Turkey - United Arab Emirates Tax Treaty

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Agreement Between the Republic of Turkey And the United Arab Emirates for the Avoidance of Double Taxation With Respect to Takes on Income And on Capital The Government of The Republic of Turkey and The Government of The United Arab Emirates Desiring to conclude an Agreement for the avoidance of double taxation with respeci to taxes on income and on capital H A V E A G R E E D AS F O L L O W S :

Article 1 PERSONAL SCOPE

This Agreement shall apply to persons who are" residents of one or both of the Contracting States.

Article 2 TAXES COVERED

1. This Agreement shall apply to taxes on income and on capital imposed on behalf of each Contracting State or of its political subdivisions or local authorities, irrespective of the manner in which they are levied.
2. There shall be regarded as taxes on income and on capital all taxes imposed on total income, on total capital, or on elements of income or of capital, including taxes on gains from the alienation of movable or immovable property, taxes on the total amounts of wages or salaries paid by enterprises, as well as taxes on capital appreciation.
3. The taxes to which the Agreement shall apply are, in particular : a) in i) ii) iii)

the case of Turkey : the income tax (Gelir Vergisi); the corporation, tax (Kurumlar Vergisi); the levy on behalf of the fund for the support of the defense industry (Savunma Sanayii Destekleme Fonu); iv) the levy on behalf of the fund for the encouragement of social charity and solidarity (Sosyal Yardımlaşma ve Dayanışmayı Teşvik Fonu); and v) the levy on behalf of the fund for business apprentices and for the Improvement and enlargement of the vocational and technical training (Çıraklık, Mesleki ve ' Teknik Eğitimi Geliştirme ve Yaygınlaştırma Fonu);

(hereinafter

referred to as "Turkish Tax") ; Yürütme ve İdare Bölümü Sayfa : 17

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b) in the case of the United Arab Emirates:

1. Income tax ; and 1i) corporation tax; (hereinafter referred to as "United Arab Emirates Tax").

4. The Agreement shall also apply to any Identical or substantially similar taxes which are Imposed after the date of signature of the Agreement In addition to, or in place of, the above-mentioned taxes. The competent authorities of the Contracting States shall notify each other of substantial changes which have been made 1n their respective taxation laws.

Article 3 GENERAL DEFINITIONS 1. requl res:

For the

purposes

of this

Agreement, unless the

context

otherwise

a) 1) the term "Turkey" means the Turkish territory, territorial waters, continental shelves and exclusive economic zones delimited by mutual agreement between the parties concerned. 11) the term "The United Arab Emirates" means, the territory of the United Arab Emirates including its territorial sea and adjacent maritime areas over which United Arab Emirates exercises sovereign rights and jurisdiction; b) the terms "a Contracting State " and " the other Contracting State" mean Turkey or the-ijnited Arab Emirates as the context requires; c) the term "tax" means any tax covered by Article 2 of this Agreement; d) the term "person" Includes an Individual, a company and any other body of persons; e) the term "company" means any body corporate or any entity which is treated as a body corporate for tax purposes; f) the term "registered office" means the legal head office registered under the Turkish Code of Commerce or legal head office registered according to laws in force in the United Arab Emirates; g) the term "national" means:

1. any individual possessing the nationality of a Contracting State; i i ) any legal person, partnership and association deriving its status as such from the laws in force in a Contracting State; h) the terms "enterprise of a Contracting State" Snd "enterprise of the other Contracting State" mean respectively an enterprise carried on by a resident of a Contracting State and an enterprise carried on by a resident of the other Contracting State; i) the term "competent authority" means :

1n Turkey,

the

Minister

of

Finance

and

Customs or

his

authorized representative; H)

1n the

United Arab Emirates, the

Minister of

Industry or his authorized representative; Yürütme ve İdare Bölümü Sayfa : IS

Finance and

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j ) t h é expression "International traffic" means any transport by a ship, an aircraft or a road vehicle operated by a Turkish or United Arab Emirates enterprise,except when the ship or aircraft or road vehicle is operated solely between places situated in the territory of Turkey or of the United Arab Emirates. 2. As regards the application of this Agreement by a Contracting State any term not defined therein shall, unless the context otherwise requires, have the meaning which 1t has under the laws of that State concerning the taxes to which the Agreement applies.

