CONVENTION
BETWEEN
THAILAND
AND
SWEDEN
FOR THE AVOIDANCE OF DOUBLE TAXATION
AND THE PREVENTION OF FISCAL EVASION
WITH RESPECT TO TAXES ON INCOME
The Government of the Kingdom of Thailand and the Government of the Kingdom of Sweden,
Desiring to conclude a Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income,
Have agreed as follows:
ARTICLE 1
PERSONAL SCOPE
This Convention shall apply to persons who are residents of one or both of the Contracting States.
ARTICLE 2
TAXES COVERED
1. This Convention shall apply to taxes on income imposed on behalf of a 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 all imposed on total income, or on elements of income, including taxes on gains from the alienation of movable or immovable property, as well as taxes on capital appreciation.
3. The existing taxes to which the Convention shall apply are :
a) In Thailand :
(i) the income tax; and
(ii) the petroleum income tax;
(hereinafter referred to as "Thai tax")
b) In Sweden :
(i) the State income tax, including the sailors' tax and
the coupon tax;
(ii) the tax on the undistributed profits of companies and
the tax on distribution in connection with reduction of
share capital or the winding up of a company;
(iii) the tax on public entertainers;
(iv) the profit sharing tax; and
(v) the communal income tax
(hereinafter referred to as "Swedish tax").
4. The Convention shall also apply to any identical or substantially similar taxes which are imposed after the date of signature of the Convention in addition to, or in place of the taxes referred to above. The competent authorities of the Contracting States shall notify each other of any significant changes which have been made in their respective taxation laws.
ARTICLE 3
GENERAL DEFINITIONS
1 For the purposes of this Convention, unless the context otherwise requires:
a) the term "Thailand" means the Kingdom of Thailand and
includes any area adjacent to the territorial waters of the
Kingdom of Thailand which by Thai legislation, and in
accordance with international law, has been or may
hereafter be designated as an area within which the rights
of the Kingdom of Thailand with respect to the seabed and
subsoil and their natural resources may be exercised;
b) the term "Sweden" means the Kingdom of Sweden and
includes any area outside the territorial sea of the Kingdom
of Sweden within which under the laws of the Kingdom of
Sweden and in accordance with international law the rights of
the Kingdom of Sweden with respect to the exploration and
exploitation of the natural resources on the seabed or in its
subsoil may be exercised;
c) the term "person" includes an individual, an estate, a
company and any other body of persons ;
d) the term "company" means any body corporate or any entity
which is treated as a body corporate for tax purposes;
e) the terms "a Contracting State" and "the other Contracting
State" mean Thailand or Sweden, as the context requires;
f) the term "enterprise of a Contracting State" and "enterprise
of the other Contracting State" mean respectively an
enterprise carried on by a resident of a Contracting State and
an enterprise carried on by a resident of the other
Contracting State ;
g) the term "international traffic" means any transport by a ship
or aircraft operated by an enterprise of a Contracting State,
except when the ship or aircraft is operated solely between
place in the other Contracting State;
h) the term "national" means :
(i) any individual possessing the nationality of a
Contracting State;
(ii) any legal person, partnership, association and any
other entity deriving its status as such from the laws in
force in a Contracting State;
i) the term "competent authority" means:
(i) in Thailand, the Minister of Finance or his authorized
representative, and
(ii) in Sweden, the Minister of Finance, his authorized
representative, or the authority designated to act as
competent authority for the purposes of the
Convention;
j) the term "tax" means Thai tax or Swedish tax, as the context
requires. The term shall, however, not include penalties,
surcharges or interest for late payments of taxes.
2. As regards the application of the Convention by a Contracting State any term not defined therein shall, unless the context otherwise requires, have the meaning which it has under the law of that State concerning the taxes to which the Convention applies.
ARTICLE 4
RESIDENT
1. For the purposes of this Convention, 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, place of incorporation, place of management or any other criterion of a similar nature. But this term does not include any person who is liable to tax in that State in respect only of income from sources in that State.
2. Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows :
a) he shall be deemed to be a resident of the State in which he
has a permanent home available to him ; if 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) if the State in which he has his centre of vital interests cannot
be determined, or if he has not a permanent home available
to him in either State, he shall be deemed to be a resident of
the State in which he has an habitual abode;
c) if he has an habitual abode in both States or in neither of
them, he shall be deemed to be a resident of the State of
which he is a national;
d) if he is 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 the Competent authorities of the Contracting States shall settle the question by mutual agreement.
ARTICLE 5
PERMANENT ESTABLISHMENT
1. For the purposes of this Convention the term "permanent establishment" means a fixed place of business through which the business of an enterprise is wholly or partly carried on.
2. The term "permanent establishment" includes especially:
a) a place of management ;
b) a branch ;
c) an office ;
d) a factory ;
e) a workshop ;
f) a warehouse, in relation to a person providing storage
facilities for others ; and
g) a mine, an oil or gas well, a quarry or any other place of
extraction of natural resources.
3. The term "permanent establishment" likewise encompasses :
a) a building site, a construction, assembly or installation
project or supervisory activities in connection therewith, but
only where such site, project or activities continue for a
period of more than
(i) 6 months, in the case of installation or setting up of
plant equipment or machinery including the auxiliary
construction as is necessary for such installation;
(ii) 3 months in all other cases;
b) the furnishing of services including consultancy services by
an enterprise through employees or other personnel
engaged by the enterprise for such purpose, but only where
activities of that nature continue (for the same or a
connected project) within the country for a period or
periods aggregating more than 6 months within any twelve-
month period.
4. Notwithstanding the preceding provisions of this Article, the term"permanent establishment" shall be deemed not to include :
a) the use of facilities solely for the purpose of storage or
display 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
or display;
c) the maintence of a stock of goods or merchandise belonging
to the enterprise solely for the purpose of processing by
another, enterprise;
d) the maintenance of a fixed place of business solely for the
purpose of purchasing goods or merchandise or of
collecting information, for the enterprise;
e) the 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.
5. Notwithstanding the provisions of paragraphs 1 and 2, where a person other than an agent of an independent status to whom paragraph 6 applies - is acting in a Contracting State on behalf of an enterprise of the other Contracting State, that enterprise shall be deemed to have a permanent establishment in the first-mentioned Contracting State in respect of any activities which that person undertakes for the enterprise, if such a person :
a) has and habitually exercises in that State an authority to
conclude contracts in the name of the enterprise, unless the
activities of such person are limited to those mentioned in
paragraph 4 which, if exercised through a fixed pace of
business, would not make this fixed place of business a
permanent establishment under the provisions of that
paragraph; or
b) has no such authority, but habitually maintains in the first-
mentioned State a stock of goods or merchandise from
which he regularly fills orders or delivers goods or
merchandise on behalf of the enterprise ; or
c) has no such authority, but habitually secures orders in the
first-mentioned Contracting State wholly or almost wholly on
behalf of the enterprise or on behalf of that enterprise and
other enterprises which are controlled by it or have a
controlling interest in it.
6. An enterprise shall not be deemed to have a permanent establishment in a Contracting State merely because it carries on business in that State through a broker, general commission agent or any other agent of an independent status, provided that such persons are acting in the ordinary course of their business. However, when the activities of such an agent are devoted wholly or almost wholly on behalf of that enterprise or on behalf of that enterprise and other enterprises, which are controlled by it or have a controlling interest in it, he will not be considered an agent of an independent status within the meaning of this paragraph but in such cases the provisions of paragraph 5 shall apply.
7. The fact a company which is 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.
8. Notwithstanding the provisions of paragraph 7, where an enterprise of a Contracting State sells to a resident of the other Contracting State goods manufactured, assembled, processed, packed or distributed in that other Contracting State by an industrial or commercial enterprise for, or at, or to the order of, that first-mentioned enterprise and
a) either enterprise participates directly or indirectly in the
management, control or capital of the other enterprise ; or
b) the same persons participate directly or indirectly in the
management, control or capital of both enterprise, then, for
the purposes of this Convention, that first -mentioned
enterprise shall be deemed to have a permanent
establishment in that other Contracting State and to carry on
business in that other Contracting State through that
permanent establishment.
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