China

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

2. For the purposes of this Convention, income received by or through an entity or instrument considered wholly or partly transparent for tax purposes in accordance with the tax rules of any of the Contracting States shall be deemed to be received by a resident of a Contracting State, but only to the extent that that State treats it, for tax purposes, as income of a resident.

3. This Convention does not affect the taxation by a Contracting State of its own residents, except in respect of profits arising from Articles 9(2), 18(2), 19, 20, 21, 23, 26, 27 and 29.

1. This Convention applies to income taxes payable by each Contracting State or its political subdivisions, irrespective of the system of its levy.

2. Income taxes are those which tax the entire income or elements thereof, including taxes on earnings arising from the disposal of movable or immovable property and taxes on the total amounts of wages or salaries paid by enterprises.

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

(a) In China:

i. Personal income tax;

ii. the income tax on enterprises;

(hereinafter referred to as ‘Chinese tax’).

(b) In Spain:

i. The Income Tax of Physical Persons;

(ii) corporation tax;

(iii) Non-Resident Income Tax;

(hereinafter referred to as ‘the Spanish tax’).

4. The Convention shall also apply to taxes of an identical or similar nature which are established after the signature of the Convention and which are added to or replaced by existing taxes. The competent authorities of the Contracting States shall notify each other of any significant amendments to their tax laws.

1. For the purposes of this Convention, unless otherwise determined by the context:

(a) The term ‘China’ means the People’s Republic of China and, used geographically, means the entire territory of the People’s Republic of China, including its land, inland waters, territorial sea and airspace over them, in which Chinese laws governing taxation apply, and areas outside its territorial sea, in which the People’s Republic of China exercises rights of sovereignty or jurisdiction under international law and its domestic law;

(b) the term ‘Spain’ means the Kingdom of Spain and, used geographically, means the territory of the Kingdom of Spain, including inland waters, airspace, territorial sea and areas outside the territorial sea in which, under international law and under its domestic law, the Kingdom of Spain exercises jurisdiction or rights of sovereignty over the seabed, its subsoil and superjacent waters, and its natural resources;

(c) the words ‘one Contracting State’ and ‘the other Contracting State’ mean China or Spain, 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 which 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) 'international traffic' means any transport carried out by a ship, aircraft, rail or road vehicle operated by an undertaking of a Contracting State, except where the ship, aircraft, rail or road vehicle is operated only between points situated in the other Contracting State;

(h) the term ‘competent authority’ means, in the case of China, the tax administration of the State or its authorised representative and, in the case of Spain, the Ministry of Finance or its authorised representative;

(i) the term 'national' means, in relation to a Contracting State:

i. any natural person possessing the nationality of a Contracting State; and

ii. any legal person, company of persons (partnership) or association constituted in accordance with the law in force in a Contracting State.

2. For the purpose of the application of the Convention at any time by a Contracting State, any term or expression not defined therein shall have, unless its context is affected by a different interpretation, the meaning attributed at that time to it by the law of that State concerning taxes which are the subject of the Convention, the meaning attributed by the tax legislation over which it would result from other branches of the law 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 incorporation, place of effective management or any other criterion of a similar nature, including also that State and its political subdivisions or local entities. This term does not, however, include persons who are subject to taxation in that State solely for the income they obtain from sources located 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) It shall be considered a resident exclusively of the State in which it has permanent housing at its disposal; if it has permanent housing at its disposal in both States, it shall be considered a resident exclusively of the State with which it has closer personal and economic relations (centre of vital interests);

(b) If it is not possible to determine the State in which the person has the centre of his or her vital interests, 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 exclusively of the State in which he or she habitually lives;

(c) If he or she habitually lives in both States or does not live in either State, he or she shall be deemed to be a resident exclusively 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 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 deemed to be a resident exclusively 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 business.

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

(a) Management offices;

(b) branches;

(c) Offices;

(d) factories;

(e) workshops; and

(f) mines, oil or gas wells, quarries or any other place of extraction of natural resources.