Article 4 RESIDENT

1. For the purposes of this Agreement, the term "resident of a Contracting State" means any person who, under the laws of that State, is liable to tax therein by reason of his domicile, residence, registered office (legal head office), place of management or any other criterion of a similar nature. resident follows:

2. Where by reason of the provisions of paragraph 1 an individual is a of both Contracting States, then his status shall be determined as a) he shall be deemed to be a resident of the State in which he has a permanent home available to him; i f he has a permanent home available to him- in- both States, he shall be deemed to be a resident of the State with which his personal and economic relations are closer (centre of vital interests); b) i f the State in which he has his centre of vital interests cannot be determined, or i f he has not a permaneit home available to him in either State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode; c) i f he has an habitual abode in both Contracting States or in neither of them, he shall be deemed to be a resident of the State of which he is a national; d) i f he is a national of both States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement.

3. Where by reason of the provisions of paragraph 1 a person other than an individual is a resident of both Contracting States, then i t shall be deemed to be a resident of the State in which its registered office is situated. However, where such person has its place of effective management in one of the Contracting States and tts registered office in the other Contracting State, then the competent authorities of the Contracting States shall determine by mutual agreement .the State of which the person shall be deemed to be a resident for the purposes of this Agreement.

4. The political subdivisions or local authorities of Turkey or the United Arab Emirates are deemed respectively as a resident of Turkey or of the United Arab Emirates-. YürUtme ve klare Bölümü Sayfa : 19

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Article 5 PERMANENT ESTABLISHMENT

1. For the purposes of this Agreement, the term "permanent establishment" means a fixed place of business through which the business of an enterprise is wholly or partly carried on,
2. The term "permanent establishment" includes

especially:

a) a place of management; b) a hranch; c) an office; d) a factory; e) a workshop; f)

a mine, an oil or gas well, a quarry or any other place of extraction of natural resources;

g) a building s i t e , a construction or installation project but only i f such site or project continue for a period of more than twelve months. 3. Notwithstanding the preceding provisions of this "permanent establishment" shall be deemed not to Include:

Article, the term

a) the use of facilities solely for the purpose of storage, display or delivery of goods or merchandise belonging to the enterprise; b) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of storage, display or delivery; c) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for _£he purpose of processing by another enterprise; d) the maintenance of a fixed place of business solely for the purpose of purchasing goods or merchandise or of collecting information, for the enterprise; e) the maintenance of a fixed place of business solely for the purpose of carrying on, for the enterprise, any other activity of a preparatory or auxiliary character; f) the maintenance of a fixed place of business solely for any combination of activities mentioned in sub-paragraphs a) to e), provided that the overall activity of the fixed place of business resulting from this combination Is of a preparatory or auxiliary character. 4. Notwithstanding the provisions of paragraphs 1 -and 2, where a person -other than an agent of an independent status to whom paragraph 5 applies - is acting on behalf of an enterprise and has, and habitually exercises, in a Contracting State an authority to conclude contracts In the name of the enterprise, that enterprise shall be deemed to have a permanent estabHshmet in that State 1n respect of any activities which that person undertakes for the enterprise, unless the activities of such person are limited to those mentioned in paragraph 3 which, 1f exercised through a fixed place of business, would not make this fixed place of business a permanent establishment under the provisions of that paragraph. YflrQtme ve tdare BfilUmii Sayfa : 20

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5. An enterprise of a Contracting State shall not be deemed to have a permanent establishment 1n the other Contracting State merely because 1t carries on business in that other State through a broker, general commission agent or any other agent of an independent status, provided that such persons are acting 1n the ordinary course of their business.
6. The fact that a company which 1s a resident of a Contracting State controls or is controlled by a company which is a resident of the other Contracting State, or which carries on business in that other State (whether through a permanent establishment or otherwise), shall not of itself constitute either company a permanent establishment of the other.
7. Where a person who is a resident of one of the Contracting States and who is a partner of a partnership situated in the other Contracting State does not have a permanent establishment in that other State constituted according to the provisions of preceding paragraphs, this partnership shall not constitute a permanent establishment of that person in that other State merely because of this participation.

