KEPPRES No. 19 Tahun 1989

Keputusan Presiden ini mulai berlaku pada tanggal ditetapkan.

Agar setiap orang mengetahuinya, memerintahkan pengundangan Keputusan Presiden ini
dengan penempatannya dalam Lembaran Negara Republik Indonesia.

Ditetapkan di Jakarta

pada tanggal 30 April 1989

PRESIDEN REPUBLIK INDONESIA

SOEHARTO

Diundangkan di Jakarta
pada tanggal 30 April 1989

MENTERI/SEKRETARIS NEGARA
REPUBLIK INDONESIA

MOERDIONO

LEMBARAN NEGARA REPUBLIK INDONESIA TAHUN 1989 NOMOR 14

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CONVENTION BETWEEN THE REPUBLIC OF INDONESIA AND THE KINGDOM

OF SWEDEN FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE

PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME

The Goverment of the Republic of Indonessia a nd the Goverment of the Kingdom of
Sweden

Desiring to conclude a Convention for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on income,

Have agreed as follows:

Article 1

Personal scope
This Convention shall apply to persons who are residents of one or both of the Contracting
States.

Article 2

Taxes covered
1. This Convention shall apply to taxes on income imposed on behalf of a Contracting
State or of its local authorities irrespective of the manner in which they are lovied.
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 existin taxes to which the Convention shall apply are:
(a) in Indonesia :
the income tax imposed under the Undang-undang Pajak Penghasilan 1984 (Law
No. 7 of 1983) and to the extent provided in such income tax law, the company tax
imposed under the Ordonansi Pajak Perseroan 1925 (SState Gazette No.319 of
1925 as lastly amended by Law No. 8 of 1970) and the tax imposed under the
Undang-undang Pajak atas Bunga, Dividen dan Royalty 1970 (Law No. 10 of
1970).

(hereinafter referred to ad "Indonesian tax").

(b) in Sweden :
(i) the State income tax (den statliga inkomstskatten), including the sailors' tax
(sjomansskatten) and the coupon tax (kupongskatten);
(ii) ta tax on public entertainers (bevillningsavgiften for vissa offentliga
forstallaingar);
(iii) the profit sharing tax (vinstdelningsskatten)(hereinafter referred to as "Swedish
tax").
4. The Convention shall also apply to any identical or substantially similar taxes on
income which are imposed after the date of signature of the Convention in addition
to, or in place of, those 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 respection taxation laws.
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Article 3

GENERAL DEFINITIONS
1. for the purposes of this Convention, unless the context otherwise requires;
(a) (i) the term "Indonesia" comprises the territory of the Republic of Indonesia as
defined in its laws and the adjacent areas over which the Republic of Indonesia
has sovereign rights or jurisdiction in accordance with the provisions of the
United Nations Convention on the Law of the Sea, 1982;
(ii) the term " Sweden " comprises the Kingdom of Sweden and, when used in a
geographical a so, includes the national territory, the territoral sea of weden as
well as other maritime areas over which ... in accordance with international law
exercises sovereign rights or jurisdiction;
(b) the term "a Contracting State" and "the other Contracting State" mean Indonesia or
Sweden, as the context requires;
(c) the term "tax" mens Indonesian tax or Swedish tax, as the context requires;
(d) the tern "person" includen an individual, company and any other body of requires;
(e) the term "company" means any body corporate or any entity which is treated as a
body corporate for tax purposes;
(f) the terms "enterprise of a Contracting State" and "enterprise of the other Contracting
State" mean, rerspectively, an enterprise Carried on by a resident of a Contracting
State and an enterprise carried on by a resident of the other Contracting State;
(g) the term "international traffic" mean any transport by a ship or aircraft operated by an
enterprise of a Contracting State, except when the ship or aircraft is operated soleiy
between places in the other Contracting State;
(h) the term "competent authority" means :
(i) in Indonesia :

the Minister of finance or his authorized representative;
(ii) in Sweden :

the Minister of Finance, his authorized representative or the authority which is
designated as a competent authority for the purposes of the Convention.
(i) the term "national" means :
(i) any individual possessing the nationality of a Contracting State;
(ii) any legal person, patnership and association deriving its status as such from the
laws in force in a Contracting State.
2. As regards the application of the Convention by a Contracting State, any term not
defined therein shall, unless the context otherwise requires, have the meaning which it
has under the laws of that State concerning the taxes to when the Convention applies.