3. The term ‘permanent establishment’ also includes:

(a) A work, or a construction, installation or assembly project, only if its duration exceeds twelve months;

(b) the provision of services by an undertaking of a Contracting State, including consultancy services, through its employees or other personnel contracted by the undertaking for that purpose, but only in the event that such activities continue (in relation to that project or related) in the other Contracting State for a total period or periods exceeding 183 days in any twelve-month period;

4. Notwithstanding the previous 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 undertaking 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 processing by another undertaking;

(d) the maintenance of a fixed place of business for the sole purpose of buying 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 any other business for the undertaking;

(f) the maintenance of a fixed place of business for the sole purpose of carrying out any combination of the activities referred to in subparagraphs (a) to (e),

provided that such activity or, in the case of sub-paragraph (f), the whole activity of the fixed place of business retains its auxiliary or preparatory character.

4.1 Paragraph 4 above shall not apply to a fixed place of business which an undertaking uses or maintains, if that undertaking, or another closely related undertaking, engages in economic activities in the same place or in another place in the same Contracting State and:

(a) that place or other place constitutes a permanent establishment for the closely related undertaking or undertaking, as provided for in this article; or

(b) the whole activity resulting from the combination of activities carried out by the two undertakings in the same place, or by the same undertaking or a closely linked undertaking in the two locations, is not preparatory or auxiliary,

provided that the activities carried out by the two companies in the same place, or by the same undertaking or the closely linked undertaking in the two locations, constitute complementary functions forming part of a cohesive economic operation.

5. By way of derogation from paragraphs 1 and 2, but subject to paragraph 6, where a person acts in a Contracting State on behalf of an undertaking and, as such, habitually concludes contracts, or habitually plays the principal role in the conclusion of contracts routinely concluded without substantial modification by the undertaking, and such contracts are concluded:

(a) On behalf of the undertaking; or

(b) for the transfer of the ownership, or right of use, of property owned by the enterprise or the right of use of which it has; or

(c) for the provision of services by that undertaking,

that undertaking shall be deemed to have a permanent establishment in that State in respect of the activities carried out by that person for the undertaking, unless the activities of that person are limited to those referred to in paragraph 4 which, if carried out through a fixed place of business, would not have determined that that fixed place of business was to be considered a permanent establishment under the provisions of that paragraph.

6.(a) Paragraph 5 shall not apply where a person acting in a Contracting State on behalf of an undertaking of the other Contracting State engages in an economic activity in the State first mentioned as an independent agent and acts by the undertaking in the ordinary course of that activity. However, where a person acts exclusively or almost exclusively on behalf of one or more undertakings to which he is closely linked, that person shall not be regarded as an independent agent under the terms of this paragraph in relation to any of those undertakings.

(b) For the purposes of this article, a person or an undertaking is closely linked to an undertaking if, in the light of all relevant facts and circumstances, one has control over the other or both are under the control of the same persons or undertakings. In any event, a person or an undertaking shall be considered to be closely linked to an undertaking if one of them participates directly or indirectly in more than 50 per cent of the other (or, in the case of one company, in more than 50 per cent of the total voting rights and the value of the shares of the company or of the shareholding in its assets) or if a third person or undertaking participates, directly or indirectly, in more than 50 per cent (or, in the case of one company, in more than 50 per cent of the total voting rights and value of the shares of the company or of the right to share in the estate) in the person and the undertaking or in the two undertakings.

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 business activities in that other State (whether by permanent establishment or otherwise), does not in itself make any of these companies permanent establishment of the other State.

1. Income from immovable property (including income from agricultural or forestry holdings) situated in the other Contracting State may be taxed in that other Contracting State.

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

3. Paragraph 1 applies to income derived from the direct use, lease or shareholding and from any other form of exploitation of immovable property.

4. The provisions of paragraphs 1 and 3 shall also apply to income derived from the immovable property of an undertaking and to immovable property used in the provision of independent personal services.

1. The profits of an undertaking of one Contracting State shall be taxable exclusively in that State, unless the undertaking carries out its business in the other Contracting State by means of a permanent establishment situated therein. If the undertaking does so, the profits of the undertaking may be taxed in the other State, but only to the extent that they are attributable to that permanent establishment.

2. Without prejudice to paragraph 3, where an undertaking of a Contracting State carries out its activity in the other Contracting State through a permanent establishment situated therein, in each Contracting State the profits which it could have derived from being a separate and independent undertaking carrying out the same or similar activities under the same or similar conditions shall be attributed to that permanent 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 purposes of the permanent establishment, including management and general administrative expenses for the same purposes, shall be permitted, whether incurred in the Contracting State in which the permanent establishment is located or elsewhere.