Article 6 INCOME FROM IMMOVABLE PROPERTY

1. Income derived by a resident of a Contracting State from immovable property (including Income from agriculture or forestry) situated in the other Contracting State may be taxed in that other State. Z . The term "Immovable property" shall have the meaning which It has under the law of the Contracting State In which the property in question Is situated. The term shall in any case include property accessory to Immovable property, livestock and equipment used in agriculture and forestry, fishing places of every kind, rights to which the provisions of general law respecting landed property apply, usufruct of immovable property and rights to variable or fixed payments as consideration for the working of, or the right to work, mineral deposits, sources and other natural resources; ships, boats and aircraft shall not be regarded as immovable, property.
2. The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use in any other form of immovable property.
3. The provisions of paragraphs 1 and 3 shall also apply to the income from immovable property of ah enterprise and to Income from Immovable property used for the performance of independent personal services.

Article 7 BUSINESS PROFITS

1. The profits of an enterprise of a Contracting State shall be taxable only In that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the Y Or Oí me ve Idare BoKlmtl Sayfa ; 21

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enterprise carries on business as aforesaid, the profits of the enterprise may be taxed in the other State but only so much of them as is attributable to that permanent establishment. 2. Subject to the provisions of paragraph 3, where an enterprise of a Contracting State carries on business 1n the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State be attributed to that permanent establishment the profits which it might be expected to make if it were a distinct and separate enterprise engaged in the same or similar activities under the same or similar conditions and dealing wholly independently with the enterprise of which i t is a permanent establi shment. 3. In determining the profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the permanent establishment, including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere. 4. No profits shall he attributed to a permanent establishment by reason of the mere purchase by that permanent establishment of goods or merchandise for the enterprise. •>. Where profits include items of income which are dealt with separately in other Articles of this Agreement, then the provisions of those Articles shall not be affected hy the provisions of this A r t i c l e .

Article 8 SHIPPING, AIR AND LAND TRANSPORT

1. Profits derived by an enterprise of a Contracting State from the operation of ships, aircraft or road vehicles 1n international traffic shall be taxable only In that State.

2. With respect to profits derived by Gulf A1r Company the provision of paragraph 1 shall be appljed, but only to such part of the profits as corresponds to the share of the United Arab Emirates thereof.

3. For the purposes of this Article, interest arising from deposit account of the enterprise of a- Contracting State connected with air transport and shipping activities in International traffic shall be exempted from tax in the other Contracting State.

4. The provisions of paragraph 1 of this Article shall also apply to profits derived from the participation in a pool, a joint business or an international operating agency.

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Article 9 ASSOCIATED ENTERPRISES

1. Where a)

an enterprise of a Contracting State p a r t i c i p a t e s d i r e c t l y or i n d i r e c t l y i n the management, control or c a p i t a l of an enterprise of the other Contracting S t a t e , or b) the same persons p a r t i c i p a t e d i r e c t l y or i n d i r e c t l y in the management , control or c a p i t a l of an enterprise of a Contracting State and an e n t e r p r i s e of the other C o n t r a c t i n g State, and i n e i t h e r case conditions are made or imposed between the two enterprises i n t h e i r commercial or f i n a n c i a l r e l a t i o n s which d i f f e r from those which would be made between independent e n t e r p r i s e s , then any p r o f i t s which would, but for those c o n d i t i o n s , have accrued to one of the e n t e r p r i s e s , b u t , by reason of those c o n d i t i o n s , have not so accrued, may be included i n the p r o f i t s of that enterprise and taxed accordi n g l y . 2. where a Contracting State includes in the p r o f i t s of an enterprise of that State-and taxes accordi ngly-prof i ts on which an enterprise of the other Contracting State has been charged to tax in that other State and the p r o f i t s so included are by the first-mentioned State claimed to be p r o f i t s which would have accrued to the enterprise of the first-mentioned State i f the conditions made between the two enterprises had been those which would have been made between independent e n t e r p r i s e s , then that other State s h a l l make an appropriate adjustment t o the amount of the tax charged therein on those p r o f i t s , where that other State considers the adjustment j u s t i f i e d . In determining such adjustment, due regard s h a l l be had to the other provisions of t h i s Agreement and the competent a u t h o r i t i e s of the Contracting States s h a l l , i f necessary, consult each other.

