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TIAS 9812 BY THE PRESIDENT OF
THE A PROCLAMATION CONSIDERING THAT: The Convention between
the The Senate of the The Convention was
ratified by the President of the It is provided in
Article 19 of the Convention that the Convention shall enter into force the
first day of the second month following the month in which the exchange of the
instruments of ratification takes place; The instruments of
ratification of the Convention were exchanged at NOW, THEREFORE, I, Jimmy
Carter, President of the United States of America, proclaim and make public
the Convention to the end that it shall be observed and fulfilled with good
faith on and after October 1, 1980, by the United States of America and by
the citizens of the United States of America and all other persons subject to
the jurisdiction thereof. IN TESTIMONY WHEREOF, I
have signed this proclamation and caused the Seal of the DONE at the city of CONVENTION BETWEEN THE
UNITED STATES OF AMERICA AND THE FRENCH REPUBLIC FOR THE AVOIDANCE OF DOUBLE
TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON
ESTATES, INHERITANCES, AND GIFTS The President of the The President of the The President of the who having communicated
to each other their full powers, found in good and due form, have agreed upon
the following provisions. CHAPTER I SCOPE OF THE CONVENTION Article 1 Estates and Gifts
Covered (1) This Convention
shall apply to estates of decedents whose domicile at death was in (2) This Convention
shall also apply to gifts of donors whose domicile at the time of making a
gift was in (3) A person who at the
time of death or the making of a gift was a resident of a possession of the
United States and who acquired United States citizenship solely by reason of
(a) his being a citizen of such possession, or (b) his birth or residence
within such possession, shall be considered as having been neither domiciled
in nor a citizen of the United States for purposes of this Convention. Article 2 Taxes Covered (1) This Convention
shall apply to: (a) In the case of the (b) In the case of (2) This Convention
shall also apply to any identical or substantially similar taxes on estates,
inheritances, and gifts which are subsequently imposed by a (3) The competent
authorities of the Contracting States shall notify each other of any
substantial changes which have been made in their respective laws relating to
taxes on estates, inheritances, and gifts. CHAPTER II DEFINITIONS Article 3 General Definitions (1) In this Convention: (a) The terms
"Contracting State" and "other (b) The term " (c) The term " (d) The term
"enterprise" means a commercial or industrial enterprise carried on
by an individual domiciled in a (e) Except where
expressly stated to the contrary, the term "tax" means the tax or
taxes referred to in Article 2 which are imposed by the Contracting State (or
Contracting States) as indicated by the context of the term's usage. (f) The term
"competent authority" means: (i) In the case of the (ii) In the case of
France, the Minister of Budget or his delegate. (2) Any term not
otherwise defined in this Convention shall, unless the context otherwise
requires, have the meaning which it has under the tax laws of the Article 4 Fiscal Domicile (1) For the purpose of
this Convention, the question whether an individual was domiciled in one of
the Contracting States shall be determined according to the law of that
State. (2) Where by reason of
the provisions of paragraph (1) an individual was domiciled in both
Contracting States, then this case shall be determined in accordance with the
following rules: (a) He shall be deemed
to have been domiciled in the (b) If he had a
permanent home in both Contracting States or in neither of the Contracting
States, his domicile shall be deemed to be in the Contracting State with
which his personal relations were closest (center of vital interests); (c) If the (d) If he had an
habitual abode in both Contracting States or in neither of the Contracting States,
his domicile shall be deemed to be in the Contracting State of which he was a
citizen; or (e) If he was a citizen
of both Contracting States or of neither of them, the competent authorities
of the Contracting States shall determine the (3) (a) Notwithstanding
the provisions of paragraph (2), an individual who at the time of his death
or the making of a gift was a citizen of one of the Contracting States
without being a citizen of the other Contracting State, and who would be
considered under paragraph (1) as having been domiciled in both Contracting
States, shall be deemed to have been domiciled only in the Contracting State of
which he was a citizen, if he had a clear intention to retain his domicile in
that Contracting State and if he was domiciled in the other Contracting State
in the aggregate less than 5 years during the 7-year period ending with the
