The Double Taxation Relief (Taxes on Income) (Norway) Order 2000

Article 23 MISCELLANEOUS RULES APPLICABLE TO CERTAIN OFFSHORE ACTIVITIES

(1) The provisions of this Article shall apply notwithstanding any other provision of this Convention.

(2) In this Article the term “offshore activities” means activities which are carried on offshore in a Contracting State in connection with the exploration or exploitation of the seabed and subsoil and their natural resources situated in that State.

(3) An enterprise of a Contracting State which carries on offshore activities in the other Contracting State shall, subject to paragraphs (5) and (6) of this Article, be deemed to be carrying on business in that other State through a permanent establishment situated therein.

(4) Subject to the provisions of paragraph (5) of this Article, a resident of a Contracting State who carries on offshore activities in the other Contracting State, which consists 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 State.

(5) The provisions of paragraphs (3) and (4) of this Article shall not apply:

(a) where the offshore activities are carried on in the other Contracting State for a period or periods not exceeding in the aggregate 30 days in any twelve month period. For the purposes of this sub-paragraph:

(i) where an enterprise of a Contracting State carrying on offshore activities in the other Contracting State 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, with the exception of activities which are carried on at the same time as its own activities;

(ii) 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 person or persons participate directly or indirectly in the management, control or capital of both enterprises;

(b) to production activities to which the provisions of Article 24 of this Convention apply.

(6) Profits derived by a resident of a Contracting State from the operation, in connection with offshore activities, of ships or aircraft which are in their existing state designed primarily for the purpose of transporting supplies or personnel, or for towing or anchor handling, shall be taxable only in that State. However, the provisions of this paragraph shall not apply to profits derived during any period in which such a ship or aircraft is contracted to be used mainly for purposes other than to transport supplies or personnel to or between places where offshore activities are being carried on, or for purposes other than towing or anchor handling, as the case may be.

(7) (a) Subject to sub-paragraph (b) of this paragraph, salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment connected with offshore activities in the other Contracting State may, to the extent that the duties are performed offshore in that other State, be taxed in that other State.

(b) Where paragraph (6) of this Article applies to the profits from the operation of a ship or aircraft, salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment exercised aboard that ship or aircraft shall be taxable only in the Contracting State of which the person deriving those profits is a resident.

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

(a) exploration or exploitation rights; or

(b) property situated in the other Contracting State and used in connection with offshore activities, as defined in paragraph (2) of this Article, carried on in that other State; or

(c) shares deriving their value or the greater 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 State. In this paragraph “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 the other Contracting State, including rights to interests in or to the benefit of such assets.