Article 10 DIVIDENDS

1. Dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State.
2. However, such dividends may also be taxed i n the Contracting State of which the company paying dividends i s a resident, i n accordance with the laws of that S t a t e , but i f the r e c i p i e n t i s the beneficial owner of the dividends the tax so charged s h a l l not exceed: a) 5 per cent of the gross amount of the dividends i f the r e c i p i e n t i s the Government, or a public i n s t i t u t i o n which i s wholly owned by the Government or i t s p o l i t i c a l s u b d i v i s i o n s or local a u t h o r i t i e s , of the other Contracting State; b) 10 per cent of the gross amount of the dividends i f the r e c i p i e n t i s a company (excluding partnership) which holds d i r e c t l y at least 25 percent of the c a p i t a l of the company paying the dividends; YttrOtme ve ldare BOlOmü Sayfa : 23

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12 per cent of

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the gross amount of the dividends

in a l l

other

cases. 3 . The term "dividends" as used in t h i s A r t i c l e means income from shares, "jouissance" shares or "jouissance" r i g h t s , founders' shares or other r i g h t s , not being d e b t - c l a i m s , p a r t i c i p a t i n g in p r o f i t s , as well as income from other corporate rights which i s subjected to the same taxation treatment as income from shares by the laws of the State of which the company making the d i s t r i b u t i o n i s a r e s i d e n t , and income derived from an investment fund and investment t r u s t . 4. P r o f i t s of a company of a Contracting State carrying on business in the other Contracting State through a permanent establishment situated therein may, a f t e r having been taxed under A r t i c l e 7, be taxed on the remaining amount i n the Contracting State i n which the permanent establishment i s situated and in accordance with paragraph 2. Taxation s h a l l be r e a l i s e d only at the time of t r a n s f e r of the p r o f i t s abroad and only to such part of the p r o f i t s t r a n s f e r r e d . 5. The provisions of paragraphs 1 and 2 s h a l l not apply i f the b e n e f i c i a l owner of the d i v i d e n d s , being a resident of a Contracting S t a t e , c a r r i e s on business i n the other Contracting State of which the company paying the dividends i s a r e s i d e n t , through a permanent establishment situated t h e r e i n , and the holding 1n respect of which the dividends are paid i s e f f e c t i v e l y connected with such permanent establishment. In such case the provisions of A r t i c l e 7 s h a l l apply.

Article 11 INTEREST

1. Interest a r i s i n g i n a Contracting State and paid to a resident the other Contracting State may be taxed in that other S t a t e .

of

2. However, such i n t e r e s t may a l s o be taxed i n the Contracting State i n which i t a r i s e s , and according to the laws of that State but i f the r e c i p i e n t i s the b e n e f i c i a l owner of the i n t e r e s t the tax so charged s h a l l not exceed 10 per cent of the gross amount of the i n t e r e s t . 3 . Notwithstanding the provisions

of paragraph 2, i n t e r e s t a r i s i n g 1n:

a) the United Arab Emirates and paid to the Government of Turkey or to the Central Rank of Turkey ( T ü r k i y e Cumhuriyet Merkez Bankası) s h a l l be exempt from "the*'United Arab Emirates t a x ; b)

Turkey and paid to the Central or Local Government of the United Arab Emirates or to the Central Bank of the United Arab Emirates s h a l l be exempt from Turkish t a x .