year of his death or the making of a gift. (b) Nothwithstanding the
provisions of paragraph (2) or of subparagraph (a) of this paragraph, an
individual who at the time of his death or the making of a gift was a citizen
of one of the Contracting States without being a citizen of the other
Contracting State, and who would be considered under paragraph (1) as having
been domiciled in both Contracting States, shall be deemed to have been
domiciled only in the Contracting State of which he was a citizen if: (i) He was domiciled in
the other Contracting State in the aggregate less than 5 years during the
7-year period ending with the year of his death or the making of a gift,
provided that he was in that other Contracting State by reason of an
assignment of employment or as the spouse or other dependent (personne a
charge) of a person present in that other Contracting State for such a
purpose; or (ii) He was domiciled in
the other Contracting State in the aggregate less than 7 years during the
10-year period ending with the year of his death or the making of a gift,
provided that he was in that other Contracting State by reason of a renewal
of an assignment of employment or as the spouse or other dependent (personne
a charge) of a person present in that other Contracting State for such a
purpose. CHAPTER III TAXING RULES Article 5 Immovable (Real)
Property (1) Immovable (real)
property may be taxed by a (2) The term
"immovable (real) property" shall be defined in accordance with the
tax laws of the (3) The provisions of
paragraphs (1) and (2) shall also apply to immovable (real) property which
forms part of the business property of a permanent establishment or is used
for the performance of professional services or other independent activities
of a similar character. Article 6 Business Property of a
Permanent Establishment and Assets Pertaining to a Fixed Base Used for the
Performance of Professional Services (1) Except as provided
in Article 5, assets (other than ships and aircraft operated in international
traffic and movable property pertaining to the operation of such ships and
aircraft) used in or held for use in the conduct of the business of a
permanent establishment may be taxed by a (2) For purposes of this
Convention, the term "permanent establishment" means a fixed place
of business through which the business of an enterprise is wholly or partly
carried on. If an individual is a member of a partnership or other
association that is not a corporation which is engaged in industrial or commercial
activity through a fixed place of business, he shall be deemed to have been
so engaged to the extent of his interest therein. (3) The term
"permanent establishment" shall include especially: (a) A seat of
management; (b) A branch; (c) An office; (d) A factory; (e) A workshop; (f) A warehouse; (g) A mine, quarry, or
other place of extraction of natural resources; and (h) A building site or a
construction or assembly project which exists for more than 12 months. (4) Notwithstanding the
provisions of paragraphs (2) and (3), the term "permanent
establishment" shall not be deemed to include: (a) The use of
facilities solely for the purpose of storage, display, or delivery of goods
or merchandise belonging to the enterprise; (b) The maintenance of a
stock of goods or merchandise belonging to the enterprise solely for the
purpose of storage, display, or delivery; (c) The maintenance of a
stock of goods or merchandise belonging to the enterprise solely for the
purpose of processing by another person; (d) The maintenance of a
fixed place of business solely for the purpose of purchasing goods or
merchandise, or the collection of information, for the enterprise; (e) The maintenanceof a
fixed place of business solely for the purpose of advertising, supplying
information, conducting scientific research, or similar activities which have
a preparatory or auxiliary character, for the enterprise; or (f) The maintenance of a
fixed place of business solely for investment purposes (and not for purposes
of engaging in industrial or commercial activity) of an individual, whether
by the individual or his employees or through a broker or other agent. (5) A person who was
acting in a Contracting State on behalf of an enterprise--other than an agent
to whom paragraph (4)(f) or (6) applies--shall be deemed to have been a
permanent establishment of the enterprise in that State if such person had,
and habitually exercised in that State, an authority to conclude contracts in
the name of the enterprise, unless the exercise of such authority was limited
to the purchase of goods or merchandise for the enterprise. (6) An enterprise shall
not be deemed to have had a permanent establishment in a Contracting State
merely because the enterprise engaged in industrial or commercial activity in
that State through a broker, general commission agent, or any other agent of
