DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 1
SUBSIDIARY LEGISLATION 123.30
DOUBLE TAXATION RELIEF ON TAXES ON 
INCOME WITH THE PEOPLE’S REPUBLIC OF 
CHINA ORDER
6th September, 1994
LEGAL NOTICE 104 of 1994. 
Title.
on Income with the People’s Republic of China Order.
Arrangements to 
have effect.
2. It is hereby declared -
( a ) that the arrangements specified in the Agreement set
out in the Schedule to this Order have been made with
the Government of the People’s Republic of China
with a view to affording relief from double taxation in
relation to the following taxes imposed by the laws of
the People’s Republic of China:
(i) the individual income tax;
(ii) the income tax for enterprises with foreign
investment and foreign enterprises;
(iii) the local income tax;
( b ) that it is expedient that those arrangements should
have effect.
2 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
SCHEDULE
AGREEMENT 
BETWEEN THE GOVERNMENT OF MALTA
AND THE GOVERNMENT OF 
THE PEOPLE’S REPUBLIC OF CHINA 
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 People’s Republic of China
desiring to conclude an Agreement 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 Agreement shall apply to persons who are residents of one or both of the
Contracting States.
ARTICLE 2
Taxes Covered
1. This Agreement 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, including taxes on gains from the alienation of
movable or immovable property, as well as taxes on capital appreciation.
3. The existing taxes to which the Agreement shall apply are:
( a ) in the People’s Republic of China:
(i) the individual income tax;
(ii) the income tax for enterprises with foreign investment and foreign
enterprises;
(iii) the local income tax;
(hereinafter referred to as "Chinese tax");
( b ) in Malta: the income tax;
(hereinafter referred to as "Malta tax").
4.  This Agreement shall also apply to any identical or substantially similar
taxes which are imposed after the date of signature of this Agreement in addition to,
or in place of, the existing taxes referred to in paragraph 3. The competent
authorities of the Contracting States shall notify each other of any significant
changes which have been made in their respective taxation laws within a reasonable
period of time after such changes.
ARTICLE 3
General Definitions
1. For the purposes of this Agreement, unless the context otherwise requires:
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 3
( a ) the term "China" means the People’s Republic of China; when used in a
geographical sense, it means all the territory of the People’s Republic of China,
including its territorial sea, in which the Chinese laws relating to taxation apply, and
any area beyond its territorial sea, within which the People’s Republic of China has
sovereign rights of exploration for and exploitation of resources of the sea-bed and
its sub-soil and superadjacent water resources in accordance with international law;
( b ) the term "Malta", where 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 sea of Malta which,
in accordance with international law, has been or may hereafter be designated, under
the law of Malta concerning the Continental Shelf, as an area within which the rights
of Malta with respect to the sea-bed and subsoil and their natural resources may be
exercised;
( c ) the terms "a Contracting State" and "the other Contracting State" mean
China 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 body corporate or any entity which is treated
as a body corporate 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 "nationals" means:
(i) in respect of China, all individuals possessing the nationality of China
and all juridical persons created or organised under the laws of China as
well as any organisations without juridical personality treated for tax
purposes as juridical persons created or organised under the laws of
China;
(ii) in respect of Malta, any citizen of Malta and any legal person,
partnership or association deriving its status as such from the law in
force in Malta;
( h ) the term "international traffic" means any transport by a ship or aircraft
operated by an enterprise which has its place of head office (i.e. 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 China, the State Tax Bureau or its authorized
representative; and
(ii) in the case of Malta, the Minister responsible for finance or his
authorized representative.
2. As regards the application of this Agreement by a Contracting State, any
term not defined therein shall, unless the context otherwise requires, have the
meaning which it has under the laws of that Contracting State concerning the taxes
to which this Agreement applies.
4 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
ARTICLE 4
Resident
1. For the purposes of this Agreement, the term "resident of a Contracting
State" means any person who, under the laws of that Contracting State, is liable to
tax therein by reason of his domicile, residence, place of head office (i.e. effective
management) or any other criterion of a similar nature.
2. Where by reason of the provisions of paragraph 1 an individual is a resident
of both Contracting States, then his status shall be determined as follows:
( a ) he shall be deemed to be a resident solely of the Contracting State in
which he has a permanent home available to him; if he has a permanent
home available to him in both Contracting States, he shall be deemed to
be a resident solely of the Contracting 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 no permanent home available to him in either
Contracting State, he shall be deemed to be a resident solely of the
Contracting State in which he has an habitual abode;
( c ) if he has an habitual abode in both Contracting States or in neither of
them, he shall be deemed to be a resident solely of the Contracting State
of which he is a national;
( d ) if he is a national of both Contracting States or of neither of them, the
competent authorities of the Contracting States shall settle the question
by mutual agreement.
