Bolivia

This Convention applies to persons resident in one or both Contracting States.

1. This Convention applies to income and property taxes payable by each of the Contracting States, their political subdivisions or their local entities, whatever the system of their taxation.

2. Income and property taxes are those that tax all or any part of the income or property, including taxes on profits resulting from the disposal of movable or immovable property, taxes on the amount of wages or salaries paid by enterprises, as well as taxes on capital gains.

3. The current taxes to which this Convention applies in particular are:

(a) In Spain:

(i) Personal Income Tax;

(ii) corporation tax;

(iii) Property Tax; and

(iv) Local income and property taxes;

(hereinafter referred to as ‘Spanish tax’).

(b) In Bolivia:

(i) Complementary Value Added Tax Scheme (RC-VAT);

(ii) Corporate Utilities Tax (EUI);

(iii) Property Tax on Real Estate and Motor Vehicles (IPBIVA); and

(iv) Transaction Tax (IT);

(hereinafter referred to as ‘Bolivian tax’).

4. The Convention shall also apply to taxes of an identical or similar nature which are established after the date of signature of the Convention and which are added to or replaced by existing taxes. The competent authorities of the Contracting States shall communicate to each other any substantial amendments to their respective tax laws within a reasonable period of time after such amendments have taken place.

1. For the purposes of this Convention, unless the context of the Convention is different:

(a) The term ‘Spain’ means the territory of the Spanish State and, used geographically, designates the territory of the Spanish State including areas outside its territorial sea in which, under international law and under its domestic law, the Spanish State may exercise jurisdiction or rights of sovereignty over the seabed, its subsoil and superjacent waters, and its natural resources.

(b) The term “Bolivia” means the territory of the Bolivian State and is used geographically by the Republic of Bolivia, where the Bolivian State may exercise jurisdiction or rights of sovereignty over land, subsoil and natural resources.

(c) The terms ‘one Contracting State’ and ‘the other Contracting State’ mean Spain or Bolivia, depending on the context.

(d) The term ‘person’ includes natural persons, companies and any other grouping of persons.

(e) the term 'company' means any legal person or any entity that is considered a legal person for tax purposes.

(f) The terms ‘undertaking of one Contracting State’ and ‘undertaking of the other Contracting State’ mean, respectively, an undertaking operated by a resident of one Contracting State and an undertaking operated by a resident of the other Contracting State.

(g) The term 'national' means:

(i) Any natural person possessing the nationality of a Contracting State; and

(ii) any legal person, association or entity incorporated under the law in force in a Contracting State.

(h) 'International traffic' means any transport by a ship or aircraft operated by an undertaking whose effective headquarters are located in a Contracting State, except where the ship or aircraft is operated only between points located in the other Contracting State.

(i) ‘competent authority’ means:

(i) In the case of Spain, the Minister of Economy and Finance or his authorized representative; and

(ii) in the case of Bolivia, the Minister of Finance or his authorized representative.

2. For the application of the Convention by a Contracting State any term not defined in the Convention shall have, unless its context is in conflict with a different interpretation, the meaning attributed to it by the law of that State concerning the taxes which are the subject of the Convention, the meaning attributed to that expression by the tax law of that State shall prevail over the meaning attributed to it by other laws of that State.

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 subject to taxation in that State by reason of his domicile, residence, place of address or any other criterion of a similar nature. However, this term does not include persons who are subject to taxation in that State solely on the income they obtain from sources located in that State or on the property they possess in that State.

2. Where, under the provisions of paragraph 1, a natural person is resident in both Contracting States, his or her situation shall be resolved as follows:

(a) Such person shall be considered a resident of the State where he or she has permanent housing at his or her disposal; if he or she has permanent housing at his or her disposal in both States, he or she shall be considered a resident of the State with which he or she has closer personal and economic relations (centre of vital interests).

(b) If the State in which the person has the centre of his or her vital interests cannot be determined, or if he or she does not have permanent housing at his or her disposal in any of the States, he or she shall be considered a resident of the Contracting State in which he or she habitually lives.

(c) If he lives habitually in both States or does not live in either State, he or she shall be considered resident of the State of which he or she is a national.

(d) If he is a national of both States or is not a national of either State, the competent authorities of the two Contracting States shall decide the case by mutual agreement.