an independent [*13] status acting in the ordinary course of his business. (7) The fact that an
enterprise controlled a corporation which engaged in industrial or commercial
activity in a (8) Except as provided
in Article 5, assets pertaining to a fixed base used for the performance of
professional services or other independent activities of a similar character
may be taxed by a Contracting State if the fixed base is situated in that
State. Article 7 Tangible Movable
Property (1) Tangible movable
property other than currency may be taxed by a (2) Notwithstanding the
provisions of paragraph (1), tangible movable property owned by an individual
referred to in paragraph (3) of Article 4 and used for his normal personal
use or that of his family may be taxed only by the (3) Notwithstanding the
provisions of paragraph (1), ships and aircraft operated in international
traffic, and movable property pertaining to the operation of such ships and
aircraft, may be taxed by a Contracting State if such ships and aircraft are
registered in that Contracting State. Other ships and aircraft may be taxed
by a Article 8 Taxation Other than
Pursuant to Articles 5, 6, and 7 Except as provided in
Articles 5, 6, and 7, property, including shares or stock in a corporation,
debt obligations (whether or not there is written evidence thereof), other
intangible property, and currency may be taxed by a Contracting State only if
the decedent or donor was a citizen of or was domiciled in that State at the
time of death or the making of a gift, and if taxable by that State under its
laws. Article 9 Deduction of Debts (1) Debts, to the extent
they would be deductible according to the internal law of a Contracting
State, shall be deducted from the gross value of the property which may be
taxed by that State in the proportion that such gross value bears to the
gross value of the entire property wherever situated. (2) Notwithstanding the
provisions of paragraph (1), for purposes of determining the French tax: (a) Debts pertaining to
a permanent establishment or to a fixed base used for the performance of
professional services or other independent activities of a similar character
shall be deducted from the value of assets referred to in Article 6. (b) Debts pertaining to
ships and aircraft operated in international traffic and to movable property
related to the operation of such ships and aircraft shall be deducted from
the value of these assets. Article 10 Charitable Exemptions
and Deductions (1) A transfer to a
legal entity created or organized in a Contracting State shall be exempt from
tax, or fully deductible from the gross value liable to tax, in the other
Contracting State with respect to its taxes referred to in Article 2,
provided the transfer would be eligible for such exemption or deduction if
the legal entity had been created or organized in that other Contracting
State. (2) The provisions of
paragraph (1) shall apply only if the legal entity: (a) Has a tax-exempt
status in the first (b) Is organized and
operated exclusively for religious, charitable, scientific, literary, or
educational purposes; and (c) Receives a
substantial part of its support from contributions from the public or
governmental funds. (3) This Article shall
not apply to transfers to a Article 11 Community Property
and Marital Deduction (1) Property (other than
community property) which was acquired during marriage for consideration by
an individual who at the time of death or the making of a gift was domiciled
in, or a citizen of, the United States and which passes to the spouse of such
individual shall, for the purposes of determining the French tax, be treated
as if it were community property, unless the spouses expressly elected to
have a treatment other than community property treatment provided by French
civil law. (2) In the case of an
individual who was domiciled in France there shall, for purpose of
determining the United States tax, be allowed the same marital deduction in
effect on the date of signature of this Convention, as if such individual
were domiciled in the United States, and in such a case the tax rates
applicable if the decedent or donor had been domiciled in the United States
shall apply. If the tax determined without regard to the preceding provision
of this paragraph is lower than that computed under the preceding provision,
the lower tax shall apply. (3) In the event the
laws of either Contracting State are changed substantially to reduce the tax
benefits of the marital deduction or community property, the competent
authorities of the Contracting States shall consult to determine whether this
Article shall be modified or shall cease to have effect. CHAPTER IV RELIEF FROM DOUBLE
TAXATION Article 12 Exemptions and
Credits (1) Except as otherwise
provided in this Convention, each (2) Double taxation
shall be avoided in the following manner: (a) In determining the
