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(Swiss Confederation) Switzerland

AGREEMENT FOR AVOIDANCE OF DOUBLE TAXATION WITH RESPECT
TO TAXES ON INCOME BETWEEN
THE GOVERNMENT OF PAKISTAN AND' THE SWISS FEDERAL COUNCIL

S.R.O. 1377 (K), dated 18th October, 1960. - Whereas the annexed Conventions for the avoidance of double taxation with respect to taxes on income between the Government of Pakistan and the Swiss Federal Council has been ratified and the instruments of ratification exchanged;

NOW, THEREFORE, in exercise of the powers conferred by section 49AA of the Income Tax Act, 1922 (XI of 1922), the Central Government is pleased to direct that all the provisions of the said Convention shall be given effect to in Pakistan.

Annexure

CONVENTION BETWEEN THE REPUBLIC OF PAKISTAN AND
THE SWISS CONFEDERATION FOR THE AVOIDANCE OF DOUBLE
TAXATION WITH RESPECT TO TAXES ON INCOME.

The Government of Pakistan and the Swiss Federal Council, desiring to conclude in Convention for the Avoidance of Double Taxation with respect to Taxes on Income, have appointed for that purpose as their respective Plenipotentiaries;

The Government of Pakistan:

Mr. Mirza Sikander Ali Baig, Ambassador Extraordinary and Plenipotentiary in Switzerland, and

The Swiss Federal Council:

Mr. Max Petitpierre, Federal Councillor, Head of the Federal Political Department, who, having communicated to one another their full powers, found in good and due form, have agreed as follows:-

ARTICLE I

(1) The taxes which are the subject of the present Convention are

(a) In Pakistan:

The income-tax, super-tax and the business profits tax (hereinafter referred to as "Pakistan tax")

(b) In Switzerland:

The federal, cantonal and communal taxes on income (total income, earned income, income from capital, industrial and commercial profits etc., hereinafter referred to as "Swiss tax").

(2) The present Convention shall also apply to any other taxes of a substantially similar character imposed by the Government of Pakistan or in Switzerland subsequently to the date of signature of the present Convention or by the Government of any territory to which the present Convention is extended under Article XVII.

ARTICLE II

(1) In the present Convention, unless the context otherwise requires:

(a) "The term 'Pakistan' means the Provinces of Pakistan".

(b) The term "Switzerland" means the Swiss Confederation.

(c) The terms "one of the territories" and "the other territory" mean Pakistan or Switzerland, as the context requires;

(d) The term "tax" means Pakistan tax or Swiss Tax, as the context requires;

(e) The term "person" includes any individual, company and any body of persons corporate or not corporate;

(f) The term "company" means, in relation to Pakistan any body corporate or not corporate assessed as a company under Pakistan Law relating to Pakistan Tax, and in relation to Switzerland, any entity with judicial personality;

(g) The term "resident of Pakistan" means:

(i) any company whose business is managed and controlled in Pakistan; and

(ii) any other person who is resident in Pakistan for the purposes of Pakistan tax and not resident in Switzerland for the purposes of Swiss tax.

(h) The term "resident of Switzerland" means:

(i) any company created or organized under Swiss law if its business is managed and controlled in Switzerland; and

(ii) any other person who is resident in Switzerland for the purposes of Swiss tax and not resident in Pakistan for the purposes of Pakistan tax.

(i) The term "Pakistan company" means a company which is a resident of Pakistan; and the term "Swiss company" means a company which is a resident of Switzerland;

(j) The terms "resident of one of the territories" and "resident of the other territory" mean a resident of Pakistan or a resident of Switzerland, as the context requires;

(k) The terms "Pakistan enterprise" and "Swiss enterprise" mean respectively an industrial or commercial enterprise or undertaking carried on in Pakistan by a resident of Pakistan and an industrial or commercial enterprise or undertaking carried on in Switzerland by a resident of Switzerland; and the terms "enterprise of one of the territories" and "enterprise of the other territory" mean a Pakistan enterprise or a Swiss enterprise, as the context requires;

(1) The term "permanent establishment", when used with respect to an enterprise of one of the territories, means a fixed place of business in which the business of the enterprise is wholly or partly carried on, it includes an office, a branch, a place of management, a factory, a workshop, a mine, quarry or other place of natural resources subject to exploitation. In this connection -

(i) An enterprise of one of the territories shall not be deemed to have a permanent establishment in the other territory merely because it carries on business dealings in that other territory through a bona fide broker, general commission agent or other independent agent acting in the ordinary course of his business as such, or because it makes purchases of goods or merchandise direct from an independent exporter in that other territory in the normal course of international trade.

