
be deemed by United States withholding agents to be a nonresident alien 
individual who is a resident of Austria not having a permanent 
establishment within the United States; and every foreign corporation or 
other entity whose address is in Austria shall be deemed by such 
withholding agents to be an Austrian corporation or other entity not 
having a permanent establishment within the United States.
    (iii) Reduced rate applicable to owner only. This subparagraph is 
based on the assumption that the payee of the dividend is the actual 
owner of the capital stock from which the dividend is derived. As to 
action by a recipient who is not the owner, see Sec. 516.3.
    (iv) Statutory rate. As used in this subparagraph, the term 
``statutory rate'' means the rate (30 percent as of the date of approval 
of this Treasury decision) prescribed with respect to dividends by 
chapter 3 of the Internal Revenue Code of 1954 as though the convention 
had not come into effect.
    (v) Nonresident alien. The term ``nonresident alien'', as used in 
this subparagraph, includes nonresident alien individuals, fiduciaries, 
and partnerships.

[[Page 104]]

    (3) Rate of 5 percent. If, in accordance with paragraph (c)(3) of 
this section, the Commissioner of Internal Revenue has notified the 
claimant corporation that the dividends qualify under Article VI of the 
convention for a rate of tax not in excess of 5 percent, the reduced 
withholding rate of 5 percent, to the extent withholding of United 
States tax is required, shall apply on or after January 1, 1958, to any 
dividends subsequently paid by such corporation and received by the 
Austrian corporation, unless (i) the stock ownership of the claimant 
corporation materially changes, (ii) the character of the income of the 
claimant corporation materially changes, or (iii) the Commissioner 
determines that the relationship between the two corporations concerned 
is being maintained primarily with the intention of securing the reduced 
rate of United States tax. In such instance, if such change in stock 
ownership or character of income occurs, the claimant corporation shall 
promptly notify the Commissioner of the then existing facts with respect 
thereto. The continued application of the rate not in excess of 5 
percent is also dependent upon the continued fulfillment of paragraph 
(c)(1)(iii) of this section.
    (4) Evidence of tax withheld. The rate at which United States tax 
has been withheld from any dividend paid at any time after the 
expiration of the thirtieth day after the date on which Secs. 516.1 to 
516.12 are published in the Federal Register to any person whose address 
is in Austria at the time the dividend is paid shall be shown either in 
writing or by appropriate stamp on the check, draft, or other evidence 
of payment, or on an accompanying statement.



Sec. 516.3  Dividends received by addressee not actual owner.

    (a) Additional tax to be withheld--(1) Nominee or representative. If 
the recipient in Austria of any dividend from which tax has been 
withheld at a reduced rate pursuant to Sec. 516.2(d)(2) is a nominee or 
representative through whom the dividend is received by a person other 
than one described in Sec. 516.2(b), such nominee or representative 
shall withhold an additional amount of United States tax equivalent to 
the United States tax which would have been withheld if the convention 
had not been in effect (30 percent as of the date of approval of 
Secs. 516.1 to 516.12) minus the amount which has been withheld at the 
source.
    (2) Fiduciary or partnership. If a fiduciary or a partnership with 
an address in Austria receives, otherwise than as a nominee or 
representative, a dividend from which United States tax has been 
withheld at a reduced rate pursuant to Sec. 516.2(d)(2), such fiduciary 
or partnership shall withhold an additional amount of United States tax 
from the portion of the dividend included in the gross income from 
sources within the United States of any beneficiary or partner, as the 
case may be, who is not entitled to the reduced rate of tax in 
accordance with Sec. 516.2(b). The amount of the additional tax is to be 
calculated in the same manner as under subparagraph (1) of this 
paragraph.
    (3) Released amounts of tax. If any amount of United States tax is 
released pursuant to Sec. 516.9(a)(2) by the withholding agent in the 
United States with respect to a dividend paid to such a person (nominee, 
representative, fiduciary, or partnership) with an address in Austria, 
the latter shall withhold from such released amount any additional 
amount of United States tax, otherwise required to be withheld from the 
dividend by the provisions of subparagraphs (1) and (2) of this 
paragraph, in the same manner as if at the time of payment of the 
dividend United States tax at the reduced rate prescribed by 
Sec. 516.2(d)(2) had been withheld at source from such dividend.
    (b) Returns filed by Austrian withholding agents. The amounts 
withheld pursuant to paragraph (a) of this section by any withholding 
agent in Austria shall be deposited, without converting the amounts into 
United States dollars, with the Austrian Federal Ministry of Finance on 
or before the 15th day after the close of the quarter of the calendar 
year in which the withholding in Austria occurs. The withholding agent 
making the deposit shall render therewith such appropriate Austrian form 
as may be prescribed by the Federal Ministry of Finance. The amounts so 
deposited should be remitted by the

[[Page 105]]

Federal Ministry of Finance by draft in United States dollars, on or 
before the end of the calendar month in which the deposit is made, to 
the Director of International Operations, Internal Revenue Service, 
Washington, D.C., U.S.A. The remittance should be accompanied by such 
Austrian forms as may be required to be rendered by the withholding 
agent in Austria in connection with the deposit.



Sec. 516.4  Interest.

    (a) Paid by Austrian corporation. Interest paid on or after January 
1, 1957, by an Austrian corporation which is not a United States 
corporation is exempt from United States tax under the provisions of 
Article XIV(1) of the convention if the recipient is a nonresident alien 
or a foreign corporation. Such exempt interest is not subject to the 
withholding of United States tax at source.
    (b) Other interest. Interest on bonds, notes, debentures, 
securities, or on any other form of indebtedness, including interest on 
obligations of the United States and its instrumentalities but not 
including interest on debts secured by mortgages, which is received from 
sources within the United States on or after January 1, 1957, by a 
nonresident alien individual who is a resident of Austria, or by an 
Austrian corporation or other entity, is exempt, in an amount not 
exceeding a fair and reasonable consideration on the indebtedness, from 
United States tax under the provisions of Article VII of the convention 
if such alien, corporation, or other entity at no time during the 
taxable year in which such interest is received has a permanent 
establishment in the United States. This paragraph does not apply to the 
interest which is exempt from United States tax in accordance with 
paragraph (a) of this section.
    (c) Personal services. If a nonresident alien individual who is a 
resident of Austria performs personal services within the United States 
during the taxable year, but has at no time during such year a permanent 
establishment in the United States, he is entitled to the interest 
exemption prescribed by paragraph (b) of this section even though under 
the provisions of section 871(c) of the Internal Revenue Code of 1954 he 
has engaged in trade or business within the United States during such 
year by reason of his having performed personal services therein.
    (d) Exemption from withholding of United States tax--(1) Coupon bond 
interest--(i) Form to use. To avoid withholding of United States tax at 
source on or after January 1, 1958, in the case of coupon bond interest 
to which paragraph (b) of this section applies, the nonresident alien 
individual who is a resident of Austria, or the Austrian corporation or 
other entity, shall, for each issue of bonds, file Form 1001-A in 
duplicate when presenting the interest coupons for payment. This form 
shall be signed by the owner of the interest, or by his trustee or 
agent, and shall show the information required by Sec. 1.1461-1(d) of 
this chapter. It shall contain a statement that the owner (a) is a 
resident of Austria, or is an Austrian corporation or other entity, and 
(b) has no permanent establishment in the United States.
    (ii) Exemption applicable only to owner. The exemption from United 
States tax contemplated by Article VII of the convention, insofar as it 
concerns coupon bond interest, is applicable only to the owner of the 
interest. The person presenting the coupon, or on whose behalf it is 
presented, shall, for the purpose of the exemption from United States 
tax, be deemed to be the owner of the interest only if he is, at the 
time the coupon is presented for payment, the owner of the bond from 
which the coupon has been detached. If the person presenting the coupon, 
or on whose behalf it is presented, is not the owner of the bond, Form 
1001, and not Form 1001-A, shall be executed.
    (iii) Disposition of form. The original and duplicate of Form 1001-A 
shall be forwarded by the withholding agent to the Director of 
International Operations, Internal Revenue Service, Washington 25, D.C., 
in accordance with Sec. 1.1461-2(b)(2) of this chapter.
    (2) Interest on noncoupon bonds--(i) Notification by letter. To 
avoid withholding of United States tax at source on or after January 1, 
1958, in the case of interest (other than coupon bond interest) to which 
paragraph (b) of this section applies, the nonresident alien individual 
who is a resident of Austria,

[[Page 106]]

or the Austrian corporation or other entity, shall notify the 
withholding agent by letter in duplicate that the interest is exempt 
from United States tax under the provisions of Article VII of the 
convention. The letter of notification shall be signed by the owner of 
the interest, or by his trustee or agent, and shall show the name and 
address of the obligor and the name and address of the owner of the 
interest. It shall contain a statement (a) that the owner is neither a 
citizen nor a resident of the United States but is a resident of 
Austria, or, in the case of a corporation or other entity, that the 
owner is an Austrian corporation or other entity, and (b) that the owner 
has at no time during the current taxable year had a permanent 
establishment in the United States.
    (ii) Use of letter for release of excess tax. If the letter is also 
to be used as authorization for the release, pursuant to 
Sec. 516.9(a)(5), of excess tax withheld from such interest, it shall 
also contain a statement (a) that, at the time when the interest was 
received from which the excess tax was withheld, the owner was neither a 
citizen nor a resident of the United States but was a resident of 
Austria, or, in the case of a corporation or other entity, the owner was 
an Austrian corporation or other entity, and (b) that the owner at no 
time during the taxable year in which such interest was received had a 
permanent establishment in the United States.
    (iii) Manner of filing letter. The letter of notification, which 
shall constitute authorization for the payment of the interest without 
withholding of United States tax at source, shall be filed with the 
withholding agent for each successive 3-calendar-year period during 
which the interest is paid. For this purpose, the first such period 
shall commence with the beginning of the calendar year in which the 
interest is first paid on or after January 1, 1958. Each letter filed 
with any withholding agent shall be filed not later than 20 days 
preceding the date of the first payment within each successive period, 
or, if that is not possible because of special circumstances, as soon as 
possible after such first payment. Once a letter has been filed in 
respect of any 3-calendar-year period, no additional letter need be 
filed in respect thereto unless the Commissioner of Internal Revenue 
notifies the withholding agent that an additional letter shall be filed 
by the taxpayer. If, after filing a letter of notification, the taxpayer 
ceases to be eligible for the exemption from United States tax granted 
by Article VII of the convention, he shall promptly notify the 
withholding agent by letter in duplicate. When any change occurs in the 
ownership of the interest as recorded on the books of the payer, the 
exemption from withholding of United States tax shall no longer apply 
unless the new owner of record is entitled to and does properly file a 
letter of notification with the withholding agent.
    (iv) Disposition of letter. Each letter of notification, or the 
duplicate thereof, shall be immediately forwarded by the withholding 
agent to the Director of International Operations, Internal Revenue 
Service, Washington 25, D.C.
    (3) Reasonableness of consideration. For purposes of this paragraph, 
the withholding agent may, unless he has information to the contrary, 
presume that the interest represents a fair and reasonable consideration 
on the indebtedness involved.



Sec. 516.5  Patent and copyright royalties and film rentals.

    (a) Items exempt from tax--(1) In general. Royalties and other 
amounts received from sources within the United States on or after 
January 1, 1957, by a nonresident alien individual who is a resident of 
Austria or by an Austrian corporation or other entity, as consideration 
for the right to use literary, musical or other copyrights, artistic and 
scientific works, patents, designs, plans, secret processes and 
formulae, trademarks, and other like property and rights (including 
rentals and like payments for the use of industrial, commercial, or 
scientific equipment but not including motion picture film rentals) are, 
in an amount not exceeding a fair and reasonable consideration for such 
right, exempt from United States tax under the provisions of Article 
VIII(1) of the convention if such alien, corporation, or other entity 
has not had a permanent establishment in the United States at any time 
during

[[Page 107]]

the taxable year in which such items are received.
    (2) Exemption from withholding of United States tax--(i) 
Notification by letter. To avoid withholding of United States tax at 
source on or after January 1, 1958, in the case of the items of income 
to which this paragraph applies, the nonresident alien individual who is 
a resident of Austria, or the Austrian corporation or other entity, 
shall notify the withholding agent by letter in duplicate that the 
income is exempt from United States tax under the provisions of Article 
VIII(1) of the convention.
    (ii) Manner of filing letter. The provisions of Sec. 516.4(d)(2) 
relating to the execution, filing, effective period, and disposition of 
the letter of notification prescribed therein, including its use for the 
release of excess tax withheld, are equally applicable with respect to 
the income falling within the scope of this paragraph.
    (iii) Reasonableness of consideration. For purposes of this 
subparagraph, the withholding agent may, unless he has information to 
the contrary, presume that the royalty or other like amount represents a 
fair and reasonable consideration for the right involved.
    (b) Motion picture film rentals--(1) Reduced rate. Under Article 
VIII(2) of the convention, the rate of United States tax imposed upon 
motion picture film rentals received from sources within the United 
States on or after January 1, 1957, by a nonresident alien individual 
who is a resident of Austria, or by an Austrian corporation or other 
entity, shall not exceed the lesser of (i) 50 percent of the statutory 
rate of tax imposed on such rentals by the United States or (ii) 10 
percent of the gross amount of such rentals, if such alien, corporation, 
or other entity at no time during the taxable year in which such rentals 
are received has a permanent establishment in the United States.
    (2) Reduction in rate of withholding of United States tax--(i) 
Notification by letter. To secure withholding of United States tax at 
source on or after January 1, 1958, at the reduced rate (10 percent, as 
of the date of approval of Secs. 516.1 to 516.12, of the gross amount of 
the rentals) in the case of the motion picture film rentals to which 
this paragraph applies, the nonresident alien individual who is a 
resident of Austria, or the Austrian corporation or other entity, shall 
notify the withholding agent by letter in duplicate that the rentals are 
subject to United States tax at the reduced rate under the provisions of 
Article VIII(2) of the convention.
    (ii) Manner of filing letter. The provisions of Sec. 516.4(d)(2) 
relating to the execution, filing, effective period, and disposition of 
the letter of notification prescribed therein, including its use for the 
release of excess tax withheld, are equally applicable with respect to 
the rentals falling within the scope of this paragraph except that the 
release of excess tax withheld from such rentals shall be made in 
accordance with Sec. 516.9(a)(6).



Sec. 516.6  Private pensions and private life annuities.

    (a) Exemption from tax. Private pensions and private life annuities 
which are from sources within the United States and are paid on or after 
January 1, 1957, to a nonresident alien individual who is a resident of 
Austria are exempt from United States tax under the provisions of 
Article XI (2) of the convention.
    (b) Exemption from withholding of United States tax--(1) 
Notification by letter. To avoid withholding of United States tax at 
source on or after January 1, 1958, in the case of the items of income 
to which this section applies, the nonresident alien individual who is a 
resident of Austria shall notify the withholding agent by letter in 
duplicate that the income is exempt from United States tax under the 
provisions of Article XI (2) of the convention. The letter of 
notification shall be signed by the owner of the income, shall show the 
name and address of both the payer and the owner of the income, and 
shall contain a statement that the owner, an individual, is neither a 
citizen nor a resident of the United States but is a resident of 
Austria.
    (2) Use of letter for release of tax. If the letter is also to be 
used as authorization for the release, pursuant to Sec. 516.9(a)(5), of 
excess tax withheld from such items of income, it shall also contain a 
statement that the owner was,

[[Page 108]]

at the time when the income was paid from which the excess tax was 
withheld, neither a citizen nor a resident of the United States but was 
a resident of Austria.
    (3) Manner of filing letter. The letter of notification shall 
constitute authorization for the payment of such items of income without 
withholding of United States tax at source unless the Commissioner of 
Internal Revenue subsequently notifies the withholding agent that the 
tax shall be withheld with respect to payments of such items of income 
made after receipt of such notice. If, after filing a letter of 
notification, the owner of the income ceases to be eligible for the 
exemption from United States tax granted by the convention in respect to 
such income, he shall promptly notify the withholding agent by letter in 
duplicate. When any change occurs in the ownership of the income as 
recorded on the books of the payer, the exemption from withholding of 
United States tax shall no longer apply unless the new owner of record 
is entitled to and does properly file a letter of notification with the 
withholding agent.
    (4) Disposition of letter. Each letter of notification, or the 
duplicate thereof, shall be immediately forwarded by the withholding 
agent to the Director of International Operations, Internal Revenue 
Service, Washington, D.C.
    (c) Definitions. As used in this section, the term ``pensions'' 
means periodic payments made in consideration for services rendered or 
by way of compensation for injuries received, and the term ``life 
annuities'' means a stated sum payable periodically at stated times 
during life, or during a specified number of years, under an obligation 
to make the payments in return for adequate and full consideration in 
money or money's worth. Neither term includes retired pay or pensions 
paid by the United States or by any State or Territory of the United 
States.



Sec. 516.7  Sources of income.

    For determining the sources of income for purposes of Secs. 516.1 to 
516.12 see sections 861 to 864, inclusive, of the Internal Revenue Code 
of 1954 and Article II (2) of the convention.



Sec. 516.8  Beneficiaries of an estate or trust.

    (a) Entitled to benefit of convention. If he otherwise satisfies the 
requirements of the respective articles concerned, a nonresident alien 
who is a beneficiary of an estate or trust shall be entitled to the 
exemption from, or reduction in the rate of, United States tax granted 
by Articles VI, VII, VIII, and XIV of the convention with respect to 
dividends, interest, and copyright royalties and other like amounts, to 
the extent that (1) any amount paid, credited, or required to be 
distributed by such estate or trust to such beneficiary is deemed to 
consist of such items, and (2) such items would, without regard to the 
convention, be includible in his gross income.
    (b) Withholding of United States tax. In order to be entitled in 
such instance to the exemption from, or reduction in rate of, 
withholding of United States tax, the beneficiary must otherwise satisfy 
such requirements and shall, where applicable, execute and submit to the 
fiduciary of the estate or trust in the United States the appropriate 
letter of notification prescribed in Secs. 516.4(d)(2), 516.5(a)(2) and 
(b)(2).
    (c) Amounts otherwise includible in gross income of beneficiary. For 
the determination of amounts which, without regard to the convention, 
are includible in the gross income of the beneficiary, see subchapter J 
of chapter 1 of the Internal Revenue Code of 1954, and the regulations 
thereunder (Secs. 1.641-1 to 1.692-1 of this chapter).



Sec. 516.9  Release of excess tax withheld at source.

    (a) Amounts to be released--(1) Dividends and interest paid by 
Austrian corporation. If United States tax at the statutory rate has 
been withheld on or after January 1, 1958, from dividends and interest 
paid by an Austrian corporation (other than a United States corporation) 
to a recipient who is a nonresident alien or a foreign corporation, the 
withholding agent shall release and pay over to the person from whom the 
tax was withheld an amount which is equal to the tax so withheld.
    (2) Dividends subject to 50 percent of statutory rate. If United 
States tax at the statutory rate has been withheld

[[Page 109]]

on or after January 1, 1958, from dividends described in Sec. 516.2(b) 
and received from sources within the United States by a nonresident 
alien (including a nonresident alien individual, fiduciary, and 
partnership) or by a foreign corporation or other entity, whose address 
at the time of payment was in Austria, the withholding agent shall 
release and pay over to the person from whom the tax was withheld an 
amount which is equal to the difference between the tax so withheld and 
the tax required to be withheld pursuant to Sec. 516.2(d)(2).
    (3) Dividends subject to 5 percent rate. If United States tax at the 
statutory rate has been withheld on or after January 1, 1958, from 
dividends which qualify under Sec. 516.2(c)(1) for a rate of tax not in 
excess of 5 percent, the withholding agent shall, if so authorized in 
accordance with Sec. 516.2(c)(3), release and pay over to the 
corporation from which the tax was withheld an amount which is equal to 
the difference between the tax so withheld and the tax required to be 
withheld pursuant to Sec. 516.2(d)(3).
    (4) Coupon bond interest--(i) Substitute form. In the case of every 
taxpayer who furnishes to the withholding agent Form 1001-A clearly 
marked ``Substitute'' and executed in accordance with 
Sec. 516.4(d)(1)(i), where United States tax has been withheld at the 
statutory rate on or after January 1, 1958, from coupon bond interest 
exempt under Sec. 516.4(b), the withholding agent shall release and pay 
over to the person from whom the tax was withheld an amount which is 
equal to the tax so withheld, if the taxpayer also attaches to such form 
a letter in duplicate, signed by the owner, or by his trustee or agent, 
and containing the following:
    (a) The name and the address of the obligor;
    (b) The name and the address of the owner of the interest from which 
the excess tax was withheld;
    (c) A statement that, at the time when the interest was received 
from which the excess tax was withheld, the owner was neither a citizen 
nor a resident of the United States but was a resident of Austria, or, 
in the case of a corporation or other entity, the owner was an Austrian 
corporation or other entity; and
    (d) A statement that the owner at no time during the taxable year in 
which the interest was received had a permanent establishment in the 
United States. One such substitute form shall be filed in duplicate with 
respect to each issue of bonds and will serve with respect to that issue 
to replace all Forms 1001 previously filed by the taxpayer in the 
calendar year in which the excess tax was withheld and with respect to 
which such excess is released.
    (ii) Disposition of form. The original and duplicate of substitute 
Form 1001-A (and letter) shall be forwarded by the withholding agent to 
the Director of International Operations, Internal Revenue Service, 
Washington, D.C., in accordance with Sec. 1.1461-2(b) of this chapter.
    (5) Interest on noncoupon bonds, royalties, pensions, and annuities. 
If a taxpayer furnishes to the withholding agent the authorization of 
release prescribed in Sec. 516.4(d)(2)(ii), Sec. 516.5(a)(2)(ii), or 
Sec. 516.6(b)(2) and United States tax has been withheld at the 
statutory rate on or after January 1, 1958, from the interest, copyright 
royalties or other like amounts, pensions, or annuities in respect to 
which such authorization is prescribed, the withholding agent shall 
release and pay over to the person from whom the tax was withheld an 
amount which is equal to the tax so withheld.
    (6) Motion picture film rentals. If a taxpayer furnishes to the 
withholding agent the authorization of release prescribed in 
Sec. 516.5(b)(2)(ii) and United States tax has been withheld at the 
statutory rate on or after January 1, 1958, from the motion picture film 
rentals in respect to which such authorization is prescribed, the 
withholding agent shall release and pay over to the person from whom the 
tax was withheld an amount which is equal to the difference between the 
tax so withheld and the tax required to be withheld pursuant to 
Sec. 516.5(b)(2)(i).
    (b) Amounts not to be released. The provisions of this section do 
not apply to excess tax withheld at source which has been paid by the 
withholding agent to the Director of International Operations.

[[Page 110]]

    (c) Statutory rate. As used in this section, the term ``statutory 
rate'' means the rate prescribed by chapter 3 of the Internal Revenue 
Code of 1954 as though the convention had not come into effect.
    (d) Amounts withheld during 1957. For provisions respecting the 
refund of excess tax withheld during the calendar year 1957, see 
Sec. 516.10.



Sec. 516.10  Refund of excess tax withheld during 1957.

    (a) In general. Where United States tax withheld at the source 
during the calendar year 1957 from dividends, interest, copyright 
royalties and the like, motion picture film rentals, private pensions or 
private life annuities is in excess of the tax imposed under subtitle A 
(relating to the income tax) of the Internal Revenue Code of 1954, as 
modified by the convention, a claim by the taxpayer for refund of any 
overpayment resulting therefrom may be made under section 6402 of such 
Code and the regulations thereunder.
    (b) Form of claim--(1) Where return previously filed. If the 
taxpayer has previously filed an income tax return with the Internal 
Revenue Service for the taxable year in which an overpayment has 
resulted because of the application of the convention, he should make a 
claim for refund of the overpayment by filing Form 843 or an amended 
return.
    (2) Where no return previously filed. If the taxpayer has not 
previously filed an income tax return with the Internal Revenue Service 
for the taxable year in which an overpayment has resulted because of the 
application of the convention, he should make a claim for refund of the 
overpayment by filing Form 1040NB, Form 1040NB-a, Form 1040B, Form 1120, 
or Form 1120NB, whichever is applicable, showing the overpayment. Such 
return will serve as a claim for refund, and it will not be necessary 
for the taxpayer to file Form 843.
    (c) Information required. If the taxpayer's total gross income 
(including every item of capital gain subject to tax) from sources 
within the United States for the taxable year in which such overpayment 
resulted has not been disclosed in an income tax return filed with the 
Internal Revenue Service prior to the time the claim for refund is made, 
the taxpayer shall disclose such total gross income with his claim. In 
the event that securities are held in the name of a person other than 
the actual or beneficial owner, the name and address of such person 
shall be furnished with the claim. In addition to such other information 
as may be required to establish the overpayment, there shall also be 
included in such claim for refund:
    (1) A statement that, at the time when the item or items of income 
were received (or ``paid'', in the case of private pensions and private 
life annuities) from which the excess tax was withheld, (i) the taxpayer 
was neither a citizen nor a resident of the United States but was a 
resident of Austria, or, in the case of a corporation or other entity, 
(ii) the taxpayer was an Austrian corporation or other entity; and
    (2) A statement that the taxpayer at no time during the taxable year 
in which the income was received had a permanent establishment within 
the United States.
    (d) Exceptions--(1) Private pensions and private life annuities. If 
the taxpayer is an individual who during the taxable year of overpayment 
received income from United States sources consisting exclusively of 
private pensions or private life annuities entitled to the benefit of 
Article XI (2) of the convention, the statement specified in paragraph 
(c)(2) of this section shall not be required.
    (2) Dividends paid by a related corporation. As to additional 
information required in the case of an Austrian corporation claiming the 
benefit of the 5 percent rate on dividends paid by a related 
corporation, see Sec. 516.2(c).



Sec. 516.11  Information to be furnished in ordinary course.

    For provisions relating to the exchange of information under Article 
XVI of the convention, see Sec. 1.1461-2(d) of this chapter.



Sec. 516.12  Taxable years beginning in 1956 and ending in 1957.

    If, in the case of a taxable year beginning in 1956 and ending in 
1957, a taxpayer has no permanent establishment in the United States at 
any time during that part of the taxable year which

[[Page 111]]

follows December 31, 1956, then he shall, for purposes of Secs. 516.1 to 
516.12 be deemed not to have had a permanent establishment in the United 
States at any time during the taxable year.



PART 517--PAKISTAN--Table of Contents




                       Subpart--Withholding of Tax

Sec.
517.1  Introductory.
517.2  Dividends paid by, or to, a Pakistan company.
517.3  Patent and copyright royalties.
517.4  Private pensions and annuities.
517.5  Interest derived by the State Bank of Pakistan.
517.6  Beneficiaries of a domestic estate or trust.
517.7  Release of excess tax withheld at source.
517.8  Information to be furnished in ordinary course.
517.9  Application of the convention to fiscal years.

    Authority: Sec. 7805, 68A Stat. 917; 26 U.S.C. 7805.

    Source: Treasury Decision 6431, 24 FR 10100, Dec. 15, 1959; 25 FR 
14022, Dec. 31, 1960, unless otherwise noted.

    Effective Date Note:  By T.D. 8732, 62 FR 53498, Oct. 14, 1997, part 
517 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 
31, 1998, the effective date was delayed until Jan. 1, 2000.



                       Subpart--Withholding of Tax



Sec. 517.1  Introductory.

    (a) Pertinent provisions of the convention. The income tax 
convention between the United States and Pakistan, signed on July 1, 
1957, referred to in Secs. 517.1 to 517.9 as the convention, provides in 
part as follows, effective for taxable years beginning on or after 
January 1, 1959:

                                Article I

    (1) The taxes which are the subject of the present Convention are:
    (a) In the United States of America: The Federal income taxes, 
including surtaxes (hereinafter referred to as United States tax)..
    (b) In Pakistan: The income tax, supertax and the business profits 
tax (hereinafter referred to as Pakistan tax).
    (2) The present Convention shall also apply to any other taxes of a 
substantially similar character (including excess profits tax) imposed 
by either contracting State after the date of signature of the present 
Convention, or by the Government of any territory to which the present 
Convention is extended under Article XVIII.

                               Article II

    (1) In the present Convention, unless the context otherwise 
requires:
    (a) The term ``United States'' means the United States of America 
and when used in a geographical sense means the States thereof, the 
Territories of Alaska and Hawaii and the District of Columbia;
    (b) The term ``Pakistan'' means the Provinces of Pakistan and the 
Capital of the Federation;
    (c) The terms ``one of the contracting States'' and ``the other 
contracting State'' mean the United States or Pakistan, as the context 
requires;
    (d) The term ``tax'' means United States tax, or Pakistan tax, as 
the context requires;
    (e) The term ``person'' includes any body of persons, corporate or 
not corporate;
    (f) The term ``company'' means any body corporate or not corporate, 
assessed as a company under Pakistan law relating to Pakistan tax;
    (g) The term ``United States corporation'' means a corporation, 
association or other like entity created or organized in the United 
States or under the law of the United States or of any State or 
Territory of the United States;
    (h) The term ``resident of the United States'' means any individual 
or fiduciary who is resident in the United States for the purposes of 
the United States tax, and not resident in Pakistan for the purposes of 
the Pakistan tax, and any United States corporation or any partnership 
created or organized in the United States or under the laws of the 
United States, being a corporation or partnership which is not resident 
in Pakistan for the purposes of Pakistan tax;
    (i) The term ``resident of Pakistan'' means any person (other than a 
citizen of the United States or a United States corporation) who is 
resident in Pakistan for the purposes of Pakistan tax and not resident 
in the United States for the purposes of the United States tax. A 
company is to be regarded as a resident of Pakistan if its business is 
managed and controlled in Pakistan;
    (j) The terms ``resident of one of the contracting States'' and 
``resident of the other contracting State'' means a person who is a 
resident of the United States or a person who is a resident of Pakistan, 
as the context requires;
    (k) The terms ``United States enterprise'' and ``Pakistan 
enterprise'' mean, respectively an industrial or commercial enterprise 
or undertaking carried on in the United States by a resident of the 
United States and an industrial or commercial enterprise or

[[Page 112]]

undertaking carried on in Pakistan by a resident of Pakistan; and the 
terms ``enterprise of one of the contracting States'' and ``enterprise 
of the other contracting State'' mean a United States enterprise or a 
Pakistan enterprise, as the context requires;
    (l) The term ``industrial or commercial profits'' does not include 
rents or royalties in respect of motion picture films or of oil wells, 
mines and quarries, or income in the form of dividends, interest, rents 
or royalties, or fees or other remuneration derived by an enterprise 
from the management, control or supervision of the trade, business, or 
other activity of another enterprise or concern, or remuneration for 
labor or personal services, or income from the operation of ships;
    (m) The term ``permanent establishment'', when used with respect to 
an enterprise of one of the contracting States, means a branch, 
management, factory or other fixed place of business, but does not 
include an agency unless the agent has, and habitually exercises, a 
general authority to negotiate and conclude contracts on behalf of such 
enterprise or has a stock of merchandise from which he regularly fills 
orders on its behalf. In this connection--
    (i) An enterprise of one of the contracting States shall not be 
deemed to have a permanent establishment in the other contracting State 
merely because it carries on business dealings in that other contracting 
State through a bona fide broker or general commission agent acting in 
the ordinary course of his business as such; and
    (ii) The fact that a corporation or company which is a resident of 
one of the contracting States has a subsidiary corporation or company 
which is a resident of the other contracting State or which is engaged 
in trade or business in such other contracting State (whether through a 
permanent establishment or otherwise) shall not of itself constitute 
that subsidiary corporation or company a permanent establishment of its 
parent corporation or company;
    (n) The term ``taxation authorities'' means, in the case of the 
United States, the Commissioner of Internal Revenue as authorized by the 
Secretary of the Treasury and, in the case of Pakistan, the Central 
Board of Revenue or their authorized representatives; and, in the case 
of any territory to which the present Convention is extended under 
Article XVIII, the competent authority for the administration in such 
territory of the taxes to which the present Convention applies.
    (2) In the application of the provisions of the present Convention 
by one of the contracting States, any term not otherwise defined shall, 
unless the contest otherwise requires, have the meaning which it has 
under the laws of that contracting State relating to the taxes which are 
the subject of the present Convention.

                                * * * * *

                               Article VI

    (1) The rate of United States tax on dividends paid by a United 
States corporation to a Pakistan company--
    (i) Not having a permanent establishment in the United States and
    (ii) Owning shares carrying more than 50 percent of the voting power 
in the corporation paying such dividends shall not exceed fifteen 
percent.

                                * * * * *

                               Article VII

    (1) Dividends paid by a company which is a resident of Pakistan 
shall be exempt from United States tax except where the recipient 
thereof is a citizen or resident or corporation of the United States.

                                * * * * *

                              Article VIII

    (1) Any royalty (other than royalties or rentals from motion picture 
films) paid as consideration for the use of, or for the privilege of 
using, any copyright, patent, design, secret process or formula, 
trademark, or other like property, and derived from sources in one of 
the contracting States by a resident of the other contracting State not 
having a permanent establishment in the former State shall be exempt 
from tax by such former State.
    (2) Where any royalty exceeds a fair and reasonable consideration in 
respect of the rights for which it is paid, the exemption provided by 
the present Article shall apply only to so much of the royalty as 
represents such fair and reasonable consideration.

                               Article IX

    (1) Remuneration, including pensions and annuities, paid by or on 
behalf of the Government of the United States or its political 
subdivisions to an individual who is a citizen of the United States, not 
ordinarily resident in Pakistan, for services rendered to that 
Government in the discharge of governmental functions shall be exempt 
from Pakistan tax.
    (2) Remuneration, including pensions and annuities, paid by or on 
behalf of the Government of Pakistan or the Government of a Province in 
Pakistan or any local authority thereof to any individual who is a 
citizen of Pakistan not having immigrant status in the United States, 
for services rendered in the discharge of functions of that Government 
or

[[Page 113]]

of local authority, as the case may be, shall be exempt from United 
States tax.
    (3) The provisions of this Article shall not apply to payments in 
respect of services rendered in connection with any trade or business 
carried on for purposes of profit.