3. Where under the provisions of paragraph 1 a person other than a natural person is a resident of both Contracting States, he or she shall be considered a resident of the State in which his or her place of effective management is located.

1. For the purposes of this Agreement, the term ‘permanent establishment’ means a fixed place of business through which an undertaking carries out all or part of its activity.

2. The term ‘permanent establishment’ includes, in particular:

(a) Offices or places of administration or business management.

(b) Branches and agencies.

(c) Agricultural factories, plants, workshops and establishments.

(d) Mines, oil or gas wells, quarries or any other natural resource extraction site.

3. A construction, installation or assembly work only constitutes a permanent establishment if its duration exceeds twelve months.

4. Notwithstanding the provisions of this Article, it is considered that the term ‘permanent establishment’ does not include:

(a) The use of facilities for the sole purpose of storing, displaying or delivering goods or goods belonging to the enterprise.

(b) The maintenance of a warehouse of goods or goods belonging to the enterprise for the sole purpose of storing, displaying or delivering them.

(c) The maintenance of a deposit of goods or goods belonging to the undertaking for the sole purpose of their processing by another undertaking.

(d) The maintenance of a fixed place of business for the sole purpose of purchasing goods or goods or collecting information for the enterprise.

(e) The maintenance of a fixed place of business for the sole purpose of carrying out for the enterprise any other activity of an auxiliary or preparatory nature.

(f) The maintenance of a fixed place of business for the sole purpose of the combined exercise of the activities referred to in the preceding subparagraphs, provided that the whole activity of the fixed place of business retains its auxiliary or preparatory character.

5. By way of derogation from paragraphs 1 and 2, where a person other than an agent enjoying an independent status, to which paragraph 6 applies, acts on behalf of an undertaking and maintains and habitually exercises in a Contracting State powers to conclude contracts on behalf of the undertaking, that undertaking shall be deemed to have a permanent establishment in that State in respect of all activities carried out by that person on behalf of the undertaking, unless the activities of that person are limited to those referred to in paragraph 4 and had they been carried out through a fixed place of business, they would not have determined that such place was a permanent establishment in accordance with the provisions of that paragraph.

6. An undertaking is not considered to have a permanent establishment in a Contracting State merely because it carries out its activities through a broker, a general commissioner or any other agent enjoying an independent status, provided that such persons act within the ordinary framework of their activity.

7. The fact that a company resident of a Contracting State controls or is controlled by a company resident of the other Contracting State, or that it carries out activities in that other State (whether by permanent establishment or otherwise), does not in itself make any such company permanent establishment of the other State.

1. Income from immovable property (including income from agricultural or forestry holdings) situated in the other Contracting State from a resident of one Contracting State may be taxed in that other State in accordance with its domestic law.

2. The term ‘real property’ shall have the meaning attributed to it by the law of the Contracting State in which the goods in question are situated. In any event, that term includes accessories, livestock and equipment used on agricultural and forestry holdings, the rights to which the provisions of private law relating to real estate, the use of immovable property and the rights to variable or fixed payments for the exploitation or concession of the exploitation of mineral deposits, sources and other natural resources apply; vessels, vessels and aircraft are not regarded as immovable property.

3. The provisions of paragraph 1 apply to income derived from direct use, lease or shareholding, as well as from any other form of exploitation of immovable property.

4. The provisions of paragraphs 1 and 3 also apply to income derived from the immovable property of an enterprise and from immovable property used for independent work.

5. Where ownership of shares or other rights in one or other corporation or other entity confers on its owner the enjoyment in any form, direct use, lease or any other form of use of immovable property held by the corporation or entity, the income derived from such enjoyment, direct use, lease or any other form of use of such rights may be taxed in the Contracting State in which the immovable property is situated.

1. The profits of an undertaking in a Contracting State may be taxed only in that State unless the undertaking carries out its business in the other Contracting State through a permanent establishment situated therein. If the company carries out its business in that way, the profits of the company may be taxed in the other State, but only to the extent that they can be attributed to that permanent establishment.

