Article 14. DEPENDENT PER­

SONAL SERVICES

Generally, under the proposed Con­ vention income from labor or personal services as an employee may be taxed

acquiring business or technical experi­ ence shall not be taxable in such other Contracting State if such remittances are made to him from sources outside such other Contracting State for the purposes of his maintenance or stud­ ies. The OECD Model Convention in­ cludes a similar provision.

The proposed Convention expands the exemption available to students by providing that an individual who is a resident of one State at the time he visits the other State and who is tem­ porarily present in the other State for the purpose of studying at a university or other accredited institution, or se­ curing training for qualification in a profession, or of studying or doing re­ search as a recipient of a grant, allow­ ance, or award from a governmental, religious, charitable, scientific, literary, or educational institution is exempt from tax in the host State on:

(1) Gifts from abroad for his main­ tenance and study;

(2) The grant, allowance, or award;

(3) Income from personal services performed in the host State in the ag­ gregate amount not in excess of $2,000 (or its equivalent in Nor­ wegian kroner) for any taxable year. Under this article and paragraph (1) of Article 15 (Teachers), these ex­ emptions continue only for such pe­ riod of time as may be reasonable or customarily required to effectuate the purpose of his visit but in no event may an individual have the benefit of this provision and the provisions of Article 15 (Teachers) for more than a total of 5 taxable years from the date of his arrival.

In addition, a resident of one State employed by or under contract with a resident of that State who, at the time he is a resident of that State, becomes temporarily present in the other State for the purpose of studying or acquir­ ing technical, professional, or business experience from a person other than a resident of the first-mentioned State, is exempt from tax in the host State on income not in excess of $5,000 (or

in the State in which such labor or personal services are performed (ex­ cept as provided in Articles 15

(Teachers), 16 (Students and Train­ ees), 17 (Governmental Functions), and 18 (Private Pensions and Annui­ ties)). However, such income will be exempt from tax in the State of source if (1) the recipient, being a resident of one of the Contracting States, is present in the State of source for a period or periods aggregating less than

183 days during the taxable year; (2) the recipient is an employee of a resi­ dent of the State of his residence (or of a permanent establishment located in the State of his residence main­ tained by a resident of a State other than that State); and (3) the remu­ neration is not borne as such by a permanent establishment which the employer has in the State of source. Thus, the rule applicable to depend­ ent personal services is similar to that contained in the existing Convention. The proposed Convention also adds a rule that income from labor or per­ sonal services performed by a resident of one of the Contracting States as an employee aboard ships or aircraft op­ erated by a resident of the other Con­ tracting State in international traffic or in fishing on the high seas may be taxed by that other Contracting State if such employee is a member of the regular complement of the ship or air­ craft.

This article of the proposed Con­ vention is substantially similar to the OECD Model Convention except that, under the proposed Convention, an individual temporarily present in one State who is an employee of a perma­ nent establishment located in the other State and maintained by a cor­ poration of the first-mentioned State will be exempt from taxation by the first-mentioned State on wages earned while temporarily present therein if the other requirements are met.