4. The term "interest" as used in t h i s A r t i c l e means income from Government s e c u r i t i e s , bonds or debentures, whether or not secured by mortgage and whether or not carrying a r i g h t to p a r t i c i p a t e in p r o f i t s , and debt-claims of every kind as well as a l l other income assimilated to income from money lent by the t a x a t i o n law of the State i n which the income a r i s e s .
5. The provisions of paragraphs 1 and 2 s h a l l not apply i f the b e n e f i c i a l owner of the i n t e r e s t , being a resident of a Contracting State c a r r i e s on business in the other Contracting State in which the i n t e r e s t a r i s e s , Yürütme ve İdare Bölümü Sayfa : H

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through a permanent establishment situated therein, and the debt-claim in respect of which the interest is paid is effectively connected with such permanent establ ishment .In such case the provisions of Article 7 shall apply. 6. Interest shall be deemed to arise in a Contracting State when the payer is that State i t s e l f , 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 arise in the Contracting State in which the permanent establishment is situated. 7. Where, by reason of a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the interest, having regard to the debt-claim for which i t 1s paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner 1n the absence of such relationship, the provisions of this Article shall apply only to the last mentioned amount. In such case the excess part of the payments shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Agreement.

Article 12 ROYALTIES

1. Royalties arising In a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.
2. However, such royalties may also be taxed in the Contracting State in which they arise and according to the laws of that State, but i f the recipient is the beneficial owner of the royalties the tax so charged shall not exceed 10 per cent of the gross amount of the royalties.
3. The term "royalties" as used in this Article means payments of any kind received as a consideration for the use of, or the right to use, any copyright of literary , a r t i s t i c or scientific work including cinematograph films and recordings for radio and'television, any patent, trade mark, design or model, plan, secret formula or process, or for Information concerning, industrial, commercial or scientific experience or for the use of, or the right to use, industrial, commercial, or scientific equipment, but exclude royalties or other payments in respect of the operation of mines or quarries or exploitation of natural resources.
4. The provisions of paragraps 1 and 2 shall not apply if the beneficial owner of the royalties, being a resident of a Contracting State carries on business In the other Contracting State in which royalties arise, through a permanent establishment situated therein, and the right or property in respect of which the royalties are paid is effectively connected with such permanent establishment. In such a case the provisions of Article 7 shall apply.
5. Royalties shall be deemed to arise in a Contracting State when the payer 1s that State Itself, a political subdivision, a local authority or a resident of that State. Where, however, the person paying the royalties, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment 1n connection with which the right or property giving rise to the royalties 1s effectively connected, and such royalties are borne by Yûrûtme ve ldare Boliimii Sayfa : 25

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such permanent establishment, then such royalties shall be deemed to arise in the Contracting State 1n which the permanent establishment is situated. -. 6. Where, by reason of a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the royalties paid,having regard to the use,right or information for which they are paid,exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned amount.In such case,the excess part of the payment shall remain taxable according to the laws of each Contracting State,due regard being had to the other provisions of this Agreement.

Article 13 CAPITAL GAINS

1. Gains derived by a resident of a Contracting State from the alienation of immovable property, referred to in Article 6 and situated In the other Contracting State may be taxed 1n that other State. ?. Rains from the alienation of movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State or of movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent personal services, including such gains .from the alienation of such a permanent establishment (alone or with the whole enterprise) or of such a fixed base, may be taxed in the other State.
2. Gains derived by an ,enterprise of a Contracting State from the alienation of ships, aircraft or road vehicles operated In International t r a f f i c , or movable property pertaining to the operation of such ships, aircraft or road vehicles shall he taxable only in the Contracting State in which the registered office of the enterprise is situated.
3. Gains from the alienation of any property other than that referred to in paragraphs 1, ? and 3 shall be taxable in the Contracting State of which the alienator is a resident. However, the capital gains mentioned in the foregoing sentence and derived from the other Contracting State, shall be taxable in the other Contracting State i f the time period does not exceed one year between acquisition and alienation.

