DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF ALBANIA _g S.L.123.53 1
SUBSIDIARY LEGISLATION 123.53
DOUBLE TAXATION RELIEF ON TAXES ON 
INCOME WITH THE REPUBLIC OF ALBANIA 
ORDER
23rd November, 2000
LEGAL NOTICE 122 of 2001.
Citation.
Taxes on Income with the Republic of Albania Order.
Arrangements to 
have effect.
2. It is hereby declared:
( a ) that the arrangements specified in the Convention set
out in the Schedule to this Order have been made with
the Republic of Albania with a view to affording relief
from double taxation in relation to the following taxes
imposed by the laws of the Republic of Albania:
(i)  the tax on the profits of juridical persons;
(ii)  the tax on small business activities;
(iii)  the individual income tax;
( b )  that it is expedient that those arrangements should
have effect;
( c )  that the Convention has entered into force on the 23
November, 2000.
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WITH THE REPUBLIC OF ALBANIA
SCHEDULE
CONVENTION BETWEEN THE GOVERNMENT OF MALTA
AND THE GOVERNMENT OF THE REPUBLIC OF ALBANIA
FOR THE AVOIDANCE OF DOUBLE TAXATION 
AND THE PREVENTION OF FISCAL EVASION 
WITH RESPECT TO TAXES ON INCOME 
The Government of Malta and the Government of the Republic of Albania,
desiring, for the purpose of further developing and facilitating their economic
relationship, to conclude a Convention for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on income, have agreed as follows:
Article 1
PERSONAL SCOPE
This Convention shall apply to persons who are residents of one or both of
the Contracting States.
Article 2
TAXES COVERED
1.  This Convention shall apply to taxes on income imposed on behalf of a
Contracting State or of its local authorities, irrespective of the manner in which they
are levied.
2.  There shall be regarded as taxes on income all taxes imposed on total
income or on elements of income.
3.  The existing taxes to which the Convention shall apply are in particular:
( a )  in Albania:
(i)  the tax on the profits of juridical persons;
(ii)  the tax on small business activities; 
(iii)  the individual income tax;
(hereinafter referred to as "Albanian Tax");
( b )  in Malta:
the income tax;
(hereinafter referred to as "Malta tax").
4. The Convention shall apply also to any identical or substantially similar
taxes which are imposed after the date of signature of the Convention in addition to,
or in place of, the existing taxes. The competent authorities of the Contracting States
shall notify each other of any significant changes which have been made in their
respective taxation laws.
5. Notwithstanding the other provisions of this Article , the Convention shall
not apply to taxes paid or payable in a Contracting State under its domestic law,
concerning taxable income of any person engaged in the production of petroleum,
provided that such activities are performed under the provisions of particular
contracts between the Government of that Contracting State and the aforesaid
persons.
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WITH THE REPUBLIC OF ALBANIA _g S.L.123.53 3
Article 3
GENERAL DEFINITIONS
1. For the purposes of this Convention unless the context otherwise requires:
( a ) the term "Albania" means the Republic of Albania, and when used in a
geographical sense means the territory of the Republic of Albania
including territorial waters and air space over them as well as any area
beyond the territorial seas of the Republic of Albania which, in
accordance with international law and the laws of the Republic of
Albania, is an area within which the Republic of Albania may exercise
its rights with respect to the seabed and subsoil and their natural
resources;
( b ) the term "Malta" means the Republic of Malta and, when used in a
geographical sense, means the Island of Malta, the Island of Gozo and
the other islands of the Maltese archipelago including the territorial
waters thereof, and any area outside the territorial waters of Malta
which has been or may hereafter be designated, in accordance with
international law and under the law of Malta concerning the continental
shelf, as an area within which the rights of Malta with respect to the
seabed and subsoil and their natural resources may be exercised;
( c ) the terms "a Contracting State" and "the other Contracting State" mean
Albania or Malta as the context requires;
( d ) the term "person" includes an individual, a company and any other body
of persons;
( e ) the term "company" means any legal entity which is treated as a
juridical person for tax purposes;
( f ) the terms "enterprise of a Contracting State" and "enterprise of the other
Contracting State" mean respectively an enterprise carried on by a
resident of a Contracting State and an enterprise carried on by a resident
of the other Contracting State;
( g ) the term "national" means:
(i) any individual possessing the nationality of a Contracting State;
(ii) any juridical person, partnership or association deriving its status
as such from the laws in force in a Contracting State;
( h ) the term "international traffic" means any transport by a ship or an
aircraft operated by an enterprise which has its place of effective
management in a Contracting State, except when the ship or aircraft is
operated solely between places in the other Contracting State;
( i ) the term "competent authority" means:
(i) in the case of Albania, the Minister of Finance or his authorised
representative;
(ii) in the case of Malta, the Minister responsible for finance or his
authorised representative.