2. Without prejudice to paragraph 3, where an undertaking of one Contracting State carries out its activity in the other Contracting State by means of a permanent establishment situated therein, in each Contracting State the profits it could have obtained from being a distinct and separate undertaking carrying out the same or similar activities under the same or similar conditions shall be attributed to that establishment and shall deal entirely independently with the undertaking from which it is a permanent establishment.

3. For the purpose of determining the benefit of the permanent establishment, the deduction of expenses incurred for the realization of the purposes of the permanent establishment shall be permitted, including management and general administrative expenses for the same purposes, whether incurred in the State in which the permanent establishment is located or elsewhere.

4. As long as it is customary in a Contracting State to determine profits attributable to permanent establishments on the basis of a distribution of the total profits of the enterprise among its various parties, the provisions of paragraph 2 shall not prevent that Contracting State from determining taxable profits in this manner; however, the method of distribution adopted shall be such that the result obtained is in accordance with the principles set out in this article.

5. No benefit shall be attributed to a permanent establishment merely because it buys goods or goods for the undertaking.

6. For the purposes of the preceding paragraphs, the profits attributable to the permanent establishment shall be calculated each year by the same method, unless there are valid and sufficient grounds for proceeding otherwise.

7. Where profits include income regulated separately in other articles of this Convention, the provisions of those articles shall not be affected by those of this Article.

1. Profits from operating aircraft in international traffic may be taxed only in the Contracting State in which the effective head office of the company is located.

2. The provisions of paragraph 1 also apply to profits from participation in a pool, on a joint holding or in an international holding group.

1. When:

(a) An undertaking of a Contracting State participates directly or indirectly in the direction, control or capital of an undertaking of the other Contracting State; or

(b) the same persons directly or indirectly participate in the direction, control or capital of an undertaking of one Contracting State and of an undertaking of the other Contracting State, and in either case the two undertakings are, in their commercial or financial relations, bound by accepted or imposed conditions which differ from those agreed by independent undertakings, the profits which would have been obtained by one of the undertakings in the absence of such conditions, and which in fact have not occurred because of them, may be included in the profits of that undertaking and subject to taxation accordingly.

2. Where a Contracting State includes in the profits of an enterprise of that State - and consequently subjects to taxation - the profits on which an undertaking of the other Contracting State has been subject to taxation in that other State, and the profits thus included are profits which would have been realized by the undertaking of the State mentioned first if the terms agreed between the two companies had been those agreed between two independent undertakings, the State referred to second shall make a corresponding adjustment to the amount of the tax it has received on those profits. In determining this adjustment, account shall be taken of the other provisions of this Convention, the competent authorities of the Contracting States being consulted if necessary.

1. Dividends paid by a company resident of one Contracting State to a resident of the other Contracting State may be taxed in the Contracting State in which the company that pays the dividends resides under the law of that State, but if the recipient of the dividends is the beneficial owner, the tax thus required may not exceed:

(a) 10 per cent of the gross amount of dividends if the beneficial owner is a company (excluding companies of persons) holding directly at least 25 per cent of the capital of the company paying the dividends;

(b) 15 per 100 of the gross amount of dividends in all other cases.

The competent authorities of the Contracting States shall, by mutual agreement, determine how these limits are to be applied.

This paragraph does not affect the company's taxation of profits from which dividends are paid.

2. The term ‘dividends’ used in this Article means the income from shares or enjoyment bonds, parts of mines, parts of founders or other rights, other than credit rights, which permit participation in profits, as well as income from other social shares subject to the same tax regime as the income from shares under the law of the State in which the distribution company resides.

3. The provisions of paragraphs 1 and 2 do not apply if the beneficial owner of the dividends, resident of a Contracting State, carries out in the other Contracting State of which the company of which the dividends are resident, an industrial or commercial activity through a permanent establishment situated therein, or carries out independent work by means of a fixed base situated therein and the share generated by the dividends is effectively linked to that permanent establishment or fixed base. In such cases, the provisions of Article 7 or Article 14 shall apply, as appropriate.

4. Where a company resident of a Contracting State obtains profits or income from the other Contracting State, that other State may not levy any tax on dividends paid by the company except to the extent that such dividends are paid to a resident of that other State or the share generated by the dividends is effectively linked to a permanent establishment or a fixed base situated in that other State, or subject the undistributed profits of the company to a tax on them, even if the dividends paid or profits not distributed consist, in whole or in part, of profits or income from that other State.