                                Article X

    (1) A pension or annuity (other than a pension or annuity of the 
kind referred to in paragraphs (1) and (2) of Article IX) derived from 
sources within one of the contracting States by a resident of the other 
contracting State shall be exempted from tax by the former State.
    (2) The term ``annuity,'' for the purposes of this Article, means a 
stated sum payable periodically at stated times during life or during a 
specified or ascertainable period of time, under an obligation to make 
the payments in return for adequate and full consideration in money or 
money's worth.
    (3) This Article shall not apply to a pension or annuity payable 
from a superannuation fund approved or recognized under the tax law of 
Pakistan nor to a pension or annuity from a fund, under an employees' 
pension or annuity plan, contributions to which under the tax law of the 
United States are deductible in determining the taxable income of the 
employer.

                                * * * * *

                               Article XIV

    (1) Effective January 1, 1956 the State Bank of Pakistan shall be 
exempted from United States tax with respect to interest from sources 
within the United States.

                                * * * * *

                               Article XVI

    (1) The taxation authorities of the contracting States shall 
exchange such information (being information which is available under 
their respective taxation laws in the normal course of administration) 
as is necessary for carrying out the provisions of the present 
Convention or for the prevention of fraud or for the administration of 
statutory provisions in relation to the taxes which are the subject of 
the present Convention. Any information so exchanged shall be treated as 
secret and shall not be disclosed to any persons other than those 
concerned with the assessment and collection of the taxes which are the 
subject of the present Convention. No information shall be exchanged 
which would disclose any trade, business, industrial or professional 
secret or trade process.

                                * * * * *

    (3) The taxation authorities of both contracting States may 
prescribe regulations necessary to interpret and carry out the 
provisions of the present Convention and may communicate with each other 
directly for the purpose of giving effect to the provisions of the 
present Convention.
    (4) The provisions of the present Convention shall not be construed 
to restrict in any manner any exemption, deduction, credit or other 
allowance now or hereafter accorded by the laws of either contracting 
State in determining the tax of such State.

                              Article XVII

    (1) The citizens or nationals of one of the contracting States shall 
not, while resident in the other contracting State, be subjected in such 
other State to taxes or any requirement connected therewith which is 
other, higher or more burdensome than the taxes and connected 
requirements to which the citizens or nationals of such other State 
resident therein are or may be subjected.
    (2) The term ``citizens'' or ``nationals'', as used in this Article, 
includes all legal persons, partnerships and associations deriving their 
status from, or created or organized under, the laws in force in the 
respective contracting States.
    (3) Nothing contained in this Article shall be construed--
    (a) as obliging either of the contracting States to grant to persons 
not resident in its territory those personal allowances, reliefs and 
reductions for tax purposes which are by law available only to persons 
who are so resident; or
    (b) as affecting any provisions of the law of Pakistan regarding the 
imposition of tax on a non-resident or the grant of rebate of tax to 
companies fulfilling specified requirements regarding the declaration 
and payment of dividends, unless those requirements are fulfilled.

                                * * * * *

                               Article XIX

    The present Convention shall come into force on the date when the 
last of all such things shall have been done in the United States and 
Pakistan as are necessary to give the Convention the force of law in the 
United States and Pakistan, respectively, and shall thereupon have 
effect--
    (a) In the United States, for the taxable years beginning on or 
after the first day of January of the year in which the instruments of 
ratification are exchanged;
    (b) In Pakistan, in respect of the ``previous years'' or the 
``chargeable accounting periods'' (as defined by the tax laws of 
Pakistan) beginning on or after the first day of January of the year in 
which the instruments of ratification are exchanged.

[[Page 114]]

                               Article XX

    The present Convention shall continue in effect indefinitely but 
either of the contracting States may, on or before the 30th day of June 
in any calendar year not earlier than three years from the date of 
signature of the present Convention, give to the other contracting State 
written notice of termination and, in such event the present Convention 
shall cease to be effective--
    (a) in the United States, for the taxable years beginning on or 
after the first day of January next following such written notice of 
termination; and
    (b) in Pakistan, in respect of the ``previous years'' or the 
``chargeable accounting periods'' (as defined by the tax laws of 
Pakistan) beginning on or after the first day of January next following 
such written notice of termination.

    (b) Meaning of terms. As used in Secs. 517.1 to 517.9, any term 
defined in the convention shall have the meaning so assigned to it; any 
term not so defined shall, unless the context otherwise requires, have 
the meaning which such term has under the internal revenue laws of the 
United States.



Sec. 517.2  Dividends paid by, or to, a Pakistan company.

    (a) Exemption from, or reduction in rate of, United States tax--(1) 
Dividends paid by a foreign company managed and controlled in Pakistan. 
Dividends which are paid by a foreign company whose business is managed 
and controlled in Pakistan and are received in a taxable year beginning 
on or after January 1, 1959, by a recipient who is not a citizen or 
resident or corporation of the United States are exempt from United 
States tax under the provisions of Article VII(1) of the convention.
    (2) Dividends paid to a Pakistan parent company. The rate of United 
States tax imposed upon dividends paid by a domestic corporation and 
received from sources within the United States in a taxable year 
beginning on or after January 1, 1959, by a Pakistan company shall not 
exceed 15 percent under the provisions of Article VI(1) of the 
convention if (i) the Pakistan company does not have a permanent 
establishment in the United States at any time during the taxable year 
in which the dividend is received and (ii) the Pakistan company owns, at 
the time the dividend is paid, shares of stock carrying more than 50 
percent of the voting power of the domestic corporation. For the 
purposes of this subparagraph, the term ``Pakistan company'' means a 
company, as defined in Article II(1)(f) of the convention.
    (b) Withholding of tax from dividends--(1) Exemption from 
withholding. No withholding of United States tax is required in the case 
of dividends paid by a foreign company whose business is managed and 
controlled in Pakistan if, in accordance with paragraph (a)(1) of this 
section, the dividends are exempt from United States tax.
    (2) Withholding of tax at rate of 15 percent from dividends paid to 
a Pakistan parent company--(i) Notification by letter. To secure 
withholding of United States tax on or after January 1, 1959, at the 
rate of 15 percent in the case of dividends entitled to the reduced rate 
in accordance with paragraph (a)(2) of this section, the Pakistan 
company shall notify the withholding agent by letter in duplicate that 
the dividends are subject to the reduced rate of United States tax under 
the provisions of Article VI(1) of the convention. The letter of 
notification shall be signed by an officer of the company and shall show 
the name and address of the corporation paying the dividends, the name 
and address of the Pakistan company receiving the dividends, and the 
official title of the officer signing the letter. The letter shall 
contain a statement that (a) the owner of the dividends is a Pakistan 
company, (b) the owner at no time during the current taxable year had a 
permanent establishment in the United States, and (c) the Pakistan 
company owns shares of stock carrying more than 50 percent of the voting 
power of the domestic corporation paying the dividends. The letter shall 
also indicate the dates on which the current taxable year of the 
taxpayer begins and ends.
    (ii) Use of letter for release of excess tax. If the letter of 
notification is also to be used as authorization for the release, 
pursuant to Sec. 517.7(a)(2), of excess tax withheld from dividends, it 
shall also contain a statement that (a) at the time when the dividends 
were paid from which the excess tax was withheld, the owner was a 
Pakistan company, (b) the owner at no time during the taxable year in 
which the dividends

[[Page 115]]

were received had a permanent establishment in the United States, and 
(c) the Pakistan company owned, at the time when the dividends were 
paid, shares of stock carrying more than 50 percent of the voting power 
of the domestic corporation paying the dividends. The dates of the 
beginning and ending of the taxable year of the taxpayer in which the 
dividends were received shall also be indicated.
    (iii) Manner of filing letter. The letter of notification, which 
shall constitute authorization for withholding of tax at the reduced 
rate of 15 percent, shall be filed with the withholding agent for each 
successive 3-calendar-year period during which the dividends are paid. 
For this purpose, the first of such periods shall commence with the 
beginning of the calendar year in which the dividends are first paid on 
or after January 1, 1959. Each letter filed with any withholding agent 
shall be filed not later than 20 days preceding the date of the first 
payment within each successive period, or, if that is not possible 
because of special circumstances, as soon as possible after such first 
payment. Once a letter of notification has been filed in respect of any 
3-calendar-year period, no additional letter need be filed in respect 
thereto unless the Commissioner of Internal Revenue notifies the 
withholding agent that an additional letter shall be filed by the 
taxpayer. If, after filing a letter of notification, the Pakistan 
company ceases to be eligible for the reduction in rate of United States 
tax granted by Article VI(1) of the convention, it shall promptly notify 
the withholding agent by letter in duplicate. When any change occurs in 
the ownership of the shares of stock as recorded in the books of record, 
the reduction in the rate of withholding of United States tax shall no 
longer apply unless the new owner of record is entitled to and does 
properly file a letter of notification with the withholding agent.
    (iv) Disposition of letter. Each letter of notification, or the 
duplicate thereof, shall be forwarded immediately by the withholding 
agent to the Director of International Operations, Internal Revenue 
Service, Washington 25, D.C.
    (3) Dividends paid to Pakistan company where degree of stock 
ownership is uncertain--(i) Request for determination in respect of 
future payments. If a Pakistan company anticipates the receipt of 
dividends from a domestic corporation and the relationship existing 
between the Pakistan company and the domestic corporation is such as to 
render uncertain whether, by reason of the requirement as to stock 
ownership, the reduction in rate of United States tax granted by Article 
VI(1) of the convention will apply to such dividends, the Pakistan 
company shall not undertake to file the letter of notification 
prescribed in subparagraph (2)(i) of this paragraph unless it has, prior 
to such filing, applied for and received from the Commissioner of 
Internal Revenue, Washington 25, D.C., a determination that it owns 
shares of stock carrying more than 50 percent of the voting power of the 
domestic corporation. The application for the determination shall 
contain a full statement of all the facts pertinent to such a 
determination.
    (ii) Notification of determination. As soon as practicable after the 
application has been filed, the Commissioner of Internal Revenue will 
determine whether the Pakistan company owns shares of stock carrying 
sufficient voting power of the domestic corporation to permit the 
Pakistan company to claim the benefit of Article VI(1) of the convention 
in the case of such dividends and shall notify the Pakistan company of 
his determination. The Pakistan company shall thereafter file with the 
withholding agent a copy of the Commissioner's letter of notification.
    (iii) Securing reduced rate of withholding. If the determination of 
the Commissioner of Internal Revenue is that the Pakistan company does 
own shares of stock carrying more than 50 percent of the voting power of 
the domestic corporation, the Pakistan company may thereafter, if 
otherwise qualified, secure the reduced rate of withholding of United 
States tax by filing a letter of notification in accordance with 
subparagraph (2) of this paragraph.
    (iv) Period during which determination is applicable. A 
determination by the Commissioner of Internal Revenue that a Pakistan 
company does own shares of stock carrying sufficient voting power

[[Page 116]]

of the domestic corporation to permit the Pakistan company to claim the 
benefit of Article VI(1) of the convention will apply until such time as 
the stock ownership of the domestic corporation has changed to the 
extent that, because of such change, dividends to be received from the 
domestic corporation by the Pakistan company no longer qualify for the 
reduced rate of United States tax under Article VI(1) of the convention. 
If such change in stock ownership occurs, the Pakistan company shall 
promptly notify both the Commissioner of Internal Revenue and the 
withholding agent of the then existing facts with respect to such stock 
ownership.
    (v) Request for determination in respect of past payments. If a 
Pakistan company has received on or after January 1, 1959, dividends 
from a domestic corporation and the relationship existing between the 
Pakistan company and the domestic corporation was at the time the 
dividends were paid, such as to render uncertain whether, by reason of 
the requirement as to stock ownership, the dividends qualified for the 
reduction in rate of United States tax granted by Article VI(1) of the 
convention, the Pakistan company shall apply to the Commissioner of 
Internal Revenue, Washington 25, D.C., for a determination as to whether 
the Pakistan company owned, at the time the dividends were paid, shares 
of stock carrying sufficient voting power of the domestic corporation. 
If the Commissioner's determination is that at such time the stock 
ownership was such as to permit the application of the reduced rate of 
United States tax granted by Article VI(1) of the convention, his letter 
of notification may, subject to the provisions of Sec. 517.7(a)(2), 
authorize the release of excess tax withheld from such dividends.



Sec. 517.3  Patent and copyright royalties.

    (a) Exemption from United States tax--(1) In general. Any royalty 
paid as consideration for the use of, or for the privilege of using, any 
copyright, patent, design, secret process or formula, trademark, or 
other like property, and received from sources within the United States 
in a taxable year beginning on or after January 1, 1959, by a 
nonresident alien individual who is resident in Pakistan for the 
purposes of Pakistan tax, or by a foreign company whose business is 
managed and controlled in Pakistan, is exempt from United States tax 
under the provisions of Article VIII of the convention if such alien or 
company has not had a permanent establishment in the United States at 
any time during the taxable year in which the royalty is received. 
Notwithstanding the preceding sentence, no exemption from United States 
tax shall be granted under Article VIII of the convention in respect of 
royalties or rentals from motion picture films.
    (2) Exemption applicable to reasonable consideration only. If any 
royalty exceeds a fair and reasonable consideration for the rights in 
respect of which it is paid, the exemption under this paragraph shall 
apply to only so much of the royalty as represents the fair and 
reasonable consideration.
    (3) Personal services. If a nonresident alien individual who is 
resident in Pakistan for the purposes of Pakistan tax were to perform 
personal services within the United States during the taxable year but 
not have a permanent establishment in the United States at any time 
during the year, he would be entitled to the exemption granted by 
Article VIII of the convention even though under the provisions of 
section 871(c) of the Internal Revenue Code of 1954 he had engaged in 
trade or business within the United States during that year by reason of 
his having performed personal services therein.
    (b) Exemption from witholding of tax--(1) Notification by letter. To 
avoid withholding of United States tax on or after January 1, 1959, from 
a royalty which is exempt in accordance with paragraph (a) of this 
section, the nonresident alien individual who is resident in Pakistan 
for the purposes of Pakistan tax, or the foreign company whose business 
is managed and controlled in Pakistan, shall notify the withholding 
agent by letter in duplicate that the royalty is exempt from United 
States tax under the provisions of Article VIII of the convention. The 
letter of notification shall be signed by the owner of the royalty, or 
by his trustee or agent, and shall show the name and address of

[[Page 117]]

the obligor and the name and address of the owner of the royalty. The 
letter shall contain a statement that (i) the owner is neither a citizen 
nor a resident of the United States but is a resident of Pakistan for 
the purposes of Pakistan tax, or, in the case of a corporation, the 
owner is a foreign company whose business is managed and controlled in 
Pakistan, and (ii) the owner has at no time during the current taxable 
year had a permanent establishment in the United States. The letter 
shall also indicate the dates on which the current taxable year of the 
taxpayer begins and ends.
    (2) Use of letter for release of excess tax. If the letter is also 
to be used as authorization for the release, pursuant to 
Sec. 517.7(a)(3), of excess tax withheld from the royalty, it shall also 
contain a statement that (i) at the time when the royalty was received 
from which the excess tax was withheld, the owner was neither a citizen 
nor a resident of the United States but was a resident of Pakistan for 
the purposes of Pakistan tax, or, in the case of a corporation, the 
owner was a foreign company whose business was managed and controlled in 
Pakistan, and (ii) the owner at no time during the taxable year in which 
the royalty was received had a permanent establishment in the United 
States. The dates of the beginning and ending of the taxable year of the 
taxpayer in which the royalty was received shall also be indicated.
    (3) Manner of filing letter. The letter of notification, which shall 
constitute authorization for the payment of the royalty without 
withholding of United States tax at source, shall be filed with the 
withholding agent for each successive 3-calendar-year period during 
which the royalty is paid. For this purpose, the first of such periods 
shall commence with the beginning of the calendar year in which the 
royalty is first paid on or after January 1, 1959. Each letter filed 
with any withholding agent shall be filed not later than 20 days 
preceding the date of the first payment within each successive period, 
or, if that is not possible because of special circumstances, as soon as 
possible after such first payment. Once a letter has been filed in 
respect of any 3-calendar-year period, no additional letter need be 
filed in respect thereto unless the Commissioner of Internal Revenue 
notifies the withholding agent that an additional letter shall be filed 
by the taxpayer. If, after filing a letter of notification, the taxpayer 
ceases to be eligible for the exemption from United States tax granted 
by Article VIII of the convention, he shall promptly notify the 
withholding agent by letter in duplicate. When any change occurs in the 
ownership of the royalty as recorded on the books of the payer, the 
exemption from withholding of United States tax shall no longer apply 
unless the new owner of record is entitled to and does properly file a 
letter of notification with the withholding agent.
    (4) Disposition of letter. Each letter of notification, or the 
duplicate thereof, shall be forwarded immediately by the withholding 
agent to the Director of International Operations, Internal Revenue 
Service, Washington 25, D.C.
    (5) Reasonableness of consideration. For purposes of this paragraph, 
the withholding agent may, unless he has information to the contrary, 
presume that the royalty represents a fair and reasonable consideration 
for the rights in respect of which it is paid.



Sec. 517.4  Private pensions and annuities.

    (a) Exemption from United States tax--(1) Pensions and annuities 
which are exempt. Except as provided in subparagraph (2) of this 
paragraph, a pension or annuity which is derived from sources within the 
United States and received in a taxable year beginning on or after 
January 1, 1959, by a nonresident alien individual who is resident in 
Pakistan for the purposes of Pakistan tax shall be exempt from United 
States tax under the provisions of Article X of the convention.
    (2) Pensions and annuities which are not exempt. The following 
pensions or annuities are not exempt from United States tax under the 
provisions of Article X of the convention or under this section--
    (i) A pension or annuity paid by or on behalf of the Government of 
the United States or its political subdivisions, for services rendered 
to that Government in the discharge of governmental functions; and

[[Page 118]]

    (ii) A pension or annuity paid by or on behalf of the Government of 
Pakistan or the Government of a Province in Pakistan or any local 
authority thereof, for services rendered in the discharge of functions 
of that Government or of local authority, as the case may be; and
    (iii) A pension or annuity payable from a fund, under an employees' 
pension or annuity plan, contributions to which are deductible under the 
tax law of the United States in determining taxable income of the 
employer.
    (b) Definition of annuity. As used in this section, the term 
``annuity'' means a stated sum payable periodically at stated times 
during life, or during a specified or ascertainable period of time, 
under an obligation to make the payments in return for adequate and full 
consideration in money or money's worth.
    (c) Exemption from withholding of tax--(1) Notification by letter. 
To avoid withholding of United States tax on or after January 1, 1959, 
from pensions or annuities which are exempt from tax in accordance with 
paragraph (a) of this section, the nonresident alien individual who is 
resident in Pakistan for the purposes of Pakistan tax shall notify the 
withholding agent by letter in duplicate that the pensions or annuities 
are exempt from United States tax under the provisions of Article X of 
the convention. The letter of notification shall be signed by the owner 
of the income, shall show the name and address of both the payer and the 
owner of the income, and shall contain a statement that the owner, an 
individual, is neither a citizen nor a resident of the United States but 
is a resident of Pakistan for the purposes of Pakistan tax. The letter 
shall also indicate the dates on which the current taxable year of the 
taxpayer begins and ends.
    (2) Use of letter for release of tax. If the letter is also to be 
used as authorization for the release, pursuant to Sec. 517.7(a)(3), of 
excess tax withheld from the pensions or annuities, it shall also 
contain a statement that the owner was, at the time when the income was 
received from which the excess tax was withheld, neither a citizen nor a 
resident of the United States but was a resident of Pakistan for the 
purposes of Pakistan tax. The dates of the beginning and ending of the 
taxable year of the taxpayer in which the income was received shall also 
be indicated.
    (3) Manner of filing letter. The letter of notification shall 
constitute authorization for the payment of the pensions or annuities 
without withholding of United States tax at source unless the 
Commissioner of Internal Revenue notifies the withholding agent 
thereafter to withhold the tax from such items of income. If, after 
filing a letter of notification, the owner of the income ceases to be 
eligible under the convention for the exemption from United States tax 
in the case of such items of income, he shall promptly notify the 
withholding agent by letter in duplicate. When any change occurs in the 
ownership of the income as recorded on the books of the payer, the 
exemption from withholding of United States tax shall no longer apply 
unless the new owner of record is entitled to and does properly file a 
letter of notification with the withholding agent.
    (4) Disposition of letter. Each letter of notification, or the 
duplicate thereof, shall be forwarded immediately by the withholding 
agent to the Director of International Operations, Internal Revenue 
Service, Washington 25, D.C.



Sec. 517.5  Interest derived by the State Bank of Pakistan.

    (a) Exemption from United States tax. Any interest of the State Bank 
of Pakistan which is received from sources within the United States on 
or after January 1, 1956, is, to the extent not exempt from tax under 
section 892 of the Internal Revenue Code of 1954, exempt from United 
States tax under the provisions of Article XIV(1) of the convention.
    (b) Exemption from withholding of tax. No withholding of United 
States tax is required in the case of interest received from sources 
within the United States by the State Bank of Pakistan if, in accordance 
with paragraph (a) of this section, the interest is exempt from United 
States tax.
    (c) Refund of excess tax withheld before January 1, 1959. If United 
States tax has been withheld before January 1, 1959, and on or after 
January 1, 1956, from interest of the State Bank of Pakistan,

[[Page 119]]

a claim by the bank for the refund of any overpayment resulting 
therefrom may be made under section 6402 of the Internal Revenue Code of 
1954 and the regulations thereunder. For the release of excess tax 
withheld from such interest on or after January 1, 1959, see 
Sec. 517.7(a)(4).



Sec. 517.6  Beneficiaries of a domestic estate or trust.

    A nonresident alien individual who is resident in Pakistan for the 
purposes of Pakistan tax and who is a beneficiary of a domestic estate 
or trust shall be entitled to the exemption from United States tax 
granted by Article VIII of the convention with respect to patent and 
copyright royalties to the extent that (a) any amount paid, credited, or 
required to be distributed by the estate or trust to the beneficiary is 
deemed to consist of those items and (b) the items so deemed to be 
included in such amount would, without regard to the convention, be 
includible in his gross income; provided, however, that the beneficiary 
otherwise satisfies the requirements for exemption specified in Article 
VIII of the convention. To obtain the exemption from withholding of 
United States tax in such a case, the beneficiary must execute and 
submit to the fiduciary of the estate or trust in the United States the 
letter of notification prescribed in Sec. 517.3(b).



Sec. 517.7  Release of excess tax withheld at source.

    (a) Amounts to be released--(1) Dividends paid by a foreign company 
managed and controlled in Pakistan. If United States tax at the 
statutory rate has been withheld on or after January 1, 1959, from 
dividends paid by a foreign company whose business is managed and 
controlled in Pakistan to a recipient other than a citizen or resident 
or corporation of the United States, the withholding agent shall release 
and pay over to the person from whom the tax was withheld an amount 
which is equal to the tax so withheld.
    (2) Dividends paid to a Pakistan parent company. If United States 
tax at the statutory rate has been withheld on or after January 1, 1959, 
from dividends entitled to the reduced rate of 15 percent in accordance 
with Sec. 517.2(a)(2), the withholding agent shall, if furnished the 
authorization of release prescribed in Sec. 517.2(b)(2)(ii) or (3)(v), 
release and pay over to the company from which the tax was withheld an 
amount which is equal to the difference between the tax so withheld from 
income received by the taxpayer in a taxable year beginning on or after 
January 1, 1959, and the tax required to be withheld from such income 
pursuant to Sec. 517.2(b)(2)(i).
    (3) Patent and copyright royalties, pensions, and annuities. If a 
taxpayer furnishes to the withholding agent the authorization of release 
prescribed in Sec. 517.3(b)(2) or Sec. 517.4(c)(2) and United States tax 
has been withheld at the statutory rate on or after January 1, 1959, 
from the royalties, pensions, or annuities in respect of which such 
authorization is prescribed, the withholding agent shall release and pay 
over to the person from whom the tax was withheld an amount which is 
equal to the tax so withheld from income received by the taxpayer in a 
taxable year beginning on or after January 1, 1959.
    (4) Interest paid to the State Bank of Pakistan. If United States 
tax at the statutory rate has been withheld on or after January 1, 1959, 
from interest of the State Bank of Pakistan, the withholding agent shall 
release and pay over to that bank an amount which is equal to the tax so 
withheld.
    (b) Amounts not to be released. The provisions of this section do 
not apply to excess tax withheld at source which has been paid by the 
withholding agent to the Director of International Operations, Internal 
Revenue Service.
    (c) Statutory rate. As used in this section, the term ``statutory 
rate'' means the rate of tax required to be withheld in accordance with 
chapter 3 of the Internal Revenue Code of 1954 as though the convention 
had not come into effect.



Sec. 517.8  Information to be furnished in ordinary course.

    For provisions relating to the exchange of information under Article 
XVI of the convention, see paragraph (d) of Sec. 1.1461-2 of this 
chapter (Income Tax Regulations; 26 CFR 1.1461-2(d)).

[[Page 120]]



Sec. 517.9  Application of the convention to fiscal years.

    Since the convention is effective for taxable years beginning on or 
after January 1, 1959, the fact that the exemption from, or reduction in 
the rate of, withholding of United States tax at source authorized by 
Secs. 517.1 to 517.9 is made effective beginning January 1, 1959, is not 
a determination in itself that the item of income concerned is entitled 
to the benefit of the exemption from, or reduced rate of, United States 
tax granted by the convention.



PARTS 518--519  [RESERVED]






PART 520--SWEDEN--Table of Contents




                       Subpart--General Income Tax

Sec.
520.101  Introductory.
520.102  Scope of this subpart.
520.103  Definitions.
520.104  Scope of convention with respect to determination of 
          ``industrial and commercial profits'' of a nonresident alien 
          individual resident of Sweden or of a Swedish corporation or 
          other entity carrying on a Swedish enterprise in the United 
          States.
520.105  Control of a domestic enterprise by a Swedish enterprise.
520.106  Income from operation of ships or aircraft.
520.107  Income from real property.
520.108  Mineral royalties.
520.109  Patent and copyright royalties.
520.110  Dividends and interest.
520.111  Capital gains.
520.112  Wages, salaries and similar compensation, pensions and life 
          annuities.
520.113  Compensation for labor or personal services.
520.114  Remittances.
520.115  Scope of Article XIV.
520.116  Reciprocal administrative assistance.
520.117  Information to be furnished in the ordinary course.
520.118  Information in specific cases.
520.119  Mutual assistance in the collection of taxes.

    Authority: 53 Stat. 32, 467; 26 U.S.C. 62, 3791.

    Source: Treasury Decision 4975, 5 FR 2400, June 28, 1940, unless 
otherwise noted. Redesignated at 25 FR 14022, Dec. 31, 1960.

    Effective Date Note: By T.D. 8732, 62 FR 53498, Oct. 14, 1997, part 
520 was removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 
31, 1998, the effective date was delayed until Jan. 1, 2000.



                       Subpart--General Income Tax



Sec. 520.101  Introductory.

    (a) The tax convention and protocol between the United States and 
Sweden, referred to in this subpart as the convention, proclaimed by the 
President of the United States on December 12, 1939, and effective 
January 1, 1940, provides as follows:

                                Article I

    The taxes referred to in this Convention are:
    (a) In the case of the United States of America:
    (1) The Federal income taxes, including surtaxes and excess-profits 
taxes.
    (2) The Federal capital stock tax.
    (b) In the case of Sweden:
    (1) The National income and property tax, including surtax.
    (2) The National special property tax.
    (3) The communal income tax.
    It is mutually agreed that the present Convention shall also apply 
to any other or additional taxes imposed by either contracting State, 
subsequent to the date of signature of this Convention, upon 
substantially the same bases as the taxes enumerated herein.
    The benefits of this Convention shall accrue only to citizens and 
residents of the United States of America, to citizens and residents of 
Sweden and to United States or Swedish corporations and other entities.

                               Article II

    An enterprise of one of the contracting States is not subject to 
taxation by the other contracting State in respect of its industrial and 
commercial profits except in respect of such profits allocable to its 
permanent establishment in the latter State. The income thus taxed in 
the latter State shall be exempt from taxation in the former State.
    No account shall be taken, in determining the tax in one of the 
contracting States, of the mere purchase of merchandise effected therein 
by an enterprise of the other State.
    The competent authorities of the two contracting States may lay down 
rules by agreement for the apportionment of industrial and commercial 
profits.

                               Article III

    When an enterprise of one of the contracting States, by reason of 
its participation in the management or capital of an enterprise of the 
other contracting State,

[[Page 121]]

makes or imposes on the latter in their commercial or financial 
relations conditions different from those which would be made with an 
independent enterprise, any profits which should normally have appeared 
in the balance sheet of the latter enterprise but which have been in 
this manner diverted to the former enterprise may, subject to applicable 
measures of appeal, be incorporated in the taxable profits of the latter 
enterprise. In such case consequent rectifications may be made in the 
accounts of the former enterprise.

                               Article IV

    Income which an enterprise of one of the contracting States derives 
from the operation of ships or aircraft registered in that State is 
taxable only in the State in which registered. Income derived by such an 
enterprise from the operation of ships or aircraft not so registered 
shall be subject to the provisions of Article II.

                                Article V

    Income of whatever nature derived from real property, including 
gains derived from the sale of such property, but not including interest 
from mortgages or bonds secured by real property, shall be taxable only 
in the contracting State in which the real property is situated.

                               Article VI

    Royalties from real property or in respect of the operation of 
mines, quarries, or other natural resources shall be taxable only in the 
contracting State in which such property, mines, quarries, or other 
natural resources are situated.
    Other royalties and amounts derived from within one of the 
contracting States by a resident or by a corporation or other entity of 
the other contracting State as consideration for the right to use 
copyrights, patents, secret processes and formulas, trademarks and other 
analogous rights, shall be exempt from taxation in the former State.

                               Article VII

    1. Dividends shall be taxable only in the contracting State in which 
the shareholder is resident or, if the shareholder is a corporation or 
other entity, in the contracting State in which such corporation or 
other entity is created or organized; provided, however, that each 
contracting State reserves the right to collect and retain (subject to 
applicable provisions of its revenue laws) the taxes which, under its 
revenue laws, are deductible at the source, but not in excess of 10 per 
centum of the amount of such dividends. For the purposes of this Article 
the National income and property tax imposed by Sweden shall be deemed 
to be a tax deducted at the source.
    2. Notwithstanding the provisions of Article XXII of this 
Convention, the provisions of this Article may be terminated by either 
of the contracting States at the end of two years from the date upon 
which this Convention enters into force or at any time thereafter, 
provided at least six months' prior notice of termination is given, such 
termination to become effective on the first day of January following 
the expiration of such six-month period. In the event the provisions of 
this Article are terminated, the provisions of--
    (1) Article XIII (2), in so far as they relate to the special 
property tax imposed by Sweden upon shares in a corporation;
    (2) Article XIV(b)(2), relating to the allowance of an additional 
deduction from taxes on dividends; and
    (3) Article XVI, in so far as they relate to exchange of information 
with respect to dividends,

will likewise terminate.

                              Article VIII

    Interest on bonds, notes, or loans shall be taxable only in the 
contracting State in which the recipient of such interest is a resident 
or, in the case of a corporation or other entity, in the State in which 
the corporation or other entity is created or organized; Provided, 
however, That each contracting State reserves the right to collect and 
retain (subject to applicable provisions of its revenue laws) the taxes 
which, under its revenue laws, are deductible at the source.

                               Article IX

    Gains derived in one of the contracting States from the sale or 
exchange of capital assets by a resident or a corporation or other 
entity of the other contracting State shall be exempt from taxation in 
the former State, provided such resident or corporation or other entity 
has no permanent establishment in the former State.

                                Article X

    Wages, salaries and similar compensation and pensions paid by one of 
the contracting States or by the political subdivisions or territories 
or possessions thereof to individuals residing in the other State shall 
be exempt from taxation in the latter State.
    Private pensions and life annuities derived from within one of the 
contracting States and paid to individuals residing in the other 
contracting State shall be exempt from taxation in the former State.

                               Article XI

    (a) Compensation for labor or personal services, including the 
practice of the liberal professions, shall be taxable only in the 
contracting State in which such services are rendered.

[[Page 122]]

    (b) The provisions of paragraph (a) are, however, subject to the 
following exceptions:
    A resident of Sweden shall be exempt from United States tax upon 
compensation for labor or personal services performed within the United 
States of America if he fails within either of the following 
classifications:
    1. He is temporarily present within the United States of America for 
a period or periods not exceeding a total of one hundred eighty days 
during the taxable year and his compensation is received for labor or 
personal services performed as an employee of, or under contract with, a 
resident or corporation or other entity of Sweden; or
    2. He is temporarily present in the United States of America for a 
period or periods not exceeding a total of ninety days during the 
taxable year and the compensation received for such services does not 
exceed $3,000.00 in the aggregate.

In such cases Sweden reserves the right to the taxation of such income.
    (c) The provisions of paragraph (b) of this Article shall apply, 
mutatis mutandis, to a resident of the United States of America deriving 
compensation for personal services performed within Sweden.
    (d) The provisions of paragraphs (b) and (c) of this Article shall 
have no application to the professional earnings of such individuals as 
actors, artists, musicians and professional athletes.
    (e) The provisions of this Article shall have no application to the 
income to which Article X relates.

                               Article XII

    Students or business apprentices from one contracting State residing 
in the other contracting State exclusively for purposes of study or for 
acquiring business experience shall not be taxable by the latter State 
in respect of remittances received by them from within the former State 
for the purposes of their maintenance or studies.