2. As regards the application of this Convention by a Contracting State, any
term not defined therein shall, unless the context otherwise requires, have the
meaning which it has under the law of that State concerning the taxes to which the
Convention applies.
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Article 4
RESIDENT
1. For the purposes of this Convention, the term "resident of a Contracting
State" means any person who, under the laws of that State, is liable to tax therein by
reason of his domicile, residence, place of management, place of registration or any
other criterion of a similar nature. But this term does not include any person who is
liable to tax in that State in respect only of income from sources in that State.
2. Where by reason of the provisions of paragraph 1 an individual is a resident
of both Contracting States, then his status shall be determined as follows:
( a ) he shall be deemed to be a resident of the State in which he has a
permanent home available to him; if he has a permanent home available
to him in both States, he shall be deemed to be a resident of the State
with which his personal and economic relations are closer (centre of
vital interests);
( b ) if the State in which he has his centre of vital interests cannot be
determined, or if he has not a permanent home available to him in either
State, he shall be deemed to be a resident of the State in which he has an
habitual abode;
( c ) if he has an habitual abode in both States or in neither of them, he shall
be deemed to be a resident of the State of which he is a national;
( d ) if he is a national of both States or of neither of them the competent
authorities of the Contracting States shall settle the question by mutual
agreement.
3. Where by reason of the provisions of paragraph 1 a person other than an
individual is a resident of both Contracting States, then it shall be deemed to be a
resident of the State in which its place of effective management is situated.
Article 5
PERMANENT ESTABLISHMENT
1. For the purposes of this Convention, the term "permanent establishment"
means a fixed place of business through which the business of an enterprise is
wholly or partly carried on.
2. The term "permanent establishment" includes especially:
( a ) a place of management;
( b ) a branch;
( c ) an office;
( d ) a factory;
( e ) a workshop, and
( f ) a mine, an oil or gas well, a quarry or any other place of extraction of
natural resources including an offshore drilling site.
3. The term "permanent establishment" likewise encompasses:
( a ) a building site, a construction, assembly or installation project or
supervisory activities in connection therewith, but only where such site,
project or activities continue for a period of more than six months
within any 12-month period commencing or ending in the calendar year
concerned; and
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WITH THE REPUBLIC OF ALBANIA _g S.L.123.53 5
( b ) the furnishing of services, including consultancy services, by an
enterprise through employees or other personnel engaged by the
enterprise for such purpose, but only where activities of that nature
continue (for the same or a connected project) within the country for a
period or periods aggregating more than six months within any 12-
month period, commencing or ending in the calendar year concerned.
4. Notwithstanding the preceding provisions of this Article , the term
"permanent establishment" shall be deemed not to include:
( a ) the use of facilities solely for the purpose of storage or display of goods
or merchandise belonging to the enterprise;
( b ) the maintenance of a stock of goods or merchandise belonging to the
enterprise solely for the purpose of storage or display;
( c ) the maintenance of a stock of goods or merchandise belonging to the
enterprise solely for the purpose of processing by another enterprise;
( d ) the maintenance of a fixed place of business solely for the purpose of
purchasing goods or merchandise or of collecting information, for the
enterprise;
( e ) the maintenance of a fixed place of business solely for the purpose of
carrying on, for the enterprise, any other activity of a preparatory or
auxiliary character;
( f ) the maintenance of a fixed place of business solely for any combination
of activities mentioned in subparagraphs ( a ) to ( e ), provided that the
overall activity of the fixed place of business resulting from this
combination is of a preparatory or auxiliary character.