(ii) The use of more storage facilities or the maintenance in one of the territories of a stock of goods or merchandise by an enterprise of the other territory, whether in a warehouse or not, merely for the convenience of delivery and not for purposes of display shall not of itself constitute a permanent establishment, even though the delivery of such goods and merchandise is made in pursuance of the instructions issued by the enterprise in that other territory on the acceptance by it of an offer of purchase obtained by an agent of the enterprise in that territory not being an agent who maintains the stock of goods or merchandise.

(ii) An enterprise of one of the territories shall be deemed to have a, permanent establishment in the other territory if it has in that other territory an agent or employee who -

(a) has and habitually exercises a general authority to negotiate and conclude contracts on behalf of the enterprise;

(b) has in that other territory a stock of goods or merchandise from which he regularly fills orders secured by him on behalf of the enterprise.

(iv) An enterprise of one of the territories shall not be deemed to have a permanent establishment in the other territory if it carries on in that other territory installation or the setting up of plant and machinery the duration of which does not exceed twelve months in all, notwithstanding the fact that it has a fixed place of business in such other territory.

(v) The fact that a company which is a resident of one of the territories has a subsidiary company which is a resident of the other territory or which carries on a trade or business in that other territory (whether through a permanent establishment or otherwise) shall not of itself constitute that subsidiary company a permanent establishment of its parent company.

(m) The term "competent authority" means, in the case of Pakistan, the Central Board of Revenue or their authorized representative; in the case of Switzerland, the Director of the Federal Tax Administration or his authorized representative; and, in the case of any territory to which the present Convention is extended under Article XVII, the competent authority for the administration in such territory of the taxes to which the Convention applies.

(2) In the application of the provisions of the present Convention by either contracting State, any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the laws in force in the territory of that State relating to the taxes which are the subject of the present Convention.

ARTICLE III

(1) The industrial or commercial profits of a Pakistan enterprise shall not be subject to Swiss tax unless the enterprise carries on a trade or business in Switzerland through a permanent establishment situated therein. If it so carries on a trade or business, tax may be imposed on those profits by Switzerland, but only on so much of them as is attributable to that permanent establishment.

(2) The industrial or commercial profits of a Swiss enterprise shall not be subject to Pakistan tax unless the enterprise carries on a trade or business in Pakistan through a permanent establishment situated therein. If it so carries on a trade or business, tax may be imposed on those profits by Pakistan, but only on so much of them as is attributable. that permanent establishment.

(3) The share of the industrial or commercial profits of an undertaking accruing to a partner therein who is a resident of one of the territories shall likewise not be subjected to tax in the other territory, unless the undertaking carries on a trade or business in that other territory through a permanent establishment situated therein. If it so carries on a trade or business, tax may be imposed in that other territory on the share of the profits accruing to that partner, but only on so much as of them represent his share of the profits attributable to that permanent establishment.

(4) Where an enterprise of one of the territories carries on a trade or business in the other territory through a permanent establishment situated therein, there shall be attributed to that permanent establishment the industrial or commercial profits which it might be expected to derive in that other territory if it were an independent enterprise engaged in the same or similar activities under the same or similar conditions and dealing at arm's length with the enterprise of which it is permanent establishment.

(5) Fees or other remuneration derived by an enterprise of one of the territories from the management, control or supervision of the trade, business or other activity of an enterprise of the other territory may be subjected to tax in that other territory, except when such payments are made for services rendered wholly outside that territory or by a subsidiary to its parent company which does not have a permanent establishment in that other territory for the purpose of such management, control or supervision.

(6) In the determination of the industrial or commercial profits of a permanent establishment there shall be allowed as deductions all expenses which are reasonably applicable to the permanent establishment, including executive and general administrative expenses so applicable, whether incurred in the territory in which the permanent establishment is situated or elsewhere.

(7) The term "industrial or commercial profits", as used in this Article, does not include interest (on bonds, securities, notes or debentures or on any other form of indebtedness), dividends or royalties, except any such income, which under the laws of one of the territories and in accordance with this Article is attributable to a permanent establishment situated therein.

ARTICLE IV

Where -

(a) an enterprise of one of the territories participates directly or indirectly in the management, control or capital of an enterprise of the other territory, or

(b) the same persons participate directly or indirectly in the management, control or capital of an enterprise of one of the territories and an enterprise of the other territory,

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 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.

