Article 13 - Fees For Management, Professional And Technical Services - Kenya

ARTICLE 13 FEES FOR MANAGEMENT, PROFESSIONAL AND TECHNICAL SERVICES 1. Fees for management, professional and technical services arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. 2. However, such fees for management, professional and technical services may be taxed in the Contracting State in which they arise, and according to the law of that State, but if the beneficial owner of fees for management, professional and technical services is a resident of the other Contracting State, the tax so charged shall not exceed 10 per cent of the gross amount of the fees for management, professional and technical services. 3. The term fees for management, professional and technical services as used in this article means payments of any kind to any person, other than to an employee of the person making the payments and those mentioned in Articles 15 and 16 of this Agreement in consideration for any services of a managerial, technical, professional or consultancy nature including the provision of services of technical or other personnel. 4. The provisions of paragraph1 and 2 shall not apply if the beneficial owner of the fees for management, professional and technical services being a resident of a Contracting State, carries on business in the other Contracting State in which the fees for management, professional and technical services arise, through a permanent establishment situated therein or performs in that other State independent personal services from a fixed base situated therein and the fees for management, professional and technical services are effectively connected with such permanent establishment or a fixed base. In such case the provisions of Article 7 or Article 15 as the case may be shall apply. 5. Fees for management, professional and technical services shall be deemed to arise in a Contracting State when the payer is that Contracting State itself, a political sub-division, a local authority or a resident of that State. Where, however, the person paying the fees for management, professional and technical services, whether he is a resident of that State or not, has in a Contracting State a permanent establishment in connection with which the liability to pay the fees for management, professional and technical services was incurred and such fees for management, professional and technical services are borne by such permanent establishment then such fees for management, professional and technical services shall be deemed to arise in the Contracting State in which the permanent establishment is situated. 6. Where, owing to a special relationship between the payer and the beneficial owner of the fees for management, professional and technical services or between both of them and some other person, the amount of the fees for management, professional and technical services paid, having regard to the service for which they are 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 that case the excess part of the payment shall remain taxable according to the law of each Contracting State, due regard being had to the other provisions of this Agreement