Article 11 Interest
     1. Interest arising in a territory and paid to a resident of the other territory may be taxed in that other territory.
     2. However, such interest may also be taxed in the territory in which it arises and according to the laws of that territory, but if the beneficial owner of the interest is a resident of the other territory, the tax so charged shall not exceed 10 percent of the gross amount of the interest.
     3. Notwithstanding the provisions of paragraph 2, interest arising in a territory and paid to a resident of the other territory who is the beneficial owner thereof shall be taxable only in that other territory to the extent that such interest:
a) is paid in respect of a bond, debenture or other similar obligation of a public entity of a territory, or of a subdivision or local authority thereof; or
b) is paid to the other territory or a subdivision or local authority thereof, a central bank of that other territory or to any instrumentality (including a financial institution) controlled by that territory or subdivision or local authority thereof; or
c) is paid between banks.
     4. The competent authorities of the territories shall by mutual agreement settle the mode of application of paragraphs 2 and 3.
     5. The term "interest" as used in this Article means income from debt-claims of every kind, whether or not secured by mortgage and whether or not carrying a right to participate in the debtor's profits, and in particular, income from public securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures. Penalty charges for late payment shall not be regarded as interest for the purpose of this Article.
     6. The provisions of paragraphs 1, 2 and 3 shall not apply if the beneficial owner of the interest, being a resident of a territory, carries on business in the other territory in which the interest arises, through a permanent establishment situated therein, or performs in that other territory independent personal services from a fixed base situated therein, and the debt-claim in respect of which the interest is paid is effectively connected with such permanent establishment or fixed base. In such case the provisions of Article 7 or Article 14, as the case may be, shall apply.
     7. Interest shall be deemed to arise in a territory when the payer is a resident of that territory. Where, however, the person paying the interest, whether he is a resident of a territory or not, has in a territory a permanent establishment or a fixed base in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment or fixed base, then such interest shall be deemed to arise in the territory in which the permanent establishment or fixed base is situated.
     8. Where, by reason of a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the interest, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned amount. In such case, the excess part of the payments shall remain taxable according to the laws of each territory, due regard being had to the other provisions of this Agreement.