ARTICLE V

(1) Notwithstanding the provisions of Article III, profits which a resident of one of the territories derives from operating aircraft, including profits of that resident from the sale of tickets for passages by such aircraft, shall be exempt from tax in the other territory, unless the aircraft is operated wholly or mainly between places within such other territory.

(2) Paragraph (1) shall likewise apply in respect of Participations in a pooled service, in a joint air transport operating organisation or in an international operating agency by a resident of one of the territories operating aircraft.

(3) Notwithstanding the provisions of Article III, profits which a resident of one of the territories derives from operating ships in the other territory, including profits of that resident from the sale of tickets for Passages by such ships, shall be exempt from tax in the first-mentioned territory, if such profits are subject to tax in the other territory.

ARTICLE VI

(a) Where a Swiss Company owns shares carrying not less than one-third of the voting power of a Pakistan Company, the rate of Pakistan tax payable in respect of the dividends declared on or after the lst January, 1961, and paid by such Pakistan Company to such Swiss Company shall not exceed:-

(i) 10 per cent when such dividends are derived from the income of an industrial undertaking in Pakistan; and

(ii) 20 per cent in the case of dividends derived from other income.

(b) The provisions of Article 59 of the Swiss Federal Defence Tax Act as in force on the 1st January, 1959, shall apply to the Swiss Company mentioned in sub-paragraph (a) of this paragraph.

(2) The provisions of section 23A of the Pakistan Income-tax Act - relating to the distribution of company profits - shall not apply to the income of a Pakistan company shares carwing not less than one-third of the voting power of which are owned by a Swiss company, if the Pakistan company is engaged in an industrial undertaking and its profits are retained for purposes of its industrial development and expansion in Pakistan.

(3) The rate of Swiss tax on dividends paid by a Swiss company to a Pakistan company, holding shares carwing not less than one-third of the voting power of the Swiss company, shall not exceed 15 per cent.

(4) Where a company, which is a resident of one of the territories, derives profits or income from sources within the other territory, there shall not be imposed in that other territory any form of taxation on dividends paid by the company to a person not resident in that other territory unless such dividend is attributable to a permanent establishment maintained in that other territory by a person not resident in that other territory, or any tax in the nature of an undistributed profits tax on undistributed profits of the company.

(5) Paragraphs (1) and (3) shall not apply where a Swiss company or a Pakistan company, as the case may be, receiving the dividends has a permanent establishment in the other territory and such dividends are, under the laws of such other territory and in accordance with Article III of the present Convention, attributable to that permanent establishment.

(6) The term "industrial undertaking", as used in this Article, means an undertaking falling under any of the classes mentioned below:-

(a) the manufacture of goods or materials or the subjection of goods or materials to any process which results in substantially changing the original condition; (b) ship-building;

(c) electricity, hydraulic power, gas and water supply;

(d) mining, including the working of an oil well or any other source of mineral deposits; and

(e) any other undertaking, which may be declared to be an "industrial undertaking" by the competent authority in Pakistan for the purposes of this Article.

ARTICLE VI-A

(1) The rate of Pakistan tax on interest paid by a resident of Pakistan to a Swiss Company or partnership in respect of indebtedness incurred on or after the 1st January, 1961, shall not exceed 30 per cent.

(2) Notwithstanding the provisions of paragraph (1) of this Article, interest paid by a resident of Pakistan to a Swiss Company or partnership on approved loans (including loans in the form of deferred payments) shall be exempt from Pakistan tax payable thereon; and the amount of Swiss tax relating to such interest (calculated according to the ratio existing between the gross amount of such interest and the recipient's total gross income) shall not exceed 10 per cent of the gross amount of such interest.

(3) The rate of Swiss tax on interest paid by a resident of Switzerland to a Pakistan Company in respect of indebtedness incurred on or after the 1st January, 1961 shall not exceed 15 per cent.

(4) Paragraphs (1) to (3) of this Article shall not apply where a Swiss Company or partnership or a Pakistan Company, as the case may be, receiving the interest has a permanent establishment in the other territory and such interest is, under the laws of such other territory and in accordance with Article III of the present Convention, attributable to that permanent establishment.