French tax where property may be taxed by the (b) In determining the (i) Where both
Contracting States impose tax with respect to property which is taxable by
France in accordance with Article 5, 6, or 7, the (ii) Notwithstanding the
provisions of subparagraph (i), the total amount of all credits allowed by
the United States pursuant to this Article or pursuant to its laws or other
conventions with respect to all property in respect of which a credit is
allowable under subparagraph (i) shall not exceed that part of the tax of the
United States which is attributable to such property. (iii) Any credits for
tax imposed by (3) If the decedent or
donor was a citizen of the (4) Exemption and
credits under this Article shall be tentatively allowed by the (5) The provisions of
this Convention shall not result in an increase in the amount of the tax
imposed by either CHAPTER V SPECIAL PROVISIONS Article 13 Time Limitations on
Claims for Credit or Refund (1) Any claim for credit
or for refund of tax founded on the provisions of this Convention shall be
made before the expiration of the latest of: (a) The time for the
making of a claim for refund of tax under the laws of the (b) Five years from the
date of death of the decedent, or from the making of a gift with respect to
which the claim is made; or (c) One year after final
determination (administrative or judicial) and payment of tax for which any
credit under Article 12 is claimed, provided that the determination and
payment are made within 10 years of the date of death of the decedent or of
the making of a gift. (2) Any refund based on
the provisions of this Convention shall be made without payment of interest
on the amount so refunded. Article 14 Mutual Agreement
Procedure (1) Any person who
considers that the actions of one or both of the Contracting States result or
will result for him in taxation not in accordance with this Convention may,
notwithstanding the remedies provided by the laws of those States, present
his case to the competent authority of either Contracting State. Such
presentation must be made within the period of time prescribed for the filing
of a claim for credit or refund under Article 13. Should the person's claim
be considered to have merit by the competent authority of the (2) The competent
authorities of the Contracting States shall resolve by mutual agreement any
difficulties or doubts arising as to the application of this Convention. (3) The competent
authorities of the Contracting States may communicate with each other
directly for the purpose of reaching an agreement in the sense of this
Article. When it seems advisable for the purpose of reaching an agreement,
the competent authorities may meet together for an oral exchange of opinions. (4) When the competent
authorities reach such an agreement, taxes shall be imposed, and refund or
credit of taxes shall be allowed by the Contracting States in accordance with
such agreement, notwithstanding any procedural rule (including the statute of
limitations) applicable under the laws of either Contracting State. (5) The competent
authority of each Article 15 Filing of Returns and
Exchange of Information (1) (a) The provisions
of Articles 5, 6, 7, or 8, which change the taxability or situs of property
or the amount of tax which would have been due in the absence of this
Convention, shall not change: (i) The requirements of
the respective tax laws of the Contracting States relating to information or
tax returns or notices, transfer certificates or maintenance of records, and (ii) The applicability
and amount of any sanctions of such laws with respect to the requirements
referred to in subparagraph (i). (b) As concerns the
United States, notwithstanding the provisions of paragraph (a), the
requirements or sanctions found to be unnecessary for the prevention of fraud
or fiscal evasion with respect to taxes to which this Convention applies may
be eliminated or modified (but not made more burdensome) by regulations
prescribed pursuant to paragraph (5) of Article 14. (2) The competent
authority of each (a) Carrying out the
provisions of this Convention or the laws of such other Contracting State
concerning its tax insofar as the taxation thereunder is in accordance with
this Convention, or (b) Preventing fraud or
fiscal evasion in relation to the taxes which are the subject of this
Convention (including information with respect to property exempted from the
tax of the first-mentioned Contracting State by reason of Article 8). However, this paragraph
shall not require the competent authority of a (3) In no case shall the
provisions of paragraph (2) be construed so as to impose on one of the
Contracting States the obligation: (a) To carry out
administrative measures at variance with the laws or the administrative
practice of that or of the other (b) To supply
particulars which are not obtainable under the laws or in the normal course
