Article V of the Protocol deletes paragraph 2 of Article 12 (Royalties) of the

Convention, which allowed taxation in the Contracting State in which they arise of royalties beneficially owned by a resident of the other Contracting State, in the case of payments with respect to certain types of intellectual property. Thus, the change

18

eliminates withholding on cross-border royalty payments regardless of the type of intellectual property involved, bringing the Convention in line with the U.S. Model.