(5) In this Article-

(a) the term ‘interest’ includes income from bonds, securities, notes, debentures or any other form of indebtedness whether or not secured by mortgages;

(b) the term ‘approved loan’ means a loan made to an industrial undertaking in Pakistan and approved by the Government of Pakistan and the term ‘industrial undertaking’ means an undertaking falling under any of the classes mentioned in paragraph (6) of Article VI of the Convention.

ARTICLE VII

(1) Any royalty derived from sources within one of the territories by a resident of the other territory, who is subject to tax in that other territory in respect thereof shall be exempt from tax in the first-mentioned territory.

(2) Where due to the existence of any special relationship between the persons paying any royalty and the person receiving it, the amount paid as royalty exceeds a fair and reasonable consideration in respect of the rights for which it is paid, the exemption provided for in this Article shall apply only to so much of the royalty as represents such fair and reasonable consideration.

(3) In this Article, the term "royalty" means any royalty or other amount paid as consideration for the right to use any copyright, artistic or scientific work, patent, model, design, secret process or formula, trade mark or other like property or right including rents or royalties in respect of motion picture films and films for use in connection with television, but does not include any royalty or other amount paid in respect of the operation of mines, quarries or other natural resources.

(4) Any capital sum derived from sources within one of the territories from the sale of the property or right mentioned in paragraph (3) of this Article by a resident of the other territory shall be exempt from tax in the first-mentioned territory.

(5) The exemption from tax under this Article shall not apply to royalties or capital sums which under the laws of one of the territories and in accordance with Article III of the present Convention are attributable to a permanent establishment situated therein.

(6) Any royalty exempt from tax of one of the territories under this Article shall be allowed as a deduction for tax purposes from the income or profits of the person paying the royalty, notwithstanding the existence of a special relationship, if any, between that person and the person receiving the royalty.

ARTICLE VIII

(1) Income derived from real property situated in one of the territories by a resident of the other territory shall be subject to tax in the first-mentioned territory.

(2) In this Article, term ‘income from real property’ means income of whatever nature derived from real property, including gains derived from the sale or exchange of such property, and it also includes royalties in respect of the operation of mines, quarries or other natural resources as well as interest from mortgages or bonds secured on real property other than the interest mentioned in Article VI-A.

ARTICLE IX

(1) Profits or remuneration from a profession (including services as director) or employment derived by an individual, who is a resident of one of the territories shall be subject to tax in the other territory when the activities are performed in that territory.

(2) An individual, who is a resident of Pakistan, shall be exempt from Swiss tax on the profits or remuneration referred to in paragraph (1) of this Article if-

(a) he is temporarily present in Switzerland for a period or periods not exceeding in the aggregate 183 days in a taxable year;

(b) the services are performed for or on behalf of a resident of Pakistan; and

(c) the profits or remuneration are borne by a resident of Pakistan and are subject to Pakistan tax.

(3) An individual, who is a resident of Switzerland, shall be exempt from Pakistan tax on the profits or remuneration referred to in paragraph (1) of this Article, if-

(a) he is temporarily present in Pakistan for a period or periods not exceeding in the aggregate 183 days in a taxable year,

(b) the services are performed for or on behalf of a resident to Switzerland, and

(c) the profits or remuneration are borne by a resident of Switzerland and are subject to Swiss tax.

(4) Where an individual permanently or predominantly performs services in ships or aircraft operated by an enterprise of one of the territories, such services shall be deemed to be performed in that territory.

(5) The provisions of paragraphs (2) and (3) of this Article shall not apply to the profits or remuneration of public entertainers, such as stage, motion picture, radio or television artists, musicians and athletes.

ARTICLE X

(1) Remuneration, including pensions, paid by or out of public funds created by one of the contracting States or political sub-divisions thereof to any individual for services rendered to that State or the political sub-division thereof shall be exempt from tax in the territory of the other State if the individual is a citizen of the first-mentioned State.

(2) The provisions of this Article shall not apply to payments in respect of services in connection with any trade or business carried on by either of the contracting States or the political sub-divisions thereof for purposes of profit.

(3) The term "political sub-division", as used in this Article, includes a local authority in Pakistan and a canton and a municipality in Switzerland.

ARTICLE XI

(1) Any pension (other than a pension of the kind referred in Article X) and any annuity, derived from sources within one of the territories by an individual, who is a resident of the other territory and subject to tax in that other territory in respect thereof, shall be exempt from tax in the first-mentioned territory, but a pension or annuity payable from a superannuation fund established in Pakistan shall be subject to tax in Pakistan.