4. As long as it is customary in a Contracting State to determine the profits attributable to a permanent establishment 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 the taxable profits in this way; however, the method of distribution adopted shall be such that the result obtained is in accordance with the principles contained in this Article.

5. No profits shall be attributed to a permanent establishment by reason of the mere acquisition of goods or goods by that permanent establishment for the enterprise.

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

7. Where profits comprise 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 ships, aircraft, railways or road vehicles in international traffic by an undertaking of a Contracting State shall be taxable exclusively in that State.

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

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 participate directly or indirectly in the direction, control or capital of an undertaking of a 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 which would be 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 been realized because of them, may be included in the profits of that undertaking and taxed accordingly.

2. Where a Contracting State includes in the profits of an undertaking of that State - and is therefore serious - those of an undertaking of the other Contracting State which have already been subject to taxation in that other Contracting State, and that other State recognizes that the profits thus included are profits which would have been realized by the undertaking of the State concerned in the first place if the terms agreed between the two companies had been those agreed upon by independent undertakings, that other State shall make such adjustment as may be appropriate to the amount of the tax which has taxed those profits. In determining such adjustment, account shall be taken of the other provisions of this Convention and the competent authorities of the Contracting States shall, if necessary, consult each other.

1. Dividends paid by a company resident of one Contracting State to a resident of the other Contracting State may be taxed in that other State.

2. However, such dividends may also be subject to taxation in the Contracting State in which the company paying the dividends resides and in accordance with the law of that State, but if the beneficial owner of the dividends is a resident of the other Contracting State, the tax thus required may not exceed:

(a) 5 per cent of the gross amount of dividends if the beneficial owner of the dividends is a company (other than a company of persons) holding directly at least 25 per cent of the capital of the company that pays the dividends for a period of 365 days covering the day of payment of the dividends;

(b) 10 per cent of the gross amount of dividends in all other cases.

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

3. By way of derogation from paragraph 2, dividends paid by a company which is resident of a Contracting State to a resident of the other Contracting State shall be considered exempt from taxation in the first State, if the actual beneficiary of the dividends is the other Contracting State, or its political subdivisions, its local entities, or the Central Bank of the other Contracting State or any entity whose capital is wholly owned, directly or indirectly, by the other Contracting State.

4. The term ‘dividends’ within the meaning of this Article means the income from shares, shares or enjoyment bonds, parts of mines, parts of founders or other rights allowing participation in profits other than credit, 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 of which the distribution company is resident.

5. The provisions of paragraphs 1, 2 and 3 do not apply if the beneficial owner of the dividends, resident of one Contracting State, carries out in the other Contracting State, of which the company that pays the dividends is resident, an economic activity through a permanent establishment located there, or which provides in that other State independent personal services from a fixed base situated there and the share generated by the dividends is effectively linked to that permanent establishment. In such a case, the provisions of Article 7 or Article 14 shall apply as appropriate.

6. Where a company resident of one Contracting State obtains profits or income from the other Contracting State, that other State may not require 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 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 that other State.

2. However, such interests may also be subject to taxation in the Contracting State from which they come and in accordance with the law of that State, but if the beneficial owner of the interest is a resident of the other Contracting State, the tax thus required may not exceed 10 per cent of the gross amount of interest.

3. By way of derogation from paragraph 2, interest from one Contracting State and paid to the other Contracting State, or to its political subdivisions, its local entities, the Central Bank of that other Contracting State or any entity whose capital is wholly owned, directly or indirectly, by the other Contracting State, or paid for on the basis of a loan secured or secured by that other Contracting State, or its political subdivisions, its local entities, the Central Bank of that other Contracting State, or any entity whose capital is wholly owned, directly or indirectly, by the other Contracting State shall be deemed to be exempt from taxation in the first Contracting State.

4. By way of derogation from paragraph 2, interest from a Contracting State whose beneficial owner is a resident of the other Contracting State shall be treated as exempt from taxation in the first State if interest is paid in connection with the sale on credit of commercial or scientific equipment.

5. The term ‘interest’ within the meaning of this Article means income from claims of any kind, with or without a mortgage guarantee or a benefit-sharing clause of the debtor, and in particular income from public securities and income from bonds or bonds, including premiums and lots attached to such securities, as well as any other income subject to the same regime as income from capital provided by the tax legislation of the State from which the income comes. Penalties for late payment are not considered interest for the purposes of this article.