5. Notwithstanding the provisions of paragraphs 1 and 2, where a person -
other than an agent of an independent status to whom paragraph 6 applies - is acting
in a Contracting State on behalf of an enterprise of the other Contracting State, that
enterprise shall be deemed to have a permanent establishment in the first-mentioned
State in respect of any activities which that person undertakes for the enterprise, if
such a person:
( a ) has and habitually exercises in the first-mentioned State an authority to
conclude contracts in the name of the enterprise, unless the activities of
such person are limited to those mentioned in paragraph 4 which, if
exercised through a fixed place of business, would not make this fixed
place of business a permanent establishment under the provisions of that
paragraph; or
( b ) has no such authority, but habitually maintains in the first-mentioned
State a stock of goods or merchandise from which he regularly delivers
goods or merchandise on behalf of the enterprise.
6. An enterprise shall not be deemed to have a permanent establishment in a
Contracting State merely because it carries on business in that State through a
broker, general commission agent or any other agent of an independent status,
provided that such persons are acting in the ordinary course of their business.
However, when the activities of such an agent are devoted wholly or almost wholly
on behalf of that enterprise, he shall not be considered to be an agent of an
independent status within the meaning of this paragraph.
7. The fact that a company which is a resident of a Contracting State controls
or is controlled by a company which is a resident of the other Contracting State, or
which carries on business in that other State (whether through a permanent
6 _g S.L.123.53
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establishment or otherwise), shall not of itself constitute either company a
permanent establishment of the other.
Article 6
INCOME FROM IMMOVABLE PROPERTY
1. Income derived by a resident of a Contracting State from immovable
property (including income from agriculture or forestry) situated in the other
Contracting State may be taxed in that other State.
2. The term "immovable property" shall have the meaning which it has under
the law of the Contracting State in which the property in question is situated. The
term shall in any case include property accessory to immovable property, livestock
and equipment used in agriculture and forestry, rights to which the provisions of
general law respecting landed property apply, usufruct of immovable property and
rights to variable or fixed payments as consideration for the working of, or the right
to work, or to explore for, mineral deposits, sources and other natural resources.
Ships and aircraft shall not be regarded as immovable property.
3. The provisions of paragraph 1 shall apply to income derived from the direct
use, letting, or use in any other form of immovable property.
4. The provisions of paragraphs 1 and 3 shall also apply to the income from
immovable property of an enterprise and to income from immovable property used
for the performance of independent personal services.
Article 7
BUSINESS PROFITS
1. The profits of an enterprise of a Contracting State shall be taxable only in
that State unless the enterprise carries on business in the other Contracting State
through a permanent establishment situated therein. If the enterprise carries on
business as aforesaid, the profits of the enterprise may be taxed in the other State but
only so much of them as is attributable to that permanent establishment.
2. Subject to the provisions of paragraph 3, where an enterprise of a
Contracting State carries on business in the other Contracting State through a
permanent establishment situated therein, there shall in each Contracting State be
attributed to that permanent establishment the profits which it might be expected to
make if it were a distinct and separate enterprise engaged in the same or similar
activities under the same or similar conditions and dealing wholly independently
with the enterprise of which it is a permanent establishment.
3. In the determination of the profits of a permanent establishment, there shall
be allowed as deductions expenses which are incurred for the purposes of the
business of the permanent establishment, including executive and general
administrative expenses so incurred, whether in the State in which the permanent
establishment is situated or elsewhere.
4. Insofar as it has been customary in a Contracting State to determine the
profits to be attributed to a permanent establishment on the basis of an
apportionment of the total profits of the enterprise to its various parts, nothing in
paragraph 2 shall preclude that Contracting State from determining the profits to be
taxed by such an apportionment as may be customary; the method of apportionment
adopted shall, however, be such that the result shall be in accordance with the
principles contained in this Article .
5. No profits shall be attributed to a permanent establishment by reason of the
mere purchase by that permanent establishment of goods or merchandise for the
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WITH THE REPUBLIC OF ALBANIA _g S.L.123.53 7
enterprise.
6. For the purposes of the preceding paragraphs, the profits to be attributed to
the permanent establishment shall be determined by the same method year by year,
unless there is good and sufficient reason to the contrary.
7. Where profits include items of income which are dealt with separately in
other Article s of this Convention, then the provisions of those Article s shall not be
affected by the provisions of this Article .
8. The provisions of this Article shall not affect the provisions of the law of a
Contracting State regarding the taxation of profits from the business of insurance.
Article 8
INTERNATIONAL TRANSPORT
1. Profits from the operation of ships or aircraft in international traffic shall be
taxable only in the Contracting State in which the place of effective management of
the enterprise is situated.