                              Article XIII

    (1) If the property consists of:
    (a) Immovable property and accessories appertaining thereto;
    In the case of taxes on property or increment of property the 
following provisions shall be applicable:
    (b) Commercial or industrial enterprises, including maritime 
shipping and air transport undertakings;

the tax may be levied only in that contracting State which is entitled 
under the preceding Articles to tax the income from such property.
    (2) In the case of all other forms of property, the tax may be 
levied only in that contracting State where the taxpayer has his 
residence or, in the case of a corporation or other entity, in the 
contracting State where the corporation or other entity has been created 
or organized.
    The same principles shall apply to the United States capital stock 
tax with respect to corporations of Sweden having capital or other 
property in the United States of America.

                               Article XIV

    It is agreed that double taxation shall be avoided in the following 
manner:
    (a) Notwithstanding any other provision of this Convention, the 
United States of America in determining the income and excess-profits 
taxes, including all surtaxes, of its citizens or residents or 
corporations may include in the basis upon which such taxes are imposed 
all items of income taxable under the revenue laws of the United States 
of America as though this Convention had not come into effect. The 
United States of America shall, however, deduct the amount of the taxes 
specified in Article I (b) (1) and (3) of this Convention or other like 
taxes from the income tax thus computed but not in excess of that 
portion of the income tax liability which the taxpayer's net income 
taxable in Sweden bears to his entire net income.
    (b)(1) Notwithstanding any other provision of this Convention, 
Sweden, in determining the graduated tax on income and property of its 
residents or corporations or other entities, may include in the basis 
upon which such tax is imposed all items of income and property subject 
to such tax under the taxation laws of Sweden. Sweden shall, however, 
deduct from the tax so calculated that portion of such tax liability 
which the taxpayer's income and property exempt from taxation in Sweden 
under the provisions of this Convention bears to his entire income and 
property.
    (2) There shall also be allowed by Sweden from its National income 
and property tax a deduction offsetting the tax deducted at the source 
in the United States of America, amounting to not less than 5 per centum 
of the dividends from within the United States of America and subject to 
such tax in Sweden. It is agreed that the United States of America shall 
allow a similar credit against the United States income tax liability of 
citizens of Sweden residing in the United States of America.

                               Article XV

    With a view to the more effective imposition of the taxes to which 
the present Convention relates, each of the contracting States 
undertakes, subject to reciprocity, to furnish such information in the 
matter of taxation, which the authorities of the State concerned have at 
their disposal or are in a position to obtain under their own law, as 
may be of use to the authorities of the other

[[Page 123]]

State in the assessment of the taxes in question and to lend assistance 
in the service of documents in connection therewith. Such information 
and correspondence relating to the subject matter of this Article shall 
be exchanged between the competent authorities of the contracting States 
in the ordinary course or on demand.

                               Article XVI

    1. In accordance with the preceding Article, the competent 
authorities of the United States of America shall forward to the 
competent authorities of Sweden as soon as practicable after the close 
of each calendar year the following information relating to such 
calendar year:
    (a) The names and addresses of all addresses within Sweden deriving 
from sources within the United States of America dividends, interest, 
royalties, pensions, annuities, or other fixed or determinable annual or 
periodical income, showing the amount of such income with respect to 
each addressee;
    (b) Any particulars which the competent United States authorities 
may obtain from banks, savings banks or other similar institutions 
concerning assets belonging to individuals resident in Sweden or to 
Swedish corporations or other entities;
    (c) Any particulars which the competent United States authorities 
may obtain from inventories in the case of property passing on death 
concerning debts contracted with individuals resident in Sweden or 
Swedish corporations or other entities.
    2. The competent authorities of Sweden shall forward to the 
competent authorities of the United States of America as soon as 
practicable after the close of each calendar year the following 
information relating to such calendar year:
    (a) The particulars contained in the forms delivered to the Swedish 
authorities in connection with the payment to individuals or 
corporations or other entities whose addresses are within the United 
States of America of dividends on shares in a corporation or 
participation certificates in cooperative societies, and interest on 
bonds or other similar securities;
    (b) The particulars contained in permits accorded to individuals 
resident in the United State of America or to United States corporations 
or other entities to enable them to acquire for business purposes 
immovable property situated in Sweden;
    (c) Any particulars which the central Swedish authorities may obtain 
from banks, savings banks or other similar institutions concerning 
assets belonging to individuals resident in the United States of America 
or to United States corporations or other entities;
    (d) Any particulars which the central Swedish authorities may obtain 
from inventories in the case of property passing on death, concerning 
debts contracted with individuals resident of the United States of 
America, or United States corporations or other entities;
    (e) A list of the names and addresses of all United States citizens 
resident in the United States of America who have made declarations to 
the Central Committee in Stockholm in charge of the taxation of 
taxpayers not resident in Sweden for purposes of the Swedish tax on 
income and property;
    (f) Particulars concerning annuities and pensions, public or 
private, paid to individuals resident in the United States of America.

                              Article XVII

    Each contracting State undertakes, in the case of citizens or 
corporations or other entities of the other contracting State, to lend 
assistance and support in the collection of the taxes to which the 
present Convention relates, together with interest, costs, and additions 
to the taxes and fines not being of a penal character. The contracting 
State making such collection shall be responsible to the other 
contracting State for the sums thus collected.
    In the case of applications for enforcement of taxes, revenue claims 
of each of the contracting States which have been finally determined 
shall be accepted for enforcement by the other contracting State and 
collected in that State in accordance with the laws applicable to the 
enforcement and collection of its own taxes. The State to which 
application is made shall not be required to enforce executory measures 
for which there is no provision in the law of the State making the 
application.
    The applications shall be accompanied by such documents as are 
required by the laws of the State making the application to establish 
that the taxes have been finally determined.
    If the revenue claim has not been finally determined the State to 
which application is made may at the request of the other contracting 
State, take such measures of conservancy as are authorized by the 
revenue laws of the former State.

                              Article XVIII

    The competent authority of each of the contracting States shall be 
entitled to obtain, through diplomatic channels, from the competent 
authority of the other contracting State, particulars in concrete cases 
relative to the application to citizens or to corporations or other 
entities of the former State, of the taxes to which the present 
Convention relates. With respect to particulars in other cases, the 
competent authority of each of the contracting States will give 
consideration to requests from the competent authority of the other 
contracting State.

[[Page 124]]

                               Article XIX

    In no case shall the provisions of Article XVII, relating to mutual 
assistance in the collection of taxes, or of Article XVIII, relating to 
particulars in concrete cases, be construed so as to impose upon either 
of the contracting States the obligation.
    (1) to carry out administrative measures at variance with the 
regulations and practice of either contracting State, or
    (2) to supply particulars which are not procurable under its own 
legislation or that of the State making application.
    The State to which application is made for information or assistance 
shall comply as soon as possible with the request addressed to it. 
Nevertheless, such State may refuse to comply with the request for 
reasons of public policy or if compliance would involve violation of a 
business, industrial or trade secret or practice. In such case it shall 
inform, as soon as possible, the State making the application.

                               Article XX

    Where a taxpayer shows proof that the action of the revenue 
authorities of the contracting States has resulted in double taxation in 
his case in respect of any of the taxes to which the present Convention 
relates, he shall be entitled to lodge a claim with the State of which 
he is a citizen or, if he is not a citizen of either of the contracting 
States, with the State of which he is a resident, or, if the taxpayer is 
a corporation or other entity, with the State in which it is created or 
organized. Should the claim be upheld, the competent authority of such 
State may come to an agreement with the competent authority of the other 
State with a view to equitable avoidance of the double taxation in 
question.

                               Article XXI

    The competent authorities of the two contracting States may 
prescribe regulations necessary to interpret and carry out the 
provisions of this Convention. With respect to the provisions of this 
Convention relating to exchange of information, service of documents and 
mutual assistance in the collection of taxes, such authorities may, by 
common agreement, prescribe rules concerning matters of procedure, forms 
of application and replies thereto, conversion of currency, disposition 
of amounts collected, minimum amounts subject to collection and related 
matters.

                              Article XXII

    The present Convention shall be ratified, in the case of the United 
States of America, by the President, by and with the advice and consent 
of the Senate, and in the case of Sweden, by His Majesty the King, with 
the consent of the Riksdag. The ratifications shall be exchanged at 
Stockholm.
    This Convention shall become effective on the first day of January 
following the exchange of the instruments of ratification and shall 
apply to income realized and property held on or after that date. The 
Convention shall remain in force for a period of five years and 
indefinitely thereafter but may be terminated by either contracting 
State at the end of the five-year period or at any time thereafter, 
provided at least six months' prior notice of termination has been 
given, the termination to become effective on the first day of January 
following the expiration of the six-month period.
    In witness whereof the respective Plenipotentiaries have signed this 
Convention and have affixed their seals hereto.
    Done in duplicate, in the English and Swedish languages, both 
authentic, at Washington, this twenty-third day of March, nineteen 
hundred and thirty-nine.
    For the President of the United States of America:
                                                   Sumner Welles  [seal]
    For His Majesty the King of Sweden:
                                                     W. Bostrom   [seal]

                                Protocol

    At the moment of signing the Convention for the avoidance of double 
taxation, and the establishment of rules of reciprocal administrative 
assistance in the case of income and other taxes, this day concluded 
between the United States of America and Sweden, the undersigned 
Plenipotentiaries have agreed that the following provisions shall form 
an integral part of the Convention:
    1. As used in this Convention:
    (a) The term ``permanent establishment'' includes branches, mines 
and oil wells, plantations, factories, workshops, warehouses, offices, 
agencies, installations, and other fixed places of business of an 
enterprise but does not include the casual or temporary use of merely 
storage facilities. A permanent establishment of a subsidiary 
corporation shall not be deemed to be a permanent establishment of the 
parent corporation. When an enterprise of one of the contracting States 
carries on business in the other State through an employee or agent, 
established there, who has general authority to contract for his 
employer or principal, it shall be deemed to have a permanent 
establishment in the latter State. But the fact that an enterprise of 
one of the contracting States has business dealings in the other State 
through a bona fide commission agent, broker or custodian shall not be 
held to mean that such enterprise has a permanent establishment in the 
latter State.
    (b) The term ``enterprise'' includes every form of undertaking 
whether carried on by an individual, partnership, corporation, or any 
other entity.

[[Page 125]]

    (c) The term ``enterprise of one of the contracting States'' means, 
as the case may be, ``United States enterprise'' or ``Swedish 
enterprise''.
    (d) The term ``United States enterprise'' means an enterprise 
carried on in the United States of America by a resident of the United 
States of America or by a United States corporation or other entity; the 
term ``United States corporation or other entity'' means a partnership, 
corporation or other entity created or organized in the United States of 
America or under the law of the United States of America or of any State 
or Territory of the United States of America.
    (e) The term ``Swedish enterprise'' is defined in the same manner, 
mutatis mutandis, as the term ``United States enterprise''.
    2. The term ``corporation'' includes associations, joint-stock 
companies, and insurance companies.
    3. A citizen of one of the contracting States not residing in either 
shall be deemed, for the purpose of this Convention, to be a resident of 
the contracting State of which he is a citizen.
    When doubt arises with respect to residence or with respect to the 
taxable status of corporations or other entities, the competent 
authorities of the two contracting States may settle the question by 
mutual agreement.
    4. The provisions of Swedish law concerning the taxation of the 
undivided estates of deceased persons shall not apply where the 
beneficiaries are directly liable to taxation in the United States of 
America.
    5. The term ``life annuities'' referred to in Article X of this 
Convention means a stated sum payable periodically at stated times 
during life, or during a specified number of years, under an obligation 
to make the payments in consideration of a gross sum paid for such 
obligation.
    6. The Swedish so-called ``fees tax'' (bevillingsavgift for vissa 
offentliga forestallningar) based on gross income in so far as it 
affects such individuals as actors, artists, musicians and professional 
athletes shall be deemed to be an income tax for the purposes of Article 
XIV (a).
    The credit for taxes provided in Article XIV shall have no 
application to taxes deducted at the source from dividends and interest 
except to the extent provided in paragraph (b)(2) of that Article.
    In the application of the provisions of this Convention the benefits 
of section 131 of the United States Revenue Act of 1938, relating to 
credits for foreign taxes shall be accorded but the credit provided for 
in Article XIV(a) shall not extend to United States excess-profits taxes 
nor to the surtax imposed on personal holding companies.
    7. Citizens of each of the contracting States residing within the 
other contracting State shall not be subjected in the latter State to 
other or higher taxes than are imposed upon the citizens of such latter 
State.
    8. The provisions of this Convention shall not be construed to deny 
or affect in any manner the right of diplomatic and consular officers to 
other or additional exemptions now enjoyed or which may hereafter be 
granted to such officers, nor to deny to either of the contracting 
States the right to subject to taxation its own diplomatic and consular 
officers.
    9. The provisions of the present Convention shall not be construed 
to restrict in any manner any exemption, deduction, credit or other 
allowance accorded by the laws of one of the contracting States in the 
determination of the tax imposed by such State.
    10. In the administration of the provisions of this Convention 
relating to exchange of information, service of documents, and mutual 
assistance in collection of taxes, fees and costs incurred in the 
ordinary course shall be borne by the State to which application is made 
but extraordinary costs incident to special forms of procedure shall be 
borne by the applying State.
    11. Documents and other communications or information contained 
therein, transmitted under the provisions of this Convention by one of 
the contracting States to the other contracting State shall not be 
published, revealed or disclosed to any person except to the extent 
permitted under the laws of the latter State with respect to similar 
documents, communications or information.
    12. As used with respect to revenue claims in Article XVII of this 
Convention the term ``finally determined'' shall be deemed to mean:
    (a) In the case of Sweden, claims which have been finally 
established, even though still open to revision by exceptional 
procedure;
    (b) In the case of the United States of America, claims which are no 
longer appealable, or which have been determined by decision of a 
competent tribunal, which decision has become final.
    13. As used in this Convention the term ``competent authority'' or 
``competent authorities'' means, in the case of the United States of 
America, the Secretary of the Treasury and in the case of Sweden, the 
Finance Ministry.
    14. The term ``United States of America'' as used in this Convention 
in a geographical sense includes only the States, the Territories of 
Alaska and Hawaii, and the District of Columbia.
    15. Should any difficulty or doubt arise as to the interpretation or 
application of the present Convention, or its relationship to 
Conventions between one of the contracting States and any other State, 
the competent authorities of the contracting States may settle the 
question by mutual agreement.

[[Page 126]]

    16. The present Convention and Protocol shall not be deemed to 
affect the exchange of notes between the United States of America and 
Sweden providing relief from double income taxation on shipping profits, 
signed March 31, 1938.
    Done at Washington, this twenty-third day of March, nineteen hundred 
and thirty-nine.
                                                    Sumner Welles [seal]
                                                     W. Bostrom   [seal]
    And where the said convention and the said protocol have been duly 
ratified on both parts and the ratifications of the two Governments were 
exchanged at Stockholm on the fourteenth day of November, one thousand 
nine hundred and thirty-nine;
    And whereas, as is provided in Article XXII, the said convention 
shall become effective on the first day of January following the 
exchange of the instruments of ratification;
    Now, therefore, be it known that I, Franklin D. Roosevelt, President 
of the United States of America, have caused the said convention and the 
said protocol to be made public to the end that the same and every 
article, clause and part thereof may be observed and fulfilled with good 
faith by the United States of America and the citizens thereof on and 
from the first day of January, one thousand nine hundred and forty.
    In testimony whereof, I have hereunder set my hand and caused the 
Seal of the United States of America to be affixed.
    Done at the city of Washington this twelfth day of December, in the 
year of our Lord one thousand nine hundred and thirty-nine, and of the 
Independence of the United States of America the one hundred and sixty-
fourth.
    [seal]
                                                    Franklin D Roosevelt

    By the President:
Cordell Hull
Secretary of State.

    (b) The Internal Revenue Code provides in part as follows:

    Sec. 22. Gross Income.

                                * * * * *

    (b) Exclusions from gross income. The following items shall not be 
included in gross income and shall be exempt from taxation under this 
chapter:

                                * * * * *

    (7) Income exempt under treaty. Income of any kind, to the extent 
required by any treaty obligation of the United States:

    Sec. 62. Rules and Regulations.
    The Commissioner, with the approval of the Secretary, shall 
prescribe and publish all needful rules and regulations for the 
enforcement of this chapter.



Sec. 520.102  Scope of this subpart.

    (a) The primary purposes of the convention, to be accomplished on a 
mutually reciprocal basis, are the avoidance of double taxation, 
exchange of fiscal information complementary to those provisions of the 
convention relating to avoidance of double taxation, and mutual 
assistance in the collection of the taxes to which the convention 
relates. The regulations in this subject deal primarily with the effect 
of the convention upon the determination of taxable income from sources 
within the United States of nonresident alien individuals resident in 
Sweden and of Swedish corporations and other Swedish entities, and with 
the information to be made available to the Finance Minister of Sweden.
    (b) The specific classes of income from sources within the United 
States exempt by reason of the convention from United States income tax 
are:
    (1) Industrial and commercial profits of a Swedish enterprise having 
no permanent establishment in the United States (Article II);
    (2) Income derived by a Swedish enterprise from the operation of 
ships or aircraft registered in Sweden (Article IV);
    (3) Royalties and amounts derived by a nonresident alien individual 
resident in Sweden or by a Swedish corporation or other entity as 
consideration for the right to use copyrights, patents, secret processes 
and formulas, trade-marks and other analogous rights (Article VI);
    (4) Gains derived from the sale or exchange of capital assets by a 
nonresident alien individual resident in Sweden, or by a Swedish 
corporation or other entity, having no permanent establishment in the 
United States (Article IX);
    (5) Wages, salaries and similar compensation and pension paid by 
Sweden or by a political subdivision thereof to individuals (other than 
citizens of the United States) temporarily residing in the United States 
(Article X);
    (6) Private pensions and life annuities paid to nonresident alien 
individuals residing in Sweden (Article X),
    (7) Compensation for labor or personal services performed within the 
United States by a nonresident alien

[[Page 127]]

individual resident in Sweden, such exemption being, however, subject to 
the limitations set forth in Article XI of the convention and in 
Sec. 520.113;
    (8) Remittances from sources within Sweden (if and to the extent 
that they constitute gross income without regard to this convention) 
received in the United States by a nonresident alien individual resident 
of Sweden who is temporarily resident in the United States for the 
purposes of study or for acquiring business experience, such remittances 
being for the purposes of their maintenance or studies (Article XII).
    (c) The convention does not affect the liability to United States 
income tax of Swedish citizens resident in the United States except to 
the extent such citizens are entitled to the benefits of Article XIV of 
the convention. For the purposes of the convention, an individual 
resident in neither Sweden nor the United States and claiming the 
benefits of the convention as a citizen of Sweden shall be deemed to be 
a resident of Sweden if it is shown to the satisfaction of the 
Commissioner that he is such citizen. With respect to dividends and 
interest, see Sec. 520.10.
    (d) Except as to those items of income expressly exempted by the 
convention, the income tax liability of a nonresident alien individual 
resident of Sweden and of a Swedish corporation or other entity is 
determined in accordance with the provisions of the internal revenue 
laws of the United States and the regulations thereunder applicable 
generally to the taxation of nonresident alien individuals and foreign 
corporations.
    (e) Except insofar as concerns dividends, the convention makes no 
reference to rates of taxation imposed by the United States.



Sec. 520.103  Definitions.

    (a) Any word or term used in this subpart which is defined in the 
convention shall be given the definition assigned to such word or term 
in such convention. Any word or term used in this subpart which is not 
defined in the convention but is defined in the Internal Revenue Code 
shall be given the definition contained therein.
    (b) As used in this subpart:
    (1) The term ``permanent establishment'' includes branches, mines 
and oil wells, plantations, factories, workshops, warehouses, offices, 
agencies, installations and other fixed places of business of an 
enterprise but does not include the casual or temporary use of merely 
storage facilities. A Swedish parent corporation having a subsidiary 
corporation which latter corporation has a permanent establishment in 
the United States will not be deemed, by reason of such fact, to have 
itself a permanent establishment in the United States. A Swedish 
enterprise as defined in the convention carrying on business in the 
United States through an employee or agent, established in the United 
States, who has general authority to contract for his employer or 
principal, shall be deemed to have a permanent establishment in the 
United States. However, business dealings in the United States by a 
Swedish enterprise through a bona fide commission agent, broker or 
custodian do not constitute a permanent establishment in the United 
States.
    (2) The term ``enterprise'' means any commercial or industrial 
undertaking whether conducted by an individual, partnership, corporation 
or any other entity. It includes such activities as manufacturing, 
merchandising, mining, banking and insurance. It does not include the 
operation of, or the trading in, real property located in the United 
States. It does not include the rendition of personal services. Hence, a 
nonresident alien individual, a resident of Sweden, rendering personal 
services within the United States, is not merely by reason of such 
services, engaged in an enterprise within the meaning of the convention 
and his liability to Federal income tax is unaffected by Article II of 
the convention.
    (3) The term ``Swedish enterprise'' means an enterprise carried on 
in Sweden by a nonresident alien individual resident in Sweden or by a 
Swedish corporation or other entity. The term ``Swedish corporation or 
other entity'' means a partnership, corporation or other entity created 
or organized in Sweden or under the laws of Sweden. For example, an 
enterprise carried on wholly without Sweden by a nonresident alien 
individual resident in

[[Page 128]]

Sweden is not a Swedish enterprise within the meaning of the convention.
    (4) The term ``industrial and commercial profits'' means the profits 
arising from the industrial, mercantile, manufacturing or like 
undertakings of a Swedish enterprise as defined in this section. Such 
term does not include dividends, interest, compensation for labor or 
personal services, or income derived from real property or from any 
interest in such property, including rentals and royalties therefrom and 
gain from the sale or disposition thereof. Such latter items of income 
are not governed by the provisions of Article II but are subject to the 
rules elsewhere set forth in the convention and in this subpart with 
respect to such specific items of income. As to gains from the sale or 
exchange of capital assets, see Sec. 520.111.




Sec. 520.104  Scope of convention with respect to determination of ``industrial and commercial profits'' of a nonresident alien individual resident of Sweden or 
          of a Swedish corporation or other entity carrying on a Swedish 
          enterprise in the United States.

    (a) General. Article II of the convention adopts the principle that 
an enterprise of one of the contracting States shall not be taxable in 
the other contracting State in respect of its industrial and commercial 
profits unless it has a permanent establishment in the latter State. 
Hence, a Swedish enterprise is subject to tax upon its industrial and 
commercial profits from sources within the United States only if it has 
a permanent establishment within the United States. From the standpoint 
of Federal income taxation, the article has application only to a 
Swedish enterprise and to the industrial and commercial income thereof 
from sources within the United States. It has no application, for 
example, to compensation for labor or personal services performed in the 
United States nor to income derived from real property located in the 
United States nor to any interest in such property, including rentals 
and royalties therefrom, nor to gains from the sale or disposition 
thereof nor to dividends and interest. Such latter items of income are 
treated separately elsewhere in the regulations in this subpart and are 
subject to the rules laid down in the sections having specific reference 
to the respective items of income: As to what is a ``Swedish 
enterprise'', a ``permanent establishment'' and ``industrial and 
commercial profits,'' see Sec. 520.103.
    (b) No United States permanent establishment. A nonresident alien 
individual resident in Sweden or a Swedish corporation or other entity, 
carrying on a Swedish enterprise but having no permanent establishment 
in the United States is not subject to United States income tax upon 
industrial and commercial profits from sources within the United States. 
For example, if such Swedish corporation sells stock in trade such as 
iron ore or wood pulp through a bona fide commission agent or broker in 
the United States, the resulting profit is, under the terms of Article 
II of the convention, exempt from United States income tax. Such Swedish 
corporation, however, remains subject to tax upon all other items of 
income from sources within the United States and not expressly exempted 
from such tax under the convention. However, see Secs. 520.109, 520.111, 
520.112 and 520.113.
    (c) United States permanent establishment. A nonresident alien 
individual resident in Sweden or a Swedish corporation or other entity, 
carrying on a Swedish enterprise having a permanent establishment in the 
United States is subject to tax upon his or its industrial and 
commercial profits from sources within the United States. In the 
determination of the income of such resident of Sweden or Swedish 
corporation or other entity from sources within the United States, all 
industrial and commercial profits from sources within the United States 
shall be deemed to be allocable to the permanent establishment within 
the United States. The net income from sources within the United States, 
including the industrial and commercial profits, shall be determined in 
accordance with the provisions of section 119, Internal Revenue Code, 
and regulations thereunder. In determining such income, no account shall 
be taken of the mere purchase of merchandise effected in the United 
States by such Swedish enterprise.

[[Page 129]]



Sec. 520.105  Control of a domestic enterprise by a Swedish enterprise.

    Article III of the convention provides that if a Swedish enterprise 
by reason of its control of a domestic business imposes conditions 
different from those which would result from normal bargaining between 
independent enterprises, the accounts between the enterprises will be 
adjusted so as to ascertain the true net income of the domestic 
enterprises. The purpose is to place the controlled domestic enterprise 
on a tax parity with an uncontrolled domestic enterprise by determining, 
according to the standard of an uncontrolled enterprise, the true net 
income from the property and business of the controlled enterprise. The 
convention contemplates that if the accounting records do not truly 
reflect the net income from the property and business of such domestic 
enterprise the Commissioner shall intervene and, by making such 
distributions, apportionments or allocations as he may deem necessary of 
gross income or deductions or of any item or element affecting net 
income as between such domestic enterprise and the Swedish enterprise by 
which it is controlled or directed, determine the true net income of the 
domestic enterprise. The provisions of Regulations 103 (26 CFR 1938 ed. 
Supps. 19.45-1), [Regulations 111 (26 CFR 1949 ed. Supps. 29.45-1) and 
Regulations 118 (Sec. 39.45-1, 26 CFR, Rev. 1953, Parts 1-79, and 
Supps.)] shall, insofar as applicable, be followed in the determination 
of the net income of the domestic business.



Sec. 520.106  Income from operation of ships or aircraft.

    The income derived by a Swedish enterprise from the operation of 
ships or aircraft registered in Sweden is exempt from United States 
income tax. However, the profits derived by such enterprise from the 
operation of ships or aircraft not so registered are treated as are 
industrial and commercial profits generally. See Article II of the 
convention and Sec. 520.104.



Sec. 520.107  Income from real property.

    Income of whatever nature derived by a nonresident alien individual 
resident in Sweden or by a Swedish corporation or other entity from real 
property situated in the United States, including gains derived from the 
sale of such property, is not exempt from taxation by the convention. 
The treatment of such income for taxation purposes is governed by those 
provisions of the Internal Revenue Code applicable generally to the 
taxation of nonresident aliens and foreign corporations. Interest 
derived from mortgages or bonds secured by real property does not 
constitute income from real property within the meaning of the 
convention but is subject to the provisions applicable to interest 
generally. See Article VIII of the convention and Sec. 520.110.



Sec. 520.108  Mineral royalties.

    Royalties derived by a nonresident alien individual resident in 
Sweden or by a Swedish corporation or other entity from real property or 
in respect of the operation of mines, quarries, timber or other natural 
resources situated in the United States are not exempt from taxation 
under the convention. Such items of income are subject to taxation under 
the provisions of the Internal Revenue Code applicable generally to the 
taxation of nonresident aliens and foreign corporations.



Sec. 520.109  Patent and copyright royalties.

    (a) Royalties and amounts derived from sources within the United 
States by a nonresident alien individual resident in Sweden or by a 
Swedish corporation or other entity (if such corporation or entity is 
not a resident of the United States) as consideration for the right to 
use copyrights, patents, secret processes and formulas, trade-marks and 
other analogous rights are exempt from Federal income taxation under the 
provisions of Article VI of the convention. Such items are therefore not 
subject to the withholding provisions of the Internal Revenue Code. Such 
exemption does not, however, apply in the case of a Swedish corporation 
engaged in trade or business within the United States or having an 
office or place of business therein. Such corporation is a resident 
Swedish corporation and hence the provisions of Article XIV (a) are 
applicable.

[[Page 130]]

    (b) To obviate withholding of the tax at the source, the alien 
individual resident in Sweden or Swedish corporation or other entity 
should by letter, notify the payor of the income that such income is 
exempt from Federal income is exempt from Federal income taxation under 
the provisions of the convention. Such letter from such resident of 
Sweden shall contain his address and a statement that he is a resident 
of Sweden. The letter from such corporation or other entity shall 
contain the address of its office or place of business and a statement 
that it is a corporation or other entity organized under the laws of 
Sweden and shall be signed by an officer of the corporation or other 
entity giving his official title. The letter of notification of a copy 
thereof should be immediately forwarded by the recipient to the 
Commissioner of Internal Revenue, Withholding Returns Section, 
Washington 25, D.C., United States of America.



Sec. 520.110  Dividends and interest.

    (a) In general dividends derived from sources within the United 
States by a nonresident alien individual resident in Sweden or by a 
Swedish corporation or other entity remain subject to taxation under the 
provisions of the Internal Revenue Code applicable generally to the 
taxation of nonresident alien individuals and foreign corporations. See 
Article XIV (a) of the convention. However, for a period of at least 2 
years beginning on January 1, 1940, the tax in the case of such alien 
individual resident in Sweden or such Swedish corporation or other 
entity (nonresident as to the United States) shall not exceed 10 percent 
of the amount of such dividends. See Article VII of the convention. 
Hence, the higher rates applicable generally in the case of nonresident 
alien individuals subject to the provisions of section 211 (c), Internal 
Revenue Code, are not applicable to dividends received by nonresident 
alien individuals who are residents of Sweden.
    (b) The taxation of interest derived from sources within the United 
States by a nonresident alien individual resident in Sweden or by a 
Swedish corporation or other entity is not affected by the convention 
except that in the case of such individual such interest is subject only 
to the rate of tax imposed by section 211 (a), Internal Revenue Code. 
Hence, interest, like dividends, is excluded for the purposes of section 
211(c), from the gross amount of fixed or determinable annual or 
periodical income of nonresident alien individuals who are residents of 
Sweden.



Sec. 520.111  Capital gains.

    Under Article IX of the convention, gain derived from the sale or 
exchange of capital assets (other than real property) within the United 
States by a nonresident alien individual resident in Sweden or by a 
Swedish corporation or other entity is exempt from Federal income tax 
unless such individual, corporation or other entity has a permanent 
establishment in the United States. With respect to real property, see 
Sec. 520.107.



Sec. 520.112  Wages, salaries and similar compensation, pensions and life annuities.

    (a) Under Article X of the convention, wages, salaries and similar 
compensation and pensions paid by Sweden or by a political subdivision 
thereof to individuals temporarily residing in the United States are 
exempt from Federal income tax. By reason, however, of the application 
of Article XIV(a) of the convention, such exemption does not apply to 
recipients of such income who are either citizens of the United States 
or aliens resident therein. As to who are resident aliens, see 
Regulations 103 (26 CFR 1938 ed. Supps. 19.211-2 to 19.211-4), 
[Regulations 111 (26 CFR 1949 ed. Supps. 29.211-2 to 29.211-4) and 
Regulations 118 (Secs. 39.211-2 to 39.211-4, 26 CFR, Rev. 1953, Parts 1-
79, and Supps.)]. As to the taxation generally of the compensation of 
employees of foreign governments, see section 116(h) of the Internal 
Revenue Code and Regulations 103 (26 CFR 1938 ed. Supps. 19.116-2), 
[Regulations 111 (26 CFR 1949 ed. Supps. 29.116-2) and Regulations 118 
(Sec. 39.116-2, 26 CFR Rev. 1953, Parts 1-79, and Supps.)].
    (b) Under the provisions of the same article of the convention, 
private pensions and life annuities derived from sources within the 
United States by nonresident alien individuals residing

[[Page 131]]

in Sweden are exempt from the Federal income tax. Such items of income 
are, therefore, not subject to the withholding provisions of the 
Internal Revenue Code. See paragraph 5 of the protocol to the convention 
as to what constitutes life annuities. See also Sec. 520.109 with 
respect to patent and copyright royalties as to requirements necessary 
to avoid withholding of the tax at the source, which requirements are 
here also applicable.



Sec. 520.113  Compensation for labor or personal services.

    (a) Article XI of the convention adopts the principle that 
compensation for labor or personal services, including compensation 
realized in the practice of the liberal professions, is subject to tax 
only in the contracting State in which such services are rendered. 
Hence, in general such compensation derived by nonresident alien 
individuals residing in Sweden for services rendered in the United 
States is subject to Federal income tax. Such general rule is, however, 
subject to the following exceptions under the provisions of Article XI:
    (1) Such nonresident alien individual is not subject to Federal 
income tax upon compensation for labor or personal services performed 
within the United States if the following conditions prescribed by 
subparagraph (2) (i) and (ii) of this paragraph are met.
    (2) He is temporarily present in the United States for a period or 
periods:
    (i) Not exceeding 180 days during the taxable year and his 
compensation is received for labor or personal services performed as an 
employee of, or under contract with, a resident of Sweden or a Swedish 
corporation or other entity; or
    (ii) Not exceeding 90 days during the taxable year and the 
compensation received for such services does not exceed $3,000 in the 
aggregate for such taxable year even though such compensation is paid by 
a United States resident or by a domestic corporation or other domestic 
entity.
    (b) If, therefore, such nonresident alien individual (1) is 
temporarily present in the United States for a period or periods in 
excess of 90 days during the taxable year, or (2) receives more than 
$3,000 in the aggregate during the taxable year for labor or personal 
services performed within the United States he is not exempt under 
paragraph (a)(2)(ii) of this section, and his right to exemption under 
the convention will depend on his meeting both tests prescribed under 
paragraph (a)(2)(i) of this section.
    (c) These exceptions, however, do not extend to the professional 
earnings of actors, artists, musicians, professional athletes and those 
engaged in like activities. The professional earnings of such 
individuals resident in Sweden for services rendered within the United 
States are subject to the provisions of the Internal Revenue Code 
applicable generally to the taxation of nonresident alien individuals.