6. The provisions of paragraphs 1, 2, 3 and 4 do not apply if the beneficial owner of the interest, resident of one Contracting State, carries out in the other Contracting State, from which the interest is derived, an economic activity through a permanent establishment situated in that other State, or who provides in that other State independent personal services from a fixed base situated in that State, and the credit generated by the interest is effectively linked to that permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14 shall apply as appropriate.

7. Interest is considered to come from a Contracting State where the debtor is 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 fixed base in respect of which the debt for which the interest is paid has been incurred and which bears the burden thereof, such interest shall be considered as originating in the State in which the permanent establishment or fixed base is situated.

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

1. Fees from one Contracting State and paid to a resident of the other Contracting State may be taxed in that other State.

2. However, such fees may also be subject to taxation in the Contracting State from which they come and in accordance with the law of that State, but if the beneficial owner of the royalties is a resident of the other Contracting State, the tax thus required may not exceed 10 per cent of the gross amount of the royalties.

3. The term ‘royalties’ within the meaning of this Article means the amounts of any kind paid for the use or granting of copyright in literary, artistic, scientific or other works, including cinematographic films and films or recordings intended for radio or television broadcasting, patents, trademarks or trade marks, designs, drawings, formulas or secret procedures, or information relating to industrial, commercial or scientific experiences.

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

5. The royalties are considered to come from a Contracting State where the debtor is a resident of that Contracting State. However, where the debtor of the royalties, whether or not he is resident of a Contracting State, has in a Contracting State a permanent establishment or fixed base in respect of which the obligation to pay the royalties has been incurred and which bears the burden thereof, such fees shall be deemed to have come from the Contracting State where the permanent establishment or fixed base is situated.

6. Where due to special relations between the debtor and the beneficial owner, or where both have with third parties, the amount of the royalties, in view of the use, right or information for which they are paid, exceeds the amount that the debtor and beneficial owner would have agreed in the absence of such relationships, the provisions of this article shall apply only to the latter amount. In such a case, the excess amount shall be taxable 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 from the disposal of movable property forming part of the assets of a permanent establishment held by an enterprise of one Contracting State in the other Contracting State or from the disposal of movable property belonging to a fixed base at the disposal of a resident of a Contracting State in that other Contracting State for the purpose of providing independent personal services, including gains arising from the disposal of that permanent establishment (only or with the enterprise as a whole) or from that fixed base, may be taxed in that other State.

3. Profits obtained by an undertaking of a Contracting State operating ships, aircraft, railways or road vehicles in international traffic resulting from the alienation of such ships, aircraft or railways or road vehicles, or from movable property affected by their operation, shall be taxable exclusively in that Contracting State.

4. Earnings obtained by a resident of a Contracting State from the disposal of shares or shares, or similar rights, the value of which derives by more than 50 per cent, directly or indirectly, from immovable property situated in the other Contracting State, may be subject to taxation in that other State. Real estate used in the course of the company's economic activity shall not be taken into account for that purpose.

5. Profits, other than those to which paragraph 4 applies, obtained by a resident of a Contracting State in the disposal of shares, other than those which are traded substantially and regularly on a recognised securities market, provided that the total amount of shares disposed of by the resident during the fiscal year in which the disposal takes place does not exceed 3 per cent of the value of such listed shares, of a company resident in the other Contracting State may be subject to taxation in that other Contracting State if, at any time during the 365 preceding the disposal, the transferor maintained, directly or indirectly, at least 25 per cent of the capital of that company.

6. The proceeds from the disposal of any property other than those referred to in paragraphs 1 to 5 shall be taxable exclusively in the Contracting State in which the transferor resides.

1. Income earned by a resident of a Contracting State through the provision of professional services or other activities of an independent nature may only be taxed in that State except in the case of any of the following circumstances, in which case such income may also be taxed in the other Contracting State:

(a) If such a resident has in the other Contracting State a fixed basis of which he normally has for the pursuit of his activities; in this case, the income may be taxed in that other Contracting State, but only to the extent that it is attributable to that fixed base; or

(b) if it remains in the other Contracting State for a total period or periods exceeding 183 days in any period of twelve months beginning or ending in the fiscal year in question; in this case, the income may be taxed in that other Contracting State, but only to the extent that it is derived from the activities carried out in that other Contracting State.

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 articles 16, 18 and 19, salaries, wages and other similar remuneration obtained by a resident of a Contracting State on account of employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. If the employment is carried out in this way, the remuneration derived therefrom may be subject to taxation in that other State.