3. Where by reason of the provisions of paragraph 1 a person other than an
individual is a resident of both Contracting States, then it shall be deemed to be a
resident solely of the Contracting State in which its place of head office (i.e.
effective management) is situated.
ARTICLE 5 
Permanent Establishment
1. For the purposes of this Agreement, the term "permanent establishment"
means a fixed place of business through which the business of an enterprise is
wholly or partly carried on.
2. The term "permanent establishment" includes especially: 
( a ) a place of management;
( b ) a branch; 
( c ) an office; 
( d ) a factory; 
( e ) a workshop;
( f ) a mine, an oil or gas well, an offshore drilling site, a quarry or any other
place of extraction of natural resources;
( g ) a building site, a construction, assembly or installation project or
supervisory activities in connection therewith, where such site, project
or activities continue for a period of more than 8 months;
( h ) the furnishing of services, including consultancy services, by an
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 5
enterprise of a Contracting State through employees or other engaged
personnel in the other Contracting State, provided that such activities
continue for the same project or a connected project for a period or
periods aggregating more than 8 months.
3. Notwithstanding the provisions of paragraphs 1 and 2, the term "permanent
establishment" shall be deemed not to include:
( a ) the use of facilities solely for the purpose of storage, display or delivery
of goods or merchandise belonging to the enterprise;
( b ) the maintenance of a stock of goods or merchandise belonging to the
enterprise solely for the purpose of storage, display or delivery;
( c ) the maintenance of a stock of goods or merchandise belonging to the
enterprise solely for the purpose of processing by another enterprise;
( d ) the 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 sub-paragraphs ( 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.
4. A person engaged in a Contracting State in activities which are
complementary or auxiliary to activities in connection with either the exploration of
the sea-bed and its subsoil or the exploitation of natural resources situated there is
deemed to exercise such activities through a permanent establishment in that State.
5. Notwithstanding the provisions of paragraphs 1 and 2, where a person -
other than an agent of an independent status to whom the provisions of paragraph 6
apply - is acting in a Contracting State on behalf of an enterprise of the other
Contracting State, has and habitually exercises an authority to conclude contracts in
the name of the enterprise, that enterprise shall be deemed to have a permanent
establishment in the first-mentioned Contracting State in respect of any activities
which that person undertakes for the enterprise, unless the activities of such person
are limited to those mentioned in paragraph 3 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.
6. An enterprise of a Contracting State shall not be deemed to have a
permanent establishment in the other Contracting State merely because it carries on
business in that other Contracting 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 an agent of an independent status within the meaning of this paragraph if
the transactions between the agent and the enterprise were not made under arm’s
length conditions.
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
establishment or otherwise), shall not of itself constitute either company a
permanent establishment of the other.
6 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
ARTICLE 6
Income from Immovable Property
1. Income derived by a resident of a Contracting State from immovable
property situated in the other Contracting State may be taxed in that other
Contracting 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 Contracting 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 Contracting 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 or with other enterprises
with which it deals.
3. In determining 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. Nothing in this Article shall affect the application of any law of a
Contracting State relating to the determination of the profits to be attributed to a
permanent establishment by the method of exercise of discretion or the making of an
estimate in cases where the information available to the competent authority of that
State is inadequate to determine those profits, provided that that law shall be applied,
so far as the information available to the competent authority permits, consistently
with the principles of this Article.
5. No profits shall be attributed to a permanent establishment by reason of the
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 7
mere purchase by that permanent establishment of goods or merchandise for the
enterprise.
6. For the purposes of paragraphs 1 to 5, 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 Articles of this Agreement, then the provisions of those Articles shall not be
affected by the provisions of this Article.
ARTICLE 8
International Traffic
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 head office (i.e. effective
management) of the enterprise is situated.
2. If the place of head office (i.e. 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. Nothing in this Article shall affect the application of any law of a
Contracting State relating to the determination of the profits to be attributed to an
enterprise by the method of exercise of discretion or the making of an estimate in
cases where the information available to the competent authority of that State is
inadequate to determine those profits, provided that that law shall be applied, so far
as the information available to the competent authority permits, consistently with the
principles of this Article.
3. Where a Contracting State includes in the profits of an enterprise of that
Contracting State, and taxes accordingly, profits on which an enterprise of the other
Contracting State has been charged to tax in that other Contracting State, and the
profits so included are profits which would have accrued to the enterprise of the
8 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
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
Contracting 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 this Agreement and the competent authorities of the
Contracting States shall, if necessary, consult each other.
