CONVENTION
BETWEEN
THE GOVERNMENT OF THE KINGDOM OF THAILAND
AND
THE GOVERNMENT OF ROMANIA
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 Romania,
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 each Contracting State, irrespective of the manner in which they are levied.
2. There shall be regarded as taxes on income all taxes imposed on total income, or on elements of income, 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 existing taxes to which the Convention shall apply are:
(a) In the case of Thailand:
(i) the income tax; and
(ii) the petroleum income tax;
(hereinafter referred to as "Thai tax")
(b) In the case of Romania:
(i) the tax on income derived by individuals;
(ii) the tax on profit;
(iii) the tax on salaries and other similar remunerations;
(iv) the tax on agricultural income;
(v) the tax on dividends.
(hereinafter referred to as "Romanian tax").
4. The Convention shall also apply to any identical or substantially similar taxes on income which are imposed after the date of signature of this Convention in addition to, or in place of, the existing taxes. The competent authorities of the Contracting States shall notify each other of important changes which have been made in their respective taxation laws.
ARTICLE 3
General Definitions
1. In this Convention, unless the context otherwise requires:
(a) the term "Romania" means Romania and used in a
geographical sense indicates the territory of Romania
including its territorial sea as well as the exclusive economic
zone over which Romania exercises sovereignty, sovereign
rights and jurisdiction in accordance with the internal law
and with the international law, concerning the exploration
and exploitation of the natural, biological and mineral
resources existing in the sea waters, sea-bed and subsoil of
these waters;
(b) 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 the 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 sea-bed and
sub-soil and their natural resources may be exercised;
(c) the terms "a Contracting State" and "the other Contracting
State" mean, as the context requires, Thailand or Romania;
(d) the term "person" includes an individual, an estate, a
company and any other body of persons which is treated as
an entity for tax purposes;
(e) the term "company" means any body corporate, including a
joint company which is incorporated under the Romanian
law, or any entity which is treated as a body corporate under
the taxation laws of the respective Contracting States;
(f) the terms "enterprise of a Contracting State" and "enterprise
of the other Contracting State" mean respectively an
enterprise carried on by a resident of a Contracting State and
an enterprise carried on by a resident of the other
Contracting State;
(g) the term "competent authority" means:
(i) in the case of Thailand, the Minister of Finance or his
authorized representative;
(ii) in the case of Romania, the Minister of Finance or his
authorized representative;
(h) the term "national" means:
(i) in relation to Thailand, any individual possessing the
nationality of Thailand, any legal person, partnership,
association and any other entity deriving its status as
such from the laws in force in Thailand;
(ii) in relation to Romania, any citizen of Romania and
any juridical person and association deriving its
status as such from the laws in force in
Romania.
(i) the term "international traffic" means any transport by a ship
or aircraft operated by an enterprise of a Contracting State
except when such ship or aircraft is operated solely between
places in the other Contracting State.
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 laws of that Contracting 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 law of that State, is liable to taxation therein by reason of his domicile, residence, place of management, place of incorporation or any other criterion of a similar nature.
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 Contracting State
in which he has a permanent home available to him. If he
has a permanent home available to him in both Contracting
States, he shall be deemed to be a resident of the
Contracting State with which his personal and economic
relations are closer (centre of vital interests);
(b) if the Contracting 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 Contracting State, he shall be
deemed to be a resident of the Contracting State in which he
has an habitual abode;
(c) if he has an habitual abode in both Contracting States or in
neither of them, he shall be deemed to be a resident of the
Contracting State of which he is a national;
(d) if he is a national of both Contracting 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 company is a resident of both Contracting States, it shall be deemed to be a resident of the Contracting State in which it is incorporated or under the law of which it derives its status as a company. If the company under this criterion still is a resident of both Contracting States, then it shall be deemed to be a resident of the Contracting State in which its place of effective management is situated.
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" shall include especially:
(a) a place of management;
(b) a branch;
(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 site or construction project where such site or
project continues for a period of more than six months;
(h) an assembly or installation project which exists for more
than 6 months;
(i) premises used as a sales outlet;
(j) a warehouse, in relation to a person providing storage
facilities for others;
(k) the furnishing of services including consultancy services by a
resident of one of the Contracting States through employees
or other personnel, provided activities of that nature continue
(for the same or a connected project) within the other
Contracting State for a period or periods aggregating more
than 183 days.
3. The term "permanent establishment" shall not be deemed to include:
(a) the use of facilities solely for the purpose of storage, display
or delivery of goods or merchandise belonging to the
enterprise;
(b) the maintenance of a stock of goods or merchandise
belonging to the enterprise solely for the purpose of storage,
display or delivery;
(c) the maintenance of a stock of goods or merchandise
belonging to the enterprise solely for the purpose of
processing by another enterprise;
(d) the goods or merchandise belonging to the enterprise
displayed in the frame of an occasional temporary fair or
exhibition organized by Government of the host country which
are sold after the closing of the said fair or exhibition;
(e) the maintenance of a fixed place of business solely for the
purpose of purchasing goods or merchandise, or of
collecting information for the enterprise;
(f) the maintenance of a fixed place of business solely 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 enterprise.
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 in a Contracting State on behalf of the enterprise of the other Contracting State, the enterprise shall be deemed to have a permanent establishment in the first-mentioned Contracting State, if such a person:
(a) has and habitually exercises in the first-mentioned State, an
authority to conclude contracts on behalf of the enterprise,
unless his activities are limited to the purchase of goods or
merchandise for the enterprise;
(b) has no such authority, but habitually maintains in the first-
mentioned State a stock of goods or merchandise belonging
to the enterprise from which he regularly fills orders or
makes deliveries on behalf of the enterprise; or
(c) has no such authority, but habitually secures orders in the
first mentioned State wholly or almost wholly for the
enterprise or for the enterprise and other enterprises which
are controlled by it or have a controlling interest in it.
5. An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carries on business in that 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. For this purpose, an agent shall not be considered to be an agent of an independent status if it carries on in that other State an activity described in paragraph 4 substantially for the enterprise or for the enterprise and other enterprises which are controlled by it or have a controlling interest in it.
6. The fact that 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.
7. Notwithstanding the preceding provisions of this Article, an insurance enterprise of a Contracting State shall be deemed to have a permanent establishment in the other State if it collects premiums in the territory of that State or insures risks situated therein through an employee or through a representative who is not an agent of independent status within the meaning of paragraph 5.
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