Article 14 INDEPENDENT PERSONAL SERVICES

1. Income derived by a resident of a Contracting State in respect of professional services or other activities of an independent character, shall be taxable only in that State unless he has a fixed base regularly available to him in the other Contracting State for the purpose of performing his activities. If he has such a fixed base, the Income may be taxed in the other State but only so much of it as is attributable to that fixed base. Yürütme ve İdare Bölümü Sayfa : 26

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2. The term "professional services" includes especially independent scientific, literary, a r t i s t i c , educational or teaching activities as well as the independent activities of physicians, lawyers, engineers, architects, dentists and accountants.

Article 15 DEPENDENT PERSONAL SERVICES

1. Subject to the provisions of Articles 16, 18, 19 and 20, salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other State.

2. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting State in respect of an employment exercised in the other Contracting State shall ,he taxable only in the first-mentioned State if:

a) the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in the calendar year concerned, and b) the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State, and c) the remuneration is not borne by a permanent establishment a fixed base which the employer has in the other State.

or

Notwithstanding the preceding provisions of this Article, remuneration derived in respect of an employment exercised aboard a ship aircraft or road vehicle operated in international t r a f f i c , may be taxed in the Contracting State in which the registered office of the enterprise is situated.

Article 16 DIRECTORS' FEES

Directors' fees and similar payments derived by a resident of a Contracting State in his capacity as a member of the board of directors of a company which is a resident of the other Contracting State may be taxed in that other State. Yürütme veldareBölümU Sayfa : 27

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Article 17 ARTISTES AND ATHLETES

1. Notwithstanding the provisions of Articles 14 and 15, Income derived by a resident of a Contracting State. as an entertainer, such as a theatre, motion picture, radio or television artiste, or a musician, or as an athlete, from his personal activities as such exercised in the other Contracting State, may be taxed in that other State. ?.. Where income 1n respect of personal activities exercised by an entertainer or an athlete in hJs capacity as such accrues npt to the entertainer or athlete himself but to another person, that Income may, notwithstanding the provisions of Articles 7, 14 and 15, be taxed in the Contracting State in which the activities of the entertainer or athlete are exercised.
2. The provisions of paragraphs 1 and 2 shall not apply to income derived from activities performed in a Contracting State by entertainers or athletes i f the visit to that State is substantially supported by public funds of the other Contracting State or their political subdivision or local authorities or i f the activities nf such persons are exercised under a cultural agreement or arrangement between the Contracting States.

Article 18 PENSIONS

1. Subject to the provisions of paragraph 1 of A r t i c l e 19, pensions and other s i m i l a r remuneration paid to a resident of a Contracting State i n consideration of past employment s h a l l be taxable only i n that S t a t e . This provision s h a l l also apply to l i f e annuities paid to a resident of a Contracting State. ? . Pensions and l i f e annuities paid, and other p e r i o d i c a l or occasional payments made by a Contracting S t a t e , or one of i t s p o l i t i c a l subdivisions in respect of i n s u r i n g personal a c c i d e n t s , may be taxed only i n t h i s S t a t e .

Article 19 GOVERNMENT SERVICE

1. Remuneration, including pensions, paid by, or out of funds created by, a Contracting State or political subdivision or a local authority thereof to any individual in respect of services rendered to that State or subdivision or local authority thereof 1n the discharge of functions of a governmental nature shall be taxable in that State. Yürütme ve İdare Bölümü Sayfa : 28

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2. The provisions of Articles i">, 16 and 18 shall apply to remuneration and pensions in respect of services rendered -in, connection with a business carried on by a Contracting State 6r a political subdivision or a local authority thereof.

