Article 13. INDEPENDENT PER­

SONAL SERVICES

The existing Convention combines the rules pertaining to independent and dependent personal services into one article.

The proposed Convention generally deals with personal services in two ar­ ticles and creates a distinction based upon whether the services are inde­ pendent or dependent personal serv­ ices. The proposed Convention also provides a special rule for independ­ ent individuals who are artists or ath­ letes. A doctor or lawyer, for example, typically renders independent personal services. Also an entertainer who under common law concepts is an in­ dependent contractor is considered as rendering independent personal serv­ ices.

Generally, under Article 13 of the proposed Convention, income earned by an individual resident of one State from independent personal services

performed in the other State may not be taxed in that other State. However, such income may be subject to tax in the State of source (i.e., where the services are performed) if the recipi­ ent is present in that State for a pe­

riod or periods aggregating 183 days or more in the taxable year or if the individual maintains a fixed base in that other State for a period or peri­ ods aggregating 183 days or more in the taxable year, but only to the ex­ tent of so much of the income as is attributable to such fixed base.

Independent personal services means services performed by an indi­ vidual for his own account where he receives the proceeds or bears the losses arising from such services. Com­ mercial, industrial, or agricultural ac­ tivities are not considered independent personal services and the income therefrom is taxed as industrial or commercial profits under Article 5

(Business Profits).

Under the fixed base concept if a physician, resident in one State, has an office available in the other State for a period aggregating 183 days or more during the taxable year, the income he earns from the performance of services within the other State will be subject to tax in that other State re­ gardless of whether he is physically present in that other State for 183 days or more during the taxable year and regardless of whether others make use of this office in his absence.

An individual who derives income from independent personal services as a public entertainer is nevertheless subject to tax in the other State if his stay in such State exceeds 90 days during the taxable year or his income

is in excess of $3,000, or its equivalent in Norwegian kroner, in the aggregate during the taxable year.