(2) In this Article-

(a) the term "pension" means periodic payment made in consideration of past services or by way of compensation for injuries received;

(b) the term "annuity" means a stated sum payable periodically at stated times during life or during a specified or ascertainable period of time, under an obligation to make the payments in return for adequate and full consideration in money or money’s worth.

ARTICLE XII

(1) An individual from one o the territories, who is temporarily present in the other territory solely-

(a) as a student at a recognized university, college or school in such other territory,

(b) as the recipient of a grant, allowance or award for the primary purpose of study or research from a religious, charitable, scientific or educational organisation, or

(c) as a business apprentice (including in Switzerland, a Bolontaer or a Praktikant),

shall be exempt from tax by such other territory; (i) on all remittances from abroad for the proposes of his maintenance, education or training, and (ii) with respect to any amount representing compensation for personal services rendered in that other territory, provided such services are in connection with his studies or training or are necessary for the purposes of his maintenance.

(2) An individual from one of the territories, who is temporarily present in the other territory for a period not exceeding twelve months in all as an employee of, or under contract with an enterprise of the first-mentioned territory or a religious, charitable, scientific or educational organisation of such territory, solely to acquire technical, professional or business experience from a person other than such enterprise or organisation, shall be exempt from tax by such other territory on compensation for such period in an amount not in excess of 12,000 Swiss Francs, or the equivalent thereof in Pakistan currency at the official rate of exchange (including remuneration from such person in the first-mentioned territory).

ARTICLE XIII

(1) Subject to the provisions of Pakistan income-tax law (as in force on the date of signature of the present Convention), Swiss tax payable, whether directly or by deduction, by a person resident in Pakistan, in respect of income from sources within Switzerland (including income accruing or arising in Switzerland but deemed, under the provisions of the law of Pakistan, to accrue or arise in Pakistan) shall be allowed as a credit against any Pakistan tax payable in respect of that income.

(2) In determining its taxes specified in Article I of the present Convention, Switzerland shall exclude in the case of its residents from the basis upon which such taxes are imposed such items of income (other than dividends and the interest referred to in Article VI-A of this Convention) as are dealt with in the present Convention derived from sources within Pakistan which according to the present Convention are not exempt from Pakistan tax. Switzerland, however, reserves the right to take into account in the determination of the rate of its taxes the items of income excluded as provided in this paragraph.

(3) In the case of a person, other than a company, who is resident in Pakistan for the purposes of Pakistan tax and is also resident in Switzerland for purposes of Swiss tax, the provisions of paragraph (1) of this Article shall apply in relation to income which that person derives from sources within Switzerland, and one provisions of paragraph (2) of this article shall apply in relation to income from sources outside both Pakistan and Switzerland, tax may be imposed on that income in both the territories (subject to the laws in force in the said territories and to any Convention which may exist between either of the contracting States and the territory from which the income is derived) but the Swiss tax on so much of that income as is subjected to tax in both the territories shall be limited to one-half of the tax on such income, and the Pakistan tax on that income shall be reduced by a credit, in accordance with paragraph (1) of this Article, for the Swiss tax so computed.

ARTICLE XIV

(1) Where a person shows to the satisfaction of the competent authority of the contracting State in whose territory he is resident that he has not received the treatment in the other territory to which he is entitled under any provision of the present Convention, that competent authority shall consult with the competent authority of the other State with a view to the avoidance of double taxation in question.

(2) The competent authorities of the two contracting States may communicate with each other directly for the purpose of giving effect to the provisions of the present Convention and for resolving any difficulty or doubt as to the application or interpretation of the present Convention.

ARTICLE XV

(1) The nationals of one of the contracting States shall not, while resident in the territory of the other State, be subjected in such territory to taxes or any requirements connected therewith, which are either*, higher or more burdensome than the taxes and connected requirements to which the nationals of such other State resident therein are or may be subjected.

* The word "either" has wrongly appeared as "other" in the Official Gazette.

(2) Where an enterprise of one of the territories has a permanent establishment in the other territory, such permanent establishment shall not be subjected in that other territory to taxes or any requirements connected therewith which are higher or more burdensome than the taxes and connected requirements to which the enterprises of such other territory carrying on the same activities may be subjected.

(3) Enterprises of one of the territories, the capital of which is wholly or partly owned or controlled, whether directly or indirectly, by one or more residents of the other territory, shall not be subjected, in the first-mentioned territory, to taxes or any requirements, connected therewith, which are either^* higher or more burdensome than the taxes and connected requirements to which similar enterprises of that first-mentioned territory are or may be subjected.