«rttcle 20 TEACHERS AND STUDENTS

1. Payments which a student or business apprentice who fs a national of a Contracting State and who is present in the other Contracting State solely for the purpose of his education or training receives for the purpose of his maintenance, education or training shall not be taxed in that other State, provided that such payments arise from sources outside that other State.
2. Likewise, remuneration received by a teacher or by an instructor who i s a national of a Contracting State and who is present in the other Contracting State and the primary purpose of teaching or engaging in scientific research for a period or periods not exceeding-two years shall be exempt from tax in that other State on his remunerations from personal services for teaching or research, provided that such payments arise from sources outside that other State.
3. Remuneration which a student or a trainee who is a Contracting State derives from an employment which he exercises Contracting State for a period or periods not exceeding 183 days year, in order to obtain practical experience related to his formation shall not be taxed in that other State.

national of a in the other in a calendar education or

Article 21 OTHER INCOME

1. Items of income of a resident of a Contracting State, wherever arising, not dealt within the foregoing Articles of this Agreement shall be taxable only in that State.
2. Items of income arising outside the two Contracting States shall be taxable only in the Contracting State of which the person receiving the income in question is a resident.

Article 22 CAPITAL

1. Capital represented by immovable property referred to in Article 6, owned by a resident of a Contracting State and situated in the other Contracting State, may be taxed in that other State. Yürütme ve İdare Bölümü Sayfa : 29

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RESMI G A Z E T E

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?. Capital represented by'movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State or by movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent personal services, may be taxed in that other State. 3. Without precluding to paragraph ? of Article 8, capital represented by ships, aircraft or road vehicles operated in international traffic and by movable property pertaining to the operation of such ships, aircraft or road vehicles shall he taxable only in the Contracting State in which the registered office of the enterprise is situated. 4 . All other elements of capital of a resident of a Contracting State shall be taxable only in that State.

Article 23 ELIMINATION OF DOUBLE TAXATION

1. Double taxation for

the residents of Turkey shall be eliminated as

follows : Where a resident of Turkey derives Income or owns capital which in accordance with the provisions of this Agreement, may be taxed in the United Arab Emirates, Turkey shall allow as a deduction from the tax on income or capital of that person, an amount equal to the tax on income or capital paid in the United Arab Emirates. Such deductions shall not, however, exceed that part of the tax computed in Turkey before the deduction is given, which is attributable, to the income or capital which may be taxed in the United Arab Fmirates. 2 . In the case of the United Arab Emirates, the elimination of double taxation will be done according to the legislation of the United Arab Emirates taking into account the general principle of avoidance of double taxation.

Article 24 NON-DISCRIMINATION

1. Nationals of a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith, which Is other or more burdensome than the taxation and connected requirements to which nationals of that other State In the same circumstances are or may be subjected. 2 . Subject to the provisions of paragraph 4 of Article 10, the taxation on a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall, not be less favourably levied in that other State than the taxation levied on enterprises of that other State carrying on the same a c t i v i t é s . YUrfttmeve IdareBölümü Sayfa : 30

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3. Enterprises of a Contracting State, the capital of which is wholly or partly owned or controlled, directly or indirectly, by one or more residents of the other Contracting State, shall not be subjected in the first-mentioned State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which other similar enterprises of the first-mentioned State are or may be subjected.
4. These provisions shall not State to grant to residents of the allowances, reliefs and reductions for status or family responsibilities which

be construed as obliging a Contracting other Contracting State any personal taxation purposes on account of c i v i l i t grants to its own residents.

Article 25 EXCHANGE OF INFORMATION

1. The competent authorities of the Contracting States shall exchange such Information as is necessary for the carrying out the provisions of this Agreement or of the domestic laws of the Contracting States concerning taxes covered by the Agreement insofar as the taxation thereunder is not contrary to the Agreement. Any information received by a Contracting State shall be treated as secret in the same manner as information obtained under the domestic laws of that State and shall be disclosed only to persons or authorities including courts and administrative bodies involved in the assessment or collection of, the enforcement or prosecution in respect of or the determination of appeals in relation to, the taxes covered by the Agreement. Such persons or authorities shall use the Information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions.
2. In no case shall the provisions of paragraph 1 be construed so as to impose on a Contracting State the obligation : a) to carry out administrative measures at variance with the laws and the administrative practice of that or of the other Contracting State ; b) to supply information which is not obtainable under the laws or in the normal course of the administration of that or of the other Contracting State ; c) to supply information which would disclose any trade, business, industrial, commercial or professional secret or trade process, or information, the disclosure of which would be contrary to public order.