of the administration of that or of the other (c) To supply
information which would disclose any trade, business, industrial, commercial,
or professional secret or trade process, or information the disclosure of
which would be contrary to public policy. (4) The furnishing of
information shall be either on a routine basis or on request with reference
to particular cases. The competent authorities of the Contracting States
shall agree on the list of information which shall be furnished on a routine
basis. Article 16 Assistance in Collection (1) The two Contracting
States undertake to lend assistance and support to each other in the
collection of the taxes to which this Convention relates, together with
interest, costs, and additions to the taxes and fines not being of a penal
character according to the laws of the State requested, in cases where the
taxes are definitively due according to the laws of the State making the
application. (2) In the case of an
application for enforcement of taxes, revenue claims of each of the
Contracting States which have been finally determined will be accepted for
enforcement by the State to which application is made and collected in that
State in accordance with the laws applicable to the enforcement and
collection of its own taxes. (3) The application will
be accompanied by such documents as are required by the laws of the State
making the application to establish that the taxes have been finally determined. (4) If the revenue claim
has not been finally determined, the State to which application is made will
take such measures of conservancy (including measures with respect to
transfer of property belonging to nonresident aliens) as are authorized by
its laws for the enforcement of its own taxes. (5) The assistance
provided for in this Article shall not be accorded with respect to estates of
citizens of the Article 17 Diplomatic and
Consular Officials (1) Nothing in this
Convention shall affect the fiscal privileges of diplomatic or consular
officials under the general rules of international law or under the
provisions of special agreements. (2) Insofar as such
privileges prevent the imposition of tax in the receiving Article 18 Territorial Extension (1) This Convention may
be extended, either in its entirety or with necessary modifications, to all
or any of the (2) At any time after
the expiration of a period of one year from the effective date of an
extension made by virtue of paragraph (1) either of the Contracting States
may, by a written notice of termination given to the other Contracting State
through diplomatic channels, terminate the application of the provisions in
respect of any territory to which this Convention has been extended, in which
case the provisions of the Convention shall cease to be applicable to such
territory on and after the first day of January following the date of such
notice. (3) Unless otherwise
agreed by both Contracting States, the termination of the Convention by one
of the Contracting States under Article 20 shall also terminate the
application of the Convention to any territory to which it has been extended
under this Article. CHAPTER VI FINAL PROVISIONS Article 19 Entry into Force (1) This Convention
shall be ratified and the instruments of ratification shall be exchanged at (2) This Convention
shall enter into force the first day of the second month following the month
in which the exchange of the instruments of ratification takes place. Its
provisions shall apply to estates of persons dying and to gifts made on or
after that date. (3) The Convention of
October 18, 1946, as modified by the Protocol of May 17, 1948, and the
Convention of June 22, 1956, n1 shall be terminated on, and shall cease to
have effect from, the date on which the present Convention enters into force
according to paragraph (2). - - - - - - - - - - - -
- - - - - -Ftnotes- - - - - - - - - - - - - - - - - - n1 TIAS 1982, 3844; 64
Stat. B3; 8 UST 843. - - - - - - - - - - - -
- - - - -End notes- - - - - - - - - - - - - - - - - Article 20 Termination (1) This Convention
shall remain in force until terminated by one of the Contracting States.
However, not earlier than the fifth year following the year in which this
Convention entered into force, either (2) Notwithstanding the
provisions of paragraph (1), if the effects of this Convention are
substantially altered as a result of changes made in the tax law of either
Contracting State, either Contracting State may, through diplomatic channels,
give a written notice of termination with effect not earlier than 6 months
after such notice is given. In such an event, its provisions shall not apply
to estates of persons dying or to gifts made on or after the effective date
of the termination. IN WITNESS WHEREOF, the
plenipotentiaries of the two Contracting States have signed this Convention
and affixed thereto their seals. DONE at |