Sec. 520.114  Remittances.

    Under Article XII nonresident alien individuals residents of Sweden 
who are temporarily residing in the United States exclusively for the 
purposes of study or acquiring business experience and receiving 
remittances from Sweden for the purposes of their maintenance and 
studies in the United States are exempt from Federal income tax upon 
such amounts if and to the extent that such amounts constitute gross 
income.



Sec. 520.115  Scope of Article XIV.

    (a) General. Article XIV (a) has an important bearing upon other 
articles of the convention. While many preceding articles provide in 
effect that items of income derived by citizens or residents of the 
United States or by domestic corporations from sources in Sweden are 
subject to tax only in Sweden, Article XIV(a) nevertheless permits the 
imposition of Federal income tax upon such income in the hands of such 
taxpayers. For example, Article V provides that income from real 
property, including gains derived from the sale or exchange of such 
property, shall be taxable only in the contracting State in which such 
property is situated. Hence, looking at such article without reference 
to Article XIV a United States citizen realizing such income from real 
property situated within Sweden would not be subject to Federal income 
tax upon such income. Article XIV(a), however, prescribes that,

[[Page 132]]

notwithstanding Article V or any other article of the convention, the 
Federal income tax may apply to all items of income without regard to 
other provisions of the convention and hence all items of income from 
sources within Sweden, regardless of their treatment in the articles 
dealing respectively with such items of income, must be included in 
gross income of United States citizens, residents and corporations for 
the purposes of the Federal income tax.
    (b) Credit for Swedish income taxes. (1) Article XIV(a), for the 
purposes of avoidance of double taxation, further provides that a 
citizen or resident of the United States or a domestic corporation 
deriving income from sources within Sweden shall be entitled to a credit 
against the Federal income tax liability for the amount of Swedish 
national income and property tax, including surtax, and for the Swedish 
communal income tax. Such credit is, however, subject to the limitations 
prescribed in section 131, Internal Revenue Code (relating to the credit 
for foreign taxes) in that it cannot exceed the same proportion of the 
tax against which the credit is taken which the taxpayer's net income 
from sources within Sweden bears to the entire net income, in the case 
of a taxpayer other than a corporation, or to the normal tax net income, 
in the case of a corporation, for the same taxable year.
    (2) In the application of Article XIV(a), the provisions of section 
131, Internal Revenue Code, are in general applicable. See paragraph 6 
of the protocol to the convention.



Sec. 520.116  Reciprocal administrative assistance.

    (a) By Article XV of the convention, United States and Sweden adopt 
the principle of exchange of information and assistance in the service 
of documents incident to the collection of taxes. It is agreed that such 
fiscal cooperation shall be carried out in accordance with the laws of 
the respective countries and hence only such information as is available 
to the Commissioner under the revenue laws may be used as a source from 
which to secure the information required to be submitted to the Finance 
Minister of Sweden.
    (b) Pursuant to such principle, withholding agents shall, in the 
preparation of withholding returns, Form 1042, report on such returns, 
in addition to the items of income upon which tax has been withheld at 
the source, those items of income paid to a nonresident alien individual 
resident in Sweden or to a Swedish corporation or other entity upon 
which tax has not been withheld at the source. (See Sec. 520.109.) Such 
return shall show the same information with respect to such items of 
income upon which tax has not been withheld at the source as is shown 
with respect to items of income upon which the tax has been withheld at 
the source.
    (c) All information and correspondence relating to exchange of 
information and to service of documents may be transmitted by the 
Secretary directly to the Finance Minister of Sweden.



Sec. 520.117  Information to be furnished in the ordinary course.

    (a) In accordance with the provisions of Article XVI (1) (a) and (b) 
of the convention, the Secretary shall forward to the Finance Minister 
of Sweden, Stockholm, Sweden, as soon as practicable after the close of 
the calendar year 1940 and of each calendar year thereafter during which 
the convention is in effect the following information relating to such 
preceding calendar year:
    (1) The name and address of each person whose address as disclosed 
on Forms 1012 and 1042 is in Sweden deriving from sources within the 
United States dividends, interest, royalties, pensions, annuities, or 
other fixed or determinable annual or periodical income, showing the 
amount of such income with respect to such person.
    (2) The name and address of each person whose address as disclosed 
by Forms 1000, 1087 and 1099 is in Sweden showing the amount of income 
set forth on such form with respect to each person.
    (b) In accordance with the provisions of Article XVI(1)(c) of the 
convention, there shall likewise be forwarded any particulars which the 
Commissioner

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may obtain incident to the determination of estate tax liability of any 
decedent from inventories of assets of estates of decedents concerning 
debts contracted with individuals resident in Sweden or with Swedish 
corporations or other entities.



Sec. 520.118  Information in specific cases.

    Under the provisions of Article XVIII of the convention and upon 
request of the Finance Minister of Sweden, made through diplomatic 
channels and subject to the provisions of Article XIX of the convention, 
the Secretary will furnish to the Finance Minister of Sweden particulars 
in case of any specific taxpayer who is a citizen of Sweden or a Swedish 
corporation or other entity, relating to the application of Swedish 
national income and property tax and the Swedish communal income tax. In 
the case of other specific taxpayers, the Secretary will give 
consideration to requests of the Finance Minister of Sweden with a view 
to furnishing similar information concerning such taxpayer.



Sec. 520.119  Mutual assistance in the collection of taxes.

    Under the provisions of Article XXI of the convention, the Secretary 
of the Treasury and the Finance Minister of Sweden are authorized to 
prescribe rules with respect to those provisions of the convention 
relating to the exchange of information, service of documents, and 
mutual assistance in the collection of the taxes to which the convention 
relates. Such rules concerning matters of procedure, forms of 
application and replies thereto, conversion of currency, disposition of 
amounts collected and related matters will be made the subject matter of 
a common agreement between the competent authorities of the two 
contracting States concerned and when consummated will be published.



PART 521--DENMARK--Table of Contents




                       Subpart--Withholding of Tax

   Release of Excess Tax Withheld and Reduction in Rate of Withholding

Sec.
521.1  Introductory.
521.2  Dividends.
521.3  Interest.
521.4  Patent and copyright royalties and film rentals.
521.5  Private pensions and life annuities.
521.6  Release of excess tax withheld at source.
521.7  Addressee not actual owner.
521.8  Beneficiaries of a domestic estate or trust.

                       Subpart--General Income Tax

   Taxation of Nonresident Aliens Who Are Residents of Denmark and of 
                           Danish Corporations

521.101  Introductory.
521.102  Applicable provisions of the Internal Revenue Code.
521.103  Scope of the convention.
521.104  Definitions.
521.105  Scope of convention with respect to determination of 
          ``industrial or commercial profits''.
521.106  Control of a domestic enterprise by a Danish enterprise.
521.107  Income from operation of ships or aircraft.
521.108  Exemption from, or reduction in rate of, United States tax in 
          the case of dividends, interest and royalties.
521.109  Real property income, natural resource royalties.
521.110  Government wages, salaries, pensions and similar remuneration.
521.111  Pensions and life annuities.
521.112  Compensation for labor or personal services.
521.113  Students and apprentices; remittances.
521.114  Visiting professors or teachers.
521.115  Credit against United States tax liability for Danish tax.
521.116  Reciprocal administrative assistance.
521.117  Claims in cases of double taxation.

    Authority: 26 U.S.C. 62, 143, 144, 211, and 231.



                       Subpart--Withholding of Tax

    Source: Treasury Decision 5692, 14 FR 1123, Mar. 12, 1949, unless 
otherwise noted. Redesignated at 25 FR 14022, Dec. 31, 1960.

    Effective Date Note: By T.D. 8732, 62 FR 53498, Oct. 14, 1997, 
Subpart--Withholding of Tax, consisting of Secs. 521.1 through 521.8 was 
removed, effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 31, 
1998, the effective date was delayed until Jan. 1, 2000.

[[Page 134]]

   Release of Excess Tax Withheld and Reduction in Rate of Withholding



Sec. 521.1  Introductory.

    (a) The income tax convention between the United States and the 
Kingdom of Denmark, signed May 6, 1948, proclaimed by the President of 
the United States on December 8, 1948, and effective as to taxable years 
beginning after December 31, 1947 (referred to in this subpart as the 
convention), provides in part as follows:

                                Article I

    (1) The taxes referred to in this Convention are:
    (a) In the case of the United States of America: The Federal income 
tax, including surtaxes.
    (b) In the case of Denmark:
    The national income tax, including the war profits tax.
    The intercommunal income tax.
    The communal income tax.
    (2) The present Convention shall also apply to any other taxes of a 
substantially similar character imposed by either contracting State 
subsequently to the date of signature of the present Convention.

                               Article II

    (1) As used in this Convention:
    (a) The term ``United States'' means the United States of America, 
and when used in a geographical sense includes only the States, the 
Territories of Alaska and Hawaii, and the District of Columbia.
    (b) The term ``Denmark'' means the Kingdom of Denmark; the 
provisions of the Convention shall not, however, extend to the Faroe 
Islands; nor do they apply to Greenland.
    (c) The term ``permanent establishment'' means a branch office, 
factory, warehouse or other fixed place of business, but does not 
include the casual and temporary use of merely storage facilities, nor 
does it include an agency unless the agent has and exercises a general 
authority to negotiate and conclude contracts on behalf of an enterprise 
or has a stock of merchandise from which he regularly fills orders on 
its behalf. An enterprise of one of the contracting States shall not be 
deemed to have a permanent establishment in the other State merely 
because it carries on business dealings in such other State through a 
bona fide commission agent, broker or custodian acting in the ordinary 
course of his business as such. The fact that an enterprise of one of 
the contracting States maintains in the other State a fixed place of 
business exclusively for the purchase of goods or merchandise shall not 
of itself constitute such fixed place of business a permanent 
establishment of such enterprise. The fact that a corporation of one 
contracting State has a subsidiary corporation which is a corporation of 
the other State or which is engaged in trade or business in the other 
State shall not of itself constitute that subsidiary corporation a 
permanent establishment of its parent corporation.
    (d) The term ``enterprise of one of the contracting States'' means, 
as the case may be, ``United States enterprise'' or ``Danish 
enterprise.''
    (e) The term ``enterprise'' includes every form of undertaking 
whether carried on by an individual, partnership, corporation, or any 
other entity.
    (f) The term ``United States enterprise'' means an enterprise 
carried on in the United States of America by a resident of the United 
States of America or by a United States corporation or other entity; the 
term ``United States corporation or other entity'' means a partnership, 
corporation or other entity created or organized in the United States of 
America or under the law of the United States of America or of any State 
or Territory of the United States of America.
    (g) The term ``Danish enterprise'' means an enterprise carried on in 
Denmark by a resident of Denmark or by a Danish corporation or other 
entity; the term ``Danish corporation or other entity'' means a 
partnership, corporation or other entity created or organized in Denmark 
or under Danish laws.
    (h) The term ``competent authorities'' means, in the case of the 
United States the Commissioner of Internal Revenue or his authorized 
representative; and in the case of Denmark, the Chief of the Taxation 
Department of the Ministry of Finance (Generaldirektren for 
Skattevaesenet) or his authorized representative.
    (2) In the application of the provisions of the present Convention 
by one of the contracting States any term not otherwise defined shall, 
unless the context otherwise requires, have the meaning which such term 
has under its own tax laws.

                                * * * * *

                               Article VI

    (1) Dividends shall be taxable only in the contracting State in 
which the shareholder is resident or, if the shareholder is a 
corporation or other entity, in the contracting State in which such 
corporation or other entity is incorporated or organized.
    (2) Each of the contracting States reserves, however, the right to 
collect and retain the tax, which, under its revenue laws, is deductible 
at the source with respect to such dividends, but the tax shall not 
exceed 15 percent of the amount of dividends derived from sources within 
such State by a resident, corporation or other entity of the other 
State,

[[Page 135]]

if the recipient has no permanent establishment in the contracting State 
from which the dividends are derived.
    (3) It is agreed, however, that the rate of dividend tax at the 
source shall not exceed five percent if the shareholder is a corporation 
controlling, directly or indirectly, at least 95 percent of the entire 
voting power in the corporation paying the dividend, and if not more 
than 25 percent of the gross income of such paying corporation is 
derived from interest and dividends, other than interest and dividends 
received from its own subsidiary corporations. Such reduction of the 
rate of five percent shall not apply if the relationship of the two 
corporations has been arranged or is maintained primarily with the 
intention of securing such reduced rate.

                               Article VII

    Interest on bonds, securities, notes, debentures, or on any other 
form of indebtedness derived from sources within one of the contracting 
States by a resident or corporation or other entity of the other 
contracting State not having a permanent establishment in the former 
State shall be exempt from tax by such former State.

                              Article VIII

    Royalties and other amounts derived as consideration for the right 
to use copyrights, patents, designs, secret processes and formulas, 
trade-marks and other like property (including rentals and like payments 
in respect of motion picture films) derived from sources within one of 
the contracting States by a resident or corporation or other entity of 
the other contracting State not having a permanent establishment in the 
former State shall be exempt from taxation in such former State.

                                * * * * *

                                Article X

                                * * * * *

    (2) Private pensions and life annuities derived from within one of 
the contracting States and paid to individuals residing in the other 
contracting State shall be exempt from taxation in the former State.
    (3) The term ``life annuities'' as used herein means a stated sum 
payable periodically at stated times during life, or during a specified 
number of years, under an obligation to make the payments in 
consideration of a gross sum paid for such obligation.

                                * * * * *

                              Article XXII

    The competent authorities of the two contracting States may 
prescribe regulations necessary to interpret and carry out the 
provisions of this Convention. With respect to the provisions of this 
Convention relating to exchange of information and mutual assistance in 
the collection of taxes, such authorities may, by common agreement, 
prescribe rules concerning matters of procedure, forms of application 
and replies thereto, conversion of currency, disposition of amounts 
collected, minimum amounts subject to collection and related matters.

                              Article XXIII

    (1) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Washington as soon as possible.
    (2) Upon the exchange of instruments of ratification, the present 
Convention shall have effect.
    (a) in the case of United States tax, for the taxable years 
beginning on or after the first day of January of the year in which such 
exchange takes place;
    (b) in the case of Danish tax, for the taxable years beginning on or 
after the first day of April of the year in which such exchange takes 
place.
    (3) The present Convention shall continue effective for a period of 
five years and indefinitely after that period, but may be terminated by 
either of the contracting States at the end of the five-year period or 
at any time thereafter, provided that at least six months' prior notice 
of termination has been given and, in such event, the present Convention 
shall cease to be effective.
    (a) As respects United States tax, for the taxable years beginning 
on or after the first day of January next following the expiration of 
the six-month period;
    (b) As respects Danish tax, for the taxable years beginning on or 
after the first day of April next following the expiration of the six-
month period.

                                * * * * *

    (b) As used in this subpart, unless the context otherwise requires, 
the terms defined in the above articles of the convention shall have the 
meanings so assigned to them.



Sec. 521.2  Dividends.

    (a) General. The rate of tax imposed by section 211(a) of the 
Internal Revenue Code (relating to nonresident alien individuals not 
engaged in trade or business within the United States) and by section 
231(a) of the Internal

[[Page 136]]

Revenue Code (relating to foreign corporations not engaged in trade or 
business within the United States) is 30 percent. Such rate is reduced 
under Article VI of the convention to 15 percent in the case of 
dividends received on or after January 1, 1948, from sources within the 
United States by a nonresident alien (including a nonresident alien 
individual, fiduciary, and partnership) who is a resident of Denmark or 
by a Danish corporation if such alien or corporation at no time during 
the taxable year had a permanent establishment within the United States. 
As to what is a Danish corporation, see Article II(1)(g) of the 
convention. Thus, if a nonresident alien who is a resident of Denmark 
performs personal services within the United States during the calendar 
year 1948, but has at no time during such year a permanent establishment 
within the United States, he is entitled to the reduced rate of tax with 
respect to dividends derived in that year from United States sources, as 
provided in Article VI of the convention, even though by reason of his 
having rendered personal services within the United States he is engaged 
in trade or business therein in that year within the meaning of section 
211(b) of the Internal Revenue Code. As to what constitutes a permanent 
establishment, see Article II(1)(c) of the convention.
    (b) Dividends paid by a United States subsidiary corporation. (1) 
Under the provisions of Article VI (3) of the convention, dividends paid 
by a domestic corporation to a Danish corporation controlling, directly 
or indirectly, at the time the dividend is paid, 95 percent or more of 
the entire voting power in such domestic corporation, are subject to tax 
at the rate of only 5 percent, if (i) not more than 25 percent of the 
gross income of such paying corporation for the three-year period 
immediately preceding the taxable year in which the dividend is paid 
consists of dividends and interest (other than dividends and interest 
paid to such domestic corporation by its own subsidiary corporations, if 
any, and (ii) the relationship between such domestic corporation and 
such Danish corporation has not been arranged or maintained primarily 
with the intention of securing such reduced rate of 5 percent.
    (2) Any domestic corporation which claims or contemplates claiming 
that dividends paid or to be paid by it on or after January 1, 1948, are 
subject only to the 5 percent rate shall file, as soon as practicable, 
with the Commissioner of Internal Revenue, the following information: 
(i) the date and place of its organization; (ii) the number of 
outstanding shares of stock of the domestic corporation having voting 
power and the voting power thereof; (iii) the person or persons 
beneficially owning such stock of the domestic corporation and their 
relationship to the Danish corporation; (iv) the amount of gross income, 
by years, of the paying corporation for the three-year period 
immediately preceding the taxable year in which the dividend is paid; 
(v) the amount of interest and dividends, by years, included in the 
gross income of such domestic corporation and the amount of interest and 
dividends, by years, received by such corporation from its subsidiary 
corporations, if any; and (vi) the relationship between the domestic 
corporation and the Danish corporation to which it pays the dividend.
    (3) As soon as practicable after such information is filed, the 
Commissioner of Internal Revenue will determine whether the dividends 
concerned fall within the provisions of Article VI (3) of the convention 
and may authorize the release of excess tax withheld with respect to 
dividends which come within such provision. In any case in which the 
Commissioner of Internal Revenue has notified such domestic corporation 
that the dividends come within such provision, the reduced rate of 5 
percent applies to any dividends subsequently paid by such corporation 
to the Danish corporation unless the stock ownership of the domestic 
corporation, or the character of its income, materially changes, and, if 
such change or changes occur, such corporation shall promptly notify the 
Commissioner of Internal Revenue of the then existing facts with respect 
to such stock ownership or income.
    (c) Effect on withholding in case of dividends of address in 
Denmark. For the purposes of withholding of the tax in

[[Page 137]]

the case of dividends, every nonresident alien (including a nonresident 
alien individual, fiduciary or partnership) whose address is in Denmark 
shall be deemed by United States withholding agents to be a resident of 
Denmark not having a permanent establishment in the United States and 
every corporation whose address is in Denmark shall be deemed by such 
withholding agents to be a Danish corporation not having a permanent 
establishment in the United States.
    (d) Rate of withholding. (1) On and after January 1, 1949, 
withholding in the case of dividends paid to nonresident aliens 
(including a nonresident alien individual, fiduciary or partnership) and 
to foreign corporations, whose addresses are in Denmark, shall (except 
(i) in any case in which prior to the date of payment of such dividend, 
the Commissioner of Internal Revenue has notified the paying corporation 
that such dividend falls within the provisions of Article VI (3) of the 
convention, and (ii) in any case in which the Commissioner notifies the 
withholding agent that the reduced rate shall not apply), be at the rate 
of 15 percent.
    (2) The preceding provisions relative to residents of Denmark and to 
Danish corporations are based upon the assumption that the payee of the 
dividend is the actual owner of the capital stock from which the 
dividend is derived and consequently is the person liable to the tax 
upon such dividend. As to action by the recipient who is not the owner 
of the dividend, see Sec. 521.7.



Sec. 521.3  Interest.

    (a) General. Interest, whether on bonds, securities, notes, 
debentures, or any other form of indebtedness (including interest on 
obligations of the United States and on obligations of instrumentalities 
of the United States), received on or after January 1, 1948, from 
sources within the United States by (1) a nonresident alien (including a 
nonresident alien individual, fiduciary, and partnership) who is a 
resident of Denmark, or (2) a Danish corporation, is exempt from United 
States tax under the provisions of Article VII of the convention if such 
alien or corporation at no time during the taxable year in which such 
interest is so received had a permanent establishment in the United 
States. Such interest is, therefore, not subject to the withholding 
provisions of the Internal Revenue Code.
    (b) Exemption from withholding. (1) To obviate withholding at the 
source in the case of coupon bond interest, the nonresident alien 
resident in Denmark or the Danish corporation shall submit Form 1001-D, 
in duplicate, to the paying agent with each presentation of interest 
coupons. Such form shall be signed by the owner of the interest, trustee 
or agent, and shall show the name and address of the obligor, and the 
name and address of the owner of such interest and the amount of such 
interest. Such form shall contain a statement that the owner is a 
resident of Denmark or a Danish corporation and that such owner has no 
permanent establishment in the United States.
    (2) The exemption from United States tax contemplated by Article VII 
of the convention, insofar as it concerns coupon bond interest, is an 
exemption applicable only to the owner of such interest. The person 
presenting such coupon or on whose behalf it is presented shall, for the 
purpose of the exemption, be deemed to be the owner of the interest only 
if he is, at the time the coupon is presented for payment, the owner of 
the bond from which the coupon has been detached. If the person 
presenting the coupon is not the owner of the bond, Form 1001, and not 
Form 1001-D, shall be executed.
    (3) The original and duplicate ownership certificates, Form 1001-D, 
must be forwarded to the Commissioner with the quarterly return, Form 
1012, as provided in existing regulations with respect to Form 1001. See 
Sec. 29.143-7 of Regulations 111 (26 CFR 1949 ed. Supps. 29.143-7) [and 
Sec. 39.143-7 of Regulations 118 (26 CFR, Rev. 1953, Parts 1-79, and 
Supps.)]. Form 1001-D need not be listed on Form 1012.
    (4) In the case of interest coupons presented in Denmark by a 
nonresident alien who is not a resident of Denmark or by a foreign 
corporation other than a Danish corporation, ownership certificates, 
Form 1001, shall be filed as provided in existing regulations without 
reference to the provisions of the

[[Page 138]]

convention. See Sec. 29.143-4 of Regulations 111 (26 CFR 1949 ed. Supps. 
29.143-4) [and Sec. 39.143-4 of Regulations 118 (26 CFR, Rev. 1953, 
Parts 1-79, and Supps.)].
    (5) To avoid withholding at the source in the case of interest other 
than interest payable by means of coupons, the nonresident alien who is 
a resident of Denmark, or the Danish corporation, shall file Form 1001A-
D, in duplicate, with the withholding agent in the United States. Such 
form shall be signed by the owner of the income, trustee or agent, and 
shall show the name and address of the obligor and the name and address 
of the owner of such interest. Such form shall contain a statement that 
the owner is a resident of Denmark or is a Danish corporation and that 
the owner has no permanent establishment in the United States.
    (6) Form 1001A-D must be filed for each three calendar year period 
and the first such form filed by the taxpayer with any withholding agent 
should be filed not later than 20 days preceding the date of the first 
payment of income in such period. If the taxpayer files such form with 
the withholding agent in the calendar year 1948 or in any subsequent 
calendar year no additional Form 1001A-D need be filed prior to the end 
of the two calendar years immediately following the calendar year in 
which such form is so filed unless the Commissioner notifies the 
withholding agent that an additional Form 1001A-D must be filed by the 
taxpayer at any earlier date. The duplicate of Form 1001A-D should be 
immediately forwarded by the withholding agent to the Commissioner of 
Internal Revenue, Records Division, Washington 25, D.C.



Sec. 521.4  Patent and copyright royalties and film rentals.

    (a) Royalties and other like amounts received on or after January 1, 
1948, by (1) a nonresident alien (including a nonresident alien 
individual, fiduciary, and partnership) who is a resident of Denmark or 
(2) a Danish corporation, as consideration for the right to use 
copyrights, patents, designs, secret processes and formulae, trademarks, 
and other like property, including rentals and like payments in respect 
of motion picture films, are exempt from United States tax under the 
provisions of Article VIII of the convention if such alien or 
corporation had at no time during the taxable year in which such royalty 
or other amount was so received a permanent establishment in the United 
States. Such items are, therefore, not subject to the withholding 
provisions of the Internal Revenue Code. As to what constitutes a 
permanent establishment, see Article II(1)(c) of the convention.
    (b) To obviate withholding at the source, the nonresident alien who 
is a resident of Denmark, or the Danish corporation shall file Form 
1001A-D, in duplicate, with the withholding agent in the United States. 
Such form shall be signed by the owner of the income, trustee or agent 
and shall contain the statements provided on such form with respect to 
interest as set forth in Sec. 521.3, the provisions of which with 
respect to the effective period of such form are equally applicable with 
respect to the income falling within the scope of this section. The 
duplicate copy of Form 1001A-D should be immediately forwarded by the 
withholding agent to the Commissioner of Internal Revenue, Records 
Division, Washington 25, D.C.



Sec. 521.5  Private pensions and life annuities.

    (a) Under Article X(2) of the convention private pensions and life 
annuities derived on or after January 1, 1948, from sources within the 
United States by a nonresident alien individual who is a resident of 
Denmark are exempt from United States tax.
    (b) The person paying such income should be notified by letter from 
the resident of Denmark that the income is exempt from taxation under 
the provisions of Article X(2) of the convention. Such letter shall 
contain the address of the individual and a statement that such 
individual is a resident of Denmark. The letter of notification, or a 
copy thereof, should be immediately forwarded by the recipient to the 
Commissioner of Internal Revenue, Records Division, Washington 25, D.C. 
Such letter shall constitute authorization to the payor of the income to 
pay such income without deduction of the tax at

[[Page 139]]

the source unless the Commissioner subsequently notifies such payor that 
the tax should be withheld with respect to payments made after such 
notification.



Sec. 521.6  Release of excess tax withheld at source.

    (a) General. (1) In order to bring the convention into force and 
effect at the earliest practicable date:
    (i) The reduced rate of tax of 15 percent to be withheld at the 
source on dividends, and
    (ii) Exemption from tax otherwise withheld at the source on 
interest, patent royalties, copyright royalties, film rentals and the 
like,

are hereby made effective beginning January 1, 1948 in any case in which 
such dividends, interest, patent royalties, copyright royalties, film 
rentals and the like are derived from sources within the United States 
by a nonresident alien including a nonresident alien individual, 
fiduciary and partnership who is a resident of Denmark, or a Danish 
corporation.
    (2) Accordingly, in the case of dividends paid to a nonresident 
alien (including a nonresident alien individual, fiduciary, and 
partnership) whose address at the time of payment was in Denmark, or to 
a Danish corporation whose address at the time of payment was in 
Denmark, where tax at the rate of 30 percent has been withheld on or 
after January 1, 1948, from dividends, there shall be released by the 
withholding agent and paid over to the person from whom it was withheld 
an amount equal to 15 percent of such dividends.
    (3) In the case of every such taxpayer who furnishes to the 
withholding agent Form 1001-D, as prescribed in Sec. 521.3 or 521.4, 
where tax at the rate of 30 percent has been withheld on or after 
January 1, 1948, there shall be released by the withholding agent and 
paid over to the person from whom withheld an amount equal to the amount 
so withheld in the case of interest (as to coupon bond interest, see 
paragraph (4) of this paragraph), patent royalties, copyright royalties, 
film rentals and the like.
    (4) In the case of every such taxpayer who furnishes to the 
withholding agent Form 1001-D, in duplicate, where tax at the rate of 28 
percent or 30 percent, as the case may be, has been withheld on or after 
January 1, 1948, from coupon bond interest, there shall be released by 
the withholding agent and paid over to the person from whom it was 
withheld an amount equal to the tax withheld from such interest. Form 
1001-D used for this purpose should be clearly marked ``Substitute'' in 
order to replace Forms 1001 previously filed. One Form 1001-D, in 
duplicate, may be used to replace two or more Forms 1001. The form 
marked ``Substitute'' is to be used solely for the release of excess tax 
withheld in 1948. The use of Form 1001-D for the purpose of exemption 
upon presentation of interest coupons is set forth in Sec. 521.3 (b).
    (b) Private pensions and life annuities paid in 1948 or subsequent 
years. (1) In order to bring the convention into force and effect at the 
earliest practicable date, the exemption from tax otherwise withheld at 
the source on private pensions and life annuities is made effective 
beginning January 1, 1948, in any case in which such pensions and life 
annuities are derived from sources within the United States by a 
nonresident alien individual who is a resident of Denmark.
    (2) The person paying such income should be notified by letter from 
the resident of Denmark that the income is exempt from taxation under 
the provisions of Article X(2) of the convention. See Sec. 521.5. Such 
letter will constitute authorization to the payor of the income to 
release the tax withheld on or after January 1, 1948, with respect to 
such pensions or life annuities.
    (c) Subsidiary's dividends. With respect to a dividend paid on or 
after January 1, 1948, by a domestic corporation to a Danish corporation 
whose address is in Denmark, tax shall be withheld in accordance with 
the provisions of Sec. 521.2 unless prior to the date of payment of such 
dividend the Commissioner of Internal revenue has notified the paying 
corporation that such dividend falls within the scope of Article VI (3) 
of the convention. As soon as practicable after information required 
under Sec. 521.2 (b) is filed, the Commissioner of Internal Revenue will 
determine whether the dividend involved

[[Page 140]]

falls within the scope of Article VI (3) and may authorize the release 
of the excess tax withheld with respect to dividends which come within 
the scope of such provision.



Sec. 521.7  Addressee not actual owner.

    (a) If the recipient in Denmark of any dividend from sources within 
the United States is a nominee or representative through whom the 
dividend flows to a person other than a person described in 
Sec. 521.2(a) as being entitled to the reduced rate of 15 percent 
provided in Article VI of the convention, such recipient in Denmark will 
withhold an additional amount of United States tax equivalent to the 
difference between the United States tax which would have been withheld 
had the convention not been in effect (30 percent as at the date of 
approval of this subpart) and the 15 percent withheld at the source with 
respect to such dividend pursuant to Sec. 521.2.
    (b) In any case in which a fiduciary or a partnership with an 
address in Denmark receives, otherwise than as a nominee or 
representative, a dividend from a United States corporation, if a 
beneficiary of such fiduciary or a partner in such partnership is not 
entitled to the reduced rate of tax provided in Article VI of the 
convention, the fiduciary or partnership will withhold an additional 
amount of United States tax with respect to the portion of such dividend 
included in such beneficiary's or partner's net distributive share of 
the income of such fiduciary or partnership, as the case may be. The 
rate of the additional tax is calculated in the same manner as under 
paragraph (a) of this section.
    (c) The amounts so withheld by the withholding agent in Denmark 
will, on or before the 15th day after the close of the calendar year 
quarter in which such withholding has taken place, be deposited with the 
Danish National Bank (Danmarks Nationalbank) without converting such 
amounts into dollars. Each withholding agent making such deposit will 
accompany such deposit with the appropriate Danish form executed as 
required by the Danish National Bank. The Danish National Bank has 
arranged to remit, on or before the end of the calendar month in which 
such deposit is so made, by draft in United States dollars, the amounts 
so deposited to the District Director of Internal Revenue, Baltimore, 
Maryland, U.S.A., forwarding with such draft the appropriate Danish form 
filed by the withholding agents.



Sec. 521.8  Beneficiaries of a domestic estate or trust.

    A nonresident alien who is a resident of Denmark and who is a 
beneficiary of a domestic estate or trust shall be entitled to the 
exemption, or reduction in the rate of tax, as the case may be, provided 
in Articles VI, VII and VIII if the convention with respect to 
dividends, interest and royalties to the extent such item or items are 
included in his distributive share of income of such estate or trust. In 
such case such beneficiary must, in order to be entitled to the 
exemption or reduction in the rate of tax, in the case of interest or 
royalties, execute Form 1001A-D and file such form with the fiduciary of 
such estate or trust in the United States.



                       Subpart--General Income Tax

    Source: Treasury Decision 5777, 15 FR 1595, Mar. 22, 1950, unless 
otherwise noted. Redesignated at 25 FR 14022, Dec. 31, 1960.

   Taxation of Nonresident Aliens Who Are Residents of Denmark and of 
                           Danish Corporations



Sec. 521.101  Introductory.

    The income tax convention between the United States and the Kingdom 
of Denmark, signed May 6, 1948, proclaimed (with reservations thereto) 
by the President of the United States on December 8, 1948, and effective 
for taxable years beginning on and after January 1, 1948 (referred to in 
this subpart as the convention), provides in part as follows:

                                Article I

    (1) The taxes referred to in this Convention are:
    (a) In the case of the United States of America: The Federal income 
tax, including surtaxes.
    (b) In the case of Denmark:
    The national income tax, including the war profits tax.
    The intercommunal income tax.

[[Page 141]]

    The communal income tax.
    (2) The present Convention shall also apply to any other taxes of a 
substantially similar character imposed by either contracting State 
subsequently to the date of signature of the present Convention.