Article

26

MUTUAL AGREEMENT PROCEDURE

1. Where a resident of a Contracting State considers that the actions of one or both of the Contracting States result or will result for him in taxation not in accordance with this Agreement,he may, irrespective of the remedies provided by the national laws of those States, present his case to the competent authority of the Contracting State of which he is a resident or i f his case comes under paragraph 1 of Article ?4, to that of the Contracting State of which he is a national. _ Yürütme ve İdare Bölümü Sayfa : 31

Sayfa : 34

RESMl G A Z E T E

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2 . The competent authority s h a l l endeavour, i f the objection appears to i t to b e ' j u s t i f i e d and i f rt 1s not i t s e l f able to a r r i v e at a s a t i s f a c t o r y s o l u t i o n , to resolve the case hy mutual agreement with the competent authority of the other Contracting State, with a view to the avoidance of taxation not i n accordance with the Agreement. 3 . The competent a u t h o r i t i e s of the Contracting States s h a l l endeavour t o resolve by mutual agreement any d i f f i c u l t i e s or doubts a r i s i n g as to the i n t e r p r e t a t i o n or a p p l i c a t i o n of the Agreement. They may also consult together f o r the e l i m i n a t i o n of double taxation i n cases not provided for i n the Agreement. 4. The competent a u t h o r i t i e s of the Contracting States may communicate with each other d i r e c t l y for the purpose of reaching an agreement in the sense of the preceding paragraphs. When I t seems advisable i n order to reach agreement to have an oral exchange of o p i n i o n s , such exchange may take place through a Commission c o n s i s t i n g of representatives of the competent a u t h o r i t i e s of the Contracting S t a t e .

Article 27 DIPLOMATIC AGENTS AND CONSULAR OFFICERS

Nothing in t h i s Agreement s h a l l affect the f i s c a l p r i v i l e g e s of d i p l o m a t i c agents or consular o f f i c e r s under the general rules of i n t e r n a t i o n a l law or under the provisions of special agreements.

Article 28 ENTRY INTO FORCE

1. Each Contracting State s h a l l notify t o the other the completion of the C o n s t i t u t i o n a l procedures required as far as i t Is concerned for the bringing into force of t h i s Agreement. This Agreement s h a l l enter Into force on the day when the l a t t e r of these n o t i f i c a t i o n s has been r e c e i v e d .
2. I t s provisions s h a l l have effect for taxes with respect to every taxable year beginning on or a f t e r the f i r s t day of January of the year f o l l o w i n g that of entry i n t o force of t h i s Agreement. 3 . Nothwithstanding tbe p r o v i s i o n of paragraph 2 of t h i s A r t i c l e , the p r o v i s i o n of A r t i c l e 8 of t h i s Agreement s h a l l have effect for the taxes based on income derived from a i r transport a c t i v i t i e s a f t e r 1 January 1988. The tax has already been c o l l e c t e d for the corresponding period s t a r t i n g with above mentioned date s h a l l be refunded. YilrUtmeve ldare Bölümü Sayfa : 32

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Article 29 TERMINATION

This Agreement shall remain In force until terminated by a Contracting State. Either Contracting State may terminate the Agreement through diplomatic channels, by giving notice of termination at least six months before the end of any calendar year. In such event, the Agreement shall cease to have effect In both States, for taxes with respect to every taxable year beginning on or after the f i r s t day of January of the year following that in which the notice of termination is given.

IN WITNESS W H E R E O F , the undersigned plenipotentiaries have signed the pre­ sent Agreement and have affixed their seals thereto. "Done in duplicate at Abu Dhabi the 29th day of January 1993 in the Turkish, Ara­ bic and English languages, all three texts being equally authentic. In case of divergence between the texts, the English text shall be the operative one."

FOR THE REBUPLIC OF TURKEY

Hikmet ÇETİN Minister of Foreign Affairs

FOR THE UNITED ARAB EMIRATES

Hamdan Bin Zayed Al - NAHAYYAN Minister of State for Foreign Affairs

YürOtmeve İdare BölQmD Sayfa : 33