ARTICLE 25

Exchange of Information

This Article provides for the exchange of information between the competent authorities of the Contracting States for the purposes of implementing the provisions of the Convention or administering statutory provisions concerning taxes covered by the Convention. Its terms are substantially similar to the corresponding provisions of the U.S. Model.

Paragraph 1 provides that the competent authorities shall exchange such information as is necessary for carrying out the provisions of the Convention or for administering statutory provisions concerning taxes covered by the Convention provided the information can be obtained under domestic laws and administrative practices with respect to each State's own taxes. Thus, provided that the information could be obtained in administering a domestic tax covered by the Convention, the competent authorities agree to exchange such information without regard to whether there is a domestic liability in the case in question. The information furnished could relate to a tax not covered by the Convention if it is relevant to enforcing a tax which is so covered. For example, it is possible that information relating to sales taxes or estate taxes could be needed to verify an item of income or expense for income tax purposes.

Paragraph 2 provides guarantees that the information exchanged shall be kept secret and may be disclosed only to persons, including a court or administrative body, concerned with the

assessment, collection, administration or enforcement of the taxes covered by the convention or with litigation with respect to those taxes. Persons involved in the administration of taxes covered by the Convention include legislative bodies involved in the administration of taxes and their agents such as, for example, the United States General Accounting Office; therefore, information may be disclosed to them, subject to the limitations of this Article and the internal law of the respective Contracting State.

Paragraph 3 provides that neither State will furnish information to the other State under this Article if it would be contrary to its public policy to do so.

Paragraph 4 states that, when specifically requested by the competent authority of the other Contracting State, and provided that such documents could be obtained in enforcing its own taxes, copies of unedited original documents shall be provided.

In paragraph 5 the competent authorities of the two Contracting States agree to endeavor to collect taxes on behalf of the other State to the extent necessary to ensure that any exemption or reduction in rate of tax provided in the Convention is not enjoyed by persons not entitled to the benefits of the Convention.