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 Contracting 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 Contracting State, but:
( a ) where the dividends are paid by a company which is a resident of China
to a resident of Malta who is the beneficial owner thereof, the Chinese
tax so charged shall not exceed 10 per cent of the gross amount of the
dividends;
( b ) where the dividends are paid by a company which is a resident of Malta
to a resident of China who is the beneficial owner thereof, the 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, 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
Contracting 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 Contracting 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 Contracting 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 Contracting 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 Contracting State.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 9
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 Contracting State.
2. However, such interest may also be taxed in the Contracting State in which
it arises and according to the laws of that Contracting State, but if the recipient is the
beneficial owner of the interest, the tax so charged shall not exceed 10 per cent of
the gross amount of the interest.
3. Notwithstanding the provisions of paragraph 2, interest arising in a
Contracting State shall be exempt from tax in that State if it is derived by the
Government of the other Contracting State, a local authority thereof or such
institution as may be agreed upon by both Contracting States, provided that such
institution is wholly owned or controlled by that Government or local authority.
4. 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 a 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.
5. 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 Contracting 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.
6. Interest shall be deemed to arise in a Contracting State when the payer is
that Government of the Contracting State, a local authority thereof or a resident of
that Contracting 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 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
Contracting State in which the permanent establishment or fixed base is situated.
7. 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 paid, 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 Agreement.
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 Contracting State.
10 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
2. However, such royalties may also be taxed in the Contracting State in which
they arise, and according to the laws of the Contracting State, but if the recipient is
the beneficial owner of the royalties, the tax so charged shall not exceed 10 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, know-how, trade mark, design or
model, plan, secret formula or process, or for the use of, or the right to use,
industrial, commercial or scientific equipment, 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
establishment situated therein, or performs in that other Contracting 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
the Government of that Contracting State, a local authority thereof or a resident of
that Contracting 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
Contracting 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 Agreement.
ARTICLE 13
Alienation of Property
1. Income or gains from the alienation of immovable property, as defined in
Article 6, may be taxed in the Contracting State in which such property is situated.
2. Income or gains from the alienation of shares of the capital stock 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 Contracting
State.
3. Income or gains from the alienation of movable property forming part of the
business property of a permanent establishment which an enterprise of a Contacting
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 income or
gains from the alienation of such a permanent establishment (alone or together with
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 11
the whole enterprise) or of such fixed base, may be taxed in the other Contracting
State.
4. Income or gains from the alienation of ships and aircraft operated in
international traffic or movable property pertaining to the operation of such means of
transportation shall be taxable only in the Contracting State in which the place of
head office (i.e. effective management) of the enterprise is situated.
5. Income or gains from the alienation of shares other than those mentioned in
paragraph 2 representing a participation of at least 25 per cent in a company which is
a resident of a Contracting State may be taxed in that Contracting State.
6. Income or gains from the alienation of any property other than that referred
to in paragraphs 1 to 5, shall be taxable only in the Contracting State of which the
alienator is a resident.
ARTICLE 14
Independent Personal Services
1. Income derived by a resident of a Contracting State in respect of
professional services or other activities of an independent character shall be taxable
only in that Contracting State except in one of the following circumstances, when
such income 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 Contracting 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 the calendar
year concerned; in that case, only so much of the income as is derived
from his activities performed in that other Contracting State may be
taxed in that other Contracting State; or
( c ) if the remuneration for his services in the other Contracting State is
derived from residents of that State and exceeds the equivalent of
U.S.$10,000 during the calendar year, notwithstanding that his stay in
that State is for a period or periods amounting in the aggregate to less
than 183 days during that year.
2. The term "professional services" includes especially independent scientific,
literary, artistic, educational or teaching activities as well as the independent
activities of physicians, lawyers, engineers, architects, dentists and accountants.
ARTICLE 15
Dependent Personal Services
1. Subject to the provisions of Articles 16, 18, 19, 20 and 21, 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 Contracting 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
Contracting 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:
12 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
( a ) the recipient is present in the other Contracting State for a period or
periods not exceeding in the aggregate 183 days in the calendar year
concerned; and
( b ) the remuneration is paid by, or on behalf of, an employer who is not a
resident of the other Contracting State; and
( c ) the remuneration is not borne by a permanent establishment or a fixed
base which the employer has in the other Contracting State.
3. Notwithstanding the provisions of paragraphs 1 and 2 of this Article,
remuneration derived in respect of an employment exercised aboard a ship or aircraft
operated by an enterprise of a Contracting State in international traffic, may be taxed
in the Contracting State in which the place of head office (i.e. 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, or other comparable body
however described, of a company which is a resident of the other Contracting State,
may be taxed in that other Contracting State.