1. Interest from one Contracting State and paid to a resident of the other Contracting State may be taxed in the Contracting State from which it comes, and in accordance with the law of that State, but the tax thus required may not exceed 15 per 100 of the gross amount of interest if the recipient of the interest is the beneficial owner.

2. Notwithstanding the provisions of paragraph 1, interest from one of the Contracting States shall be exempt from taxation in that State if:

(a) The debtor of interest is that State or one of its political subdivisions or local entities;

(b) interest is paid to the other Contracting State or to one of its political subdivisions or local entities, or to an institution or bodies (including financial institutions) wholly belonging to that Contracting State or to one of its political subdivisions or local entities;

(c) interest is paid to other institutions or agencies (including financial institutions) on the basis of financing agreed upon with them in the framework of agreements concluded between the Governments of the two Contracting States and provided that the time limit for such agreements is not less than five years;

(d) interest is paid in connection with sales of industrial, commercial or scientific equipment.

3. The term ‘interest’ used in this Article means the income from claims of any kind, with or without mortgage guarantee or benefit-sharing clause of the debtor, and in particular income from public funds and bonds or bonds, including premiums and lots attached to such securities, as well as any other income subject to the same regime as the income from capital provided by the law of the Contracting State from which the income derives. Penalizations for late payment are not considered interest for the purposes of this article.

4. The provisions of paragraphs 1 and 2 do not apply if the beneficial owner of the interest, resident of a Contracting State, carries out in the other Contracting State, from which the interest is derived, an industrial or commercial activity through a permanent establishment situated therein or carries out independent work through a fixed base situated therein, and the credit generated by the interest is effectively linked to that permanent establishment or fixed base. In such cases, the provisions of Article 7 or Article 14 shall apply, as appropriate.

5. Interest shall be deemed to have come from a Contracting State where the debtor is the State itself or one of its political subdivisions or local entities, or a resident of that State. However, where the debtor of interest, whether or not resident of a Contracting State, has in a Contracting State a permanent establishment or a fixed basis in respect of which the debt giving rise to the payment of the interest and bearing the burden of the interest has been incurred, the interest shall be deemed to have come from the Contracting State where the permanent establishment or fixed base is situated.

6. Where, on account of the special relations between the debtor and the beneficial owner of the interest or the interest between them and third parties, the amount of interest, taking into account the claim for which it is paid, exceeds that agreed by the debtor and the creditor in the absence of such relations, the provisions of this article shall apply only to the latter amount. In such a case, the excess may be imposed in accordance with the law of each Contracting State, taking into account the other provisions of this Convention.

1. Fees or royalties from a Contracting State and paid to a resident of the other Contracting State may be taxed in the Contracting State from which they come, in accordance with the law of that State, but the tax thus required may not exceed 15 per cent of the gross amount of royalties if the recipient of the royalties is the beneficial owner.

2. Notwithstanding the provisions of paragraph 1, royalties or royalties paid under copyright and other similar remuneration for the production of a literary, dramatic, musical or artistic work (excluding royalties or royalties relating to cinematographic films, magnetoscopic tapes intended for television and discs or tape recorders) from a Contracting State and paid to a resident of the other Contracting State may only be subject to taxation in that other State.

3. The term ‘royalties’ or royalties used in this Article means the amounts of any kind paid for the use or granting of copyright on literary, artistic or scientific works, including cinematographic films and radio and television films or tapes, patents, trademarks, designs, plans, formulas or secret procedures, as well as for the use or granting of industrial, commercial or scientific equipment, and for information relating to industrial, commercial or scientific experience.

4. The provisions of paragraphs 1 and 2 do not apply if the beneficial owner of the royalties or royalties, resident of one Contracting State, carries out in the other Contracting State, from which the royalties or royalties come, an industrial or commercial activity through a permanent establishment situated therein or carries out independent work through a fixed base situated therein, and the right or for which the royalties or royalties are paid is effectively linked to that permanent establishment or fixed base. In such cases, the provisions of Article 7 or Article 14 shall apply, as appropriate.