2. By way of derogation from paragraph 1, remuneration obtained by a resident of a Contracting State on account of employment in the other Contracting State shall be taxable only in the State referred to above where:

(a) The recipient shall remain in the other State for a period or periods of not more than 183 days together in any twelve-month period beginning or ending in the fiscal 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) remuneration is not supported by a permanent establishment or a fixed basis which the employer has in the other State.

3. Notwithstanding the foregoing provisions of this Article, remunerations earned on account of employment on board a ship, aircraft, rail or road vehicle operated in international traffic by an undertaking of a Contracting State may be subject to taxation in that State.

The remuneration of directors and other similar remunerations which a resident of a Contracting State obtains as a member of a board of directors of a company resident of the other Contracting State may be taxed in that other State.

1. Notwithstanding Articles 14 and 15, income earned by a resident of a Contracting State in the exercise of his personal activity in the other Contracting State as an artist, such as a theatre, film, radio or television actor, or as a musician, or as an athlete, may be taxed in that other State.

2. Notwithstanding Articles 7, 14 and 15, where income derived from 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. By way of derogation from paragraphs 1 and 2 of this Article, income obtained in the pursuit of the activities provided for in paragraph 1 under an agreement or agreement on cultural cooperation between the Contracting States or their political subdivisions or local entities shall be exempt from taxation in the Contracting State in which such activities are carried out where the visit to that State is wholly or substantially financed by public funds from either of the two States or their political subdivisions or local entities.

1. Without prejudice to Article 19(2), pensions and similar remuneration paid to a resident of a Contracting State on account of previous employment shall be taxable exclusively in that State.

2. Without prejudice to paragraph 1, pensions paid and similar payments paid by the administration of a Contracting State or a local entity of that State under the benefit scheme of the public social security system of that State shall be taxable exclusively in that State.

1. (a) Salaries, wages and other similar remunerations, except pensions, paid by a Contracting State or by one of its political subdivisions or local entities to a natural person on account of services rendered to that State, subdivision or entity, shall be taxable exclusively in that State.

(b) However, such salaries, salaries and similar remuneration shall be taxable only in the other Contracting State where the services are provided in that State and the natural person is a resident of that State who:

i. is a national of that State; or

ii. has not acquired the resident status of that State solely to provide the services.

(a) Pensions and other similar remuneration paid by a Contracting State or by one of its political subdivisions or local entities, either directly or from funds constituted, to a natural person for services rendered to that State, subdivision or entity, shall be taxable exclusively in that State.

(b) However, such pensions and similar remuneration shall be taxable only in the other Contracting State where the natural person is a resident and a national of that State.

3. Articles 15, 16, 17 and 18 apply to salaries, salaries, pensions and other similar remuneration paid for services rendered in the context of an economic activity carried out by a Contracting State or by one of its political subdivisions or local authorities.

1. The remuneration that a person who is or has been, immediately prior to his arrival in a Contracting State, resident of the other Contracting State, and who is in the State referred to first for the sole purpose of teaching, giving lectures or engaging in research in a school, institute, university or other institution engaged in education or research officially recognized by the administration of that State, receives for such services is exempt from taxation in that State for a total period not exceeding three years from the date of his arrival in that State.

2. The provisions of paragraph 1 do not apply to income derived from the investigation, where this investigation is not conducted in the public interest but primarily for the particular benefit of a particular person or persons.

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

1. The income of a resident of a Contracting State, regardless of its origin, not mentioned in the previous articles of this Convention shall be taxable exclusively in that State.

2. Paragraph 1 does not apply to income, other than income derived from immovable property within the meaning of Article 6(2), where the recipient of such income, resident of a Contracting State, carries out an economic activity in the other Contracting State through a permanent establishment situated in that other State, or provides independent personal services in that other State from a fixed base situated in that State, and the right or for which the income is paid is effectively linked to that permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14 shall apply as appropriate.

1. In China, in accordance with the provisions of Chinese law, double taxation will be avoided as follows:

(a) Where a resident of China obtains income in Spain, the amount of the income tax to be paid in Spain in accordance with the provisions of this Agreement (except to the extent that those provisions allow Spain to tax them for the sole reason that the income is also considered to have been obtained by a resident of Spain), may be deducted from the Chinese tax due by that resident. However, this deduction may not exceed the amount of Chinese income tax calculated in accordance with the rules governing taxation in China.

