DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE CZECH REPUBLIC ġ S.L.123.43 1
SUBSIDIARY LEGISLATION 123.43
DOUBLE TAXATION RELIEF ON TAXES ON 
INCOME WITH THE CZECH REPUBLIC ORDER
6th June, 1997
LEGAL NOTICE 228 of 1997. 
Title.
on Income with the Czech Republic Order.
Arrangements to 
hove 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 Czech Republic with a view to
affording relief from double taxation in relation to the
following taxes imposed by the laws of the Czech
Republic:
(i) the tax on income of individuals;
(ii) the tax on income of legal persons;
(iii) the tax on immovable property;
( b ) that it is expedient that those arrangements should
have effect.
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SCHEDULE
CONVENTION 
BETWEEN MALTA AND THE CZECH REPUBLIC
FOR THE AVOIDANCE OF DOUBLE TAXATION
AND THE PREVENTION OF FISCAL EVASION
WITH RESPECT TO TAXES ON INCOME AND ON CAPITAL
Malta and the Czech Republic, desiring to conclude a Convention for the
avoidance of double taxation and the prevention of fiscal evasion with respect to
taxes on income and on capital, have agreed as follows:
ARTICLE 1
Personal Scope
This Convention shall apply to persons who are resident of one or both of the
Contracting States.
ARTICLE 2 
Taxes Covered
1. This Convention shall apply to taxes on income and on capital imposed on
behalf of a Contracting State or of its political subdivisions or local authorities,
irrespective of the manner in which they are levied.
2. There shall be regarded as taxes on income and on capital all taxes imposed
on total income, on total capital, or on elements of income or of capital including
taxes on gains from the alienation of movable or immovable property, taxes on the
total amounts of wages or salaries paid by enterprises, as well as taxes on capital
appreciation.
3. The existing taxes to which the Convention shall apply are:
( a ) in the Czech Republic:
(i) the tax on income of individuals;
(ii) the tax on income of legal persons;
(iii)  the tax on immovable property; 
(hereinafter referred to as "Czech tax");
( b ) in Malta:
the income tax;
(hereinafter refereed 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, this Convention shall
not apply to tax paid or payable in Malta in accordance with the provisions of sub-
article (13) of article 56 of the Income Tax Act, concerning the chargeable income of
any person engaged in the production of petroleum produced in Malta or any
substantially similar provision which is imposed after the date of signature of this
Convention.
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WITH THE CZECH REPUBLIC ġ S.L.123.43 3
ARTICLE 3
General Definitions
For the purposes of this Convention, unless the context otherwise requires:
( a ) the term "Czech Republic", when used in a geographical sense, means the
territory over which the Czech Republic, under the Czech legislation and in
accordance with international law, may exercise its sovereign rights;
( 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 the
Czech Republic 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 "national" means:
(i) any individual possessing the nationality of a Contracting State;
(ii) any legal 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, aircraft or
road vehicle operated by an enterprise of a Contracting State, except when the ship,
aircraft or road vehicle is operated solely between places in the other Contracting
State;
( i ) the term "competent authority" means:
(i) in the case of the Czech Republic, the Minister of Finance or his
authorized representative;
(ii) in the case of Malta, the Minister responsible for finance or his
authorized representative.
2. As regards the application of the Convention by a Contracting State any
term not defined therein shall, unless the context otherwise requires, have the
meaning which it has under the law of that State concerning the taxes to which the
Convention applies.
ARTICLE 4
Resident
1. For the purposes of this Convention, the term "resident of a Contracting
State" means any person who, under the laws of that State, is liable to tax therein by
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reason of his domicile, residence, place of management 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 or capital situated therein.
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 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 solely 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 permenent home available to him in either
State, he shall be deemed to be a resident solely 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 solely 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 solely 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" shall include 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 nine months;
( b ) the furnishing of services, including consultancy and managerial
services, by an enterprise through employees or other personnel
engaged by the enterprise for such purpose, but only where activities of
that nature continue within a Contracting State for a period or periods
aggregating more than six months within any twelve month period.
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4. Notwithstanding the preceding provisions of this Article, the term
"permanent establishment" shall he 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 mainteance 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
advertising, for the supply of information, for scientific research or for
similar activities which have a preparatory or auxiliary character, for
the enterprise; and
( f ) the rnaintenance 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.
5. Notwithstanding the provisions of paragraphs 1 and 2, where a person -
other than an agent of an independent state to whom paragraph 6 applies - is acting
on behalf of an enterprise and has, and habitually exercises, in a Contracting State an
authority to conclude contracts in the name of the enterprise, that enterprise shall be
deemed to have a permanent establishment in that 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 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.
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 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.
7. The fact that a company which is a resident of a Contractig 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.
ARTICLE 7
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
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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 perfomance 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 or with other associated
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
permanent establishment, including executive and general administrative expenses
so incurred, and which would be deductible if the permanent establishntent were an
independent entity which paid those expenses, whether incurred in the Contracting
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
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 Articles of this Convention, then the provisions of those Articles shall not be
affected by the provisions of this Article.
