DT6919A - DT: Falkland Islands: double taxation agreement, Article 21: Miscellaneous rules applicable to certain offshore activities

(1) The provisions of this Paragraph shall apply notwithstanding any other provision of this Arrangement.

(2) In this Paragraph the term "offshore activities" means activities which are carried on offshore in a territory in connection with the exploration or exploitation of the seabed and subsoil and their natural resources situated in that territory.

(3) An enterprise of a territory which carries on offshore activities in the other territory shall, subject to sub-paragraph (4) of this Paragraph, be deemed to be carrying on a trade in that other territory through a permanent establishment situated therein.

(4)) The provisions of sub-paragraph (3) of this Paragraph shall not apply where the offshore activities are carried on in the other territory for a period or periods not exceeding in the aggregate 30 days in any twelve month period.

For the purposes of this sub-paragraph:
(a) Where an enterprise of a territory carrying on offshore activities in the other territory is associated with another enterprise carrying on substantially similar offshore activities there, the former enterprise shall be deemed to be carrying on all such activities of the latter enterprise, except to the extent that those activities are carried on at the same time as its own activities;
(b) an enterprise shall be regarded as associated with another enterprise if one participates directly or indirectly in the management, control or capital of the other or if the same persons participate directly or indirectly in the management, control or capital of both enterprises.

(5) Profits derived by an enterprise of a territory from the operation, in connection with offshore activities in the other territory, of ships or aircraft, may be taxed in that other territory.

(6) A resident of a territory who carries on offshore activities in the other territory consisting of professional services or other activities of an independent character, shall be deemed to be performing those activities from a fixed base in that other territory.

(7) Salaries, wages and similar remuneration derived by a resident of a territory in respect of an employment connected with offshore activities in the other territory may, to the extent that the duties are performed offshore in that other territory, be taxed in that other territory.

(8) Gains derived by a resident of a territory from the alienation of:

(a) exploration or exploitation rights; or
(b) property situated in the other territory and used in connection with the exploration or exploitation of the seabed and subsoil and their natural resources in that other territory; or
(c) shares, other than shares which are listed in the official list of a recognised Stock Exchange, deriving any part of their value directly or indirectly from such rights or such property or from such rights and such property taken together;
may be taxed in that other territory but in the case of shares only insofar as the gain is attributable to such rights or property.

In this sub-paragraph:

the term "exploration or exploitation rights" means rights to assets to be produced by the exploration or exploitation of the seabed and subsoil and their natural resources in such territory, including rights to interests in or the benefit of such assets;
a stock exchange shall not be recognised unless it has been designated as such by the agreement of the competent authorities of both territories.