(b) Where the income obtained in Spain is dividends paid by a company resident in Spain to a company resident in China and holding at least 20 per cent of the shares of the company paying the dividends, the deduction shall take into account the income tax paid in Spain by the company paying the dividends.

2. In Spain, double taxation shall be avoided either in accordance with the provisions of its domestic legislation or in accordance with the following provisions, in accordance with Spanish domestic law:

(a) Where a resident of Spain obtains income which, in accordance with the provisions of this Convention (except to the extent that those provisions allow China to subject them to taxation for the sole reason that the income is also considered to have been obtained by a resident of China), may be taxed in China, Spain shall permit:

i. The deduction in the income tax of that resident from an amount equal to the income tax paid in China;

ii. the deduction of corporation tax actually paid by the company distributing the dividends, corresponding to the profits from which the dividends are paid, in accordance with Spain's domestic law.

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

(b) However, where under any provision of this Agreement the income obtained by a resident of Spain is tax-exempt in Spain, the resident may take into account the exempt income in calculating the tax on the rest of the income of that resident.

Notwithstanding the other provisions of this Convention, benefits granted under this Convention shall not be granted in respect of an income element where it is reasonable to conclude, taking into account all relevant facts and circumstances, that the legal instrument or operation that directly or indirectly generates the right to receive such benefit has as its main objectives the acquisition of such benefit, except where it is determined that the granting of the benefit in such circumstances is in conformity with the object and purpose of the relevant provisions of this Convention.

The provisions of this Convention are without prejudice to the right of Contracting States to apply their own rules and measures on the prevention of tax avoidance, explicitly defined as such or not, to the extent that they do not lead to an imposition contrary to the Convention.

1. Nationals of one Contracting State shall not be subject in the other Contracting State to any taxes or obligations relating thereto which are not or are 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 persons who are not residents of one or both Contracting States.

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 that other 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 and tax reductions it grants to its own residents in view of their marital status or family burdens.

3. Unless the provisions of Article 9(1) of Article 11(8) or Article 12(6) apply, the interest, royalties and other expenses paid by an undertaking of a Contracting State to a resident of the other Contracting State shall be deductible to determine the profits subject to taxation of that undertaking under the same conditions as if they had been paid to a resident of the State referred to first.

4. Undertakings of a Contracting State whose capital is wholly or partly owned, directly or indirectly, by one or more residents of the other Contracting State, or which is controlled, directly or indirectly, by one or more residents of that State, shall not be subject in the Contracting 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 Article 2, the provisions of this Article apply to all taxes irrespective of 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 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 26 (1) applies, to that of the Contracting State of which he is a national. The case must arise within three years of the first notification of the measure involving an imposition not in conformity with the provisions of the Convention.

2. The competent authority shall, if it finds the complaint well founded and if it cannot in itself reach 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 which does not comply with this Convention. The agreement reached shall apply irrespective of the time limits provided for by the domestic law of the Contracting States.

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

4. The competent authorities of the Contracting States may communicate directly with each other in order to reach agreement within the meaning of paragraphs 2 and 3. Where appropriate to reach agreement, representatives of the competent authorities of the Contracting States may meet to exchange views orally.

1. The competent authorities of the Contracting States shall exchange information which is likely to be relevant to the application of this Convention or to the administration or application of national law relating to taxes of any kind or designation required by the Contracting States, their political subdivisions or their local authorities, to the extent that the imposition so required is not contrary to the Convention. The exchange of information is not limited by Articles 1 and 2.

2. Information received by a Contracting State pursuant to paragraph 1 shall be kept secret in the same way as information obtained under the domestic law of that State and shall be communicated only to the persons or authorities (including courts and administrative bodies) responsible for the determination or collection of taxes referred to in paragraph 1 of their effective application, the prosecution of non-compliance with such taxes, the determination of remedies relating thereto, or the supervision of such activities. Such persons or authorities shall use this information only for those purposes. They may disclose the information at public court hearings or in court judgements. Notwithstanding the foregoing, information received by a Contracting State may be used for other purposes where, under the law of both Contracting States, such information may be used for such other purposes and the competent authority of the State providing the information authorizes such use.

3. In no case may the provisions of paragraphs 1 and 2 be interpreted as obliging a Contracting State to:

(a) To take administrative measures contrary to its legislation and 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) providing information revealing business, industrial, commercial or professional secrecy, or an industrial procedure, or information the communication of which is contrary to public policy (ordre public).

