MULTILATERAL CONVENTION

of November 24, 2016

On accomplishment of the measures relating to tax agreements for the purpose of counteraction to washing out of tax base and to profit conclusion from under the taxation

Parties of this Convention,

recognizing that the governments sustain considerable losses of the budget regarding the income tax of the organizations because of aggressive international tax planning as a result of which the profit is artificially removed in the territory where it is not taxed or assessed at the lowered rate;

in view of the fact that washing out of tax base and conclusion of profit from under the taxation (further - BEPS) is urgent problem not only for industrialized countries, but also for emerging economies and developing countries;

recognizing importance of providing the taxation of profit in the place of conducting the main economic activity as a result of which the profit is created and cost is created;

supporting packet died, developed according to the Plan of OECD "/Group of Twenty" for BEPS (further - the Plan of BEPS OESR/G20);

noting that the Plan of BEPS OESR/G20 included the measures relating to tax agreements for the solution of questions of application of hybrid schemes of decrease in the tax load, prevention of abuses of provisions of agreements, the solution of question of artificial avoidance of the status of permanent mission and enhancement of the procedure of the dispute resolution;

realizing need of ensuring the bystry, coordinated and approved implementation on multilateral basis of measures of BEPS connected with tax agreements;

noting need of providing that the existing agreements on avoidance of double taxation on taxes on the income were interpreted for the purpose of elimination of double taxation concerning taxes to which these agreements extend, without creating opportunity for not taxation or the lowered taxation by means of avoidance or evasion of taxes (including by use of schemes for the purpose of indirect receipt by residents of the third jurisdictions of the privileges and benefits provided by such agreements);

recognizing need of the effective mechanism of implementation of the approved changes as the coordinated and rational method concerning all existing agreements on avoidance of double taxation concerning taxes on the income without need to hold bilateral negotiations on each such agreement;

agreed as follows:

Part I. Coverage and interpretation of terms

Article 1 - Convention coverage

This Convention changes all Tax agreements to which this Convention extends, determined in the subitem a) Item 1 of the article 2 "Interpretation of Terms".

Article 2 - Interpretation of terms

1. For the purpose of this Convention the following concepts are applied:

a) The term "The Tax Agreement to Which This Convention Extends" means the agreement on avoidance of double taxation concerning taxes on the income (regardless of whether it extends to other taxes):

i) which is effective concerning two or more:

A) Parties; and/or

B) the jurisdictions or the territories which are the parties of the above-stated agreement and for which international relations the Party is responsible; and

ii) concerning which each Party notified Depositary on inclusion of the agreement together with any documents or appendices to it changing it (with indication of the name, names of the parties, signature date and if it is acceptable at the time of submission of the notification, the effective dates) in the list of agreements to which operation of this Convention extends.

b) The term "Party" means:

i) the state concerning which this Convention became effective according to Article 34 (Entry into force); or

ii) jurisdiction which signed this Convention according to the subitem b) or c) Item 1 of Article 27 (Signing and ratification, acceptance or approval), and for which this Convention became effective according to Article 34 (Entry into force).

c) The term "Agreeing Jurisdiction" means the party of the Tax agreement to which this Convention extends.

d) The term "Signatory Party" means the state or jurisdiction which signed this Convention, but concerning which the Convention did not become effective yet.

2. In case of application of this Convention by the Party at any time any term which is not determined in it if other does not follow from context, has that significance which is attached to it at the moment by the relevant Tax agreement to which this Convention extends.

Part II. Hybrid schemes of decrease in the tax load

Article 3 - Fiscal and transparent educations

1. For the purpose of application of the Tax agreement to which this Convention, income gained by education either through it extends or by means of structure which are considered fully or partially transparent from the point of view of the taxation according to the tax legislation of any of the Agreeing Jurisdictions, is considered as the income of the resident Dogovarivayushcheysya Yurisdiktion, but only in that part in which such income is considered the income of resident this Yurisdiktion for the purposes of the taxation in this Dogovarivayushcheysya Yurisdiktion.

2. Provisions of the Tax agreement to which this Convention extends demanding from the Agreeing Jurisdiction of release of the income from the taxation or provision of the offsetting on tax amount paid are not applied to income gained by resident of this Agreeing Jurisdiction which can be assessed with tax in other Agreeing Jurisdiction based on provisions of the Tax agreement to which this Convention extends in that degree in which such provisions provide possibility of the taxation in this other Agreeing Jurisdiction, only based on the fact that mentioned the income is also income gained by resident of this other Agreeing Jurisdiction.

3. Concerning Tax agreements to which this Convention extends, concerning which one or several Parties made the clause stated in the subitem a) Item 3 of Article 11 (Application of tax agreements for the purpose of restriction of rights of the Party on the taxation of the residents), the following offer will be included at the end of Item 1: "Provisions of this Item shall not be considered as limiting the right of the Agreeing Jurisdiction to tax residents of this Agreeing Jurisdiction at all".

4. Item 1 (taking into account changes which can be stipulated in Item 3) it is applied instead of or in the absence of provisions of the Tax agreement to which this Convention, in that degree in which income gained through educations or structures which are considered transparent from the point of view of the taxation according to the tax legislation of any of the Agreeing Jurisdictions (or according to the general rule, or detailed determination of specific forms and types of such educations or structures) is considered the income of the resident Dogovarivayushcheysya Yurisdiktion extends.

