ARTICLE 23

Relief from Double Taxation

1. In accordance with the provisions and subject to the limitations of the law of the United States (as it may be amended from time to time without changing the general principle hereof), the United States shall allow to a resident or citizen of the United States as a credit against the United States tax on income:

a) the Estonian tax paid by or on behalf of such resident or citizen; and b) in the case of a United States company owning at least 10 percent of the voting stock of a company which is a resident of Estonia and from which the United States company receives dividends, the Estonian tax paid by or on behalf of the distributing company with respect to the profits out of which the dividends are paid.

2. In Estonia, double taxation shall be avoided as follows:

a) where a resident of Estonia derives income which, in accordance with this

Convention, may be taxed in the United States, unless a more favorable treatment is provided in its domestic law, Estonia shall allow as a deduction from the tax on the income of that resident, an amount equal to the income tax paid thereon in the United States (other than any such tax imposed by reason of citizenship of the United States); such deduction shall not, however, exceed that part of the income tax in Estonia, as computed before the deduction is given, which is attributable to the income which may be taxed in the United States;

b) For the purposes of subparagraph a), where a company that is a resident of Estonia receives a dividend from a company that is a resident of the United States in which it owns at least 10 percent of its shares having full voting rights, the tax paid in the United States shall include not only the tax paid on the dividend, but also the appropriate portion of the tax paid on the underlying profits of the company out of which the dividend was paid.

3. For the purposes of allowing relief from double taxation pursuant to this Article, and subject to such source rules in the domestic laws of the Contracting States as apply for purposes of limiting the foreign tax credit, income derived by a resident of a Contracting State which may be taxed in the other Contracting State in accordance with this Convention (other than solely by reason of citizenship in accordance with paragraph 4 of Article 1 (General Scope)) shall be deemed to arise in that other State.