4. Where a Contracting State requests information under this Article, the other Contracting State shall use the measures to collect information at its disposal in order to obtain the information requested, even if that other State may not need such information for its own tax purposes. The above obligation is limited by paragraph 3, but in no case may Contracting States interpret such limitations as allowing them to refuse to provide information solely because of the absence of national interest in it.

5. In no case shall the provisions of paragraph 3 be interpreted as allowing a Contracting State to refuse the exchange of information solely because it is held by banks, other financial institutions or any person acting in a representative or fiduciary capacity, including designated agents, or because it relates to shares or shares in a person.

The provisions of this Convention shall not affect the tax privileges enjoyed by members of diplomatic missions or consular offices in accordance with the general principles of international law or under the provisions of special agreements.

1. Each Contracting State shall notify the other, through diplomatic means, that the domestic legal procedures for the entry into force of this Convention have been complied with.

2. This Convention shall enter into force within three months of the date of receipt of the last notification referred to in paragraph 1, and shall take effect:

(a) In respect of taxes not withheld at source, for fiscal years beginning from the date on which the Convention enters into force; and

(b) in the remaining cases, from the date on which the Convention enters into force.

3. The Convention between the Government of Spain and the Government of the People's Republic of China on the prevention of double taxation and tax evasion in respect of income and property taxes, done at Beijing on 22 November 1990 (hereinafter referred to as the 1990 Convention), shall cease to have effect from the date on which the provisions of this Convention apply, in accordance with the provisions of this Article. The provisions of Article 23 of the 1990 Convention shall cease to have effect on 31 December following the date of entry into force of this Convention.

This Convention shall remain in force until its denunciation by one of the Contracting States. Any Contracting State may denounce it, through diplomatic means, by written notification to that effect at least six months before the end of any calendar year beginning after a period of five years from the date of its entry into force. In such a case, the Convention shall cease to have effect:

(a) In respect of taxes not withheld at source, for fiscal years beginning from the end of that calendar year; and

(b) in all other cases, after the end of that calendar year.

In faith, the signatories, duly authorized to do so, have signed this Convention.

Done in duplicate in Madrid on 28 November 2018, in the English, Chinese and Spanish languages, all texts being equally authentic. In the event of a divergence in the interpretation of the texts, the text shall be settled in accordance with the English text.

At the time of the signing of the Convention between the Kingdom of Spain and the People's Republic of China on the elimination of double taxation in relation to income taxes and the prevention of tax avoidance and evasion (hereinafter referred to as the ‘Convention’), both parties have agreed on the following provisions which shall form an integral part of the Convention.

1. With regard to articles 10, 11 and 12. It is understood that the limitation of the tax rates will apply directly and not through the procedure of levying and subsequent reimbursement when those rates are lower than those provided for in the domestic law of the Contracting State from which the income is derived.

2. With regard to Articles 10(3) and 11(3). The term ‘whose capital is wholly owned, directly or indirectly, by the other Contracting State’ means:

(a) In the case of China:

i. The Chinese Development Bank;

(ii) The Agricultural Development Bank of China;

iii. China Export and Import Bank;

iv. the National Council for the Social Security Fund;

v. China Export Credit Insurance Agency;

vi. the China Investment Corporation and entities whose capital is wholly owned, directly or indirectly, by that State;

vii. the Silk Road Fund Society; and

viii. any other entity which is fully owned by China that the competent authorities of the contracting States agree in due course;

(b) In the case of Spain:

i. The Official Credit Institute;

ii. the Banks Ordained Restructuring Fund;

iii. the Insurance Compensation Consortium;

iv. any other entity which is fully owned by Spain that the competent authorities of the contracting States agree in due course.

In faith, the signatories, duly authorized to do so, have signed this Convention.

Done in duplicate in Madrid on 28 November 2018, in the English, Chinese and Spanish languages, all texts being equally authentic. In the event of a divergence in the interpretation of the texts, the text shall be settled in accordance with the English text.

* * *

This Convention and its Protocol shall enter into force on 2 May 2021, within three months of the date of receipt of the last notification by which the Parties were informed of their compliance with their respective domestic requirements, as set out in Article 30 thereof.

Madrid, March 23, 2021.–The Technical Secretary General, José María Muriel Palomino.