1. Royalties arising in a Contracting Party and paid to or deemed to be paid to a resident of the other Contracting Party may be taxed in that other Contracting 
    Party.

2. However, such royalties may also be taxed in the Contracting Party in which they arise and according to the laws of that Contracting Party, but if the beneficial
    owner of the royalties is a resident of the other Contracting Party, the tax so charged shall not exceed 3 per cent of the gross amount of the royalties. The
    competent authorities of the Contracting Parties shall by mutual agreement settle the mode of application of this limitation.

3. The term “royalties” as used in this Article means payments of any kind received as a consideration for the use of, or the right to use, any copyright of literary,
    artistic or scientific work including cinematograph films, or films or tapes used for radio or television broadcasting, any patent, trade mark, design or model,
    plan, secret formula or process, or for the use of, or the right to use, industrial, commercial or scientific equipment or for information concerning industrial,
    commercial or scientific experience.

4. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties, being a resident of a Contracting Party, carries on business in
     the other Contracting Party in which the royalties arise, through a permanent establishment situated therein and the right or property in respect of which the
    royalties are paid is effectively connected with such permanent establishment. In such case the provisions of Article 7 shall apply.

5. 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
    royalties exceeds, for whatever reasons, 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 Contracting Party, due regard being had to the other provisions of this Agreement.

6. Royalties shall be deemed to arise in a Contracting Party when the payer is a resident of that Contracting Party. Where, however, the person paying the
    royalties, whether he is a resident of a Contracting Party or not, has in a Contracting Party a permanent establishment in connection with which the liability to
    pay the royalties was incurred, and such royalties are borne by such permanent establishment, then such royalties shall be deemed to arise in the
    Contracting Party in which the permanent establishment is situated.

The above information is the wording of the article dealing with the withholding tax on royalties of the tax treaty between The Netherlands and Hong Kong.  Please note that the ultimate withholding tax rate may differ from the treaty rate, for instance as consequence of domestic anti-abuse legislation, provisions of the treaty protocol, etc. Before you use this information we therefore strongly recommend that you consult us to determine the accurate withholding tax rate for your specific situation. If you require our follow up, you can contact us via e-mail or call us at our offices: Ph. + 31 (10) 2010466.