ARTICLE 17
Artistes and Athletes
1. Notwithstanding the provisions of Articles 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 an athlete, from his personal activities
as such exercised in the other Contracting State, may be taxed in that other
Contracting State.
2. Where income in respect of personal activities exercised by an entertainer or
an athlete in his capacity as such accrues not to the entertainer or athlete himself but
to another person, that income may, notwithstanding the provisions of Articles 7, 14
and 15, be taxed in the Contracting State in which the activities of the entertainer or
athlete are exercised.
3. Notwithstanding the provisions of paragraphs 1 and 2, income derived by
entertainers or athletes who are residents of a Contracting State from the activities
exercised in the other Contracting State under a plan of cultural exchange between
the Governments of both Contracting States shall be exempt from tax in that other
Contracting State.
ARTICLE 18
Pensions
1. 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 Contracting State.
2. Notwithstanding the provisions of paragraph 1, pensions and other payments
made under the social security legislation of a Contracting State shall be taxable
only in that Contracting State.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 13
ARTICLE 19
Government Service
1. ( a ) Remuneration, other than a pension, paid by the Government of a
Contracting State or a local authority thereof to an individual in respect of services
rendered to the Government of that Contracting State or a local authority thereof
shall be taxable only in that Contracting State.
( b ) However, such remuneration shall be taxable only in the other Contracting
State if the services are rendered in that other Contracting State and the individual is
a resident of that other Contracting State who:
(i) is a national of that other Contracting State; or
(ii) did not become a resident of that other Contracting State solely for the
purpose of rendering the services.
2. ( a ) Any pension paid by, or out of funds to which contributions are made
by, the Government of a Contracting State or a local authority thereof to an
individual in respect of services rendered to the Government of that Contracting
State or a local authority thereof shall be taxable only in that Contracting 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 Contracting State.
3. The provisions of Articles 15, 16, 17 and 18 shall apply to remuneration and
pensions in respect of services rendered in connection with any business carried on
by the Government of a Contracting State or a local authority thereof.
ARTICLE 20
Teachers and Researchers
1. Remuneration which a professor or teacher 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 for the purpose of carrying out advanced study
or research or for teaching at a university, college, school or other educational
institution receives for such work shall not be taxed in that State, for a period of two
years from the date of his first arrival in the first mentioned Contracting State,
insofar as such remuneration derives from such advanced study, research or
teaching.
2. This Article shall not apply to income from research if such research is
undertaken primarily for the private benefit of a specific person or persons.
ARTICLE 21
Students and Trainees
A student, business apprentice or trainee 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 shall be exempt from tax in that first-mentioned State on the following
payments or income received or derived by him for the purpose of his maintenance,
education or training:
( a ) payments derived from sources outside that Contracting State for the
purpose of his maintenance, education, study, research or training;
( b ) grants, scholarships or awards supplied by the Government, or a
14 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
scientific, educational, cultural or other tax-exempt organization; and
( c ) any remuneration not exceeding an amount equivalent to U.S.$ 3,000 in
respect of services in the first mentioned Contracting State provided the
services are performed in connection with his study, research or training
or are necessary for the purposes of his maintenance.
ARTICLE 22
Other Income
1. Items of income of a resident of a Contracting State, wherever arising, nor
dealt with in the foregoing Articles of this Agreement shall be taxable only in that
Contracting 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 Contracting 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 23
Elimination of Double Taxation
1. In China, double taxation shall be eliminated as follows:
( a ) Where a resident of China derives income from Malta, the amount of tax
on that income payable in Malta in accordance with the provisions of
this Agreement shall be credited against the Chinese tax imposed on
that resident. The amount of the credit, however, shall not exceed the
amount of the Chinese tax on the income computed in accordance with
the taxation laws and regulations of China.
( b ) Where the income derived from Malta is a dividend paid by a company
which is a resident of Malta to a company which is a resident of China
and which owns not less than 10 per cent of the shares of the company
paying the dividend, the credit shall take into account the tax paid to
Malta by the company paying the dividend in respect of its income.
2. In 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 Agreement, there is included in a Malta assessment income from sources
within China, the Chinese tax on such income shall be allowed as a credit against the
relative Malta tax payable thereon.