2. If the place of effective management of a shipping enterprise is aboard a
ship, then it shall be deemed to be situated in the Contracting State in which the
home harbour of the ship is situated, or, if there is no such home harbour, in the
Contracting State of which the operator of the ship is a resident.
3. The provisions of paragraph 1 shall also apply to profits from the
participation in a pool, a joint business or an international operating agency.
Article 9
ASSOCIATED ENTERPRISES
1. Where -
( a ) an enterprise of a Contracting State participates directly or indirectly in
the management, control or capital of an enterprise of the other
Contracting State, or
( b ) the same persons participate directly or indirectly in the management,
control or capital of an enterprise of a Contracting State and an
enterprise of the other Contracting State,
and in either case conditions are made or imposed between the two enterprises in
their commercial or financial relations which differ from those which would be made
between independent enterprises, then any profits which would, but for those
conditions, have accrued to one of the enterprises, but, by reason of those conditions
have not so accrued, may be included in the profits of that enterprise and taxed
accordingly.
2. Where a Contracting State includes in the profits of an enterprise of that
State -and taxes accordingly - profits on which an enterprise of the other Contracting
State has been charged to tax in that other State and the profits so included are
profits which would have accrued to the enterprise of the first-mentioned State if the
conditions made between the two enterprises had been those which would have been
made between independent enterprises, then that other State shall make an
appropriate adjustment to the amount of the tax charged therein on those profits. In
determining such adjustment, due regard shall be had to the other provisions of the
Convention and the competent authorities of the Contracting States shall, if
necessary, consult each other.
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Article 10
DIVIDENDS
1. Dividends paid by a company which is a resident of a Contracting State to a
resident of the other Contracting State may be taxed in that other State.
2. However, such dividends may also be taxed in the Contracting State of
which the company paying the dividends is a resident and according to the laws of
that State, but:
( a ) where the dividends are paid by a company which is a resident of
Albania to a resident of Malta who is the beneficial owner thereof, the
Albanian tax so charged shall not exceed:
(i) 5 per cent of the gross amount of the dividends if the beneficial
owner is a company which holds at least 25 per cent of the voting
power of the company paying the dividends;
(ii) 15 per cent of the gross amount of the dividends in all other cases;
( b ) where the dividends are paid by a company which is a resident of Malta
to a resident of Albania who is the beneficial owner thereof, Malta tax
on the gross amount of the dividends shall not exceed that chargeable on
the profits out of which the dividends are paid.
This paragraph shall not affect the taxation of the company in respect of
the profits out of which the dividends are paid.
3. The term "dividends" as used in this Article means income from shares of
any kind, or other rights not being debt-claims, participating in profits, as well as
income from other corporate rights which is subjected to the same taxation treatment
as income from shares by the laws of the State of which the company making the
distribution is a resident.
4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner
of the dividends, being a resident of a Contracting State, carries on business in the
other Contracting State of which the company paying the dividends is a resident,
through a permanent establishment situated therein, or performs in that other State
independent personal services from a fixed base situated therein, and the holding in
respect of which the dividends are paid is effectively connected with such permanent
establishment or fixed base. In such case, the provisions of Article 7 or Article 14, as
the case may be, shall apply.
5. Where a company which is a resident of a Contracting State derives profits
or income from the other Contracting State, that other State may not impose any tax
on the dividends paid by the company except insofar as such dividends are paid to a
resident of that other State or insofar as the holding in respect of which the dividends
are paid is effectively connected with a permanent establishment or a fixed base
situated in that other State, nor subject the company’s undistributed profits to a tax
on the company’s undistributed profits, even if the dividends paid or the
undistributed profits consist wholly or partly of profits or income arising in such
other State.
Article 11
INTEREST
1. Interest arising in a Contracting State and paid to a resident of the other
Contracting state may be taxed in that other State.
2. However, such interest may also be taxed in the Contracting State in which
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WITH THE REPUBLIC OF ALBANIA _g S.L.123.53 9
it arises and according to the laws of that State, but, if the recipient is the beneficial
owner of the interest the tax so charged shall not exceed 5 percent of the gross
amount of the interest.
3. The term "interest" as used in this Article means income from debt-claims of
every kind, whether or not secured by mortgage, and whether or not carrying the
right to participate in the debtor’s profits, and in particular, income from government
securities and income from bonds or debentures, including premiums and prizes
attaching to such securities, bonds or debentures. Penalty charges for late payment
shall not be regarded as interest for the purpose of this Article .