5. Royalties or royalties shall be deemed to come from a Contracting State where the debtor is the State itself or one of its political subdivisions or local entities, or a resident of that State. However, where the debtor of the royalties or royalties, whether or not resident of a Contracting State, has in one of the Contracting States a permanent establishment or a fixed basis for which the obligation to pay the royalties or royalties has been incurred and which bear the burden thereof, the royalties or royalties shall be deemed to come from the Contracting State where the permanent establishment or fixed base is situated.

6. Where, by reason of the special relations between the debtor and the beneficial owner of the royalties or royalties or of which both have with third parties, the amount of the royalties or royalties, having regard to the benefit for which they are paid, exceeds that for which the debtor and beneficial owner would have agreed in the absence of such relationships, the provisions of this article apply only to the latter amount. In such a case, the excess may be imposed in accordance with the law of each Contracting State, taking into account the other provisions of this Convention.

1. Profits that a resident of one Contracting State obtains from the disposal of immovable property, as defined in Article 6, located in the other Contracting State, may be taxed in that other State.

2. Gains on the disposal of movable property forming part of the assets of a permanent establishment held by an undertaking of one Contracting State in the other Contracting State, or on movable property belonging to a fixed basis held by a resident of one Contracting State in the other Contracting State for the purpose of carrying out independent work, including gains on the disposal of that permanent establishment (only or with the enterprise as a whole) or on that fixed basis, may be taxed in that other State.

3. Profits arising from the alienation of ships or aircraft operated in international traffic or from movable property affected by the operation of such vessels and aircraft may be taxed only in the Contracting State where the place of effective management of the undertaking is situated.

4. Gains arising from the disposal of assets or rights other than those referred to in the preceding paragraphs of this article may be subject to taxation only in the Contracting State of which the transferor is resident.

1. Incomes which a resident of a Contracting State obtains from the provision of professional services or other activities of an independent nature may only be taxed in that State unless that resident habitually has a fixed basis in the other Contracting State for the performance of his or her activities. If it has such a fixed base, such income may be taxed in the other State, but only to the extent that it is attributable to that fixed base.

2. The term ‘professional services’ includes in particular independent scientific, literary, artistic, educational or pedagogical activities, as well as independent activities of doctors, lawyers, engineers, architects, dentists and accountants.

1. Without prejudice to the provisions of Articles 16, 18, 19, 20 and 21, salaries, wages and similar remuneration obtained by a resident of a Contracting State on account of employment may be subject to taxation only in that State, unless the employment is exercised in the other Contracting State. If the employment is exercised in this other State, the remuneration received in this respect may be subject to taxation in the latter State.

2. Notwithstanding paragraph 1, remunerations obtained by a resident of a Contracting State on the basis of employment in the other Contracting State may be taxed only in the State referred to first, if:

(a) The recipient does not remain in total in the other State, for one or more periods, for more than one hundred and eighty-three days in any twelve-month period beginning or ending in the fiscal year concerned; and

(b) remuneration is paid by, or on behalf of, an employer who is not a resident of the other State; and

(c) Remuneration is not borne by a permanent establishment or a fixed basis which the employer has in the other State.

3. Notwithstanding the preceding provisions of this Article, remunerations earned on account of employment on board a ship or aircraft operated in international traffic may be taxed in the Contracting State in which the effective head office of the undertaking is situated.

Participations, attendance allowances and other similar remunerations which a resident of a Contracting State obtains as a member of a Board of Directors or a supervisory body of a company resident of the other Contracting State may be taxed in that other State.

1. Notwithstanding the provisions of Articles 14 and 15, the income which a resident of a Contracting State obtains from the exercise of his personal activity in the other Contracting State as a performer, theatre, cinema, radio or television actor, or musician, or as an athlete, may be subject to taxation in the Contracting State in which those activities are carried out.

2. Notwithstanding the provisions of Articles 7, 14 and 15, where the income derived from the activities carried out by an artist or athlete personally and in that capacity is attributed, not to the artist or athlete himself, but to another person, such income may be taxed in the Contracting State in which the activities of the artist or athlete are carried out.

3. The provisions of paragraphs 1 and 2 do not apply if the activities carried out in one Contracting State are financed mainly by public funds of the other Contracting State or by one of its political subdivisions or local entities, within the framework of a cultural agreement. In such a case, income derived from such activities may only be taxed in that other State.