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8. The provisions of this Article shall not affect the provisions of the law of a
Contracting State regarding the taxation of profits froun the business of insurance.
ARTICLE 8
International Traffic
1.  Profits of an enterprise of a Contracting State from the operation of ships,
aircraft, or road vehicles in international traffic shall be taxable only in that State.
2. The provisions of paragraph 1 shall also apply to profits derived 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 this Convention and the competent authorities of the Contracting
States shall if necessary consult each other.
3. A Contracting State shall not change the profits of an enterprise in the
circumstances referred to in paragraph 2 after the expiry of the time limits provided
in its national laws.
4. The provisions of paragraph 2 shall not apply in the case of fraud, wilful
default or neglect.
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
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that State, but:
( a ) where the dividends are paid by a company resident of the Czech
Republic to a resident of Malta who is the beneficial owner thereof, the
Czech tax so charged shall not exceed five per cent of the gross amount
of the dividends;
( b ) where the dividends are paid by a company resident of Malta to a
resident of the Czech Republic 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 taxation 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 shall be taxable only in that other State if such resident is the
beneficial owner of that interest.
2. The term "interest" as used in this Articlc 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, bond, or debentures. Penalty charges for late payment
shall not be regarded as interest for the purpose of this Article.
3. The provisions of paragraph 1 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
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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.
4. Where, by reason of a special relationship between the payer and the
recipient who is 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
recipient 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. Howwer, such royalties may also be taxed in the Contracting State in which
they arise, and according to the laws of the State, but if the beneficial owner of the
royalties is a resident of the other Contracting State, the tax so charged shall not
exceed five 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 television or radio broadcasting, any patent, trade mark, design or model, plan,
secret formula or process, or any 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 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 establishinent 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 Convention.
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ARTICLE 13
Alienation of Property
1. Income or 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. Income or 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 income or
gains from the alienation of such permanent establishment (alone or with the whole
enterprise) or of such fixed base, may be taxed in that other State.
3. Income or gains from the alienation of shares or comparable interests in a
company, the assets of which consist directly or indirectly principally of immovable
property situated in a Contracting State may be taxed in that State.
4. Income or gains from the alienation of ships, aircraft or road vehicles
operated in international traffic by an enterprise of a Contracting State, or from the
alienation of movable property pertaining to the operation of such ships, aircraft or
road vehicles shall be taxable only in that State.
5. Income or 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 a resident of a Contracting State in respect of
professional services or other activities of an independent character shall be taxable
only in that State. However, such income may be taxed in the other Contracting State
in the following circumstances:
( 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 120 days during any twelve-
month period commencing or ending in the fiscal year concerned; in
that case, only so much of the income as is derived from the activity
exercised in the other Contracting State may be taxed in that other State.
2. In the computation of the periods mentioned in paragraph 1( b ) the
provisions of paragraph 3 of Article 15 shall apply.
3. The term "professional services" includes especially independent scientific,
literary, artistic, educational or teaching activities as well as the independent
activities of physicians, surgeons, lawyers, engineers, architects, dentists and
accountants.
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ARTICLE 15
Dependent Personal Services
1. Subject to the provisions of Articles 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-mentioend State if all the
following conditions are fulfilled:
( a ) the recipient is present in the other State for a period or periods not
exceeding in the aggregate 183 days in any twelve-month period
commencing or ending in the fiscal year concerned, and
( b ) the remuneration is paid by, or on behalf of an employer who is not a
resident of the other State, and
( c ) the remuneration is not borne by a permanent establishment or a fixed
base which the employer has in the other State.
3. In the computation of the periods mentioned in paragraph 2( a ), the
following days shall be included:
( a ) all days of physical presence including days of arrivals and departures,
and
( b ) days spent outside the State of activity such as Saturdays and Sundays,
national holidays, holidays, connected business trips after which the
activity was resumed on the territory of that State.
4. The term employer mentioned in paragraph 2( b ) means the person having
right on the work produced and bearing the responsibility and risk connected with
the performance of the work.
5. Notwithstanding the preceding provisions of this Article, renumeration
derived in respect of an employment exercised aboard a ship, aircraft, or road
vehicle operated in international traffic by an enterprise of a Contracting State may
be taxed in that State.
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 any other similar organ
of a company which is a resident of the other Contracting State may be taxed in that
other 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 State.
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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 from
such activities, as defined in paragraph 1, performed within the framework of
cultural exchange between the Governments of both States, shall be exempt from tax
in the Contracting State in which these activities are exercised.
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 State.
2. Notwithstanding the provisions of paragraph 1, pensions paid and other
payments made under the social security legislation of a Contracting State shall be
taxable only in that State.
ARTICLE 19
Government Service
1. ( a ) Salaries, wages and other similar 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 local
authority shall be taxable only in that State.
( b ) However, such salaries, wages and other similar 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 Statc 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 subdivision or 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 State.
3. The provisions of Articles 15, 16 and 18 shall apply to salaries, wages and
other similar remuneration, and to 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.