5. The party can reserve the right:

a) not apply completely this Article to the Tax agreements to which this Convention extends;

b) not apply Item 1 to the Tax agreements to which this Convention which already contain the provisions stated in item 4 extends;

c) not apply Item 1 to the Tax agreements to which this Convention which already contain the provisions stated in Item 4, refusing provision of privileges under the agreement concerning the income gained by the education or structure founded in the third jurisdiction, or received through such education or structure extends;

d) not apply Item 1 to the Tax agreements to which this Convention which already contain the provisions stated in Item 4, in details determining specific shapes and types of such faces or structures extends;

e) not apply Item 1 to the Tax agreements to which this Convention which already contain the provisions stated in Item 4, in details determining specific forms and types of such educations or structures, and refusing provision of privileges under the agreement concerning the income gained by the education or structure founded in the third jurisdiction, or received through such education or structure extends;

f) not apply Item 2 to the Tax agreements to which this Convention extends;

g) apply Item 1 only to the Tax agreements to which this Convention which already contain the provisions stated in Item 4, in details determining specific forms and types of such educations or structures extends.

6. Each Party which did not make clause according to the subitem a) or b) Item 5, notifies Depositary on whether contains each Tax agreement to which this Convention, provisions stated in Item 4, which are not clause subject according to subitems with c) on e) Item 5, extends and if contains, then specifies number of Article and Item of each such provision. In case the Party which made the clause specified in the subitem g) Item 5, the notification according to the previous offer is limited to Tax agreements to which this Convention extends, concerning which this clause is made. If all Agreeing Jurisdictions made the notification concerning such provisions of the Tax agreement to which this Convention extends, these provisions are replaced with Item 1 provisions (taking into account changes which can be stipulated in Item 3) in that degree as it is stipulated in Item 4. Otherwise, Item 1 (taking into account changes which can be stipulated in Item 3) replaces with itself provisions of the Tax agreement to which this Convention extends, only in that degree in which these provisions are incompatible with Item 1 (taking into account changes which can be stipulated in Item 3).

Article 4 - Persons with double residence

1. If according to provisions of the Tax agreement to which this Convention, person, other, than physical extends, is resident more than one Agreeing Jurisdiction, competent authorities of the Agreeing Jurisdictions by mutual consent aim to determine the Agreeing Jurisdiction which resident such person for the purposes of the Tax agreement to which this Convention extends is considered, considering the place of its actual management, place of registration or any similar place of its organization, and also other important factors. In the absence of such consent any privileges or tax exemption provided by the Tax agreement to which this Convention extends are not provided to this person if only by competent authorities of the Agreeing Jurisdictions it is not approved in what measure and what method.

2. Item 1 is applied instead of or in the absence of provisions of the Tax agreement to which this Convention, the establishing rules of recognition of person which is not physical person, resident of one of the Agreeing Jurisdictions in cases when such person otherwise could be considered as resident more than one of the Agreeing Jurisdictions extends. However Item 1 is not applied to provisions of the Tax agreement to which this Convention extends, concerning determination of residence of the companies participating in the agreement on creation of the double registered (listing) company (dual-listed company arrangements).

3. The party can reserve the right:

a) not apply completely this Article to the Tax agreements to which this Convention extends;

b) not apply completely this Article to the Tax agreements to which this Convention which already contain the provisions concerning cases when person, other, than physical, is resident more than one Agreeing Jurisdiction, and the requiring achievements of mutual consent of competent authorities of the Agreeing Jurisdictions on recognition of such person by the resident of one of the Agreeing Jurisdictions extends;

c) not apply completely this Article to the Tax agreements to which this Convention which already contain the provisions concerning cases when person, other, than physical, is resident more than one of the Agreeing Jurisdictions extends and establish refusal in provision of privileges under the agreement without requirement of achievement of mutual consent of competent authorities of the Agreeing Jurisdictions for recognition of such person by the resident of one of the Agreeing Jurisdictions;

d) not apply completely this Article to the Tax agreements to which this Convention which already contain the provisions concerning cases when person, other, than physical, is resident more than one of the Agreeing Jurisdictions extends and require achievement of mutual consent of competent authorities of the Agreeing Jurisdictions on recognition of such person by the resident of one of the Agreeing Jurisdictions and which establish rules of application of the Tax agreement to which this Convention extends, concerning such person if such consent cannot be reached;

e) replace the last offer of Item 1 for the purposes of the Tax agreements to which this Convention, the text of the following content extends: "In the absence of such consent any privileges or tax exemption provided by the Tax agreement to which this Convention extends are not provided to this person.";

f) not apply completely this Article to the Tax agreements to which this Convention, with the Parties which made clause according to the subitem e extends).

4. Each party which did not make clause according to the subitem a) Item 3, shall notify Depositary on whether contains each of its Tax agreements to which this Convention extends, provisions stated in Item 2, which are not clause subject according to subitems with b) on d) Item 3, and in case of availability to specify number of Article and Item of each such provision. If all Agreeing Jurisdictions made the notification concerning provision of the Tax agreement to which this Convention extends, such provision is replaced with Item 1 provisions. Otherwise, Item 1 replaces with itself provisions of the Tax agreement to which this Convention, only in that degree in which these provisions are incompatible with Item 1 extends.

Article 5 - Application of methods of elimination of double taxation

1. The party can select either Items 2 and 3 (Option A), or items 4 and 5 (Option B), or Items 6 and 7 (Option C), or can not choose any of Options. If each Agreeing Jurisdiction of the Tax agreement to which this Convention extends, chooses different Options (or if one Agreeing Jurisdiction chooses application of one of Options, and another does not choose any of Options), then the Option chosen as each Agreeing Jurisdiction is applied to its residents.

Option A

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