4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner
of the interest, being a resident of a Contracting State, carries on business in the
other Contracting State in which the interest arises, through a permanent
establishment situated therein, or performs in that other State independent personal
services from a fixed base situated therein, and the debt-claim in respect of which
the interest is paid is effectively connected with such permanent establishment or
fixed base. In such case, the provisions of Article 7 or Article 14, as the case may be,
shall apply.
5. Interest shall be deemed to arise in a Contracting State when the payer is
that State itself, a political subdivision, a local authority or a resident of that State.
Where, however, the person paying the interest, whether he is a resident of a
Contracting State or not, has in a Contracting State a permanent establishment or a
fixed base in connection with which the indebtedness on which the interest is paid
was incurred and such interest is borne by such permanent establishment or fixed
base, then such interest shall be deemed to arise in the State in which the permanent
establishment or fixed base is situated.
6. Where by reason of a special relationship between the payer and the
beneficial owner or between both of them and some other person, the amount of the
interest, having regard to the debt-claim for which it is paid, exceeds the amount
which would have been agreed upon by the payer and the beneficial owner in the
absence of such relationship, the provisions of this Article shall apply only to the
last-mentioned amount. In such case, the excess part of the payments shall remain
taxable according to the laws of each Contracting State, due regard being had to the
other provisions of this Convention.
Article 12
ROYALTIES
1. Royalties arising in a Contracting State and paid to a resident of the other
Contracting State may be taxed in that other State.
2. However, such royalties may also be taxed in the Contracting State in which
they arise and according to the laws of that State, but if the recipient is the beneficial
owner of the royalties, the tax so charged shall not exceed 5 per cent of the gross
amount of the royalties.
3. The term "royalties" as used in this Article means payments of any kind
received as a consideration for the use of, or the right to use, any copyright of
literary, artistic or scientific work including cinematograph films and films or tapes
for radio or television broadcasting, any patent, trade mark, design or model, plan,
secret formula or process, or for information concerning industrial, commercial or
scientific experience.
4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner
of the royalties, being a resident of a Contracting State, carries on business in the
other Contracting State in which the royalties arise, through a permanent
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establishment situated therein, or performs in that other State independent personal
services from a fixed base situated therein, and the right or property in respect of
which the royalties are paid is effectively connected with such permanent
establishment or fixed base. In such case, the provisions of Article 7 or Article 14, as
the case may be, shall apply.
5. Royalties shall be deemed to arise in a Contracting state when the payer is
that State itself, a political subdivision, a local authority or a resident of that State.
Where, however, the person paying the royalties, whether he is a resident of a
Contracting State or not, has in a Contracting State a permanent establishment or a
fixed base in connection with which the liability to pay the royalties was incurred,
and such royalties are borne by such permanent establishment or fixed base, then
such royalties shall be deemed to arise in the state in which the permanent
establishment or fixed base is situated.
6. Where by reason of a special relationship between the payer and the
beneficial owner or between both of them and some other person, the amount of the
royalties, having regard to the use, right or information for which they are paid,
exceeds the amount which would have been agreed upon by the payer and the
beneficial owner in the absence of such relationship, the provisions of this Article
shall apply only to the last-mentioned amount. In such case, the excess part of the
payments shall remain taxable according to the laws of each Contracting State, due
regard being had to the other provisions of this Convention.
Article 13
CAPITAL GAINS
1. Gains derived by a resident of a Contracting State from the alienation of
immovable property referred to in Article 6 and situated in the other Contracting
State may be taxed in that other State.
2. Gains from the alienation of movable property forming part of the business
property of a permanent establishment which an enterprise of a Contracting State has
in the other Contracting State or of movable property pertaining to a fixed base
available to a resident of a Contracting State in the other Contracting State for the
purpose of performing independent personal services, including such gains from the
alienation of such a permanent establishment (alone or with the whole enterprise) or
of such fixed base, may be taxed in that other State.
3. Gains from the alienation of ships or aircraft operated in international traffic
or movable property pertaining to the operation of such ships or aircraft shall be
taxable only in the Contracting State in which the place of effective management of
the enterprise is situated.
4. Gains from the alienation of shares of a company the property of which
consists directly or indirectly principally of immovable property situated in a
Contracting State may be taxed in that State.