                               Article II

    (1) As used in this Convention:
    (a) The term ``United States'' means the United States of America, 
and when used in a geographical sense includes only the States, the 
Territories of Alaska and Hawaii, and the District of Columbia.
    (b) The term ``Denmark'' means the Kingdom of Denmark; the 
provisions of the Convention shall not, however, extend to the Faroe 
Islands; nor do they apply to Greenland.
    (c) The term ``permanent establishment'' means a branch office, 
factory, warehouse or other fixed place of business, but does not 
include the casual and temporary use of merely storage facilities, nor 
does it include an agency unless the agent has and exercises a general 
authority to negotiate and conclude contracts on behalf of an enterprise 
or has a stock of merchandise from which he regularly fills orders on 
its behalf. An enterprise of one of the contracting States shall not be 
deemed to have a permanent establishment in the other State merely 
because it carries on business dealings in such other State through a 
bona fide commission agent, broker or custodian acting in the ordinary 
course of his business as such. The fact that an enterprise of one of 
the contracting States maintains in the other State a fixed place of 
business exclusively for the purchase of goods or merchandise shall not 
of itself constitute such fixed place of business a permanent 
establishment of such enterprise. The fact that a corporation of one 
contracting State has a subsidiary corporation which is a corporation of 
the other State or which is engaged in trade or business in the other 
State shall not of itself constitute that subsidiary corporation a 
permanent establishment of its parent corporation.
    (d) The term ``enterprise of one of the contracting States'' means, 
as the case may be, ``United States enterprise'' or ``Danish 
enterprise''.
    (e) The term ``enterprise'' includes every form of undertaking 
whether carried on by an individual, partnership, corporation, or any 
other entity.
    (f) The term ``United States enterprise'' means an enterprise 
carried on in the United States of America by a resident of the United 
States of America or by a United States corporation or other entity; the 
term ``United States corporation or other entity'' means a partnership, 
corporation or other entity created or organized in the United States of 
America or under the law of the United States of America or of any State 
or Territory of the United States of America.
    (g) The term ``Danish enterprise'' means an enterprise carried on in 
Denmark by a resident of Denmark or by a Danish corporation or other 
entity; the term ``Danish corporation or other entity'' means a 
partnership, corporation, or other entity created or organized in 
Denmark or under Danish laws.
    (h) The term ``competent authorities'' means, in the case of the 
United States, the Commissioner of Internal Revenue or his authorized 
representative; and in the case of Denmark, the Chief of the Taxation 
Department of the Ministry of Finance (Generaldirektoren for 
Skattevaesenet) or his authorized representative.
    (2) In the application of the provisions of the present Convention 
by one of the contracting States any term not otherwise defined, shall, 
unless the context otherwise requires, have the meaning which such term 
has under its own tax laws.

                               Article III

    (1) An enterprise of one of the contracting States shall not be 
subject to taxation in the other contracting State in respect of its 
industrial and commercial profits unless it is engaged in trade or 
business in such other State through a permanent establishment situated 
therein. If it is so engaged such other State may impose its tax upon 
the entire income of such enterprise from sources within such other 
State.
    (2) In determining the industrial or commercial profits from sources 
within the territory of one of the contracting States of an enterprise 
of the other contracting State, no profits shall be deemed to arise from 
the mere purchase of goods or merchandise within the territory of the 
former contracting State by such enterprise.
    (3) Where an enterprise of one of the contracting States is engaged 
in trade or business in the territory of the other contracting State 
through a permanent establishment situated therein, there shall be 
attributed to such permanent establishment the industrial or commercial 
profits which it might be expected to derive if it were an independent 
enterprise engaged in the same or similar activities under the same or 
similar conditions and dealing at arm's length with the enterprise of 
which it is a permanent establishment and the profits so attributed 
shall, subject to the law of such other contracting State, be deemed to 
be income from sources within the territory of such other contracting 
State.

                               Article IV

    Where an enterprise of one of the contracting States, by reason of 
its participation in the management or the financial

[[Page 142]]

structure of an enterprise of the other contracting State, makes with or 
imposes on the latter, in their commercial or financial relations, 
conditions different from those which would be made with an independent 
enterprise, any profits which would normally have accrued to one of the 
enterprises but by reason of those conditions have not so accrued, may 
be included in the profits of that enterprise and taxed accordingly.

                                Article V

    (1) Income which an enterprise of one of the contracting States 
derives from the operation of ships or aircraft registered in that State 
shall be exempt from taxation in the other contracting State.
    (2) The present Convention shall not be deemed to affect the 
arrangement between the United States and Denmark providing for relief 
from double income taxation on shipping profits, effected by exchanges 
of notes dated May 22, August 9 and 18, October 24, 25, and 28, and 
December 5 and 6, in the year 1922.

                               Article VI

    (1) Dividends shall be taxable only in the contracting State in 
which the shareholder is resident or, if the shareholder is a 
corporation or other entity, in the contracting State in which such 
corporation or other entity is incorporated or organized.
    (2) Each of the contracting States reserves, however, the right to 
collect and retain the tax which, under its revenue laws, is deductible 
at the source with respect to such dividends, but the tax shall not 
exceed 15 percent of the amount of dividends derived from sources within 
such State by a resident, corporation or other entity of the other 
State, if the recipient has no permanent establishment in the 
contracting State from which the dividends are derived.
    (3) It is agreed, however, that the rate of dividend tax at the 
source shall not exceed five percent if the shareholder is a corporation 
controlling, directly or indirectly, at least 95 percent of the entire 
voting power in the corporation paying the dividend, and if not more 
than 25 percent of the gross income of such paying corporation is 
derived from interest and dividends, other than interest and dividends 
received from its own subsidiary corporations. Such reduction of the 
rate to five percent shall not apply if the relationship of the two 
corporations has been arranged or is maintained primarily with the 
intention of securing such reduced rate.

                               Article VII

    Interest on bonds, securities, notes, debentures, or on any other 
form of indebtedness derived from sources within one of the contracting 
States by a resident or corporation or other entity of the other 
contracting State not having a permanent establishment in the former 
State shall be exempt from tax by such former State.

                              Article VIII

    Royalties and other amounts derived as consideration for the right 
to use copyrights, patents, designs, secret processes and formulas, 
trade-marks and other like property (including rentals and like payments 
in respect of motion picture films) derived from sources within one of 
the contracting States by a resident or corporation or other entity of 
the other contracting State not having a permanent establishment in the 
former State shall be exempt from taxation in such former State.

                               Article IX

    (1) Income from real property (not including interest derived from 
mortgages and bonds secured by real property) and royalties in respect 
of the operation of mines, quarries, or other natural resources, shall 
be taxable only in the contracting State in which such property, mines, 
quarries, or other natural resources are situated.
    (2) A resident or corporation of one of the contracting States 
deriving any such income from sources within the other contracting State 
may, for any taxable year, elect to be subject to the tax of such other 
contracting State, on a net basis, as if such resident or corporation 
were engaged in trade or business within such other contracting State 
through a permanent establishment therein during such taxable year.

                                Article X

    (1) Wages, salaries, and similar compensation and pensions paid by 
one of the contracting States or by any other public authority within 
that State to individuals residing in the other State shall be taxable 
only in the former State.
    (2) Private pensions and life annuities derived from within one of 
the contracting States and paid to individuals residing in the other 
contracting State shall be exempt from taxation in the former State.
    (3) The term ``life annuities'' as used herein means a stated sum 
payable periodically at stated times during life, or during a specified 
number of years, under an obligation to make the payments in 
consideration of a gross sum paid for such obligation.

                               Article XI

    (1) Compensation for labor or personal services, including the 
practice of the liberal professions, shall be taxable only in the 
contracting State in which such services are rendered.
    (2) The provisions of paragraph (1) are, however, subject to the 
following exceptions:

[[Page 143]]

    (a) A resident of Denmark shall be exempt from United States tax 
upon compensation for labor or personal services if he is temporarily 
present in the United States for a period or periods not exceeding a 
total of ninety days during the taxable year and the compensation 
received for such services does not exceed $3,000 in the aggregate. If, 
however, his compensation is received for labor or personal services 
performed as an employee of, or under contract with, a resident or 
corporation or other entity of Denmark, he will be exempt from United 
States tax if his stay in the United States does not exceed a total of 
180 days during the taxable year.
    (b) The provisions of paragraph (2)(a) of this Article shall apply 
mutatis mutandis, to a resident of the United States with respect to 
compensation for personal services otherwise subject to income tax in 
Denmark.
    (3) The provisions of this Article shall have no application to the 
income to which Article X (1) relates.

                               Article XII

    Gains derived in one of the contracting States from the sale or 
exchange of capital assets by a resident or corporation or other entity 
of the other contracting State shall be exempt from taxation in the 
former State if such resident or corporation or other entity is not 
engaged in trade or business in such former State. [This Article deleted 
by reservation, see President's Proclamation hereinafter.]

                              Article XIII

    Students or apprentices, citizens of one of the contracting States, 
residing in the other contracting State exclusively for purposes of 
study or for acquiring business experience, shall not be taxable in the 
latter State in respect of remittances (other than their own income) 
received by them from abroad for the purposes of their maintenance or 
studies.

                               Article XIV

    A professor or teacher, a resident of one of the contracting States, 
who temporarily visits the territory of the other contracting State for 
the purpose of teaching for a period not exceeding two years at a 
university, college, school or other educational institution in the 
other contracting State, shall be exempted in such other contracting 
State from tax on his remuneration for such teaching for such period.

                               Article XV

    It is agreed that double taxation shall be avoided in the following 
manner:
    (a) The United States in determining the income taxes, including 
surtaxes, of its citizens, residents or corporations may, regardless of 
any other provision of this Convention, include in the basis upon which 
such taxes are imposed all items of income taxable under the revenue 
laws of the United States as if this convention had not come into 
effect. The United States shall, however, subject to the provisions of 
section 131, Internal Revenue Code, deduct from its taxes the amount of 
Danish taxes specified in Article I of this Convention.
    (b) Denmark, in determining its taxes specified in Article I of this 
Convention, may regardless of any other provision of this Convention, 
include in the basis upon which such taxes are imposed all items of 
income subject to such taxes under the taxation laws of Denmark. Denmark 
shall, however, deduct from the taxes so calculated the United States 
tax on income coming within the provisions of Articles III, IX, X (1), 
XIII and XIV of this Convention and on earned income earned within the 
United States, but in an amount not exceeding that proportion of the 
Danish taxes which such income bears to the entire income subject to tax 
by Denmark. Denmark will also allow as a deduction from its taxes an 
amount equal to 15 percent (five percent in the case of dividends 
covered by Article VI (3)) of the gross amount of dividends (reduced by 
the United States tax applicable to such dividends) from sources within 
the United States.

                               Article XVI

    (1) The citizens of one of the contracting States shall not, while 
resident in the other contracting State, be subjected therein to other 
or more burdensome taxes than are the citizens of such other contracting 
State residing in its territory. As used in this paragraph:
    (a) The term ``citizens'' includes all legal persons, partnerships, 
and associations created or organized under the laws in the respective 
contracting States, and
    (b) The term ``taxes'' means taxes of every kind or description 
whether national, Federal, state, provincial or municipal.
    (2) It is agreed that section 25, paragraph 5, of the Danish law No. 
391 of July 12, 1946, prescribing an addition of 50 percent of the 
capital increment tax on corporations in cases where more than 50 
percent of the entire stock capital is owned by a single shareholder 
residing outside Denmark, shall not be applicable when the shareholder 
in question is a resident of the United States or a United States 
corporation or other entity.

                              Article XVII

    The competent authorities of the contracting States shall exchange 
such information (being information available under the respective 
taxation laws of the contracting States) as is necessary for carrying 
out the provisions of the present Convention or for the prevention of 
fraud or the administration of statutory provisions against tax

[[Page 144]]

avoidance in relation to the taxes which are the subject of the present 
Convention. Any information so exchanged shall be treated as secret and 
shall not be disclosed to any person other than those concerned with the 
assessment and collection of the taxes which are the subject of the 
present Convention. No information shall be exchanged which would 
disclose any trade secret or trade process.

                              Article XVIII

    (1) The contracting States undertake to lend assistance and support 
to each other in the collection of the taxes which are the subject of 
the present Convention, together with interest, costs, and additions to 
the taxes.
    (2) In the case of application for enforcement of taxes, revenue 
claims of each of the contracting States which have been finally 
determined may be accepted for enforcement by the other contracting 
State and may be collected in that State in accordance with the laws 
applicable to the enforcement and collection of its own taxes.
    (3) Any application shall include a certification that under the 
laws of the State making the application the taxes have been finally 
determined.
    (4) The assistance provided for in this Article shall not be 
accorded with respect to the citizens, corporations, or other entities 
of the State to which application is made, except as is necessary to 
insure that the exemption or reduced rate of tax granted under the 
present Convention to such citizens, corporations, or other entities 
shall not be enjoyed by persons not entitled to such benefits.

                               Article XIX

    The State to which application is made for information or assistance 
shall comply as soon as possible with the request addressed to it except 
that such State may refuse to comply with the request for reasons of 
public policy or if compliance would involve violation of a trade, 
business, industrial or professional secret or trade process.

                               Article XX

    Where a taxpayer shows proof that the action of the revenue 
authorities of the contracting States has resulted in double taxation in 
his case in respect of any of the taxes to which the present Convention 
relates, he shall be entitled to lodge a claim with the State of which 
he is a citizen or, if he is not a citizen of either of the contracting 
States, with the State of which he is a resident, or, if the taxpayer is 
a corporation or other entity, with the State in which it is created or 
organized. Should the claim be upheld, the competent authority of such 
State may come to an agreement with the competent authority of the other 
State with a view to equitable avoidance of the double taxation in 
question.

                               Article XXI

    (1) The provisions of this Convention shall not be construed to deny 
or affect in any manner the right of diplomatic and consular officers to 
other or additional exemptions now enjoyed or which may hereafter be 
granted to such officers.
    (2) The provisions of the present Convention shall not be construed 
to restrict in any manner any exemption, deduction, credit or other 
allowance accorded by the laws of one of the contracting States in the 
determination of the tax imposed by such State.
    (3) Should any difficulty or doubt arise as to the interpretation or 
application of the present Convention, or its relationship to 
Conventions between one of the contracting States and any other State, 
the competent authorities of the contracting States may settle the 
question by mutual agreement.

                              Article XXII

    The competent authorities of the two contracting States may 
prescribe regulations necessary to interpret and carry out the 
provisions of this Convention. With respect to the provisions of this 
Convention relating to exchange of information and mutual assistance in 
the collection of taxes, such authorities may, by common agreement, 
prescribe rules concerning matters of procedure, forms of application 
and replies thereto, conversion of currency, disposition of amounts 
collected, minimum amounts subject to collection and related matters.

                              Article xxiii

    (1) The present Convention shall be ratified and the instruments of 
ratification shall be exchanged at Washington as soon as possible.
    (2) Upon the exchange of instruments of ratification, the present 
Convention shall have effect.
    (a) In the case of United States tax, for the taxable years 
beginning on or after the first day of January of the year in which such 
exchange takes place;
    (b) In the case of Danish tax, for the taxable years beginning on or 
after the first day of April of the year in which such exchange takes 
place.
    (3) The present Convention shall continue effective for a period of 
five years and indefinitely after that period, but may be terminated by 
either of the contracting States at the end of the five-year period or 
at any time thereafter, provided that at least six months' prior notice 
of termination has been given and, in such event, the present Convention 
shall cease to be effective.
    (a) As respects United States tax, for the taxable years beginning 
on or after the first

[[Page 145]]

day of January next following the expiration of the six-month period;
    (b) As respects Danish tax, for the taxable years beginning on or 
after the first day of April next following the expiration of the six-
month period.
    Done at Washington, in duplicate, in the English and Danish 
languages, the two texts having equal authenticity, this 6th day of May 
1948.
    For the President of the United States of America:

    [seal]
                                                         G. C. Marshall.
    For his Majesty the King of Denmark:
    [seal]
                                                        Henrik Kauffman.

  Proclamation of the President of the United States Dated December 8, 
                                  1948

                                * * * * *

    And whereas the Senate of the United States of America, by their 
resolution of June 17, 1948, two-thirds of the Senators present 
concurring therein, did advise and consent to the ratification of the 
aforesaid convention subject to a reservation, as follows:
    The Government of the United States of America does not accept 
Article XII of the convention relating to gains from the sale or 
exchange of capital assets.
    And whereas the text of the aforesaid reservation was communicated 
by the Government of the United States of America to the Government of 
Denmark and thereafter the Government of Denmark gave notice of its 
acceptance of the aforesaid reservation;
    And whereas the aforesaid convention was duly ratified by the 
President of the United States of America on November 24, 1948, in 
pursuance of the aforesaid advice and consent of the Senate and subject 
to the aforesaid reservation, and the said convention, with the 
exception of Article XII thereof, was duly ratified on the part of 
Denmark;
    And whereas the respective instruments of ratification of the 
aforesaid convention were duly exchanged at Washington on December 1, 
1948, and a protocol of exchange of instruments of ratification, in the 
English and Danish languages, was signed on that date by the respective 
Plenipotentiaries of the United States of America and Denmark, the 
English text of which protocol reads in part: ``it is the understanding 
of both Governments that Article XII of the convention aforesaid shall 
be deemed to be deleted and of no effect.'';

                                * * * * *



Sec. 521.102  Applicable provisions of the Internal Revenue Code.

    (a) The Internal Revenue Code provides in part as follows:

                          Chapter I--Income Tax

                                * * * * *

    Sec. 22. Gross income.

                                * * * * *

    (b) Exclusions from gross income. The following items shall not be 
included in gross income and shall be exempt from taxation under this 
chapter:

                                * * * * *

    (7) Income exempt under treaty. Income of any kind, to the extent 
required by any treaty obligation of the United States;

                                * * * * *

    Sec. 62. Rules and regulations. The Commissioner, with the approval 
of the Secretary, shall prescribe and publish all needful rules and 
regulations for the enforcement of this chapter.

    (b) Pursuant to section 62 of the Internal Revenue Code, other 
provisions of the internal revenue laws, and to Article XXII of the 
convention, the following regulations, which are designated as 
Secs. 521.101 to 521.117 are hereby prescribed and all regulations 
inconsistent herewith are modified accordingly.



Sec. 521.103  Scope of the convention.

    (a) The primary purposes of the convention, to be accomplished on a 
reciprocal basis, are to avoid double taxation upon major items of 
income derived from sources in one country by persons resident in, or by 
corporations of, the other country, and to provide for administrative 
cooperation between the competent tax authorities of the two countries 
looking to the avoidance of double taxation and fiscal evasion.
    (b) The specific classes of income from sources within the United 
States exempt under the convention from United States tax for taxable 
years beginning on and after January 1, 1948, are:

[[Page 146]]

    (1) Industrial and commercial profits of a Danish enterprise having 
no permanent establishment in the United States (Article III);
    (2) Income derived by a nonresident alien who is a resident of 
Denmark, or by a Danish corporation, from the operation of ships or 
aircraft registered in Denmark (Article V);
    (3) Interest and royalties (including motion picture film rentals) 
derived by a nonresident alien who is a resident of Denmark or by a 
Danish corporation if such alien or corporation has no permanent 
establishment in the United States (Articles VII and VIII);
    (4) Compensation and pensions paid by Denmark to aliens for services 
rendered to Denmark (Article X(1));
    (5) Private pensions and life annuities derived by nonresident alien 
individuals residing in Denmark (Article X(2));
    (6) Compensation, subject to certain limitations, for personal 
services derived by a nonresident alien who is a resident of Denmark 
(Article XI);
    (7) Remittances from sources outside the United States received in 
the United States by a Danish citizen who is temporarily present in the 
United States for the purposes of study or for acquiring business 
experience, such remittances being for the purpose of his maintenance or 
studies (Article XIII);
    (8) Remuneration derived from teaching in the United States for a 
period of not more than two years by a professor or teacher who is a 
resident of Denmark but who is temporarily present in the United States 
(Article XIV).
    (c) The convention also reduces to 15 percent the rate of tax 
otherwise imposed upon dividends derived by a nonresident alien who is a 
resident of Denmark, or by a Danish corporation, if such alien or 
corporation has no permanent establishment in the United States (Article 
VI).
    (d) As to exemption from withholding of the tax at the source in the 
case of interest, royalties, pensions and life annuities, and reduction 
in the rate of tax from 30 percent to 15 percent in the case of 
dividends, see Treasury Decision 5692, approved March 8, 1949 
(Secs. 521.1 to 521.8).
    (e) The convention does not affect the liability to United States 
income taxation of citizens of Denmark who are residents of the United 
States except that such individuals are entitled to the benefits of 
Article XV (relating to credit for Danish income tax), and of Article 
XVI (relating to equality of taxation). Except as provided in Article 
XV, relating to the credit for income tax, the convention does not 
affect taxation by the United States of a citizen of the United States 
or of a domestic corporation, even though such citizen is resident in 
Denmark and such corporation is engaged in trade or business in Denmark.

    Effective Date Note: By T.D. 8732, 62 FR 53498, Oct. 14, 1997, 
Sec. 521.103 was amended by removing and reserving paragraph (d), 
effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 31, 1998, the 
effective date was delayed until Jan. 1, 2000.



Sec. 521.104  Definitions.

    (a) As used in Secs. 521.101 to 521.117, unless the context 
otherwise requires, the terms defined in the convention shall have the 
meanings so assigned to them. Any term used in Secs. 521.101 to 521.117, 
which is not defined in the convention but which is defined in the 
Internal Revenue Code shall be given the definition contained therein 
unless the context otherwise requires.
    (b) As used in Secs. 521.101 to 521.117.
    (1) The term ``permanent establishment'' means a branch office, 
factory, warehouse or other fixed place of business, but does not 
include the casual and temporary use of merely storage facilities. The 
fact that a Danish corporation has a domestic subsidiary corporation or 
a foreign subsidiary corporation having a branch in the United States, 
does not of itself constitute either subsidiary corporation a permanent 
establishment of the parent Danish enterprise. The fact that a Danish 
enterprise has business dealings in the United States through a bona 
fide commission agent, broker, or custodian, acting in the ordinary 
course of his business as such, or maintains in the United States an 
office or other fixed place of business used exclusively for the 
purchase of goods or merchandise, does not mean that such Danish 
enterprise has a permanent establishment in the United States. If, 
however, a Danish enterprise carries on business in

[[Page 147]]

the United States through an agent who has, and habitually exercises, a 
general authority to negotiate and conclude contracts on behalf of such 
enterprise or if it has an agent who maintains within the United States 
a stock of merchandise from which he regularly fills orders on behalf of 
his principal, then such enterprise shall be deemed to have a permanent 
establishment in the United States. However, an agent having power to 
contract on behalf of his principal but only at fixed prices and under 
conditions determined by the principal does not necessarily constitute a 
permanent establishment of such principal. The mere fact that an agent 
(assuming he has no general authority to contract on behalf of his 
employer or principal) maintains samples or occasionally fills orders 
from incidental stocks of goods maintained in the United States will not 
constitute a permanent establishment within the United States. The mere 
fact that salesmen, employees of a Danish enterprise, promote the sale 
of their employer's products in the United States or that such 
enterprise transacts business in the United States by means of mail 
order activities, does not mean such enterprise has a permanent 
establishment therein. The term ``permanent establishment'' as used in 
the convention implies the active conduct therein of a business 
enterprise. The mere ownership, for example, of timberlands or a 
warehouse in the United States by a Danish enterprise does not mean that 
such enterprise has a permanent establishment therein. As to the effect 
of the maintenance of a permanent establishment within the United States 
upon exemption from United States tax in the case of interest and 
royalties and reduction in the rate of United States tax in the case of 
dividends, see Sec. 521.108.
    (2) The term ``enterprise'' means any commercial or industrial 
undertaking whether conducted by an individual, partnership, 
corporation, or other entity. It includes such activities as 
manufacturing, merchandising, mining, processing, and banking. It does 
not include the rendition of personal services. Hence, a non resident 
alien who is a resident of Denmark and who renders personal services is 
not, merely by reason of such services, engaged in an enterprise within 
the meaning of the convention and his liability to United States tax is 
not affected by Article III of the convention.
    (3) The term ``Danish enterprise'' means an enterprise carried on in 
Denmark by a resident of Denmark or by a Danish corporation or other 
entity. The term ``Danish corporation or other entity'' means a 
partnership, corporation or other entity created or organized in Denmark 
or under the laws of Denmark.
    (4) The term ``industrial or commercial profits'' means profits 
arising from industrial, commercial, mercantile, manufacturing, and like 
activities of a Danish enterprise as defined in this section. Such term 
does not include rentals, royalties, interest, dividends, fees, 
compensation for personal services, nor gains derived from the sale or 
exchange of capital assets. Such enumerated items of income are not 
governed by the provisions of Article III of the convention.



Sec. 521.105  Scope of convention with respect to determination of ``industrial or commercial profits''.

    (a) General. Article III of the convention adopts the principle that 
an enterprise of one of the contracting States shall not be taxable by 
the other contracting State upon its industrial or commercial profits 
unless it has a permanent establishment in the latter State. Hence, a 
Danish enterprise is subject to United States tax upon its industrial 
and commercial profits to the extent of such profits from sources within 
the United States only if it has a permanent establishment within the 
United States. From the standpoint of Federal income taxation, the 
article has application only to a Danish enterprise and to the 
industrial and commercial income thereof from sources within the United 
States. It has no application for example, to compensation for labor or 
personal services performed in the United States nor to income derived 
from real property located in the United States, including rentals and 
royalties therefrom, nor to gains from the sale or disposition of

[[Page 148]]

such property, nor to interest, dividends, royalties, other fixed or 
determinable annual or periodical income and gains derived from the sale 
or exchange of capital assets.
    (b) No United States permanent establishment. A nonresident alien 
(including a nonresident alien individual, fiduciary and partnership) 
who is a resident of Denmark or a Danish corporation, carrying on an 
enterprise in Denmark and having no permanent establishment in the 
United States, is not for taxable years beginning on or after January 1, 
1948, subject to United States income tax upon industrial or commercial 
profits from sources within the United States. For example, if the 
Danish enterprise carried on by such alien or corporation sells, in 
1948, merchandise, such as silverware, dairy products, or liquors, 
through a bona fide commission agent or broker in the United States 
acting in the ordinary course of his business as such agent or broker, 
the resulting profits are, under the terms of Article III of the 
convention, exempt from United States income tax. Likewise no permanent 
establishment exists and no United States income tax attaches to such 
profits if such enterprise, through its sales agents in the United 
States, secures orders for its products, the sales being made in 
Denmark.
    (c) United States permanent establishment. A nonresident alien 
(including a nonresident alien individual, fiduciary and partnership), 
who is a resident of Denmark, or a Danish corporation, whether or not 
carrying on a Danish enterprise, having a permanent establishment in the 
United States, is subject to tax upon industrial or commercial profits 
from sources within the United States to the same extent as are 
nonresident aliens and foreign corporations engaged in trade or business 
therein. In the determination of the income taxable to such alien or 
foreign corporation all industrial and commercial profits from sources 
within the United States shall be deemed to be allocable to the 
permanent establishment in the United States. Hence, for example, if a 
Danish enterprise having a permanent establishment in the United States 
sells in the United States, through a commission agent therein goods 
produced in Denmark, the resulting profits derived from United States 
sources from such transactions are allocable to such permanent 
establishment even though such transactions were carried on 
independently of such establishment. In determining industrial and 
commercial profits no account shall be taken of the mere purchase of 
merchandise within the United States by the Danish enterprise. The 
industrial or commercial profits of the permanent establishment shall be 
determined as if the establishment were an independent enterprise 
engaged in the same or similar activities and dealing at arm's length 
with the enterprise of which it is a permanent establishment.



Sec. 521.106  Control of a domestic enterprise by a Danish enterprise.

    Article IV of the convention provides, in effect, that if a Danish 
corporation by reason of its control of a domestic enterprise imposes on 
such later enterprise conditions different from those which would result 
from normal business relations between independent enterprises, the 
accounts between the enterprises may be adjusted so as to ascertain the 
true net income of each enterprise. The purpose is to place the 
controlled domestic enterprise on a tax parity with an uncontrolled 
domestic enterprise by determining, according to the standard of an 
uncontrolled enterprise, the true net income from the property and 
business of the controlled enterprise. The basic objective of the 
article is that if the accounting records do not truly reflect the net 
income from the property and business of such domestic enterprise the 
Commissioner of Internal Revenue may intervene and, by making such 
distributions, apportionments, or allocations as he may deem necessary 
of gross income or deductions of any item or element affecting net 
income as between such domestic enterprise and the Danish enterprise by 
which it is controlled or directed, determine the true net income of the 
domestic enterprise. The provisions of Sec. 29.45-1 of Regulations 111 
(26 CFR 1949 ed. Supps. 29.45-1) [and Sec. 39.45-1 of Regulations 118 
(26 CFR, Rev. 1953, Parts 1-79, and Supps.)] shall, insofar as 
applicable, be followed

[[Page 149]]

in the determination of the net income of the domestic business.



Sec. 521.107  Income from operation of ships or aircraft.

    The income derived from the operation of ships or aircraft 
registered in Denmark by a nonresident alien who is a resident of 
Denmark, or by a Danish corporation, and carrying on an enterprise in 
Denmark, is, for taxable years beginning on or after January 1, 1948, 
exempt from United States income tax under the provisions of Article V 
of the convention.



Sec. 521.108  Exemption from, or reduction in rate of, United States tax in the case of dividends, interest and royalties.

    (a) Dividends--(1) General. The tax imposed by the Internal Revenue 
Code in the case of dividends received from sources within the United 
States by (i) a nonresident alien (including a nonresident alien 
individual, fiduciary and partnership) who is a resident of Denmark, or 
(ii) a Danish corporation is, for taxable years beginning on and after 
January 1, 1948, limited to 15 percent under the provisions of Article 
VI (relating to dividends) if such alien or corporation, at no time 
during the taxable year in which such dividends were so derived, had a 
permanent establishment within the United States. Thus, if a nonresident 
alien who is a resident of Denmark, performs personal services within 
the United States during the calendar year 1948 but has at no time 
during such year a permanent establishment within the United States, he 
is entitled to the reduced rate of tax with respect to such dividends 
derived in that year from United States sources, as provided in Article 
VI of the convention, even though by reason of his having rendered 
personal services within the United States he is engaged in trade or 
business therein in that year within the meaning of section 211(b) of 
the Internal Revenue Code. If, for example, A, a nonresident alien who 
is a resident of Denmark, derives in 1948, $5,000 compensation for such 
personal services and his only other income from sources within the 
United States consists of dividends, the dividends are subject to tax at 
a rate not to exceed 15 percent and his earned income is subject to 
normal tax and surtax without taking the dividends into account in 
determining the tax on such earned income.
    (2) Dividends paid by a United States subsidiary corporation. Under 
the provisions of Article VI(3) of the convention, dividends paid by a 
domestic corporation to a Danish corporation are subject to tax at the 
rate of only 5 percent if (i) such Danish corporation controls, directly 
or indirectly, at the time the dividend is paid 95 percent or more of 
the voting power in such domestic corporation, (ii) not more than 25 
percent of the gross income of the domestic corporation for the three-
year period immediately preceding the taxable year in which the dividend 
is paid consists of dividends and interest (other than dividends and 
interest paid to such domestic corporation by its own subsidiary 
corporations, if any), and (iii) the relationship between such domestic 
corporation and such Danish corporation has not been arranged or 
maintained primarily with the intention of securing such reduced rate of 
5 percent.
    (b) Interest and royalties. (1) Interest, whether on bonds, 
securities, notes, debentures, or any other form of indebtedness 
(including interest on obligations of the United States and on 
obligations of instrumentalities of the United States), and royalties 
for the right to use copyrights, patents, designs, secret processes and 
formulae, trade-marks, and other analogous property and royalties 
(including rentals and like payments in respect of motion picture films) 
received from sources within the United States by (i) a nonresident 
alien (including a nonresident alien individual, fiduciary, and 
partnership) who is a resident of Denmark, or (ii) a Danish corporation, 
are, for taxable years beginning on and after January 1, 1948, exempt 
from United States tax under the provisions of Articles VII and VIII of 
the convention if such alien or corporation at no time during the 
taxable year in which such interest or royalty was so derived had a 
permanent establishment situated within the United States.

[[Page 150]]

    (2) Such interest and royalties are, therefore, not subject to the 
withholding provisions of the Internal Revenue Code.
    (c) Beneficiaries of an estate or trust. (1) A nonresident alien who 
is a resident of Denmark and who is a beneficiary of a domestic estate 
or trust shall be entitled to the exemption, or reduction in the rate of 
tax, as the case may be, provided in Articles VI, VII and VIII of the 
convention with respect to dividends, interest and royalties to the 
extent that such item or items are included in his distributive share of 
income of such estate or trust if he at no time during the taxable year 
had a permanent establishment in the United States. In such case such 
beneficiary must, in order to be entitled to the exemption or reduction 
in the rate of tax execute Form 101-D or Form 1001A-D (modified to show 
dividends where applicable) and file such form with the fiduciary of 
such estate or trust in the United States.
    (2) In any case in which dividends, interest or royalties are 
derived from United States sources by a Danish estate or trust, any 
beneficiary of such estate or trust who is not a resident of Denmark, or 
who has a permanent establishment in the United States, is not entitled 
to any exemption under the convention with respect to such income 
included in his distributive share of the income of the estate or trust.



Sec. 521.109  Real property income, natural resource royalties.

    Under Article IX of the convention, a nonresident alien (including a 
nonresident alien individual, fiduciary, and partnership) who is a 
resident of Denmark, or a Danish corporation, who derives from sources 
within the United States in any taxable year beginning on or after 
January 1, 1948, income from real property (not including interest 
derived from mortgages or bonds secured by real property) or royalties 
from the operation of mines, quarries, oil wells or other natural 
resources may, for such taxable year, elect to be subject to Federal 
income tax as if such alien or corporation were engaged in trade or 
business within the United States by reason of having a permanent 
establishment therein during such taxable year. Such election shall be 
made by so signifying on the return for such year. The election so 
signified shall be irrevocable for the taxable year for which such 
election is made. In such case a return may be filed by the nonresident 
alien or foreign corporation even though the sole income of such alien 
or corporation from sources within the United States is fixed or 
determinable annual or periodical income upon which the tax has been 
fully satisfied at the source and there exists no necessity for the 
filing of the return except for the purposes of securing the benefits of 
Article IX of the convention. See Sec. 29.217-2 of Regulations 111 (26 
CFR 1949 ed. Supps. 29.217-2) [and Sec. 39.217-2 of Regulations 118 (26 
CFR, Rev. 1953, Parts 1-79, and Supps.)]