4. Where salaries, values, and other similar remuneration are paid under a
development assistance programme of a Contracting State, out of funds exclusively
supplied by that State to a specialist or volunteer seconded to the other Contracting
State with the consent of that other State, such remuneration shall be taxable only in
the first-mentioned State.
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ARTICLE 20
Students and Business Apprentices
A student or business apprentice who is present in a Contracting State solely for
the purpose of his education or training and who is, or immediately before being so
present was, a resident of the other Contracting State shall be exempt from tax in the
first-mentioned State on payments received from outside that first-mentioned State
for the purposes of his maintenance, education or training.
ARTICLE 21
Other Income
1. Items of income of a resident of a Contracting State, wherever arising, not
dealt with in the foregoing Articles 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 he, shall apply.
ARTICLE 22
Capital
1. Capital represented by inmovable property referred to in Article 6, owned by
a resident of a Contracting State and situated in the other Contracting State, may be
taxed in that other State.
2. Capital represented by 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 by 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, may be taxed in that other
State.
3. Capital represented by ships, aircraft and road vehicles operated by an
enterprise of a Contracting State in international traffic and by movable property
pertaining to the operation of such ships, aircraft and road vehicles, shall be taxable
only in that State in which the enterprise is situated.
4. All other elements of capital of a resident of a Contracting State shall be
taxable only in that State.
ARTICLE 23
Elimination of Double Taxation
1. 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
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DOUBLE TAXATION RELIEF ON TAXES ON INCOME
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within the Czech Republic, the Czech tax on such income shall be allowed as a credit
against the relative Malta tax payable thereon.
2. In the case of the Czech Republic, double taxation shall be eliminated as
follows:
The Czech Republic, when imposing taxes on its residents, may include in the tax
base upon which such taxes are imposed the items of income or capital which
according to the provisions of this Convention may also be taxed in Malta, but shall
allow as a credit against the amount of tax computed on such a base an amount equal
to the tax paid in Malta. Such credit shall not, however, exceed that part of the Czech
tax, as computed before the credit is given, which is appropriate to the income or
capital which, in accordance with the provisions of this Convention, may be taxed in
Malta.
3. Where the Convention provides that income arising in a Contracting State
shall be relieved from tax in that State, either in full or in part, and, under the law in
force in the other Contracting State, such income is subject to tax by reference to the
amount thereof which is remitted to or received in that other State and not by
reference to the full amount thereof, then the relief to be allowed in the frrst-
mentioned State shall apply only to so much of the income as is remitted to or
received in the other State.
4. For the purposes of allowance as a credit, the tax payable in the Czech
Republic 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
State under its legal provisions for tax incentives.
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 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.
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 4 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 resicient 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. Similarly, any debts of an enterprise of a
Contracting State to a resident of the other Contracting State shall, for the purpose of
determining the taxable capital of such enterprise, be deductible under the same
conditions as if they had been contracted to a resident of the first-mentioned State.
DOUBLE TAXATION RELIEF ON TAXES ON INCOME
WITH THE CZECH REPUBLIC ġ S.L.123.43 15
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 that first-
mentioned State are or may be subjected.
5. The provisions of this Arrticle shall, notwithstanding the provisions of
Article 2, apply to taxes of every kind and description which are the subject of this
Convention.
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 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 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 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. When it seems advisable in order to reach agreement to have
an oral exchange of opinions, such exchange may take place through a Commission
consisting of representatives of the competent authorities of the Contracting States.
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 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
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 (inclucling courts and administrative bodies) involved in the
assesstnent 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.
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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 the
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
Members of Diplomatic Missions and Consular Posts
Nothing in this Convention shall affect the fiscal privileges of members of
diplomatic missions or consular posts under the general rules of international law or
under the provisions of special agreements.
ARTICLE 28
Entry into Force
1. The Contracting States shall notify each other that the constitutional
requirements for the entry into force of this Convention have been complied with. 
2. The 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 the Czech Republic:
(i) in respect of taxes withheld at source, to amounts derived on or
after 1st January in the calendar year next following that in which
the Convention enters into force;
(ii) in respect of other taxes on income and taxes on capital, to taxes
chargeable for any taxable year beginning on or after 1st January
in the calendar year next following that in which the Convention
enters into force;
( 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 immediately following the date on which the Convention
enters into force.
ARTICLE 29
Termination
This Convention shall remain in force until terminated by a Contracting State.
Either Contracting State may terminate the Convention, through diplomatic
channels, by giving notice of termination 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 the Czech Republic:
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WITH THE CZECH REPUBLIC ġ S.L.123.43 17
(i) in respect of taxes withheld at source, to amounts derived on or
after 1st January in the calendar year next following that in which
the notice is given;
(ii) in respect of other taxes on income and taxes on capital, to taxes
chargeable for any taxable year beginning on or after 1st January
in the calendar year next following that in which the notice is
given;
( 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 immediately following the date on which the notice is
given.
IN WITNESS WHEREOF the undersigned, being duly authorized thereto, have
signed this Convention.
DONE in duplicate at Crans Montana this 21st day of June, 1996 in the English
language.
JOHN DALLI
FOR MALTA
IVAN KO C ÁRNIK
FOR THE CZECH REPUBLIC