5. Gains from the alienation of any property other than that referred to in
paragraphs 1, 2, 3 and 4 shall be taxable only in the Contracting State of which the
alienator is a resident.
Article 14
INDEPENDENT PERSONAL SERVICES
1. Income derived by an individual who is a resident of a Contracting State in
respect of professional or other activities of an independent character shall be
taxable only in that State except in the following circumstances, when such income
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WITH THE REPUBLIC OF ALBANIA _g S.L.123.53 11
may also be taxed in the other Contracting State:
( a ) if he has a fixed base regularly available to him in the other Contracting
State for the purpose of performing his activities; in that case, only so
much of the income as is attributable to that fixed base may be taxed in
that other State; or
( b ) if his stay in the other Contracting State is for a period or periods
amounting to or exceeding in the aggregate 183 days in any 12-month
period commencing or ending in the fiscal year concerned; in that case,
only so much of the income as is derived from his activities performed
in that other State may be taxed in that other State, or
( c ) if the remuneration for his activities in the other Contracting State is
paid by a resident of that Contracting State or is borne by a permanent
establishment or a fixed base situated in that Contracting State and
exceeds in the fiscal year the equivalent of 4,000 United States dollars.
2. The term "professional services" includes especially independent scientific,
literary, artistic, educational or teaching activities as well as the independent
activities of physicians, dentists, lawyers, engineers, architects and accountants.
Article 15
DEPENDENT PERSONAL SERVICES
1. Subject to the provisions of Article s 16, 18 and 19, salaries, wages and
other similar remuneration derived by a resident of a Contracting State in respect of
an employment shall be taxable only in that State unless the employment is exercised
in the other Contracting State. If the employment is so exercised, such remuneration
as is derived therefrom may be taxed in that other State.
2. Notwithstanding the provisions of paragraph 1, remuneration derived by a
resident of a Contracting State in respect of an employment exercised in the other
Contracting State shall be taxable only in the first-mentioned State if all the
following conditions are met:
( a ) the recipient is present in the other State for a period or periods not
exceeding in the aggregate 183 days in any 12-month period
commencing or ending in the calendar year concerned;
( b ) the remuneration is paid by, or on behalf of, an employer who is not a
resident of the other State; and
( c ) the remuneration is not borne by a permanent establishment or a fixed
base which the employer has in the other State.
3. Notwithstanding the preceding provisions of this Article , remuneration
derived in respect of an employment exercised aboard a ship or aircraft operated in
international traffic may be taxed in the Contracting State in which the place of
effective management of the enterprise is situated.
Article 16
DIRECTORS’ FEES
Directors’ fees and other similar payments derived by a resident of a
Contracting State in his capacity as a member of the board of directors of a company
which is a resident of the other Contracting State may be taxed in that other State.
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Article 17
ARTISTES AND SPORTSMEN
1. Notwithstanding the provisions of Article s 14 and 15, income derived by a
resident of a Contracting State as an entertainer, such as a theatre, motion picture,
radio or television artiste, or a musician, or as a sportsman, from his personal
activities as such exercised in the other Contracting State, may be taxed in that other
State.
2. Where income in respect of personal activities exercised by an entertainer or
a sportsman in his capacity as such accrues not to the entertainer or sportsman
himself but to another person, that income may, notwithstanding the provisions of
Article s 7, 14 and 15, be taxed in the Contracting State in which the activities of the
entertainer or sportsman are exercised.
Article 18
PENSIONS
Subject to the provisions of paragraph 2 of Article 19, pensions and other
similar remuneration paid to a resident of a Contracting State in consideration of
past employment shall be taxable only in that State.
Article 19
GOVERNMENT SERVICE
1. ( a ) Remuneration, other than a pension, paid by a Contracting State or a
political subdivision or a local authority thereof to an individual in
respect of services rendered to that State or subdivision or authority
shall be taxable only in that State.
( b ) However, such remuneration shall be taxable only in the other
Contracting State if the services are rendered in that State and the
individual is a resident of that State who:
(i) is a national of that State; or
(ii) did not become a resident of that State solely for the purpose of
rendering the services.
2. ( a ) Any pension paid by, or out of funds created by, a Contracting State or a
political subdivision or a local authority thereof to an individual in
respect of services rendered to that State or local authority shall be
taxable only in that State.
( b ) However, such pension shall be taxable only in the other Contracting
State if the individual is a resident of, and a national of, that other State.