Sec. 521.110  Government wages, salaries, pensions and similar remuneration.

    Under Article X (1) of the convention any wage, salary, similar 
compensation or pension paid by the Government of Denmark or by any 
other public authority within Denmark to an individual in the United 
States is exempt from Federal income tax for taxable years beginning on 
and after January 1, 1948. By reason, however, of the application of 
Article XV (a) of the convention, such exemption does not apply to 
recipients of such income who are either citizens of the United States 
or alien residents therein. As to the taxation generally of compensation 
of alien employees of foreign governments, see section 116(h) of the 
Internal Revenue Code and Sec. 29.116-2 of Regulations 111 (26 CFR 1949 
ed. Supps. 29.116-2) [and Sec. 39.116-2 of Regulations 118 (26 CFR, Rev. 
1953, Parts 1-79, and Supps.)].



Sec. 521.111  Pensions and life annuities.

    Under the provisions of Article X(2) of the convention, private 
pensions and life annuities derived from sources within the United 
States by nonresident alien individuals who are residents of Denmark are 
exempt from Federal income tax for taxable years beginning on and after 
January 1, 1948. The term ``life annuities'' is defined in Article X(3). 
The term ``private pensions'' does not include pensions or retired pay 
paid by the United States or

[[Page 151]]

by any State or Territory of the United States; it does include periodic 
payments made in consideration for services rendered or by way of 
compensation for injuries received.



Sec. 521.112  Compensation for labor or personal services.

    Article XI of the convention adopts the principle that compensation 
for labor or personal services, including the practice of the liberal 
professions, is subject to tax only in the contracting State in which 
such services are rendered. Hence, in general, such compensation derived 
by a nonresident alien individual residing in Denmark for services 
rendered in the United States is subject to Federal income tax. Under 
Article XI of the convention this general rule is subject to the 
following exceptions:
    (a) Where such individual is temporarily present in the United 
States for a period or periods not exceeding a total of 90 days during 
the taxable year, compensation received for labor or personal services 
within the United States during such year is exempt from Federal income 
tax provided such compensation does not exceed $3,000 in the aggregate.
    (b) Where such individual is temporarily present in the United 
States for a period or periods not exceeding a total of 180 days during 
the taxable year, compensation for labor or personal services within the 
United States during such year is exempt from Federal income tax 
provided such compensation is received for services performed as a 
worker or employee of, or under contract with, a resident or corporation 
of Denmark (even though such resident or corporation is engaged in trade 
or business in the United States) which resident or corporation actually 
bears the expense of such compensation and is not reimbursed therefor by 
another person.
    As to the source of compensation for labor or personal services, see 
section 119(a)(3) of the Internal Revenue Code.



Sec. 521.113  Students and apprentices; remittances.

    Under Article XIII of the convention, citizens of Denmark who are 
temporarily present in the United States as students or apprentices 
exclusively for the purposes of study or for acquiring business 
experience, are exempt for taxable years beginning on or after January 
1, 1948, from Federal income tax upon amounts representing remittances 
from sources outside the United States for the purposes of their 
maintenance or studies.



Sec. 521.114  Visiting professors or teachers.

    Under Article XIV of the convention, an alien who is a resident of 
Denmark but who is temporarily present within the United States for the 
purpose of teaching, lecturing, or instructing at any university, 
college, school, or other educational institution, situated within the 
United States, is, for a period not exceeding two years from the date of 
his arrival in the United States, exempt for taxable years beginning on 
or after January 1, 1948, from Federal income tax on remuneration 
received for such services. It shall be deemed that such alien coming to 
the United States for the purposes indicated has, for a period of not 
more than two years immediately succeeding the date of his arrival 
within the United States for such purposes, the tax status of a 
nonresident alien in the absence of proof of his intention to remain 
indefinitely in the United States.



Sec. 521.115  Credit against United States tax liability for Danish tax.

    For the purpose of avoidance of double taxation, Article XV provides 
that, on the part of the United States, there shall be allowed against 
the United States income tax a credit for the amount of Danish taxes 
described in Article I of the convention imposed on income derived from 
sources within Denmark for taxable years beginning on and after January 
1, 1948. Such credit, however, is subject to the limitations provided in 
section 131 of the Internal Revenue Code (relating to the credit for 
foreign taxes). See Secs. 29.131-1 to 29.131-10 of Regulations 111 (26 
CFR 1949 ed. Supps. 29.131-1 to 29.131-10) [and Secs. 39.131(a) 1 to 
39.131(j)-1 of Regulations 118 (26 CFR, Rev. 1953, Parts 1-79, and 
Supps.)].

[[Page 152]]



Sec. 521.116  Reciprocal administrative assistance.

    (a) General. (1) By Article XVII of the convention, the United 
States and Denmark adopt the principle of exchange of such information 
as is necessary for carrying out the provisions of the convention or for 
the prevention of fraud or for the detection of practices which are 
aimed at reduction of the revenues of either country, but not including 
information which would disclose a trade, business, industrial or 
professional secret or trade process.
    (2) The information and correspondence relative to exchange of 
information may be transmitted directly by the Commissioner of Internal 
Revenue to the Chief of the Taxation Department of the Ministry of 
Finance (Generaldirektoren for Skattevaesenet) of Denmark.
    (b) Information to be furnished in due course. (1) Pursuant to such 
principle, withholding agents shall, in the preparation of withholding 
returns, Form 1042, report on such returns, for the calendar year 1949 
and each subsequent calendar year, in addition to the items of income 
upon which tax has been withheld at the source, those items of income 
paid to a nonresident alien individual resident in Denmark, or to a 
Danish corporation, upon which tax has not been withheld at the source. 
Such return shall show the same information with respect to such items 
of income upon which tax has not been withheld at the source as is shown 
with respect to items of income upon which the tax has been withheld at 
the source.
    (2) In accordance with the provisions of Article XVII of the 
convention, the Commissioner of Internal Revenue will transmit to the 
Chief of the Taxation Department of the Ministry of Finance of Denmark, 
as soon as practicable after the close of the calendar year 1949, and of 
each calendar year thereafter during which the convention is in effect, 
the following information relating to such calendar year: The names and 
addresses of all persons whose addresses are in Denmark as disclosed on 
such withholding return, Form 1042, deriving from sources within the 
United States dividends interest (other than coupon bond interest), 
rents, royalties, salaries, wages, pensions, annuities and other fixed 
or determinable annual or periodical profits or income, and the amount 
of such income with respect to such persons as disclosed on such return, 
together with ownership certificate, Form 1001-D, filed in connection 
with coupon bond interest. Such transmission shall constitute compliance 
with Article XVII of the convention and of Secs. 521.101 to 521.117.
    (c) Information in specific cases. Under the provisions and 
limitations of Article XVII of the convention, and subject to the 
provisions of Article XIX and Article XXII of the convention, and upon 
the request of the Chief of the Taxation Department of the Ministry of 
Finance of Denmark, the Commissioner of Internal Revenue shall furnish 
to the Chief of the Taxation Department information available to or 
obtainable by the Commissioner of Internal Revenue relative to the tax 
liability of any person under the revenue laws of Denmark in any case in 
which such information is necessary to the administration of the 
provisions of the convention or for the prevention of fraud or the 
administration of statutory provisions against tax avoidance.



Sec. 521.117  Claims in cases of double taxation.

    Under Article XX of the convention, where the action of the revenue 
authorities of the contracting States has resulted in double taxation in 
respect of any of the taxes to which the convention relates, the 
taxpayer is entitled to lodge a claim with the country of which he is a 
citizen or, if he is not a citizen of either country, with the country 
of which he is a resident, or if the taxpayer is a corporation or other 
entity, with the country in which it is created or organized. Article XX 
further provides that should the claim be upheld, the competent 
authority of the country with which the claim is lodged may come to an 
agreement with the competent authority of the other country with a view 
to equitable avoidance of the double taxation. Such a claim on behalf of 
a United States citizen or corporation or other entity, or on behalf of 
a resident of the United States who is not a Danish citizen, shall be 
filed with the Commissioner of Internal

[[Page 153]]

Revenue, Washington, D.C. The claim should be set up in the form of a 
letter and should show fully all facts on the basis of which the 
claimant alleges that such double taxation has resulted. If the 
Commissioner of Internal Revenue determines that there is an appropriate 
basis for the claim under the convention, he will take the matter up 
with the Chief of the Taxation Department of the Ministry of Finance of 
Denmark with a view to arranging an agreement of the character 
contemplated by Article XX.


[[Page 155]]



                              FINDING AIDS




  --------------------------------------------------------------------

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.


  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  Table of OMB Control Numbers
  List of CFR Sections Affected



[[Page 157]]



                    Table of CFR Titles and Chapters




                     (Revised as of March 31, 1999)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
        IV  Miscellaneous Agencies (Parts 400--500)

                          Title 2--[Reserved]

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  General Accounting Office (Parts 1--99)
        II  Federal Claims Collection Standards (General 
                Accounting Office--Department of Justice) (Parts 
                100--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
        IV  Advisory Committee on Federal Pay (Parts 1400--1499)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
       VII  Advisory Commission on Intergovernmental Relations 
                (Parts 1700--1799)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Part 2100)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)

[[Page 158]]

      XXII  Federal Deposit Insurance Corporation (Part 3201)
     XXIII  Department of Energy (Part 3301)
      XXIV  Federal Energy Regulatory Commission (Part 3401)
       XXV  Department of the Interior (Part 3501)
      XXVI  Department of Defense (Part 3601)
    XXVIII  Department of Justice (Part 3801)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)
    XXXIII  Overseas Private Investment Corporation (Part 4301)
      XXXV  Office of Personnel Management (Part 4501)
        XL  Interstate Commerce Commission (Part 5001)
       XLI  Commodity Futures Trading Commission (Part 5101)
      XLII  Department of Labor (Part 5201)
     XLIII  National Science Foundation (Part 5301)
       XLV  Department of Health and Human Services (Part 5501)
      XLVI  Postal Rate Commission (Part 5601)
     XLVII  Federal Trade Commission (Part 5701)
    XLVIII  Nuclear Regulatory Commission (Part 5801)
         L  Department of Transportation (Part 6001)
       LII  Export-Import Bank of the United States (Part 6201)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Part 6401)
      LVII  General Services Administration (Part 6701)
     LVIII  Board of Governors of the Federal Reserve System (Part 
                6801)
       LIX  National Aeronautics and Space Administration (Part 
                6901)
        LX  United States Postal Service (Part 7001)
       LXI  National Labor Relations Board (Part 7101)
      LXII  Equal Employment Opportunity Commission (Part 7201)
     LXIII  Inter-American Foundation (Part 7301)
       LXV  Department of Housing and Urban Development (Part 
                7501)
      LXVI  National Archives and Records Administration (Part 
                7601)
      LXIX  Tennessee Valley Authority (Part 7901)
      LXXI  Consumer Product Safety Commission (Part 8101)
     LXXIV  Federal Mine Safety and Health Review Commission (Part 
                8401)
     LXXVI  Federal Retirement Thrift Investment Board (Part 8601)
    LXXVII  Office of Management and Budget (Part 8701)

                          Title 6--[Reserved]

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture

[[Page 159]]

         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)
        II  Food and Nutrition Service, Department of Agriculture 
                (Parts 210--299)
       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
      XIII  Northeast Dairy Compact Commission (Parts 1300--1399)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy, Department of Agriculture (Parts 
                2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)
      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  Office of Procurement and Property Management, 
                Department of Agriculture (Parts 3200--3299)

[[Page 160]]

    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)
     XXXIV  Cooperative State Research, Education, and Extension 
                Service, Department of Agriculture (Parts 3400--
                3499)
      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)
     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)

                    Title 8--Aliens and Nationality

         I  Immigration and Naturalization Service, Department of 
                Justice (Parts 1--499)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Department of 
                Agriculture (Parts 300--599)

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)
        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)

[[Page 161]]

        IV  Export-Import Bank of the United States (Parts 400--
                499)
         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)
      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Department of the Treasury (Parts 1500--1599)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700--1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Department of Commerce, Economic Development 
                Administration, (Parts 300--399)

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--499)
         V  National Aeronautics and Space Administration (Parts 
                1200--1299)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Export Administration, Department of 
                Commerce (Parts 700--799)

[[Page 162]]

      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)
        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)
            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  United States Customs Service, Department of the 
                Treasury (Parts 1--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)

[[Page 163]]

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)
       III  Social Security Administration (Parts 400--499)
        IV  Employees' Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Employment Standards Administration, Department of 
                Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)
        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training, Department of Labor 
                (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  United States Information Agency (Parts 500--599)
       VII  Overseas Private Investment Corporation, International 
                Development Cooperation Agency (Parts 700--799)
        IX  Foreign Service Grievance Board Regulations (Parts 
                900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Board for International Broadcasting (Parts 1300--
                1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

[[Page 164]]

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
        IV  Office of Multifamily Housing Assistance 
                Restructuring, Department of Housing and Urban 
                Development (Parts 400--499)
         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)
        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs, Section 202 Direct Loan Program, Section 
                202 Supportive Housing for the Elderly Program and 
                Section 811 Supportive Housing for Persons With 
                Disabilities Program) (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--999)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

[[Page 165]]

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Part 1001)
       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Part 1200)

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--799)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Bureau of Alcohol, Tobacco and Firearms, Department of 
                the Treasury (Parts 1--299)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--199)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)

[[Page 166]]

       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Pension and Welfare Benefits Administration, 
                Department of Labor (Parts 2500--2599)
     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Minerals Management Service, Department of the 
                Interior (Parts 200--299)
       III  Board of Surface Mining and Reclamation Appeals, 
                Department of the Interior (Parts 300--399)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
        VI  Bureau of Mines, Department of the Interior (Parts 
                600--699)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)

[[Page 167]]

       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense
       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)
    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)
      XXIX  Presidential Commission on the Assignment of Women in 
                the Armed Forces (Part 2900)

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvement, 
                Department of Education (Parts 700--799)
        XI  National Institute for Literacy (Parts 1100--1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

[[Page 168]]

                        Title 35--Panama Canal

         I  Panama Canal Regulations (Parts 1--299)

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)
        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
         X  Presidio Trust (Parts 1000--1099)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
       XIV  Assassination Records Review Board (Parts 1400--1499)

             Title 37--Patents, Trademarks, and Copyrights

         I  Patent and Trademark Office, Department of Commerce 
                (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--99)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Rate Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--799)
         V  Council on Environmental Quality (Parts 1500--1599)

          Title 41--Public Contracts and Property Management

            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)

[[Page 169]]

        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans 
                Employment and Training, Department of Labor 
                (Parts 61-1--61-999)
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System
       201  Federal Information Resources Management Regulation 
                (Parts 201-1--201-99) [Reserved]
            Subtitle F--Federal Travel Regulation System
       300  General (Parts 300-1--300.99)
       301  Temporary Duty (TDY) Travel Allowances (Parts 301-1--
                301-99)
       302  Relocation Allowances (Parts 302-1--302-99)
       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Parts 303-1--303-2)
       304  Payment from a Non-Federal Source for Travel Expenses 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Health Care Financing Administration, Department of 
                Health and Human Services (Parts 400--499)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 200--499)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)

[[Page 170]]

       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10005)

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899)
         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  Corporation for National and Community Service (Parts 
                1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)
      XXII  Christopher Columbus Quincentenary Jubilee Commission 
                (Parts 2200--2299)
     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

[[Page 171]]

                          Title 46--Shipping

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
       III  Coast Guard (Great Lakes Pilotage), Department of 
                Transportation (Parts 400--499)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Department of Defense (Parts 200--299)
         3  Department of Health and Human Services (Parts 300--
                399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  United States Agency for International Development 
                (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)
        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)
        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  United States Information Agency (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)
        29  Department of Labor (Parts 2900--2999)

[[Page 172]]

        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        35  Panama Canal Commission (Parts 3500--3599)
        44  Federal Emergency Management Agency (Parts 4400--4499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement (Parts 5300--5399)
        54  Defense Logistics Agency, Department of Defense (Part 
                5452)
        57  African Development Foundation (Parts 5700--5799)
        61  General Services Administration Board of Contract 
                Appeals (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Research and Special Programs Administration, 
                Department of Transportation (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)
       III  Federal Highway Administration, Department of 
                Transportation (Parts 300--399)
        IV  Coast Guard, Department of Transportation (Parts 400--
                499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)
       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)
        XI  Bureau of Transportation Statistics, Department of 
                Transportation (Parts 1400--1499)

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)

[[Page 173]]

        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR



[[Page 175]]





           Alphabetical List of Agencies Appearing in the CFR




                     (Revised as of March 31, 1999)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
Advisory Commission on Intergovernmental          5, VII
     Relations
Advisory Committee on Federal Pay                 5, IV
Advisory Council on Historic Preservation         36, VIII
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development              22, II
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Cooperative State Research, Education, and      7, XXXIV
       Extension Service
  Economic Research Service                       7, XXXVII
  Energy, Office of                               7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Nutrition Service                      7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Procurement and Property Management, Office of  7, XXXII
  Rural Business-Cooperative Service              7, XVIII, XLII
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Alcohol, Tobacco and Firearms, Bureau of          27, I
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII
Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX

[[Page 176]]

Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Assassination Records Review Board                36, XIV
Benefits Review Board                             20, VII
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase From People Who Are
Board for International Broadcasting              22, XIII
Census Bureau                                     15, I
Central Intelligence Agency                       32, XIX
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Christopher Columbus Quincentenary Jubilee        45, XXII
     Commission
Civil Rights, Commission on                       45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Coast Guard (Great Lakes Pilotage)                46, III
Commerce Department                               44, IV
  Census Bureau                                   15, I`
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Export Administration, Bureau of                15, VII
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV, VI
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office                     37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Product Safety Commission                5, LXXI; 16, II
Cooperative State Research, Education, and        7, XXXIV
     Extension Service
Copyright Office                                  37, II
Corporation for National and Community Service    45, XII, XXV
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Customs Service, United States                    19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A
  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII

[[Page 177]]

  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 2
  National Imagery and Mapping Agency             32, I
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Elementary and Secondary Education, Office of     34, II
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             5, XXIII; 10, II, III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Environmental Protection Agency                   5, LIV; 40, I
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV
  Environmental Quality, Council on               40, V
  Management and Budget, Office of                25, III, LXXVII; 48, 99
  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export Administration, Bureau of                  15, VII
Export-Import Bank of the United States           5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV
Farm Service Agency                               7, VII, XVIII
Federal Acquisition Regulation                    48, 1

[[Page 178]]

Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               4, II
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       11, I
Federal Emergency Management Agency               44, I
  Federal Acquisition Regulation                  48, 44
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II; 49, III
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Board                     12, IX
Federal Labor Relations Authority, and General    5, XIV; 22, XIV
     Counsel of the Federal Labor Relations 
     Authority
Federal Law Enforcement Training Center           31, VII
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Pay, Advisory Committee on                5, IV
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Property Management Regulations System    41, Subtitle C
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Fishery Conservation and Management               50, VI
Food and Drug Administration                      21, I
Food and Nutrition Service                        7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX
Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II
General Accounting Office                         4, I, II
General Services Administration                   5, LVII
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Property Management Regulations System  41, 101, 105
  Federal Travel Regulation System                41, Subtitle F
  General                                         41, 300
  Payment From a Non-Federal Source for Travel    41, 304
       Expenses
  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302

[[Page 179]]

  Temporary Duty (TDY) Travel Allowances          41, 301
Geological Survey                                 30, IV
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          5, XLV; 45, Subtitle A
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Health Care Financing Administration            42, IV
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Health Care Financing Administration              42, IV
Housing and Urban Development, Department of      5, LXV; 24, Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Inspector General, Office of                    24, XII
  Multifamily Housing Assistance Restructuring,   24, IV
       Office of
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Human Development Services, Office of             45, XIII
Immigration and Naturalization Service            8, I
Independent Counsel, Office of                    28, VII
Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Information Agency, United States                 22, V
  Federal Acquisition Regulation                  48, 19
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Intergovernmental Relations, Advisory Commission  5, VII
     on
Interior Department
  American Indians, Office of the Special         25, VII
       Trustee
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II
  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II
  Mines, Bureau of                                30, VI

[[Page 180]]

  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            43, Subtitle A
  Surface Mining and Reclamation Appeals, Board   30, III
       of
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, Agency for             22, II
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
  International Development, Agency for           22, II; 48, 7
  Overseas Private Investment Corporation         5, XXXIII; 22, VII
International Fishing and Related Activities      50, III
International Investment, Office of               31, VIII
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                5, XXVIII; 28, I
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             4, II
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration and Naturalization Service          8, I
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII
  Benefits Review Board                           20, VII
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V
  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Pension and Welfare Benefits Administration     29, XXV
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training, Office of    41, 61; 20, IX
       the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
Management and Budget, Office of                  5, III, LXXVII; 48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II
Micronesian Status Negotiations, Office for       32, XXVII
Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II
Mines, Bureau of                                  30, VI

[[Page 181]]

Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
Multifamily Housing Assistance Restructuring,     24, IV
     Office of
National Aeronautics and Space Administration     5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National Archives and Records Administration      5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Bureau of Standards                      15, II
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National and Community Service, Corporation for   45, XII, XXV
National Council on Disability                    34, XII
National Credit Union Administration              12, VII
National Drug Control Policy, Office of           21, III
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 49, V
National Imagery and Mapping Agency               32, I
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Standards and Technology    15, II
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV, VI
National Mediation Board                          29, X
National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII
National Science Foundation                       5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III
     Administration
National Transportation Safety Board              49, VIII
National Weather Service                          15, IX
Natural Resources Conservation Service            7, VI
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Dairy Compact Commission                7, XIII
Nuclear Regulatory Commission                     5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Offices of Independent Counsel                    28, VI
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Panama Canal Commission                           48, 35
Panama Canal Regulations                          35, I
Patent and Trademark Office                       37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension and Welfare Benefits Administration       29, XXV
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII
  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
     Acquisition Regulation
[[Page 182]]

  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Postal Rate Commission                            5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Commission on the Assignment of      32, XXIX
     Women in the Armed Forces
Presidential Documents                            3
Presidio Trust                                    36, X
Prisons, Bureau of                                28, V
Procurement and Property Management, Office of    7, XXXII
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Refugee Resettlement, Office of                   45, IV
Regional Action Planning Commissions              13, V
Relocation Allowances                             41, 302
Research and Special Programs Administration      49, I
Rural Business-Cooperative Service                7, XVIII, XLII
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV
Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
     National Security Council
Secret Service                                    31, IV
Securities and Exchange Commission                17, II
Selective Service System                          32, XVI
Small Business Administration                     13, I
Smithsonian Institution                           36, V
Social Security Administration                    20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  22, I
  Federal Acquisition Regulation                  48, 6
Surface Mining and Reclamation Appeals, Board of  30, III
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     5, L
  Coast Guard                                     33, I; 46, I; 49, IV
  Coast Guard (Great Lakes Pilotage)              46, III
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II; 49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 49, V
  Research and Special Programs Administration    49, I
  Saint Lawrence Seaway Development Corporation   33, IV

[[Page 183]]

  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X
  Transportation Statistics Bureau                49, XI
Transportation, Office of                         7, XXXIII
Transportation Statistics Brureau                 49, XI
Travel Allowances, Temporary Duty (TDY)           41, 301
Treasury Department                               5, XXI; 12, XV; 17, IV
  Alcohol, Tobacco and Firearms, Bureau of        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs Service, United States                  19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Law Enforcement Training Center         31, VII
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  International Investment, Office of             31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII
United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training, Office of the  41, 61; 20, IX
     Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 185]]

                                     

                                     



                   Table of OMB Control NumbersSecs. 



     PART 602--OMB CONTROL NUMBERS UNDER THE PAPERWORK REDUCTION ACT

Sec. 602.101  OMB Control numbers.

    (a) Purpose. This part collects and displays the control numbers 
assigned to collections of information in Internal Revenue Service 
regulations by the Office of Management and Budget (OMB) under the 
Paperwork Reduction Act of 1980. The Internal Revenue Service intends 
that this part comply with the requirements of Secs. 1320.7(f), 1320.12, 
1320.13, and 1320.14 of 5 CFR part 1320 (OMB regulations implementing 
the Paperwork Reduction Act), for the display of control numbers 
assigned by OMB to collections of information in Internal Revenue 
Service regulations. This part does not display control numbers assigned 
by the Office of Management and Budget to collections of information of 
the Bureau of Alcohol, Tobacco, and Firearms.
    (b) Display.

------------------------------------------------------------------------
                                                             Current OMB
     CFR part or section where identified and described      control No.
------------------------------------------------------------------------
1.23-5.....................................................    1545-0074
1.25-1T....................................................    1545-0922
                                                               1545-0930
1.25-2T....................................................    1545-0922
                                                               1545-0930
1.25-3T....................................................    1545-0922
                                                               1545-0930
1.25-4T....................................................    1545-0922
1.25-5T....................................................    1545-0922
1.25-6T....................................................    1545-0922
1.25-7T....................................................    1545-0922
1.25-8T....................................................    1545-0922
1.28-1.....................................................    1545-0619
1.31-2.....................................................    1545-0074
1.32-2.....................................................    1545-0074
1.32-3T....................................................    1545-1575
1.37-1.....................................................    1545-0074
1.37-3.....................................................    1545-0074
1.41-2.....................................................    1545-0619
1.41-3.....................................................    1545-0619
1.41-4A....................................................    1545-0074
1.41-4 (b) and (c).........................................    1545-0074
1.41-8(d)..................................................    1545-0732
1.41-9.....................................................    1545-0619
1.42-1T....................................................    1545-0984
                                                               1545-0988
1.42-2.....................................................    1545-1005
1.42-5.....................................................    1545-1291
1.42-6.....................................................    1545-1102
1.42-8.....................................................    1545-1102
1.42-10....................................................    1545-1102
1.42-13....................................................    1545-1357
1.42-14....................................................    1545-1423
1.43-3(a)(3)...............................................    1545-1292
1.43-3(b)(3)...............................................    1545-1292
1.44A-1....................................................    1545-0068
1.44A-3....................................................    1545-0074
1.44B-1....................................................    1545-0219
1.458-1....................................................    1545-0879
1.458-2....................................................    1545-0152
1.46-1.....................................................    1545-0123
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1.48-4.....................................................    1545-0808
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1.48-12....................................................    1545-0155
1.50A-1....................................................    1545-0895
1.50A-2....................................................    1545-0895
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1.50A-5....................................................    1545-0895
1.50A-6....................................................    1545-0895
1.50A-7....................................................    1545-0895
1.50B-1....................................................    1545-0895
1.50B-2....................................................    1545-0895
1.50B-3....................................................    1545-0895
1.50B-4....................................................    1545-0895
1.50B-5....................................................    1545-0895
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1.56A-1....................................................    1545-0227
1.56A-2....................................................    1545-0227
1.56A-3....................................................    1545-0227
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1.57-5.....................................................    1545-0227
1.58-1.....................................................    1545-0175
1.58-9(c)(5)(iii)(B).......................................    1545-1093
1.58-9(e)(3)...............................................    1545-1093
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1.72-17A...................................................    1545-0074
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1.103-15AT.................................................    1545-0720
1.103-18...................................................    1545-1226
1.103(n)-2T................................................    1545-0874
1.103(n)-4T................................................    1545-0874
1.103A-2...................................................    1545-0720
1.105-4....................................................    1545-0074
1.105-5....................................................    1545-0074
1.105-6....................................................    1545-0074
1.108-4....................................................    1545-1539
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1.127-2....................................................    1545-0768
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1.167(a)-5T................................................    1545-1021
1.167(a)-7.................................................    1545-0172
1.167(a)-11................................................    1545-0152
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1.168(d)-1.................................................    1545-1146
1.168(f)(8)-1T.............................................    1545-0923
1.168(i)-1.................................................    1545-1331
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1.169-4....................................................    1545-0172
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1.170A-2...................................................    1545-0074
1.170A-4(A)(b).............................................    1545-0123
1.170A-8...................................................    1545-0074
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1.170A-13(f)...............................................    1545-1464
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1.190-3....................................................    1545-0074
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1.194-4....................................................    1545-0735
1.195-1....................................................   1545-1582.
1.197-1T...................................................    1545-1425
1.213-1....................................................    1545-0074
1.215-1T...................................................    1545-0074
1.217-2....................................................    1545-0182
1.243-3....................................................    1545-0123
1.243-4....................................................    1545-0123
1.243-5....................................................    1545-0123
1.248-1....................................................    1545-0172
1.261-1....................................................    1545-1041
1.263(e)-1.................................................    1545-0123
1.263A-1...................................................    1545-0987
1.263A-1T..................................................    1545-0187
1.263A-2...................................................    1545-0987
1.263A-3...................................................    1545-0987
                                                               1545-0987
1.263A-8(b)(2)(iii)........................................    1545-1265
1.263A-9(d)(1).............................................    1545-1265
1.263A-9(f)(1)(ii).........................................    1545-1265
1.263A-9(f)(2)(iv).........................................    1545-1265
1.263A-9(g)(2)(iv)(C)......................................    1545-1265
1.263A-9(g)(3)(iv).........................................    1545-1265
1.265-1....................................................    1545-0074
1.265-2....................................................    1545-0123
1.266-1....................................................    1545-0123
1.267(f)-1.................................................    1545-0885
1.268-1....................................................    1545-0184
1.274-1....................................................    1545-0139
1.274-2....................................................    1545-0139
1.274-3....................................................    1545-0139
1.274-4....................................................    1545-0139
1.274-5A...................................................    1545-0139
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1.274-5T...................................................    1545-0074
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1.274-6....................................................    1545-0139
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1.274-6T...................................................    1545-0074
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1.274-7....................................................    1545-0139
1.274-8....................................................    1545-0139
1.279-6....................................................    1545-0123
1.280C-4...................................................    1545-1155
1.280F-3T..................................................    1545-0074
1.281-4....................................................    1545-0123
1.302-4....................................................    1545-0074
1.305-3....................................................    1545-0123
1.305-5....................................................    1545-1438
1.307-2....................................................    1545-0074
1.312-15...................................................    1545-0172
1.316-1....................................................    1545-0123
1.331-1....................................................    1545-0074
1.332-4....................................................    1545-0123
1.332-6....................................................    1545-0123
1.337(d)-1.................................................    1545-1160
1.337(d)-2.................................................    1545-1160
1.337(d)-4.................................................    1545-1633
1.338-1....................................................    1545-1295
1.338(b)-1.................................................    1545-1295
1.338(h)(10)-1.............................................    1545-1295
1.341-7....................................................    1545-0123
1.351-3....................................................    1545-0074
1.355-5....................................................    1545-0123
1.362-2....................................................    1545-0123
1.367(a)-1T................................................    1545-0026
1.367(a)-2T................................................    1545-0026
1.367(a)-3.................................................    1545-0026
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1.367(a)-6T................................................    1545-0026
1.367(a)-8.................................................    1545-1271
1.367(d)-1T................................................    1545-0026
1.367(e)-1T................................................    1545-1487
1.367(e)-2T................................................    1545-1124
1.368-3....................................................    1545-0123
1.371-1....................................................    1545-0123
1.371-2....................................................    1545-0123
1.374-3....................................................    1545-0123
1.381(b)-1.................................................    1545-0123
1.381(c)(4)-1..............................................    1545-0123
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1.381(c)(5)-1..............................................    1545-0123
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1.381(c)(6)-1..............................................    1545-0123
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1.381(c)(8)-1..............................................    1545-0123
1.381(c)(10)-1.............................................    1545-0123
1.381(c)(11)-1(k)..........................................    1545-0123
1.381(c)(13)-1.............................................    1545-0123
1.381(c)(17)-1.............................................    1545-0045
1.381(c)(25)-1.............................................    1545-0045
1.382-1T...................................................    1545-0123
1.382-2....................................................    1545-0123
1.382-2T...................................................    1545-0123
1.382-3....................................................    1545-1281
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1.382-6....................................................    1545-1381
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1.382-91...................................................    1545-1260
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1.383-1....................................................    1545-0074
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1.401(a)-11................................................    1545-0710
1.401(a)-20................................................    1545-0928
1.401(a)-31................................................    1545-1341
1.401(a)-50................................................    1545-0710
1.401(a)(31)-1.............................................    1545-1341
1.401(b)-1.................................................    1545-0197
1.401(f)-1.................................................    1545-0710
1.401(k)-1.................................................    1545-1039
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1.401-1....................................................    1545-0020
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1.401-12(n)................................................    1545-0806
1.401-14...................................................    1545-0710
1.402(c)-2.................................................    1545-1341
1.402(f)-1.................................................    1545-1341
1.403(b)-1.................................................    1545-0710
1.403(b)-2.................................................    1545-1341
1.404(a)-4.................................................    1545-0710
1.404(a)-12................................................    1545-0710
1.404A-2...................................................    1545-0123
1.404A-6...................................................    1545-0123
1.408-2....................................................    1545-0390
1.408-5....................................................    1545-0747
1.408-6....................................................    1545-0203
                                                               1545-0390
1.408-7....................................................    1545-0119
1.408A-2...................................................    1545-1616
1.408A-4...................................................    1545-1616
1.408A-5...................................................    1545-1616
1.408A-7...................................................    1545-1616
1.410(a)-2.................................................    1545-0710
1.410(d)-1.................................................    1545-0710
1.411(a)-11................................................    1545-1471
1.411(d)-4.................................................    1545-1545
1.411(d)-6.................................................    1545-1477
1.412(b)-5.................................................    1545-0710
1.412(c)(1)-2..............................................    1545-0710
1.412(c)(2)-1..............................................    1545-0710
1.412(c)(3)-2..............................................    1545-0710
1.414(c)-5.................................................    1545-0797
1.414(r)-1.................................................    1545-1221
1.415-2....................................................    1545-0710
1.415-6....................................................    1545-0710
1.417(e)-1.................................................    1545-1471
1.417(e)-1T................................................    1545-1471
1.441-3T...................................................    1545-0134
1.442-1....................................................    1545-0074
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1.442-3T...................................................    1545-0134
1.443-1....................................................    1545-0123
1.444-3T...................................................    1545-1036
1.446-1....................................................    1545-0074
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1.446-4(d).................................................    1545-1412
1.448-1(g).................................................    1545-0152
1.448-1(h).................................................    1545-0152
1.448-1(i).................................................    1545-0152
1.448-2T...................................................    1545-0152
1.451-1....................................................    1545-0091
1.451-3....................................................    1545-0152
                                                               1545-0736
1.451-4....................................................    1545-0123
1.451-5....................................................    1545-0074
1.451-6....................................................    1545-0074
1.451-7....................................................    1545-0074
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1.453-2....................................................    1545-0152
1.453-8....................................................    1545-0152
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1.453-10...................................................    1545-0152
1.453A-1...................................................    1545-0152
                                                               1545-1134
1.453A-2...................................................    1545-0152
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1.453A-3...................................................    1545-0963
1.454-1....................................................    1545-0074
1.455-2....................................................    1545-0152
1.455-6....................................................    1545-0123
1.456-2....................................................    1545-0123
1.456-6....................................................    1545-0123
1.456-7....................................................    1545-0123
1.458-1....................................................    1545-0879
1.458-2....................................................    1545-0152
1.460-6....................................................    1545-1031
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1.461-1....................................................    1545-0074
1.461-2....................................................    1545-0096
1.461-4....................................................    1545-0917
1.461-5....................................................    1545-0917
1.463-1T...................................................    1545-0916
1.465-1T...................................................    1545-0712
1.466-1T...................................................    1545-0152
1.466-4....................................................    1545-0152
1.468A-3...................................................    1545-1269
                                                               1545-1378
                                                               1545-1511
1.468A-4...................................................    1545-0954
1.468A-7...................................................    1545-0954
1.468A-8...................................................    1545-1269
1.468B-1(j)................................................    1545-1299
1.468B-2(k)................................................    1545-1299
1.468B-2(l)................................................    1545-1299
1.468B-3(b)................................................    1545-1299
1.468B-3(e)................................................    1545-1299
1.468B-5(b)................................................    1545-1299
1.469-1....................................................    1545-1008
1.469-2T...................................................    1545-0712
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1.469-4T...................................................    1545-0985
                                                               1545-1037
1.471-2....................................................    1545-0123
1.471-5....................................................    1545-0123
1.471-6....................................................    1545-0123
1.471-8....................................................    1545-0123
1.471-11...................................................    1545-0123
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1.472-1....................................................    1545-0042
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1.472-2....................................................    1545-0152
1.472-3....................................................    1545-0042
1.472-5....................................................    1545-0152
1.472-8....................................................    1545-0028
                                                               1545-0042
1.475(b)-4.................................................    1545-1496
1.481-4....................................................    1545-0152
1.481-5....................................................    1545-0152
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1.482-7....................................................    1545-1364
1.501(a)-1.................................................    1545-0056
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1.501(c)(3)-1..............................................    1545-0056
1.501(c)(9)-5..............................................    1545-0047
1.501(c)(17)-3.............................................    1545-0047
1.501(e)-1.................................................    1545-0814
1.503(c)-1.................................................    1545-0047
                                                               1545-0052
1.505(c)-1T................................................    1545-0916
1.507-1....................................................    1545-0052
1.507-2....................................................    1545-0052
1.508-1....................................................    1545-0052
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1.509(a)-3.................................................    1545-0047
1.509(a)-5.................................................    1545-0047
1.509(c)-1.................................................    1545-0052
1.512(a)-1.................................................    1545-0687
1.512(a)-4.................................................    1545-0047
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1.521-1....................................................    1545-0051
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1.527-2....................................................    1545-0129
1.527-5....................................................    1545-0129
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1.527-9....................................................    1545-0129
1.528-8....................................................    1545-0127
1.533-2....................................................    1545-0123
1.534-2....................................................    1545-0123
1.542-3....................................................    1545-0123
1.545-2....................................................    1545-0123
1.545-3....................................................    1545-0123
1.547-2....................................................    1545-0045
                                                               1545-0123
1.547-3....................................................    1545-0123
1.551-4....................................................    1545-0074
1.552-3....................................................    1545-0099
1.552-4....................................................    1545-0099
1.552-5....................................................    1545-0099
1.556-2....................................................    1545-0704
1.561-1....................................................    1545-0044
1.561-2....................................................    1545-0123
1.562-3....................................................    1545-0123
1.563-2....................................................    1545-0123
1.564-1....................................................    1545-0123
1.565-1....................................................    1545-0043
                                                               1545-0123
1.565-2....................................................    1545-0043
1.565-3....................................................    1545-0043
1.565-5....................................................    1545-0043
1.565-6....................................................    1545-0043
1.585-1....................................................    1545-0123
1.585-3....................................................    1545-0123
1.585-8....................................................    1545-1290
1.586-2....................................................    1545-0123
1.593-1....................................................    1545-0123
1.593-6....................................................    1545-0123
1.593-6A...................................................    1545-0123
1.593-7....................................................    1545-0123
1.595-1....................................................    1545-0123
1.597-2....................................................    1545-1300
1.597-4....................................................    1545-1300
1.597-6....................................................    1545-1300
1.597-7....................................................    1545-1300
1.611-2....................................................    1545-0099
1.611-3....................................................    1545-0007
                                                               1545-0099
1.612-4....................................................    1545-0074
1.612-5....................................................    1545-0099
1.613-3....................................................    1545-0099
1.613-4....................................................    1545-0099
1.613-6....................................................    1545-0099
1.613-7....................................................    1545-0099
1.613A-3...................................................    1545-0919
1.613A-3(e)................................................    1545-1251
1.613A-3(l)................................................    1545-0919
1.613A-5...................................................    1545-0099
1.613A-6...................................................    1545-0099
1.614-2....................................................    1545-0099
1.614-3....................................................    1545-0099
1.614-5....................................................    1545-0099
1.614-6....................................................    1545-0099
1.614-8....................................................    1545-0099
1.617-1....................................................    1545-0099
1.617-3....................................................    1545-0099
1.617-4....................................................    1545-0099
1.631-1....................................................    1545-0007
1.631-2....................................................    1545-0007
1.641(b)-2.................................................    1545-0092
1.642(c)-1.................................................    1545-0092
1.642(c)-2.................................................    1545-0092
1.642(c)-5.................................................    1545-0074
1.642(c)-6.................................................    1545-0020
                                                               1545-0074
                                                               1545-0092
1.642(g)-1.................................................    1545-0092
1.642(i)-1.................................................    1545-0092
1.663(b)-2.................................................    1545-0092
1.664-1....................................................    1545-0196
1.664-1(a)(7)..............................................    1545-1536
1.664-2....................................................    1545-0196
1.664-3....................................................    1545-0196
1.664-4....................................................    1545-0020
                                                               1545-0196
1.665(a)-0A through
1.665(g)-2A................................................    1545-0192
1.666(d)-1A................................................    1545-0092
1.671-4....................................................    1545-1442
1.701-1....................................................    1545-0099
1.702-1....................................................    1545-0074
1.703-1....................................................    1545-0099
1.704-2....................................................    1545-1090
1.706-1....................................................    1545-0099
                                                               1545-0074
                                                               1545-0134
1.706-1T...................................................    1545-0099
1.707-3(c)(2)..............................................    1545-1243
1.707-5(a)(7)(ii)..........................................    1545-1243
1.707-6(c).................................................    1545-1243
1.707-8....................................................    1545-1243
1.708-1....................................................    1545-0099
1.732-1....................................................    1545-0099
1.736-1....................................................    1545-0074
1.743-1....................................................    1545-0074
1.751-1....................................................    1545-0074
                                                               1545-0099
                                                               1545-0941
1.752-5....................................................    1545-1090
1.754-1....................................................    1545-0099
1.755-1....................................................    1545-0099
1.755-2T...................................................    1545-1021
1.761-2....................................................    1545-1338
1.801-1....................................................    1545-0123
                                                               1545-0128
1.801-3....................................................    1545-0123
1.801-5....................................................    1545-0128
1.801-8....................................................    1545-0128
1.804-4....................................................    1545-0128
1.811-2....................................................    1545-0128
1.812-2....................................................    1545-0128
1.815-6....................................................    1545-0128
1.818-4....................................................    1545-0128
1.818-5....................................................    1545-0128
1.818-8....................................................    1545-0128

