24 DE ABRIL DE 1999

1636-(19)

to conclude an Agreement for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, have agreed as follows:

Article J

Personal scope

This Agreement Shall apply to persons who are residents of one or both of the Contracting States.

Article 2 Taxes covered

1 — This Agreement shall apply to taxes on income imposed on behalf of a Contracting State or of its administrative subdivisions or local authorities, irrespective of the manner in which they are levied.

2 — There shall be regarded as taxes on income all taxes imposed on total income, or on elements of income, including taxes on gains from the alienation of movable or immovable property, as well as taxes on capital appreciation.

3 — The existing taxes to which this Agreement shall apply are:

a) In the case of China:

i) The individual income tax;

ii) The income tax for enterprises with foreign investment and foreign enterprises; and

iii) The local income tax;

(hereinafter referred to as «Chinese tax»);

b) In the case of Portugal:

i) Personal income tax (imposto sobre o rendimento das pessoas singulares — IRS);

ii) Corporate income tax (imposto sobre o rendimento das pessoas colectivas — IRC); and

iii) Local surtax on corporate income tax (derrama);

(hereinafter referred to as «Portuguese tax»).

4 — The Agreement shall also apply to any identical or substantially similar taxes which are imposed after the date of signature of the Agreement in addition to, or in place of, the existing taxes referred to in paragraph 3. The competent authorities of the Contracting States shall notify each other of any substantial changes which have been made in their respective taxation laws within a reasonable period of time after such changes.

Article 3

General definitions

1 — For the purposes of this Agreement, unless the context otherwise requires:

a) The term «China» means the People's Republic of China; when used in geographical sense, means all the territory of the People's Republic of China, including its territorial sea, in which the Chinese laws relating to taxation apply, and any area beyond its territorial sea, within which the People's Republic of China has sovereign

rights of exploration for and exploitation of resources of the sea-bed and its sub-soil and superjacent water resources in accordance with international law;

b) The term «Portugal» means the Portuguese Republic; when used in a geographical sense, means all the territory of the Portuguese Republic situated in the European continent, the archipelagos of Azores and Madeira, the respective territorial sea and any other zone in which, in accordance with the laws of Portugal and international law, the Portuguese Republic has its jurisdiction or sovereign rights with respect to the exploration and exploitation of the natural resources of the sea-bed and sub-soil, and of the superjacent waters;

c) The terms «a Contracting State» and «the other Contracting State» mean China or Portugal, as the context requires;

d) The term «tax» means Chinese tax or Portuguese tax, as the context requires;

e) The term «person» includes an individual, a company and any other body of persons;

f) The term «company» means any body corporate or any entity which is treated as a body corporate for tax purposes;

g) The terms «enterprise of a Contracting State» and «enterprise of the other Contracting State» mean, respectively, an enterprise carried on by a resident of a Contracting State and an enterprise carried on by a resident of the other Contracting State;

h) The term «national» means:

/') All individuals possessing the nationality of a Contracting State;

ii) All legal persons, partnerships and associations deriving their status as such from the laws in force in a Contracting State;

i) The term international traffic» means any transport by a ship or aircraft operated by an enterprise of a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State;

j) The term «competent authority» means:

i) In the case of China, the State Administration of Taxation or its authorised representative;

«) In the case of Portugal, the Minister of Finance, the Director General of Taxation (director-geral dos Impostos) or their authorised representative.

2 — As regards the application of the Agreement by a Contracting State, any term not defined therein shall, unless the context otherwise requires, have the meaning which it has under the law of that Contracting State concerning the taxes to which the Agreement applies.

Article 4 Resident

1 — For the purposes of this Agreement, the term «resident of a Contracting State» means any person who, under the laws of that State, is liable to tax therein by reason of his domicile, residence, place of head office,