3. The provisions of Articles 15, 16 and 18 shall apply to remuneration and
pensions in respect of services rendered in connection with a business carried on by
a Contracting State or a political subdivision or a local authority thereof.
Article 20
STUDENTS AND BUSINESS APPRENTICES
Where a student or business apprentice who is or was immediately before
visiting a Contracting State a resident of the other Contracting State and who is
present in the first-mentioned State solely for the purpose of his education or
training, any payments received for the purpose of his maintenance, education or
training shall not be taxed in that State, provided that such payments arise from
sources outside that State.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF ALBANIA _g S.L.123.53 13
Article 21
OTHER INCOME
1. Items of income of a resident of a Contracting State, wherever arising, not
dealt with in the foregoing Article s of this Convention shall be taxable only in that
State.
2. The provisions of paragraph 1 shall not apply to income, other than income
from immovable property as defined in paragraph 2 of Article 6, if the recipient of
such income, being a resident of a Contracting State, carries on business in the other
Contracting State through a permanent establishment situated therein, or performs in
that other State independent personal services from a fixed base situated therein, and
the right or property in respect of which the income is paid is effectively connected
with such permanent establishment or fixed base. In such case, the provisions of
Article 7 or Article 14, as the case may be, shall apply.
Article 22
ELIMINATION OF DOUBLE TAXATION
1. In the case of Albania double taxation shall be eliminated as follows:
( a ) Where a resident of Albania derives income which, in accordance with
the provisions of this Convention, may be taxed in Malta, Albania shall
allow as a deduction from Albanian tax on the income of that resident
an amount equal to the income tax paid in Malta. Such deduction shall
not, however, exceed that part of the Albanian tax, as computed before
the deduction is given, which is attributable to the income which may be
taxed in Malta.
( b ) Where in accordance with any provision of the convention income
derived by a resident of Albania is exempt from tax in Albania, Albania
may nevertheless, in calculating the amount of tax on the remaining
income of such resident, take into account the exempted income.
2. In the case of Malta, double taxation shall be eliminated as follows:
Subject to the provisions of the law of Malta regarding the allowance of
a credit against Malta tax in respect of foreign tax, where, in accordance
with the provisions of this Convention, there is included in a Malta
assessment income from sources within Albania, the Albanian tax on
such income shall be allowed as a credit against the relative Malta tax
payable thereon.
3. Where, under the laws of one of the Contracting States, any tax to which this
Convention applies has been exempted or reduced for a limited period of time to
promote economic development in that State, for the purposes of paragraphs 1 and 2
of this Article , such tax shall be deemed to have been paid.
Article 23
NON-DISCRIMINATION
1. Nationals of a Contracting State shall not be subjected in the other
Contracting State to any taxation or any requirement connected therewith, which is
other or more burdensome than the taxation and connected requirements to which
nationals of that other State in the same circumstances, in particular with respect to
residence, are or may be subjected. This provision shall, notwithstanding the
provisions of Article 1, also apply to persons who are not residents of one or both of
the Contracting States.
14 _g S.L.123.53
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF ALBANIA
2. The taxation on a permanent establishment which an enterprise of a
Contracting State has in the other Contracting State shall not be less favourably
levied in that other State than the taxation levied on enterprises of that other State
carrying on the same activities. This provision shall not be construed as obliging a
Contracting State to grant to residents of the other Contracting State any personal
allowances, reliefs and reductions for taxation purposes on account of civil status or
family responsibilities which it grants to its own residents.
3. Except where the provisions of paragraph 1 of Article 9, paragraph 6 of
Article 11, or paragraph 6 of Article 12, apply, interest, royalties and other
disbursements paid by an enterprise of a Contracting State to a resident of the other
Contracting State shall, for the purpose of determining the taxable profits of such
enterprise, be deductible under the same conditions as if they had been paid to a
resident of the first-mentioned State. 
4. Enterprises of a Contracting State, the capital of which is wholly or partly
owned or controlled, directly or indirectly, by one or more residents of the other
Contracting State, shall not be subjected in the first-mentioned State to any taxation
or any requirement connected therewith which is other or more burdensome than the
taxation and connected requirements to which other similar enterprises of the first-
mentioned State are or may be subjected.