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1.819-2....................................................    1545-0128
1.821-1....................................................    1545-1027
1.821-3....................................................    1545-1027
1.821-4....................................................    1545-1027
1.822-5....................................................    1545-1027
1.822-6....................................................    1545-1027
1.822-8....................................................    1545-1027
1.822-9....................................................    1545-1027
1.823-2....................................................    1545-1027
1.823-5....................................................    1545-1027
1.823-6....................................................    1545-1027
1.825-1....................................................    1545-1027
1.826-1....................................................    1545-1027
1.826-2....................................................    1545-1027
1.826-3....................................................    1545-1027
1.826-4....................................................    1545-1027
1.826-6....................................................    1545-1027
1.831-3....................................................    1545-0123
1.831-4....................................................    1545-0123
1.832-4....................................................    1545-1227
1.832-5....................................................    1545-0123
1.848-2(g)(8)..............................................    1545-1287
1.848-2(h)(3)..............................................    1545-1287
1.848-2(i)(4)..............................................    1545-1287
1.851-2....................................................    1545-1010
1.851-4....................................................    1545-0123
1.852-1....................................................    1545-0123
1.852-4....................................................    1545-0123
                                                               1545-0145
1.852-6....................................................    1545-0123
                                                               1545-0144
1.852-7....................................................    1545-0074
1.852-9....................................................    1545-0074
                                                               1545-0123
                                                               1545-0144
                                                               1545-0145
1.852-11...................................................    1545-1094
1.853-3....................................................    1545-0123
1.853-4....................................................    1545-0123
1.854-2....................................................    1545-0123
1.855-1....................................................    1545-0123
1.856-2....................................................    1545-0123
                                                               1545-1004
1.856-6....................................................    1545-0123
1.856-7....................................................    1545-0123
1.856-8....................................................    1545-0123
1.857-8....................................................    1545-0123
1.857-9....................................................    1545-0074
1.858-1....................................................    1545-0123
1.860-2....................................................    1545-0045
1.860-4....................................................    1545-0045
                                                               1545-1054
                                                               1545-1057
1.860E-2(a)(5).............................................    1545-1276
1.860E-2(a)(7).............................................    1545-1276
1.860E-2(b)(2).............................................    1545-1276
1.861-2....................................................    1545-0089
1.861-3....................................................    1545-0089
1.861-8....................................................    1545-0126
1.861-8(e)(6) and (g)......................................    1545-1224
1.861-9T...................................................    1545-0121
                                                               1545-1072
1.861-18...................................................    1545-1594
1.863-1....................................................    1545-1476
1.863-3....................................................    1545-1476
                                                               1545-1556
1.863-3A...................................................    1545-0126
1.863-4....................................................    1545-0126
1.863-7....................................................    1545-0132
1.864-4....................................................    1545-0126
1.871-1....................................................    1545-0096
1.871-6....................................................    1545-0795
1.871-7....................................................    1545-0089
1.871-10...................................................    1545-0089
                                                               1545-0165
1.874-1....................................................    1545-0089
1.881-4....................................................    1545-1440
1.882-4....................................................    1545-0126
1.884-0....................................................    1545-1070
1.884-1....................................................    1545-1070
1.884-2....................................................    1545-1070
1.884-2T...................................................    1545-0126
                                                               1545-1070
1.884-4....................................................    1545-1070
1.884-5....................................................    1545-1070
1.892-1T...................................................    1545-1053
1.892-2T...................................................    1545-1053
1.892-3T...................................................    1545-1053
1.892-4T...................................................    1545-1053
1.892-5T...................................................    1545-1053
1.892-6T...................................................    1545-1053
1.892-7T...................................................    1545-1053
1.897-2....................................................    1545-0123
                                                               1545-0902
1.897-3....................................................    1545-0123
1.897-5T...................................................    1545-0902
1.897-6T...................................................    1545-0902
1.901-2....................................................    1545-0746
1.901-2A...................................................    1545-0746
1.901-3....................................................    1545-0122
1.902-1....................................................    1545-0122
                                                               1545-1458
1.904-1....................................................    1545-0121
                                                               1545-0122
1.904-2....................................................    1545-0121
                                                               1545-0122
1.904-3....................................................    1545-0121
1.904-4....................................................    1545-0121
1.904-5....................................................    1545-0121
1.904(f)-1.................................................    1545-0121
                                                               1545-0122
1.904(f)-2.................................................    1545-0121
1.904(f)-3.................................................    1545-0121
1.904(f)-4.................................................    1545-0121
1.904(f)-5.................................................    1545-0121
1.904(f)-6.................................................    1545-0121
1.904(f)-7.................................................    1545-1127
1.905-2....................................................    1545-0122
1.905-3T...................................................    1545-1056
1.905-4T...................................................    1545-1056
1.905-5T...................................................    1545-1056
1.911-1....................................................    1545-0067
                                                               1545-0070
1.911-2....................................................    1545-0067
                                                               1545-0070
1.911-3....................................................    1545-0067
                                                               1545-0070
1.911-4....................................................    1545-0067
                                                               1545-0070
1.911-5....................................................    1545-0067
                                                               1545-0070
1.911-6....................................................    1545-0067
                                                               1545-0070
1.911-7....................................................    1545-0067
                                                               1545-0070
1.913-13...................................................    1545-0067
1.921-1T...................................................    1545-0190
                                                               1545-0884
                                                               1545-0935
                                                               1545-0939
1.921-2....................................................    1545-0884
1.921-3T...................................................    1545-0935
1.923-1T...................................................    1545-0935
1.924(a)-1T................................................    1545-0935

[[Page 191]]

 
1.925(a)-1T................................................    1545-0935
1.925(b)-1T................................................    1545-0935
1.926(a)-1T................................................    1545-0935
1.927(a)-1T................................................    1545-0935
1.927(b)-1T................................................    1545-0935
1.927(d)-1.................................................    1545-0884
1.927(d)-2T................................................    1545-0935
1.927(e)-1T................................................    1545-0935
1.927(e)-2T................................................    1545-0935
1.927(f)-1.................................................    1545-0884
1.931-1....................................................    1545-0074
                                                               1545-0123
1.934-1....................................................    1545-0782
1.935-1....................................................    1545-0074
                                                               1545-0087
                                                               1545-0803
1.936-1....................................................    1545-0215
                                                               1545-0217
1.936-4....................................................    1545-0215
1.936-5....................................................    1545-0704
1.936-6....................................................    1545-0215
1.936-7....................................................    1545-0215
1.936-10(c)................................................    1545-1138
1.952-2....................................................    1545-0126
1.953-2....................................................    1545-0126
1.954-1....................................................    1545-1068
1.954-2....................................................    1545-1068
1.955-2....................................................    1545-0123
1.955-3....................................................    1545-0123
1.955A-2...................................................    1545-0755
1.955A-3...................................................    1545-0755
1.956-1....................................................    1545-0704
1.956-2....................................................    1545-0704
1.959-1....................................................    1545-0704
1.959-2....................................................    1545-0704
1.960-1....................................................    1545-0122
1.962-2....................................................    1545-0704
1.962-3....................................................    1545-0704
1.962-4....................................................    1545-0704
1.964-1....................................................    1545-0126
                                                               1545-0704
                                                               1545-1072
1.964-3....................................................    1545-0126
1.970-2....................................................    1545-0126
1.985-2....................................................    1545-1051
                                                               1545-1131
1.985-3....................................................    1545-1051
1.988-0....................................................    1545-1131
1.988-1....................................................    1545-1131
1.988-2....................................................    1545-1131
1.988-3....................................................    1545-1131
1.988-4....................................................    1545-1131
1.988-5....................................................    1545-1131
1.992-1....................................................    1545-0190
                                                               1545-0938
1.992-2....................................................    1545-0190
                                                               1545-0884
                                                               1545-0938
1.992-3....................................................    1545-0190
                                                               1545-0938
1.992-4....................................................    1545-0190
                                                               1545-0938
1.993-3....................................................    1545-0938
1.993-4....................................................    1545-0938
1.994-1....................................................    1545-0938
1.995-5....................................................    1545-0938
1.1012-1...................................................    1545-0074
                                                               1545-1139
1.1014-4...................................................    1545-0184
1.1015-1...................................................    1545-0020
1.1017-1...................................................    1545-1539
1.1031(d)-1T...............................................    1545-1021
1.1033(a)-2................................................    1545-0184
1.1033(g)-1................................................    1545-0184
1.1034-1...................................................    1545-0072
1.1039-1...................................................    1545-0184
1.1041-1T..................................................    1545-0074
1.1042-1T..................................................    1545-0916
1.1044(a)-1................................................    1545-1421
1.1060-1T..................................................    1545-1021
1.1071-1...................................................    1545-0184
1.1071-4...................................................    1545-0184
1.1081-4...................................................    1545-0028
                                                               1545-0046
                                                               1545-0123
1.1081-11..................................................    1545-0074
                                                               1545-0123
1.1082-1...................................................    1545-0046
1.1082-2...................................................    1545-0046
1.1082-3...................................................    1545-0046
                                                               1545-0184
1.1082-4...................................................    1545-0046
1.1082-5...................................................    1545-0046
1.1082-6...................................................    1545-0046
1.1083-1...................................................    1545-0123
1.1092(b)-1T...............................................    1545-0644
1.1092(b)-2T...............................................    1545-0644
1.1092(b)-3T...............................................    1545-0644
1.1092(b)-4T...............................................    1545-0644
1.1092(b)-5T...............................................    1545-0644
1.1211-1...................................................    1545-0074
1.1212-1...................................................    1545-0074
1.1221-2...................................................    1545-1403
1.1221-2(d)(2)(iv).........................................    1545-1480
1.1221-2(e)(5).............................................    1545-1480
1.1221-2(g)(5)(ii).........................................    1545-1480
1.1221-2(g)(6)(ii).........................................    1545-1480
1.1221-2(g)(6)(iii)........................................    1545-1480
1.1221-2T(c)...............................................    1545-1403
1.1231-1...................................................    1545-0177
                                                               1545-0184
1.1231-2...................................................    1545-0177
                                                               1545-0184
1.1231-2...................................................    1545-0074
1.1232-3...................................................    1545-0074
1.1237-1...................................................    1545-0184
1.1239-1...................................................    1545-0091
1.1242-1...................................................    1545-0184
1.1243-1...................................................    1545-0123
1.1244(e)-1................................................    1545-0123
                                                               1545-1447
1.1245-1...................................................    1545-0184
1.1245-2...................................................    1545-0184
1.1245-3...................................................    1545-0184
1.1245-4...................................................    1545-0184
1.1245-5...................................................    1545-0184
1.1245-6...................................................    1545-0184
1.1247-1...................................................    1545-0122
1.1247-2...................................................    1545-0122
1.1247-4...................................................    1545-0122
1.1247-5...................................................    1545-0122
1.1248-7...................................................    1545-0074
1.1250-1...................................................    1545-0184
1.1250-2...................................................    1545-0184
1.1250-3...................................................    1545-0184
1.1250-4...................................................    1545-0184
1.1250-5...................................................    1545-0184
1.1251-1...................................................    1545-0184
1.1251-2...................................................    1545-0074
                                                               1545-0184
1.1251-3...................................................    1545-0184
1.1251-4...................................................    1545-0184
1.1252-1...................................................    1545-0184
1.1252-2...................................................    1545-0184

[[Page 192]]

 
1.1254-1(c)(3).............................................    1545-1352
1.1254-4...................................................    1545-1493
1.1254-5(d)(2).............................................    1545-1352
1.1258-1...................................................    1545-1452
1.1272-3...................................................    1545-1353
1.1273-2(h)(2).............................................    1545-1353
1.1274-3(d)................................................    1545-1353
1.1274-5(b)................................................    1545-1353
1.1274A-1(c)...............................................    1545-1353
1.1275-2...................................................    1545-1450
1.1275-3...................................................    1545-0887
                                                               1545-1353
                                                               1545-1450
1.1275-4...................................................    1545-1450
1.1275-6...................................................    1545-1450
1.1287-1...................................................    1545-0786
1.1291-9...................................................    1545-1507
1.1291-10..................................................    1545-1507
                                                               1545-1304
1.1294-1T..................................................    1545-1002
                                                               1545-1028
1.1295-1T..................................................    1545-1028
                                                               1545-1555
1.1295-3T..................................................    1545-1555
1.1297-3T..................................................    1545-1028
1.1311(a)-1................................................    1545-0074
1.1361-1...................................................    1545-0731
1.1362-1...................................................    1545-1308
1.1362-2...................................................    1545-1308
1.1362-3...................................................    1545-1308
1.1362-4...................................................    1545-1308
1.1362-5...................................................    1545-1308
1.1362-6...................................................    1545-1308
1.1362-7...................................................    1545-1308
1.1367-1(f)................................................    1545-1139
1.1368-1(f)(2).............................................    1545-1139
1.1368-1(f)(3).............................................    1545-1139
1.1368-1(f)(4).............................................    1545-1139
1.1368-1(g)(2).............................................    1545-1139
1.1374-1A..................................................    1545-0130
1.1377-1...................................................    1545-1462
1.1383-1...................................................    1545-0074
1.1385-1...................................................    1545-0074
                                                               1545-0098
1.1388-1...................................................    1545-0118
                                                               1545-0123
1.1398-1...................................................    1545-1375
1.1398-2...................................................    1545-1375
1.1402(a)-2................................................    1545-0074
1.1402(a)-5................................................    1545-0074
1.1402(a)-11...............................................    1545-0074
1.1402(a)-15...............................................    1545-0074
1.1402(a)-16...............................................    1545-0074
1.1402(b)-1................................................    1545-0171
1.1402(c)-2................................................    1545-0074
1.1402(e)(1)-1.............................................    1545-0074
1.1402(e)(2)-1.............................................    1545-0074
1.1402(e)-1A...............................................    1545-0168
1.1402(e)-2A...............................................    1545-0168
1.1402(e)-3A...............................................    1545-0168
1.1402(e)-4A...............................................    1545-0168
1.1402(e)-5A...............................................    1545-0168
1.1402(f)-1................................................    1545-0074
1.1402(h)-1................................................    1545-0064
1.1441-1...................................................    1545-1484
1.1441-2...................................................    1545-0795
1.1441-3...................................................    1545-0165
                                                               1545-0795
1.1441-4...................................................    1545-1484
1.1441-5...................................................    1545-0096
                                                               1545-0795
1.1441-6...................................................    1545-0055
                                                               1545-0795
1.1441-7...................................................    1545-0795
1.1441-8...................................................    1545-1053
                                                               1545-1484
1.1441-8T..................................................    1545-1053
1.1441-9...................................................    1545-1484
1.1443-1...................................................    1545-0096
1.1445-1...................................................    1545-0902
1.1445-2...................................................    1545-0902
                                                               1545-1060
1.1445-3...................................................    1545-0902
                                                               1545-1060
1.1445-4...................................................    1545-0902
1.1445-5...................................................    1545-0902
1.1445-6...................................................    1545-0902
                                                               1545-1060
1.1445-7...................................................    1545-0902
1.1445-8...................................................    1545-0096
1.1445-9T..................................................    1545-0902
1.1445-10T.................................................    1545-0902
1.1451-1...................................................    1545-0054
1.1451-2...................................................    1545-0054
1.1461-1...................................................    1545-0054
                                                               1545-0055
                                                               1545-0795
1.1461-2...................................................    1545-0054
                                                               1545-0055
                                                               1545-0096
                                                               1545-0795
1.1461-3...................................................    1545-0054
                                                               1545-0055
                                                               1545-0096
                                                               1545-0795
1.1461-4...................................................    1545-0054
                                                               1545-0055
                                                               1545-0096
1.1462-1...................................................    1545-0795
1.1492-1...................................................    1545-0026
1.1494-1...................................................    1545-0026
1.1502-5...................................................    1545-0257
1.1502-9...................................................    1545-0121
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1.1502-20..................................................    1545-1160
1.1502-21T.................................................    1545-1237
1.1502-31..................................................    1545-1344
1.1502-32..................................................    1545-1344
1.1502-33..................................................    1545-1344
1.1502-47..................................................    1545-0123
1.1502-75..................................................    1545-0025
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1.1502-76..................................................    1545-1344
1.1502-77..................................................    1545-0123
1.1502-77T.................................................    1545-1046
1.1502-78..................................................    1545-0582
1.1502-95T.................................................    1545-1218
1.1503-2A..................................................    1545-1083
1.1552-1...................................................    1545-0123
1.1561-3...................................................    1545-0123
1.1563-1...................................................    1545-0123
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1.6013-1...................................................    1545-0074
1.6013-2...................................................    1545-0091
1.6013-6...................................................    1545-0074
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1.6015(a)-1................................................    1545-0087
1.6015(b)-1................................................    1545-0087
1.6015(d)-1................................................    1545-0087
1.6015(e)-1................................................    1545-0087
1.6015(f)-1................................................    1545-0087
1.6015(g)-1................................................    1545-0087
1.6015(h)-1................................................    1545-0087
1.6015(i)-1................................................    1545-0087
1.6017-1...................................................    1545-0074
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                                                               1545-0090
1.6031(b)-1T...............................................    1545-0099
1.6031(c)-1T...............................................    1545-0099
1.6031-1...................................................    1545-0099
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1.6032-1...................................................    1545-0099
1.6033-2...................................................    1545-0047
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1.6033-3...................................................    1545-0052
1.6034-1...................................................    1545-0092
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1.6035-1...................................................    1545-0704
1.6035-2...................................................    1545-0704
1.6035-3...................................................    1545-0704
1.6037-1...................................................    1545-0130
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1.6038-2...................................................    1545-0704
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1.6038A-2..................................................    1545-1191
1.6038A-3..................................................    1545-1191
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1.6038B-1..................................................    1545-1615
1.6038B-1T.................................................    1545-0026
1.6038B-2..................................................    1545-1615
1.6039-2...................................................    1545-0820
1.6041-1...................................................    1545-0008
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1.6041-2...................................................    1545-0008
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1.6041-3...................................................    1545-1148
1.6041-4...................................................    1545-0115
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1.6041-5...................................................    1545-0295
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1.6041-6...................................................    1545-0008
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1.6041-7...................................................    1545-0112
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1.6042-2...................................................    1545-0110
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1.6042-3...................................................    1545-0295
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1.6045-1...................................................    1545-0715
1.6045-2...................................................    1545-0115
1.6045-4...................................................    1545-1085
1.6046-1...................................................    1545-0704
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1.6046-2...................................................    1545-0704
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1.6047-1...................................................    1545-0119
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1.6049-7...................................................    1545-1018
1.6049-7T..................................................    1545-0112
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1.6050A-1..................................................    1545-0115
1.6050B-1..................................................    1545-0120
1.6050D-1..................................................    1545-0120
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1.6050E-1..................................................    1545-0120
1.6050H-1..................................................    1545-0901
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1.6050H-2..................................................    1545-0901
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1.6050H-1T.................................................    1545-0901
1.6050I-2..................................................    1545-1449
1.6050J-1T.................................................    1545-0877
1.6050K-1..................................................    1545-0941
1.6050P-1..................................................    1545-1419
1.6050P-1T.................................................    1545-1419
1.6052-1...................................................    1545-0008
1.6052-2...................................................    1545-0008
1.6060-1...................................................    1545-0074
1.6061-1...................................................    1545-0123
1.6061-2T..................................................    1545-1348
1.6062-1...................................................    1545-0123
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1.6065-1...................................................    1545-0123
1.6071-1...................................................    1545-0123
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1.6081-4...................................................    1545-0188
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1.6081-6...................................................    1545-0148
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1.6091-3...................................................    1545-0089
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1.6115-1...................................................    1545-1464
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1.6302-2...................................................    1545-0098
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1.6654-2...................................................    1545-0087
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1.6654-4...................................................    1545-0087
1.6655-1...................................................    1545-0142
1.6655-2...................................................    1545-0142
1.6655-3...................................................    1545-0142
1.6655-7...................................................    1545-0123
1.6655(e)-1................................................    1545-1421
1.6661-3...................................................    1545-0988
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1.6662-4(e) and (f)........................................    1545-0889
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1.6694-1...................................................    1545-0074
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1.6694-2(c)................................................    1545-1231
1.6694-3(e)................................................    1545-1231
1.6695-1...................................................    1545-0074
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1.6695-2T..................................................    1545-1570
1.6696-1...................................................    1545-0074
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1.6851-1...................................................    1545-0086
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1.6851-2...................................................    1545-0086
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1.7476-1...................................................    1545-0197
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1.7519-2T..................................................    1545-1036
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1.9101-1...................................................    1545-0008
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2.1-5......................................................    1545-0123
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2.1-10.....................................................    1545-0123
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2.1-20.....................................................    1545-0123
2.1-22.....................................................    1545-0123
2.1-26.....................................................    1545-0123
3.2........................................................    1545-0123
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4.954-2....................................................    1545-1068
5.6411-1...................................................    1545-0098
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5c.44F-1...................................................    1545-0619
5c.128-1...................................................    1545-0123
5c.168(f)(8)-1.............................................    1545-0123
5c.168(f)(8)-2.............................................    1545-0123
5c.168(f)(8)-6.............................................    1545-0123
5c.168(f)(8)-8.............................................    1545-0123
5c.305-1...................................................    1545-0110
5c.442-1...................................................    1545-0152
5f.103-1...................................................    1545-0720
5f.103-3...................................................    1545-0720
5f.6045-1..................................................    1545-0715
6a.103A-2..................................................    1545-0123
                                                               1545-0720
6a.103A-3..................................................    1545-0720
7.367(b)-1.................................................    1545-0026
7.367(b)-3.................................................    1545-0026
7.367(b)-7.................................................    1545-0026
7.367(b)-9.................................................    1545-0026
7.367(b)-10................................................    1545-0026
7.465-1....................................................    1545-0712
7.465-2....................................................    1545-0712
7.465-3....................................................    1545-0712
7.465-4....................................................    1545-0712
7.465-5....................................................    1545-0712
7.936-1....................................................    1545-0217
7.999-1....................................................    1545-0216
7.6039A-1..................................................    1545-0015
7.6041-1...................................................    1545-0115
11.410-1...................................................    1545-0710
11.412(c)-7................................................    1545-0710
11.412(c)-11...............................................    1545-0710
12.7.......................................................    1545-0190
12.8.......................................................    1545-0191
12.9.......................................................    1545-0195
14a.422A-1.................................................    1545-0123
15A.453-1..................................................    1545-0228
16.3-1.....................................................    1545-0159
16A.126-2..................................................    1545-0074
16A.1255-1.................................................    1545-0184
16A.1255-2.................................................    1545-0184
18.1371-1..................................................    1545-0130
18.1378-1..................................................    1545-0130
18.1379-1..................................................    1545-0130
18.1379-2..................................................    1545-0130
20.2011-1..................................................    1545-0015
20.2014-5..................................................    1545-0015
                                                               1545-0260
20.2014-6..................................................    1545-0015
20.2016-1..................................................    1545-0015
20.2031-2..................................................    1545-0015
20.2031-3..................................................    1545-0015
20.2031-4..................................................    1545-0015
20.2031-6..................................................    1545-0015
20.2031-7..................................................    1545-0020
20.2031-10.................................................    1545-0015
20.2032-1..................................................    1545-0015
20.2032A-3.................................................    1545-0015
20.2032A-4.................................................    1545-0015
20.2032A-8.................................................    1545-0015
20.2039-4..................................................    1545-0015
20.2051-1..................................................    1545-0015
20.2053-3..................................................    1545-0015
20.2053-9..................................................    1545-0015
20.2053-10.................................................    1545-0015
20.2055-1..................................................    1545-0015
20.2055-2..................................................    1545-0015
                                                               1545-0092
20.2055-3..................................................    1545-0015
20.2056(b)-4...............................................    1545-0015
20.2056(b)-7...............................................    1545-0015
                                                               1545-1612
20.2056A-2.................................................    1545-1443
20.2056A-3.................................................    1545-1360
20.2056A-4.................................................    1545-1360
20.2056A-10................................................    1545-1360
20.2106-1..................................................    1545-0015
20.2106-2..................................................    1545-0015
20.2204-1..................................................    1545-0015
20.2204-2..................................................    1545-0015
20.6001-1..................................................    1545-0015
20.6011-1..................................................    1545-0015
20.6018-1..................................................    1545-0015
                                                               1545-0531
20.6018-2..................................................    1545-0015
20.6018-3..................................................    1545-0015
20.6018-4..................................................    1545-0015
                                                               1545-0022
20.6036-2..................................................    1545-0015
20.6061-1..................................................    1545-0015
20.6065-1..................................................    1545-0015
20.6075-1..................................................    1545-0015
20.6081-1..................................................    1545-0015
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20.6091-1..................................................    1545-0015
20.6161-1..................................................    1545-0015
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20.6161-2..................................................    1545-0015
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20.6166A-1.................................................    1545-0015
20.6166A-3.................................................    1545-0015
20.6324A-1.................................................    1545-0754
20.7520-1..................................................    1545-1343
20.7520-2..................................................    1545-1343
20.7520-3..................................................    1545-1343
20.7520-4..................................................    1545-1343
22.0.......................................................    1545-0015
25.2511-2..................................................    1545-0020
25.2512-2..................................................    1545-0020
25.2512-3..................................................    1545-0020
25.2512-5..................................................    1545-0020
25.2512-9..................................................    1545-0020
25.2513-1..................................................    1545-0020
25.2513-2..................................................    1545-0020
                                                               1545-0021
25.2513-3..................................................    1545-0020
25.2518-2..................................................    1545-0959
25.2522(a)-1...............................................    1545-0196
25.2522(c)-3...............................................    1545-0020
                                                               1545-0196
25.2523(a)-1...............................................    1545-0020
                                                               1545-0196
25.2523(f)-1...............................................    1545-0015
25.2701-2..................................................    1545-1241
25.2701-4..................................................    1545-1241
25.2701-5..................................................    1545-1273
25.2702-5..................................................    1545-1485
25.2702-6..................................................    1545-1273
25.6001-1..................................................    1545-0020
                                                               1545-0022
25.6011-1..................................................    1545-0020
25.6019-1..................................................    1545-0020
25.6019-2..................................................    1545-0020
25.6019-3..................................................    1545-0020
25.6019-4..................................................    1545-0020
25.6061-1..................................................    1545-0020
25.6065-1..................................................    1545-0020
25.6075-1..................................................    1545-0020
25.6081-1..................................................    1545-0020
25.6091-1..................................................    1545-0020
25.6091-2..................................................    1545-0020
25.6151-1..................................................    1545-0020
25.6161-1..................................................    1545-0020
25.7520-1..................................................    1545-1343
25.7520-2..................................................    1545-1343
25.7520-3..................................................    1545-1343
25.7520-4..................................................    1545-1343
26.2601-1..................................................    1545-0985
26.2632-1..................................................    1545-0985
26.2642-1..................................................    1545-0985
26.2642-2..................................................    1545-0985
26.2642-3..................................................    1545-0985
26.2642-4..................................................    1545-0985
26.2652-2..................................................    1545-0985
26.2662-1..................................................    1545-0015
                                                               1545-0985
26.2662-2..................................................    1545-0985
31.3102-3..................................................    1545-0029
                                                               1545-0059
                                                               1545-0065
31.3121(b)(19)-1...........................................    1545-0029
31.3121(d)-1...............................................    1545-0004
31.3121(i)-1...............................................    1545-0034
31.3121(k)-4...............................................    1545-0137
31.3121(r)-1...............................................    1545-0029
31.3121(s)-1...............................................    1545-0029
31.3121(v)(2)-1............................................    1545-1643
31.3302(a)-2...............................................    1545-0028
31.3302(a)-3...............................................    1545-0028
31.3302(b)-2...............................................    1545-0028
31.3302(e)-1...............................................    1545-0028
31.3306(c)(18)-1...........................................    1545-0029
31.3401(a)-1...............................................    1545-0029
31.3401(a)(6)..............................................    1545-1484
31.3401(a)(6)-1............................................    1545-0029
                                                               1545-0096
                                                               1545-0795
31.3401(a)(7)-1............................................    1545-0029
31.3401(a)(8)(A)-1 ........................................    1545-0029
                                                               1545-0666
31.3401(a)(8)(C)-1 ........................................    1545-0029
31.3401(a)(15)-1...........................................    1545-0182
31.3401(c)-1...............................................    1545-0004
31.3402(b)-1...............................................    1545-0010
31.3402(c)-1...............................................    1545-0010
31.3402(f)(1)-1............................................    1545-0010
31.3402(f)(2)-1............................................    1545-0010
                                                               1545-0410
31.3402(f)(3)-1............................................    1545-0010
31.3402(f)(4)-1............................................    1545-0010
31.3402(f)(4)-2............................................    1545-0010
31.3402(f)(5)-1............................................    1545-0010
                                                               1545-1435
31.3402(h)(1)-1............................................    1545-0029
31.3402(h)(3)-1............................................    1545-0010
31.3402(h)(3)-1............................................    1545-0029
31.3402(h)(4)-1............................................    1545-0010
31.3402(i)-(1).............................................    1545-0010
31.3402(i)-(2).............................................    1545-0010
31.3402(k)-1...............................................    1545-0065
31.3402(l)-(1).............................................    1545-0010
31.3402(m)-(1).............................................    1545-0010
31.3402(n)-(1).............................................    1545-0010
31.3402(o)-2...............................................    1545-0415
31.3402(o)-3...............................................    1545-0008
                                                               1545-0010
                                                               1545-0415
                                                               1545-0717
31.3402(p)-1...............................................    1545-0415
                                                               1545-0717
31.3402(q)-1...............................................    1545-0238
                                                               1545-0239
31.3404-1..................................................    1545-0029
31.3405(c)-1...............................................    1545-1341
31.3406(a)-1...............................................    1545-0112
31.3406(a)-2...............................................    1545-0112
31.3406(a)-3...............................................    1545-0112
31.3406(a)-4...............................................    1545-0112
31.3406(b)(2)-1............................................    1545-0112
31.3406(b)(2)-2............................................    1545-0112
31.3406(b)(2)-3............................................    1545-0112
31.3406(b)(2)-4............................................    1545-0112
31.3406(b)(2)-5............................................    1545-0112
31.3406(b)(3)-1............................................    1545-0112
31.3406(b)(3)-2............................................    1545-0112
31.3406(b)(3)-3............................................    1545-0112
31.3406(b)(3)-4............................................    1545-0112
31.3406(b)(4)-1............................................    1545-0112
31.3406(c)-1...............................................    1545-0112
31.3406(d)-1...............................................    1545-0112
31.3406(d)-2...............................................    1545-0112
31.3406(d)-3...............................................    1545-0112
31.3406(d)-4...............................................    1545-0112
31.3406(d)-5...............................................    1545-0112
31.3406(e)-1...............................................    1545-0112
31.3406(f)-1...............................................    1545-0112
31.3406(g)-1...............................................    1545-0096
                                                               1545-0112
31.3406(g)-2...............................................    1545-0112
31.3406(g)-3...............................................    1545-0112
31.3406(h)-1...............................................    1545-0112
31.3406(h)-2...............................................    1545-0112
31.3406(h)-3...............................................    1545-0112