Without prejudice to article 19, paragraph 2, pensions and similar remuneration paid to a resident of a Contracting State on account of previous employment may only be taxed in that State.

1. (a) Remuneration, excluding pensions, paid by a Contracting State or one of its political subdivisions or local entities to a natural person for services rendered to that State, subdivision or entity, may only be subject to taxation in that State.

(b) However, such remuneration may be subject to taxation in the other Contracting State only if the services are provided in that other State and the natural person is a resident of that State who:

(i) possesses the nationality of this State; or

(ii) has not acquired the status of resident of this State solely to provide the services.

2. (a) Pensions paid by a Contracting State or by one of its political subdivisions or local entities, either directly or from constituted funds, to a natural person on account of services rendered to that State, subdivision or entity, may only be subject to taxation in that State.

(b) Such pensions may, however, be subject to taxation in the other Contracting State only if the natural person is a resident and national of that other State.

3. Articles 15, 16 and 18 apply to remuneration and pensions paid for services rendered in the context of an industrial or commercial activity of a Contracting State or one of its political subdivisions or local authorities.

1. The amounts received to cover their gestures of maintenance, study or training by a student or a person in training who is, or was immediately before arriving in a Contracting State, resident of the other Contracting State and who is in the State mentioned above in the first place for the sole purpose of continuing his studies or training, may not be subject to taxation in that State provided they come from sources outside that State.

2. In respect of grants, scholarships and remuneration for work not provided for in paragraph 1, students and trainees described therein shall also be entitled, during the period of study or training, to the same exemptions, allowances or tax allowances as are granted to residents of the State who are visiting.

1. A natural person who is or has been a resident of a Contracting State immediately before moving to the other Contracting State and who, at the invitation of a non-profit university, school or other similar institution of higher education, remains in that other State for a period not exceeding two years from the date of his first arrival in that State, for the sole purpose of carrying out education or research, or both, in such educational institutions, shall be exempt from taxation in that other State in respect of remuneration received on the basis of such education or research.

2. The provisions of paragraph 1 of this article shall not apply to remuneration for research work if such work is not carried out in the general interest, but primarily for the private benefit of a particular person or persons.

1. The income of a resident of a Contracting State, whatever its source, not referred to in the previous articles of this Convention may be taxed only in that State.

2. Paragraph 1 shall not apply to income, excluding income derived from property defined as immovable in article 6, paragraph 2, where the beneficiary of such income, resident of a Contracting State, engages in industrial or commercial activity in the other Contracting State through a permanent establishment situated therein or carries out independent work by means of a fixed base also situated therein, with which the right or ownership for which the income is paid is effectively linked. In such cases, the provisions of Article 7 or Article 14 shall apply, as appropriate.

1. Property consisting of immovable property covered by Article 6 owned by a resident of a Contracting State and situated in the other Contracting State may be taxed in that other State.

2. Property consisting of movable property forming part of the assets of a permanent establishment held by an undertaking of a Contracting State in the other Contracting State, or movable property belonging to a fixed basis held by a resident of a Contracting State in the other Contracting State for the purpose of carrying out independent work, may be taxed in the Contracting State in which the permanent establishment or fixed base is situated.

3. Assets made up of ships or aircraft operated in international traffic, as well as movable property affected by the operation of such vessels or aircraft, may be taxed only in the Contracting State in which the place of effective management of the undertaking is situated.

4. Other assets of a resident of a Contracting State may be subject to taxation only in that State.

1. In the case of a resident of Spain, double taxation shall be avoided, in accordance with the applicable provisions of Spanish law, as follows:

(a) Where a resident of Spain obtains income or possesses assets that, under the provisions of this Agreement, may be taxed in Bolivia, Spain shall allow the deduction of income tax or capital of that resident from an amount equal to the tax actually paid in Bolivia.

However, such deduction may not exceed the part of the income or property tax, calculated before the deduction, corresponding to the income or assets that may be taxed in Bolivia.

(b) In the case of dividends paid by a company resident in Bolivia to a company resident in Spain, in addition to the amount deductible under subparagraph (a) of this subparagraph, account shall be taken of the tax actually paid by the company mentioned above in respect of the profits from which the dividends are paid, in the amount corresponding to such dividends, provided that that amount is included, for this purpose, in the taxable base of the company receiving them.