Article 24
MUTUAL AGREEMENT PROCEDURE
1. Where a person considers that the actions of one or both of the Contracting
States result or will result for him in taxation not in accordance with the provisions
of this Convention, he may, irrespective of the remedies provided by the domestic
law of those States, present his case to the competent authority of the Contracting
State of which he is a resident or, if his case comes under paragraph 1 of Article 23,
to that of the Contracting State of which he is a national. The case must be presented
within three years from the first notification of the action resulting in taxation not in
accordance with the provisions of the Convention.
2. The competent authority shall endeavour, if the objection appears to it to be
justified and if it is not itself able to arrive at a satisfactory solution, to resolve the
case by mutual agreement with the competent authority of the other Contracting
State, with a view to the avoidance of taxation which is not in accordance with the
Convention. Any agreement reached shall be implemented notwithstanding any time
limits in the domestic law of the Contracting States.
3. The competent authorities of the Contracting States shall endeavour to
resolve by mutual agreement any difficulties or doubts arising as to the
interpretation or application of the Convention. They may also consult together for
the elimination of double taxation in cases not provided for in the Convention.
4. The competent authorities of the Contracting States may communicate with
each other directly for the purpose of reaching an agreement in the sense of the
preceding paragraphs.
Article 25
EXCHANGE OF INFORMATION
1. The competent authorities of the Contracting States shall exchange such
information as is necessary for carrying out the provisions of this Convention or of
the domestic laws of the Contracting States concerning taxes covered by the
Convention insofar as the taxation thereunder is not contrary to the Convention. The
exchange of information is not restricted by Article 1. Any information received by a
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF ALBANIA _g S.L.123.53 15
Contracting State shall be treated as secret in the same manner as information
obtained under the domestic laws of that State and shall be disclosed only to persons
or authorities (including courts and administrative bodies) involved in the
assessment or collection of, the enforcement or prosecution in respect of, or the
determination of appeals in relation to, the taxes covered by the Convention. Such
persons or authorities shall use the information only for such purposes. They may
disclose the information in public court proceedings or in judicial decisions.
2. In no case shall the provisions of paragraph 1 be construed so as to impose
on a Contracting State the obligation:
( a ) to carry out administrative measures at variance with the laws and
administrative practice of that or of the other Contracting State;
( b ) to supply information which is not obtainable under the laws or in the
normal course of the administration of that or of the other Contracting
State;
( c ) to supply information which would disclose any trade, business,
industrial, commercial or professional secret or trade process, or
information, the disclosure of which would be contrary to public policy
( ordre public) .
Article 26
DIPLOMATIC AGENTS AND CONSULAR OFFICERS
Nothing in this Convention shall affect the fiscal privileges of diplomatic
agents and consular officers under the general rules of international law or under the
provisions of special agreements.
Article 27
ENTRY INTO FORCE
1. The Contracting States shall notify each other that the legal requirements for
the entry into force of this Convention have been complied with.
2. This Convention shall enter into force on the date of the later of the
notifications referred to in paragraph 1 and its provisions shall have effect:
( a ) in Albania, in respect of income derived on or after the first day of
January of the calendar year next following that of the entry into force
of the Convention;
( b ) in Malta, in respect of taxes on income derived during any calendar year
or accounting period, as the case may be, beginning on or after the first
day of January next following the date on which the Convention enters
into force.  
Article 28
TERMINATION
This Convention shall remain in force until terminated by a Contracting
State. Either Contracting State may terminate the Convention by giving written
notice of termination, through diplomatic channels, at least six months before the
end of any calendar year beginning after the expiration of a period of five years from
the date of its entry into force. In such event, the Convention shall cease to have
effect:
( a ) in Albania, in respect of income derived on or after the first day of
January of the calendar year next following that in which the notice of
termination is given;
16 _g S.L.123.53
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE REPUBLIC OF ALBANIA
( b ) in Malta, in respect of taxes on income derived during any calendar year
or accounting period, as the case may be, beginning on or after the first
day of January next following the date on which the notice of
termination is given.
IN WITNESS WHEREOF the undersigned, being duly authorised thereto by
their respective Governments, have signed this Convention.
DONE in duplicate at Valletta this 2nd day of May, 2000 in the English and
Albanian languages, both texts being equally authentic. In the case of divergence
between the texts, the English text shall prevail.
For the Government of Malta For the Government of the Republic of Albania
JOE BORG PASKAL MILO
Minister of Foreign Affairs  Minister of Foreign Affairs