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31.3406(i)-1...............................................    1545-0112
31.3501(a)-1T..............................................    1545-0771
31.3503-1..................................................    1545-0024
31.3504-1..................................................    1545-0029
31.6001-1..................................................    1545-0798
31.6001-2..................................................    1545-0034
                                                               1545-0798
31.6001-3..................................................    1545-0798
31.6001-4..................................................    1545-0028
31.6001-5..................................................    1545-0798
31.6001-6..................................................    1545-0029
                                                               1459-0798
31.6011(a)-1...............................................    1545-0029
                                                               1545-0034
                                                               1545-0035
                                                               1545-0059
                                                               1545-0074
                                                               1545-0718
                                                               1545-0256
31.6011(a)-2...............................................    1545-0001
                                                               1545-0002
31.6011(a)-3...............................................    1545-0028
31.6011(a)-3A..............................................    1545-0955
31.6011(a)-4...............................................    1545-0034
                                                               1545-0035
                                                               1545-0718
                                                               1545-1413
31.6011(a)-5...............................................    1545-0718
                                                               1545-0028
31.6011(a)-6...............................................    1545-0028
31.6011(a)-7...............................................    1545-0074
31.6011(a)-8...............................................    1545-0028
31.6011(a)-9...............................................    1545-0028
31.6011(a)-10..............................................    1545-0112
31.6011(b)-1...............................................    1545-0003
31.6011(b)-2...............................................    1545-0029
31.6051-1..................................................    1545-0008
                                                               1545-0182
                                                               1545-0458
31.6051-2..................................................    1545-0008
31.6051-3..................................................    1545-0008
31.6053-1..................................................    1545-0029
                                                               1545-0062
                                                               1545-0064
                                                               1545-0065
31.6053-2..................................................    1545-0008
31.6053-3..................................................    1545-0065
                                                               1545-0714
31.6053-4..................................................    1545-0065
31.6065(a)-1...............................................    1545-0029
31.6071(a)-1...............................................    1545-0001
                                                               1545-0028
                                                               1545-0029
31.6071(a)-1A..............................................    1545-0955
31.6081(a)-1...............................................    1545-0008
                                                               1545-0028
31.6091-1..................................................    1545-0028
                                                               1545-0029
31.6157-1..................................................    1545-0955
31.6205-1..................................................    1545-0029
31.6301(c)-1AT.............................................    1545-0035
                                                               1545-0112
                                                               1545-0257
31.6302-1..................................................    1545-1413
31.6302-2..................................................    1545-1413
31.6302-3..................................................    1545-1413
31.6302-4..................................................    1545-1413
31.6302(c)-2...............................................    1545-0001
                                                               1545-0257
31.6302(c)-2A..............................................    1545-0955
31.6302(c)-3...............................................    1545-0257
31.6402(a)-2...............................................    1545-0256
31.6413(a)-1...............................................    1545-0029
31.6413(a)-2...............................................    1545-0029
                                                               1545-0256
31.6413(c)-1...............................................    1545-0029
                                                               1545-0171
31.6414-1..................................................    1545-0029
32.1.......................................................    1545-0029
                                                               1545-0415
32.2.......................................................    1545-0029
35a.3406-2.................................................    1545-0112
35a.9999-3.................................................    1545-0112
35a.9999-5.................................................    1545-0029
36.3121(l)(1)-1............................................    1545-0137
36.3121(l)(1)-2............................................    1545-0137
36.3121(l)(3)-1............................................    1545-0123
36.3121(1)(7)-1............................................    1545-0123
36.3121(1)(10)-1...........................................    1545-0029
36.3121(1)(10)-3...........................................    1545-0029
36.3121(1)(10)-4...........................................    1545-0257
40.6302(c)-3(b)(2)(ii).....................................    1545-1296
40.6302(c)-3(b)(2)(iii)....................................    1545-1296
40.6302(c)-3(e)............................................    1545-1296
40.6302(c)-3(f)(2)(ii).....................................    1545-1296
41.4481-1..................................................    1545-0143
41.4481-1T.................................................    1545-0143
41.4481-2..................................................    1545-0143
41.4482(b)-1T..............................................    1545-0143
41.4483-3..................................................    1545-0143
41.6001-1..................................................    1545-0143
41.6001-2..................................................    1545-0143
41.6001-3..................................................    1545-0143
41.6071(a)-1...............................................    1545-0143
41.6081(a)-1...............................................    1545-0143
41.6091-1..................................................    1545-0143
41.6109-1..................................................    1545-0143
41.6151(a)-1...............................................    1545-0143
41.6156-1..................................................    1545-0143
41.6161(a)(1)-1............................................    1545-0143
44.4401-1..................................................    1545-0235
44.4403-1..................................................    1545-0235
44.4412-1..................................................    1545-0236
44.4901-1..................................................    1545-0236
44.4905-1..................................................    1545-0236
44.4905-2..................................................    1545-0236
44.6001-1..................................................    1545-0235
44.6011(a)-1...............................................    1545-0235
                                                               1545-0236
44.6071-1..................................................    1545-0235
44.6091-1..................................................    1545-0235
44.6151-1..................................................    1545-0235
44.6419-1..................................................    1545-0235
44.6419-1..................................................    1545-0235
44.6419-2..................................................    1545-0235
46.4371-4..................................................    1545-0023
46.4374-1..................................................    1545-0023
46.4701-1..................................................    1545-0023
                                                               1545-0257
48.4041-4..................................................    1545-0023
48.4041-5..................................................    1545-0023
48.4041-6..................................................    1545-0023
48.4041-7..................................................    1545-0023
48.4041-9..................................................    1545-0023
48.4041-10.................................................    1545-0023
48.4041-11.................................................    1545-0023
48.4041-12.................................................    1545-0023
48.4041-13.................................................    1545-0023
48.4041-18.................................................    1545-0023
48.4041-19.................................................    1545-0023
48.4041-20.................................................    1545-0023
48.4041-21.................................................    1545-1270
48.4042-2..................................................    1545-0023
48.4061(a)-1...............................................    1545-0023

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48.4061(a)-2...............................................    1545-0023
48.4061(b)-3...............................................    1545-0023
48.4064-1..................................................    1545-0014
                                                               1545-0242
48.4071-1..................................................    1545-0023
48.4073-1..................................................    1545-0023
48.4073-3..................................................    1545-0023
                                                               1545-1074
                                                               1545-1087
48.4081-2(c)(3)............................................    1545-1270
48.4081-3(d)(2)(iii).......................................    1545-1270
48.4081-3(e)(2)(ii)........................................    1545-1270
48.4081-3(f)(2)(ii)........................................    1545-1270
48.4081-4(b)(2)(ii)........................................    1545-1270
48.4081-4(b)(3)(i).........................................    1545-1270
48.4081-4(c)...............................................    1545-1270
48.4081-6(c)(1)(ii)........................................    1545-1270
48.4081-7..................................................    1545-1270
48.4081-9..................................................    1545-1270
48.4082-2..................................................    1545-1418
48.4082-7T.................................................    1545-1608
48.4082-8T.................................................    1545-1608
48.4091-3T.................................................    1545-1608
48.4101-1..................................................    1545-1418
48.4101-2..................................................    1545-1418
48.4101-2T.................................................    1545-1608
48.4101-3T.................................................    1545-1608
48.4161(a)-1...............................................    1545-0723
48.4161(a)-2...............................................    1545-0723
48.4161(a)-3...............................................    1545-0723
48.4161(b)-1...............................................    1545-0723
                                                               1545-0723
48.4216(a)-2...............................................    1545-0023
48.4216(a)-3...............................................    1545-0023
48.4216(c)-1...............................................    1545-0023
48.4221-1..................................................    1545-0023
48.4221-2..................................................    1545-0023
48.4221-3..................................................    1545-0023
48.4221-4..................................................    1545-0023
48.4221-5..................................................    1545-0023
48.4221-6..................................................    1545-0023
48.4221-7..................................................    1545-0023
48.4222(a)-1...............................................    1545-0023
                                                               1545-0014
48.4223-1..................................................    1545-0023
                                                               1545-0723
                                                               1545-0723
                                                               1545-0723
                                                               1545-0257
48.6302(c)-1...............................................    1545-0023
                                                               1545-0257
48.6412-1..................................................    1545-0723
48.6416(a)-1...............................................    1545-0023
                                                               1545-0723
48.6416(a)-2...............................................    1545-0723
48.6416(a)-3...............................................    1545-0723
48.6416(b)(2)-3............................................    1545-1087
48.6416(b)(1)-1............................................    1545-0723
48.6416(b)(1)-2............................................    1545-0723
48.6416(b)(1)-3............................................    1545-0723
48.6416(b)(1)-4............................................    1545-0723
48.6416(b)(2)-1............................................    1545-0723
48.6416(b)(2)-2............................................    1545-0723
48.6416(b)(2)-3............................................    1545-0723
                                                               1545-1087
48.6416(b)(2)-4............................................    1545-0723
48.6416(b)(3)-1............................................    1545-0723
48.6416(b)(3)-2............................................    1545-0723
48.6416(b)(3)-3............................................    1545-0723
48.6416(b)(4)-1............................................    1545-0723
48.6416(b)(5)-1............................................    1545-0723
48.6416(c)-1...............................................    1545-0723
48.6416(e)-1...............................................    1545-0023
                                                               1545-0723
48.6416(f)-1...............................................    1545-0023
                                                               1545-0723
48.6416(g)-1...............................................    1545-0723
48.6416(h)-1...............................................    1545-0723
48.6420(c)-2...............................................    1545-0023
48.6420(f)-1...............................................    1545-0023
48.6420-1..................................................    1545-0162
                                                               1545-0723
48.6420-2..................................................    1545-0162
                                                               1545-0723
48.6420-3..................................................    1545-0162
                                                               1545-0723
48.6420-4..................................................    1545-0162
                                                               1545-0723
48.6420-5..................................................    1545-0162
                                                               1545-0723
48.6420-6..................................................    1545-0162
                                                               1545-0723
48.6420-7..................................................    1545-0162
                                                               1545-0723
48.6421-0..................................................    1545-0162
                                                               1545-0723
48.6421-1..................................................    1545-0162
                                                               1545-0723
48.6421-2..................................................    1545-0162
                                                               1545-0723
48.6421-3..................................................    1545-0162
                                                               1545-0723
48.6421-4..................................................    1545-0162
                                                               1545-0723
48.6421-5..................................................    1545-0162
                                                               1545-0723
48.6421-6..................................................    1545-0162
                                                               1545-0723
48.6421-7..................................................    1545-0162
                                                               1545-0723
48.6424-0..................................................    1545-0723
48.6424-1..................................................    1545-0723
48.6424-2..................................................    1545-0723
48.6424-3..................................................    1545-0723
48.6424-4..................................................    1545-0723
48.6424-5..................................................    1545-0723
48.6424-6..................................................    1545-0723
48.6427-0..................................................    1545-0723
48.6427-1..................................................    1545-0023
                                                               1545-0162
                                                               1545-0723
48.6427-2..................................................    1545-0162
                                                               1545-0723
48.6427-3..................................................    1545-0723
48.6427-4..................................................    1545-0723
48.6427-5..................................................    1545-0723
48.6427-8..................................................    1545-1418
48.6427-9..................................................    1545-1418
48.6427-11T................................................    1545-1608
49.4251-1..................................................    1545-1075
49.4251-2..................................................    1545-1075
49.4253-3..................................................    1545-0023
49.4253-4..................................................    1545-0023
49.4264(b)-1...............................................    1545-0023
                                                               1545-0226
                                                               1545-0226
                                                               1545-0912
                                                               1545-0912
                                                               1545-0257
                                                               1545-0230
                                                               1545-0224
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49.4271-1(d)...............................................    1545-0685
52.4682-1(b)(2)(iii).......................................    1545-1153
52.4682-2(b)...............................................    1545-1153
                                                               1545-1361
52.4682-2(d)...............................................    1545-1153
                                                               1545-1361
52.4682-3(c)(2)............................................    1545-1153
52.4682-3(g)...............................................    1545-1153
52.4682-4(f)...............................................    1545-1153
                                                               1545-0257
52.4682-5(d)...............................................    1545-1361
52.4682-5(f)...............................................    1545-1361
53.4940-1..................................................    1545-0052
                                                               1545-0196
53.4942(a)-1...............................................    1545-0052
53.4942(a)-2...............................................    1545-0052
53.4942(a)-3...............................................    1545-0052
53.4942(b)-3...............................................    1545-0052
53.4945-1..................................................    1545-0052
53.4945-4..................................................    1545-0052
53.4945-5..................................................    1545-0052
53.4945-6..................................................    1545-0052
53.4947-1..................................................    1545-0196
53.4947-2..................................................    1545-0196
53.4948-1..................................................    1545-0052
53.4961-2..................................................    1545-0024
53.4963-1..................................................    1545-0024
53.6001-1..................................................    1545-0052
53.6011-1..................................................    1545-0049
                                                               1545-0052
                                                               1545-0092
                                                               1545-0196
53.6065-1..................................................    1545-0052
53.6071-1..................................................    1545-0049
53.6081-1..................................................    1545-0066
                                                               1545-0148
53.6161-1..................................................    1545-0575
54.4972-1..................................................    1545-0197
54.4975-7..................................................    1545-0575
54.4977-1T.................................................    1545-0771
54.4980B-6.................................................    1545-1581
54.4980B-7.................................................    1545-1581
54.4980B-8.................................................    1545-1581
54.4981A-1T................................................    1545-0203
54.6011-1..................................................    1545-0575
54.6011-1T.................................................    1545-0575
54.9801-3T.................................................    1545-1537
54.9801-4T.................................................    1545-1537
54.9801-5T.................................................    1545-1537
54.9801-6T.................................................    1545-1537
55.6001-1..................................................    1545-0123
55.6011-1..................................................    1545-0999
                                                               1545-0123
                                                               1545-1016
55.6061-1..................................................    1545-0999
55.6071-1..................................................    1545-0999
56.4911-6..................................................    1545-0052
56.4911-7..................................................    1545-0052
56.4911-9..................................................    1545-0052
56.4911-10.................................................    1545-0052
56.6001-1..................................................    1545-1049
56.6011-1..................................................    1545-1049
56.6081-1..................................................    1545-1049
56.6161-1..................................................    1545-1049
                                                               1545-0257
145.4051-1.................................................    1545-0745
145.4052-1.................................................    1545-1608
                                                               1545-0120
                                                               1545-0745
                                                               1545-1076
145.4061-1.................................................    1545-0745
                                                               1545-0257
                                                               1545-0230
                                                               1545-0224
156.6001-1.................................................    1545-1049
156.6011-1.................................................    1545-1049
156.6081-1.................................................    1545-1049
156.6161-1.................................................    1545-1049
301.6011-2.................................................    1545-0225
                                                               1545-0350
                                                               1545-0387
                                                               1545-0441
                                                               1545-0957
301.6017-1.................................................    1545-0090
301.6034-1.................................................    1545-0092
301.6035-1.................................................    1545-0123
301.6036-1.................................................    1545-0013
                                                               1545-0773
301.6047-1.................................................    1545-0367
                                                               1545-0957
301.6057-1.................................................    1545-0710
301.6057-2.................................................    1545-0710
301.6058-1.................................................    1545-0710
301.6059-1.................................................    1545-0710
301.6103(c)-1..............................................    1545-0280
301.6104(a)-1..............................................    1545-0495
301.6104(a)-5..............................................    1545-0056
301.6104(a)-6..............................................    1545-0056
301.6104(b)-1..............................................    1545-0094
                                                               1545-0742
301.6104(d)-1..............................................    1545-0092
301.6109-1.................................................    1545-0003
                                                               1545-0295
                                                               1545-0367
                                                               1545-0387
                                                               1545-0957
                                                               1545-1461
301.6109-3T................................................    1545-1564
301.6110-3.................................................    1545-0074
301.6110-5.................................................    1545-0074
301.6111-1T................................................    1545-0865
                                                               1545-0881
301.6112-1T................................................    1545-0865
301.6114-1.................................................    1545-1126
                                                               1545-1484
301.6222(a)-2T.............................................    1545-0790
301.6222(b)-1T.............................................    1545-0790
301.6222(b)-2T.............................................    1545-0790
301.6222(b)-3T.............................................    1545-0790
301.6227(b)-1T.............................................    1545-0790
                                                               1545-0790
301.6231(a)(7)-1...........................................    1545-0790
301.6241-1T................................................    1545-0130
301.6316-4.................................................    1545-0074
301.6316-5.................................................    1545-0074
301.6316-6.................................................    1545-0074
301.6316-7.................................................    1545-0029
301.6324A-1................................................    1545-0015
301.6361-1.................................................    1545-0074
                                                               1545-0024
301.6361-2.................................................    1545-0024
301.6361-3.................................................    1545-0074
301.6402-2.................................................    1545-0024
                                                               1545-0073
                                                               1545-0091
301.6402-3.................................................    1545-0055
                                                               1545-0073
                                                               1545-0091
                                                               1545-0132
301.6402-5.................................................    1545-0928
301.6404-1.................................................    1545-0024
301.6404-2T................................................    1545-0024
301.6404-3.................................................    1545-0024
301.6405-1.................................................    1545-0024

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301.6501(c)-1..............................................    1545-1241
301.6501(d)-1..............................................    1545-0074
                                                               1545-0430
301.6501(o)-2..............................................    1545-0728
301.6511(d)-1..............................................    1545-0582
                                                               1545-0024
301.6511(d)-2..............................................    1545-0582
                                                               1545-0024
301.6511(d)-3..............................................    1545-0024
                                                               1545-0582
301.6652-2.................................................    1545-0092
301.6656-1.................................................    1545-0794
301.6656-2.................................................    1545-0794
301.6685-1.................................................    1545-0092
301.6689-1T................................................    1545-1056
301.6707-1T................................................    1545-0865
                                                               1545-0881
301.6708-1T................................................    1545-0865
301.6712-1.................................................    1545-1126
301.6723-1A(d).............................................    1545-0909
301.6903-1.................................................    1545-0013
301.6905-1.................................................    1545-0074
301.7001-1.................................................    1545-0123
301.7101-1.................................................    1545-1029
301.7207-1.................................................    1545-0092
301.7216-2.................................................    1545-0074
301.7216-2(o)..............................................    1545-1209
301.7425-3.................................................    1545-0854
301.7430-2(c)..............................................    1545-1356
301.7507-8.................................................    1545-0123
301.7507-9.................................................    1545-0123
301.7513-1.................................................    1545-0429
301.7517-1.................................................    1545-0015
301.7605-1.................................................    1545-0795
301.7623-1.................................................    1545-0409
                                                               1545-1534
301.7654-1.................................................    1545-0803
301.7701-3.................................................    1545-1486
301.7701-4.................................................    1545-1465
301.7701-7.................................................    1545-1600
301.7701-16................................................    1545-0795
301.7701(b)-1..............................................    1545-0089
301.7701(b)-2..............................................    1545-0089
301.7701(b)-3..............................................    1545-0089
301.7701(b)-4..............................................    1545-0089
301.7701(b)-5..............................................    1545-0089
301.7701(b)-6..............................................    1545-0089
301.7701(b)-7..............................................    1545-0089
                                                               1545-1126
301.7701(b)-9..............................................    1545-0089
301.7805-1.................................................    1545-0805
301.9001-1.................................................    1545-0220
301.9100-1.................................................    1545-1488
301.9100-4T................................................    1545-0016
                                                               1545-0042
                                                               1545-0074
                                                               1545-0129
                                                               1545-0172
                                                               1545-0619
301.9100-6T................................................    1545-0872
301.9100-7T................................................    1545-0982
301.9100-8.................................................    1545-1112
301.9100-11T...............................................    1545-0123
301.9100-12T...............................................    1545-0026
                                                               1545-0074
                                                               1545-0172
                                                               1545-1027
301.9100-14T...............................................    1545-0046
301.9100-15T...............................................    1545-0046
301.9100-16T...............................................    1545-0152
302.1-7....................................................    1545-0024
305.7701-1.................................................    1545-0823
305.7871-1.................................................    1545-0823
404.6048-1.................................................    1545-0160
420.0-1....................................................    1545-0710
Part 502...................................................    1545-0844
Part 503...................................................    1545-0837
Part 509...................................................    1545-0846
Part 513...................................................    1545-0834
Part 514...................................................    1545-0845
Part 516...................................................    1545-0841
Part 517...................................................    1545-0849
Part 520...................................................    1545-0833
Part 521...................................................    1545-0848
601.104....................................................    1545-0233
601.105....................................................    1545-0091
601.201....................................................    1545-0019
                                                               1545-0819
601.204....................................................    1545-0152
601.401....................................................    1545-0257
601.504....................................................    1545-0150
601.601....................................................    1545-0800
601.602....................................................    1545-0295
                                                               1545-0387
                                                               1545-0957
601.702....................................................    1545-0429
------------------------------------------------------------------------


(26 U.S.C. 7805)

[T.D. 8011, 50 FR 10222, Mar. 14, 1985; 64 FR 15688, Apr. 1, 1999]

    Editorial Note: For Federal Register citations affecting 
Sec. 602.101, see the List of CFR Sections Affected in the Findings Aids 
section of 26 CFR part 600-end.

    Effective Date Note: By T.D. 8734, 62 FR 53498, Oct. 14, 1997, the 
table in Sec. 602.101 was amended by removing the entries for 1.1441-8T, 
1.1461-3, 1.1461-4, 35a.9999-3, part 502, part 503, part 516, part 517, 
and part 520; adding entries for 1.1441-1, 1.1441-4, 11.1441-8, 1.1441-
9, 31.3401(a)(6), and 301.6114-1; and revising the entries for 1.1441-5, 
1.1441-6, 1.1461-1, and 301.6402-3, effective Jan. 1, 1999. At 63 FR 
2723, Jan. 16, 1998, the entry for ``11.1441-8'' was corrected to read 
``1.1441-8'', effective Jan. 1, 1999. By T.D. 8804, 63 FR 72183, Dec. 
31, 1998, the effective date was delayed to Jan. 1, 2000. For the 
convenience of the user, the revised text is set forth as follows:

Sec. 602.101  OMB Control numbers.

      

                                * * * * *

------------------------------------------------------------------------
                                                             Current OMB
     CFR part or section where identified and described      control No.
------------------------------------------------------------------------
                      *      *      *      *      *
1.1441-5...................................................    1545-0096
                                                               1545-0795
                                                               1545-1484
1.1441-6...................................................    1545-0055
                                                               1545-0795
                                                               1545-1484
1.1461-1...................................................    1545-0054
                                                               1545-0055

[[Page 201]]

 
                                                               1545-0795
                                                               1545-1484
                      *      *      *      *      *
301.6402-3.................................................    1545-0055
                                                               1545-0073
                                                               1545-0091
                                                               1545-0132
                                                               1545-1484
                      *      *      *      *      *
------------------------------------------------------------------------


[[Page 203]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations which were 
made by documents published in the Federal Register since January 1, 
1973, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 1973, see the ``List of Sections 
Affected, 1949-1963 and 1964-1972,'' published in three separate 
volumes.

                                1973-1987

                       (No regulations published)

                                  1988

26 CFR
                                                                   53 FR
                                                                    Page
Chapter I
501  Removed.......................................................35506
504--507  Removed..................................................35506
511  Removed.......................................................35506
512  Removed.......................................................35506
518  Removed.......................................................35506
519  Removed.......................................................35506

                                  1989

26 CFR
                                                                   54 FR
                                                                    Page
Chapter I
510  Removed.......................................................37453
515  Removed.......................................................37453

                                1990-1996

                       (No regulations published)

                                  1997

26 CFR
                                                                   62 FR
                                                                    Page
502  Removed; eff. 1-1-99..........................................53497
503  Removed; eff. 1-1-99..........................................53497
509  Authority citation added......................................53497
509.1--509.10  (Subpart) Removed; eff. 1-1-99......................53497
509.103  (e) removed; eff. 1-1-99..................................53497
509.117  (a) removed; eff. 1-1-99..................................53497
509.119  Removed; eff. 1-1-99......................................53497
509.122  Removed; eff. 1-1-99......................................53497
513  Authority citation revised....................................53497
513.1  Removed; eff. 1-1-99........................................53497
513.2  Revised; eff. 1-1-99........................................53497
513.3  Revised; eff. 1-1-99........................................53497
513.4  Revised; eff. 1-1-99........................................53498
513.5  Revised; eff. 1-1-99........................................53498
514  Authority citation added......................................53498
514.1--514.32  (Subpart) Authority citation removed................53498
514.1--514.10  Undesignated center heading removed; eff. 1-1-99....53498
514.20  Removed; eff. 1-1-99.......................................53498
514.21  Removed; eff. 1-1-99.......................................53498
514.22  (c) removed; eff. 1-1-99...................................53498
514.23  Removed; eff. 1-1-99.......................................53498
514.24  Removed; eff. 1-1-99.......................................53498
514.25  Removed; eff. 1-1-99.......................................53498
514.26  Removed; eff. 1-1-99.......................................53498
514.27  Removed; eff. 1-1-99.......................................53498
514.28  Removed; eff. 1-1-99.......................................53498
514.29  Removed; eff. 1-1-99.......................................53498
514.30  Removed; eff. 1-1-99.......................................53498
514.31  Removed; eff. 1-1-99.......................................53498
514.32  Removed; eff. 1-1-99.......................................53498
514.101--514.117  (Subpart) Undesignated center heading and 
        sections removed; eff. 1-1-99..............................53498
516  Removed; eff. 1-1-99..........................................53498
517  Removed; eff. 1-1-99..........................................53498
520  Removed; eff. 1-1-99..........................................53498
521  Authority citation revised....................................53498
521.1--521.8  (Subpart) Removed; eff. 1-1-99.......................53498
521.103  (d) removed; eff. 1-1-99..................................53498

[[Page 204]]

                                  1998

26 CFR
                                                                   63 FR
                                                                    Page
Chapter I
502  Regulation at 62 FR 53497 eff. date delayed to 1-1-00.........72183
503  Regulation at 62 FR 53497 eff. date delayed to 1-1-00.........72183
509.1--509.10  (Subpart) Regulation at 62 FR 53497 eff. date 
        delayed to 1-1-00..........................................72183
509.103  Regulation at 62 FR 53497 eff. date delayed to 1-1-00.....72183
509.117  Regulation at 62 FR 53497 eff. date delayed to 1-1-00.....72183
509.119  Regulation at 62 FR 53497 eff. date delayed to 1-1-00.....72183
509.122  Regulation at 62 FR 53497 eff. date delayed to 1-1-00.....72183
513.1  Regulation at 62 FR 53497 eff. date delayed to 1-1-00.......72183
513.2  Corrected....................................................2723
    Regulation at 62 FR 53497 eff. date delayed to 1-1-00..........72183
513.3  Regulation at 62 FR 53497 eff. date delayed to 1-1-00.......72183
513.4  Regulation at 62 FR 53498 eff. date delayed to 1-1-00.......72183
513.5  Regulation at 62 FR 53498 eff. date delayed to 1-1-00.......72183
514.1--514.10  Regulation at 62 FR 53498 eff. date delayed to 1-1-
        00.........................................................72183
514.20  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.21  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.22  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.23  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.24  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.25  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.26  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.27  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.28  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.29  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.30  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.31  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.32  Regulation at 62 FR 53498 eff. date delayed to 1-1-00......72183
514.101--514.117  (Subpart) Regulation at 62 FR 53498 eff. date 
        delayed to 1-1-00..........................................72183
516  Regulation at 62 FR 53498 eff. date delayed to 1-1-00.........72183
517  Regulation at 62 FR 53498 eff. date delayed to 1-1-00.........72183
520  Regulation at 62 FR 53498 eff. date delayed to 1-1-00.........72183
521.1--521.8  (Subpart) Regulation at 62 FR 53498 eff. date 
        delayed to 1-1-00..........................................72183
521.103  Regulation at 62 FR 53498 eff. date delayed to 1-1-00.....72183

                                  1999

  (No regulations published from January 1, 1999 through April 1, 1999)


                                  
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