* The word "either" has wrongly appeared as "other" in the Official Gazette.

(4) The term "nationals" as used in this Article includes all legal persons, partnerships and associations deriving their status as such from the laws in force in the respective State.

(5) The term "taxes", as used in this Article, means tax mentioned in Article I as well as any other taxes levied by the Government of Pakistan or the Swiss Confederation.

(6) Nothing contained in this Article shall be construed -

(a) as obliging any contracting State to grant to persons not resident in that State any personal allowances, reliefs and reductions for tax purposes, which it grants to its own residents on account of their marital status or family responsibilities or to charge persons who are not resident in its territory tax at rates applicable to persons who are resident; or

(b) as affecting the law of Pakistan relating to the grant of rebate of tax to companies fulfilling specified requirements regarding the declaration and payment of dividends, unless those requirements are fulfilled.

ARTICLE XVI

(1) The provisions of the present Convention shall not be construed as restricting in any manner any exemption, deduction, credit or other allowance now or hereafter accorded by the laws in force in one of the territories in the determination of the tax imposed in that territory.

(2) The provisions of the present Convention shall not be construed as denying or affecting in any manner the right of diplomatic and consular officers to such exemptions as may be granted to them.

ARTICLE XVII

(1) The present Convention may be extended, either in its entirety or with modifications, to any territory for the international relations of which Pakistan is responsible and which imposes taxes substantially similar in character to those which are the subject of the present Convention, and any such extension shall take effect from such date and subject to such modifications and conditions (including conditions as to termination) as may be specified and agreed between the contracting States in notes to be exchanged for the purpose.

(2) The termination in respect of Pakistan or Switzerland of the present Convention under Article XXI shall unless otherwise agreed by the contracting States, terminate the application of the Convention to any territory to which it has been extended under this Article.

ARTICLE XVIII

The competent authorities of the contracting States may prescribe regulations necessary to carry into effect the present Convention within their territories.

ARTICLE XIX

(1) The present Convention shall be ratified and the instruments of ratification shall be exchanged at Karachi as soon as possible.

(2) The present Convention shall enter into force upon the exchange of the instruments of ratification.

ARTICLE XX

(1) Upon the entry into force of the present Convention in accordance with Article XIX, the provisions of the Convention shall have effect:

(a) In Pakistan:

as respects income-tax and super-tax for any year of assessment beginning on or after the 1st January, 1959;

as respects business profits tax, in respect of the following profits -

(i) profits by reference to which income-tax is, or but for the present Convention would be, chargeable for any year of assessment beginning on or after the 1st January, 1959;

(ii) other profits, being profits by reference to which income-tax is not chargeable, but which arise in any chargeable accounting period beginning on or after the 1st January, 1959, or are attributable to so much of any chargeable accounting period falling* partly before and partly after that date as falls after that date;

* The word "falling" has wrongly appeared as "failing" in the Official Gazette.

(b) In Switzerland:
for any taxable year beginning on or after the 1st January, 1959.

(2) The exemption from tax provided for in paragraphs (1) and (2) of Article V shall have effect after the 1st January, 1956.

ARTICLE XXI

The present Convention shall continue in effect indefinitely but either contracting State may, on or before the 30th June in any calendar year give to the other contracting State, through diplomatic channel, written notice of termination and, in such event, the Convention shall cease to be effective.

(a) In Pakistan:
as respects income-tax and super-tax, for any year of assessment beginning on or after the 1st January next following such written notice of termination;

as respects business profits tax, in respect of the following profits -

(i) profits by reference to which income-tax is chargeable for any year of assessment beginning on or after the 1st January next following such written notice of termination;

(ii) other profits being profits by reference to which income-tax is not chargeable but which arise in any chargeable accounting period beginning on or after the 1st January next following such written notice of termination, or are attributable to so much of the chargeable accounting period failing partly before and partly after that date as falls after that date.

(b) In Switzerland:
for any taxable year beginning on or after the 1st January next following such written notice of termination.

IN WITNESS THEREOF the above-mentioned Plenipotentiaries have signed the present Convention and have affixed thereto their seals.

DONE in duplicate at Berne the thirtieth day of December, one thousand nine hundred and fifty-nine, in the English and German languages, both texts being equally authoritative.

No. 25(17)-ITP/56.

Published in the Gazette of Pakistan, Extraordinary, Pages 1611-1623(II), dated 18-10-1960.

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