Such deduction, together with the deduction applicable in respect of dividends pursuant to subparagraph (a) of this paragraph, may not exceed the part of the income tax, calculated prior to the deduction, corresponding to income subject to taxation in Bolivia.

In order to apply the provisions of this paragraph, participation in the company paying dividends shall be as provided for in Spanish domestic law, and in any case when it reaches at least 25 per 100 of the capital of the company that pays the dividends and is maintained continuously during the year preceding the day on which the dividend that is distributed is due.

(c) Where under any provision of this Agreement the income obtained by a resident of Spain or the assets he holds are exempt from taxes in Spain, Spain may, however, take into account the income or assets exempted in calculating the tax on the rest of the income or assets of that resident.

2. In the case of a resident of Bolivia, any income originating in Spain or any property located in Spain that may be taxed under this Agreement shall be excluded from the basis on which the Bolivian tax is levied.

However, the Republic of Bolivia retains the right to include in the determination of the applicable aliquot items of income and wealth thus excluded.

1. Nationals of a Contracting State shall not be subject in the other Contracting State to any tax or obligation relating thereto which is not or is more burdensome than those to which nationals of that other State who are under the same conditions, in particular with regard to residence, are or may be subject. Notwithstanding article 1, this provision shall also apply to nationals of any of the Contracting States, even if they are not residents of any of them.

2. Permanent establishments held by an undertaking of one Contracting State in the other Contracting State shall not be subject to taxation in that State in a less favourable manner than undertakings of the latter State carrying out the same activities. This provision may not be interpreted as obliging a Contracting State to grant to residents of the other Contracting State the personal deductions, reliefs or tax reductions it grants to its own residents in view of their marital status or family burdens.

3. Unless the provisions of article 9, paragraph 1, article 11, paragraph 6, or article 12, paragraph 6, apply, interest, royalties or other gestures paid by an enterprise of one Contracting State to a resident of the other Contracting State shall be deductible, in order to determine the profits subject to taxation of that enterprise, under the same conditions as if they had been paid to a resident of the State referred to first. Similarly, the debts of an undertaking of a Contracting State contracted with a resident of the other Contracting State shall be deductible for the determination of the assets subject to taxation of that undertaking under the same conditions as if they had been contracted with a resident of the State referred to first.

4. Undertakings of a Contracting State whose capital is wholly or partly detained or controlled, directly or indirectly, by one or more residents of the other Contracting State shall not be subject in the State referred to above to any tax or obligation relating thereto which is not or is more burdensome than those to which other similar undertakings of the State referred to above are or may be subject.

5. Notwithstanding the provisions of Article 2, the provisions of this Article shall apply to all taxes, whatever their nature or name.

1. Where a person considers that the measures taken by one or both Contracting States imply or may entail for him an imposition which is not in conformity with the provisions of this Convention, irrespective of the remedies provided for by the domestic law of those States, he may submit his case to the competent authority of the Contracting State of which he is resident or, if article 25, paragraph 1, to that of the Contracting State of which he is a national. The case shall be brought within three years of the first notification of the measure involving an imposition not in accordance with the provisions of this Convention.

2. That competent authority shall, if it finds the complaint well founded and if it is not in a position to adopt a satisfactory solution, make every effort to resolve the matter through an amicable agreement with the competent authority of the other Contracting State in order to avoid an imposition not in conformity with this Convention.

3. The competent authorities of the Contracting States shall endeavour to resolve difficulties or to dispel doubts arising from the interpretation or application of the Convention by means of an amicable agreement. They may also agree to avoid double taxation in cases not covered by this Convention.

4. The competent authorities of the Contracting States may communicate directly in order to reach agreement within the meaning of the preceding paragraphs of this article. Where it is considered that such an agreement may be facilitated by personal contacts, the exchange of views may take place within a committee composed of representatives of the competent authorities of the Contracting States.

1. The competent authorities of the Contracting States shall exchange the information necessary to implement the provisions of this Convention or of the national law of the Contracting States relating to taxes covered by the Convention to the extent that the taxation required by that Convention is not contrary to the Convention. The exchange of information shall not be limited by Article 1. Information received by a Contracting State shall be kept secret in the same way as information obtained under the domestic law of that State and shall be communicated only to persons or authorities (including courts and administrative bodies) responsible for the management or collection of taxes covered by the Convention, to declaratory or executive procedures relating to such taxes or to the resolution of appeals relating thereto. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public hearings of the courts or in court judgements.