3. For the purposes of allowance as a credit, the tax payable in China or Malta,
as the context requires, shall be deemed to include the tax which is otherwise
payable in a Contracting State but has been reduced or waived by that Contracting
State under its legal provisions for tax incentives. In the case of dividends, interest
and royalties, any such tax which has been exempted or reduced shall be deemed to
have been paid at 10 per cent of the gross amount of such dividends, interest and
royalties.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 15
ARTICLE 24
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 Contracting State in the same circumstances are or may be
subjected. The provisions of this paragraph shall, notwithstanding the provisions of
Article 1, also apply to persons who are not residents of one or both of the
Contracting States.
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 Contracting State than the taxation levied on enterprises of that
other Contracting State carrying on the same activities.
3. Except where the provisions of paragraph 1 of Article 9, paragraph 7 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 requirement to which other similar enterprises of the first-
mentioned State are or may be subjected.
5. Nothing in this Article shall be construed as obliging a Contracting State to
grant to individuals who are residents of the other Contracting State any personal
allowances, reliefs and reductions for tax purposes on account of civil status, family
responsibilities or any other personal circumstances which it grants to its own
residents.
6. The provisions of this Article shall, notwithstanding the provisions of
Article 2, apply to taxes of every kind and description.
ARTICLE 25
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 Agreement, 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 24,
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 Agreement.
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 this
Agreement. Any agreement reached shall be implemented notwithstanding any time
limits in the domestic law of the Contracting States.
16 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
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 Agreement. They may also consult together for
the elimination of double taxation in cases not provided for in this Agreement.
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
paragraphs 2 and 3. When it seems advisable for reaching agreement, representatives
of the competent authorities of the Contracting States may meet together for an oral
exchange of opinions.
ARTICLE 26
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 Agreement or of
the domestic laws of the Contracting States concerning taxes covered by the
Agreement, insofar as the taxation thereunder is not contrary to this Agreement, in
particular for the prevention of evasion of such taxes. The exchange of information
is not restricted by Article 1. Any information received by a Contracting State shall
be treated as secret in the same manner as information obtained under the domestic
laws of that Contracting 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 Agreement. 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 27
Diplomatic Agents and Consular Officers
Nothing in this Agreement shall affect the fiscal privileges of diplomatic agents or
consular officers under the general rules of international law or under the provisions
of special agreements.
ARTICLE 28
Entry into Force
This Agreement shall enter into force on the thirtieth day after the date on which
diplomatic notes indicating the completion of internal legal procedures necessary in
each Contracting State for the entry into force of this Agreement have been
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA [ S.L.123.30 17
exchanged. This Agreement shall have effect in respect of income derived during
any year beginning on or after the first day of January of the calendar year next
following that in which this Agreement enters into force. 
ARTICLE 29
Termination
This Agreement shall remain in force until terminated by a Contracting State.
Either of the Contracting States may, on or before the thirtieth day of June in any
calendar year beginning after the expiration of a period of five years from the date of
its entry into force, give written notice of termination to the other Contracting State
through the diplomatic channels. In such event this Agreement shall cease to have
effect in respect of income derived during any year beginning on or after the first
day of January of the calendar year next following that in which the notice of
termination is given.
IN WITNESS WHEREOF the undersigned, being duly authorised thereto by their
respective Governments, have signed this Agreement.
DONE at Beijing on the second day of February, 1993 in duplicate in the English
and Chinese languages, both texts being equally authentic.
FOR THE GOVERNMENT OF MALTA
JOHN DALLI
MINISTER OF FINANCE
FOR THE GOVERNMENT OF THE
PEOPLE’S REPUBLIC OF CHINA 
LIU ZHONG LI 
MINISTER OF FINANCE
18 [ S.L.123.30
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE PEOPLE’S REPUBLIC OF CHINA
PROTOCOL
At the moment of signature of the Agreement between the Government of the
People’s Republic of China and the Government of Malta for the Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on
Income, both parties have agreed upon the following provisions which will form an
integral part of the Agreement:
1. With reference to Article 7, each Contracting State shall tax the profit from
the business of insurance in accordance with the provisions of its own law.
2. With reference to Article 8, this Agreement shall not affect the application
of the provisions of Article 18 in respect of taxation of the Agreement on Maritime
Transport signed in Beijing between the Government of Malta and the Government
of the People’s Republic of China on September 10, 1991.
IN WITNESS whereof the undersigned, being duly authorised thereto by their
respective Governments, have signed this Protocol.
DONE at Beijing on the second day of February, 1993 in duplicate in the English
and Chinese languages, both texts being equally authentic.
FOR THE GOVERNMENT OF MALTA
JOHN DALLI
MINISTER OF FINANCE
FOR THE GOVERNMENT OF THE
PEOPLE’S REPUBLIC OF CHINA 
LIU ZHONG LI 
MINISTER OF FINANCE
