ARTICLE 2

General Definitions

Paragraph (1) sets out definitions of certain basic terms used in the Convention. Unless the context otherwise requires, a term defined in this paragraph has a uniform meaning throughout the Convention. A number of important terms, however, are defined elsewhere in the Convention.

The term "United States" means the United States of America. When used in a geographical sense, the term means the states of the United States and the District of Columbia. Thus, the Convention does not apply to the possessions of the United States or the Commonwealth of Puerto Rico. The term "Egypt" means the Arab Republic of Egypt.

When used in a geographical sense, the terms "United States" and "Egypt" also include their respective territorial seas, and in general accord with the principles of section 638 of the Code, their respective continental shelves.

The term "Contracting State" is defined to mean the United States or Egypt as the context requires. The term "State" means the United States, Egypt, or any other national State.

The term "person" includes an individual, a partnership, a corporation, an estate or a trust.

The term "United States corporation" is defined as a corporation, or any unincorporated entity which is treated as a corporation for United States tax purposes, which is created or organized under the laws of the United States, any state thereof, or the District of Columbia. An "Egyptian corporation" is defined as a corporation, or any unincorporated entity which is treated as a corporation for Egyptian tax purposes, which is created or organized under the laws of Egypt.

With respect to the United States, the term "competent authority" means the Secretary of the Treasury or his delegate. With respect to Egypt, it means the Minister of Finance or his delegate. The term "tax" means those taxes imposed by the United States or Egypt to which the Convention applies by virtue of Article 1 (Taxes Covered).

The term "international traffic" is defined as any voyage of a ship or aircraft operated by a resident of one of the Contracting States except where such voyage is confined solely to places within a Contracting State. Thus, for example, coastal shipping along the Atlantic coast of the United States is not a voyage in international traffic. However, if a ship operated by a resident of Egypt transports goods from Canada to the United States, leaving some of the goods in New York and the remainder in Norfolk, the portion of the voyage between New York and Norfolk is international traffic.

Paragraph (2) provides that any term used in the Convention which is not defined therein shall, unless the context otherwise requires, have the meaning which it has under the laws of the Contracting State whose tax is being determined. However, where a term has a different meaning under the laws of Egypt and the United States, or where the meaning under the laws of one of the

Contracting States is not readily determinable, the competent authorities may for purposes of the Convention establish a common meaning, which may differ from the meaning under the laws of either Contracting States, in order to prevent double taxation or to further any other purpose of the Convention.