2. Under no circumstances may the provisions of paragraph 1 be interpreted as obliging a Contracting State to:

(a) Take administrative measures contrary to its legislation or administrative practice or those of the other Contracting State;

(b) to provide information which cannot be obtained on the basis of their own legislation or in the exercise of their normal administrative practice or that of the other Contracting State;

(c) provide information revealing trade, industrial or professional secrets, or commercial procedures or information whose communication is contrary to public policy.

The provisions of this Convention do not affect the tax privileges enjoyed by diplomatic agents or consular officials in accordance with the general principles of international law or under special agreements.

1. This Convention shall be ratified, and the instruments of ratification shall be exchanged as soon as possible.

2. The Convention shall enter into force on the date of the exchange of instruments of ratification, and its provisions shall apply to taxes levied on income or property from 1 January of the calendar year following the entry into force of the Convention.

The Convention shall remain in force until it is denounced by one of the Contracting States. Any Contracting State may denounce the Convention by diplomatic means, notifying it in writing at least six months before the end of any calendar or calendar year, after five years from the date of its entry into force. In such a case, the Convention shall cease to have effect in respect of taxes levied on income or property from 1 January of the calendar year following that in which the denunciation is communicated.

In faith, the signatories, duly authorized for this purpose by their respective Governments, have signed this Convention.

Done in Spanish in duplicate at La Paz on 30 June 1997.

At the time of signing the Convention between the Kingdom of Spain and the Republic of Bolivia to Prevent Double Taxation and Tax Evasion in Income and Property Taxes, the signatories have agreed on the following provisions which form an integral part of the Convention:

1. The tax reductions or exemptions provided for by the Convention in respect of dividends, interest, royalties or royalties and profits arising from the disposal of goods or rights shall not apply where such income is obtained in a Contracting State by a company resident of the other Contracting State in whose capital they participate, directly or indirectly, in more than 50 per cent, non-resident members of that other State. This number shall not apply where that company engages in substantive commercial or industrial activities in one or another Contracting State other than the mere management of securities or other assets.

2. If, following the signature of this Convention, the Republic of Bolivia concludes a Double Taxation Agreement with another member country of the Organization for Economic Cooperation and Development, in which the source tax limit for royalties or royalties is lower than that provided for in article 12 of this Convention, the lower rate or exemption provided for in the Convention concerned shall automatically apply, from the date of its entry into force, to the residents of both Contracting States with respect to that category of income.

3. In relation to article 24.1.a and b, the tax actually paid in Bolivia will be the Tax on the Utilities of the Satisfied Companies. In accordance with Bolivia's domestic legislation, the Transaction Tax that exceeds the amount that can be compensated by the Tax on the Utilities of Companies, will be deductible from the latter tax corresponding to the current year.

4. Method of exemption: In relation to Article 24(1)(a) and (b), to the extent that the Bolivian Tax continues to be considered comparable to the Spanish Company Tax, in terms equal or similar to those existing on the date of signature of this Agreement, a company resident in Spain that receives dividends, under the conditions provided for in Article 24.1.b of this Agreement, or that obtains income through a permanent establishment located in Bolivia and that, in both cases, under the provisions of this Agreement, may be subject to taxation in Bolivia, may deduct from the Spanish Tax 100 per 100 of the full fee corresponding to the taxable base derived from such dividends or income, subject to the requirements provided for in Articles 29a and 30a of Law 43/1995 of 27 December, or any other provision that may be adopted in the future by granting a substantially similar regime.

In faith, the signatories, duly authorized for this purpose by their respective Governments, have signed this Protocol.

Done in Spanish in duplicate at La Paz on 30 June 1997.

This Convention and the Protocol forming part of it entered into force, as provided for in Article 29 of that Convention, on 23 November 1998, the date on which the exchange of the instruments of ratification took place in Madrid.

What is made public for general knowledge.

Madrid, 26 November 1998. –The Technical Secretary General of the Ministry of Foreign Affairs, Julio Núñez Montesinos.