Article 4

Resident
1. For the purposes of this Convention, 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 management or any other criterion of a similar nature. But
this term does not include any person who is liable to tax in that State in respect only of
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income from sources in that State.
2. Where by reason of the provisions of paragragh i an individual is a resident of both
Contracting States, then his status shall be determined as follows :
(a) he shall be deemed to be a resident of the State in which he has a permanent home
available to him. If he has a permanent home available to him in both States, he
shall be deemend to be a resident of the State with which his personal and
economic relations are closer (centre of vital interests);
(b) if the State in which he has his centre of vital interests cannot be determined, or if he
has not permanent home available to him in either State, he shall be deemend to be
a resident of the State in which he has an habitual abode;
(c) if he has an habitual abode in both States or in neither of them, the competent
authorities of the Contracting States shall settle the question by mutual agreement.
3. Where by reason of the provisions of paragraph 1, a person other than an individual is
a resident of both Contracting States, the competent authorities of the Contracting
States shall settle the question by mutual agreement.

Article 5

Permanent establishment
1. For the 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.
2. The term "permanent establishment" includes especially :
(a) a place of management;
(b) a branch;
(c) an office;
(d) a factory;
(e) a workshop;
(f) a farm or plantation;
(g) a mine, an oil or gas well, a quarry or any other place of extraction of natural
resources;
(h) a building site, a construction, installatio or assembly project or supervisory activities
in connection where such site, project or activity continues for a period of more than
six months;
(i) the furnishing of services, including consultancy services, by an enterprise through
employees or other personnel (other than an agent of an independent status within
the meaning of paragraph 6) engaged by the enterprise for such purpose, but only
where activities of that nature continue (for the same or a connected project) within
the contry for a period or periodes aggregating more than three months within any
12 month-period.
3. Notwithstanding the preceding provisions of this Article, the term "permanent
establishment" shall be deemed not to include:

(a) the use of the facilities solely for the purpose of storage or display of display of
goods or merchandise belonging to the enterprise;

(b) the maintenance of a stock of goods or merchandise belonging to tha enterprise
solely for the purpose of storage or display;
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(c) the maintenance of a stock of goods or merchandise belonging to tha enterprise
solely for the purpose of processing by another enterprise;

(d) the maintenance of a fixed place of business solely for the purpose of purchasing
goods or merchandise, or collecting information, for the enterprise;

(e) the maintenance of a fixed place of business solely for the purpose of advertising,
for the supply of information, for scientific research or the similar activities which
have a preparatory or auxiliary character, for the enterprise.
4. Notwithstanding the provisions of paragraphs 1 and 2 where a person - other than an
agent of an independent status to whom paragraph 6 applies - is acting in a Contracting
State on behalf of an enterprise of the other Contracting State, that enterprise shall be
deemend to have a permanent establishment in the first-mentioned Contracting State in
respect of any activities which that person undertakes for the enterprise, if such a
person:
(a) has and habitually exercises in that State an authority to conclude sontracts in the
name of the enterprise, enless the activities of such person are limited to those
mentioned in paragraph 3 which, if exercised through a fixed place of business,
would not make this fixed place of business a permanent establishment under the
provisions of that paragraph ; or
(b) has no such authority, but habitually maintains in the first-mentioned State a stock of
goods or merchandise from which he regularly delivers goods or merchandise on
behalf of the enterprise.
5. Notwithstanding the preceding provisions of this Article, an insurance enterprise of a
Contracting State shall, except in regard to re-insurance, be deemed to have
a
permanent establishiment in the other Contracting State if it collects premiums in the
territory of that other State or insures risks situated therein through a person other than
an agent of an independent status to whom paragraph 6 applies.
6. An enterprise of a Contracting State shall not be deement to have a permanent
establishment in the other Contracting State merely because it carries on business in
that other State through a broker, general commission agent or any other agent of an
independent status, provided that such persons are acting in the ordinary course of their
business. However, when the activities of such an agent are devoted wholly or almost
wholly on behalf of that enterprise, he will not be considerend an agent of an
independent status within the meaning of this paragraph.
7. The fact that a company which is a resident of a Contracting State controls or is
controlled by a company which is a resident of the other Contracting State, or which
carries on business in that other State (whether through a permanent establishment or
otherwise), shall not of itself constitute either company a permanent establishment of
the other.

Article 6

Income from immovable property
1. Income derived by a resident of a Contracting State from immovable property (including
income from agriculture or forestry), situated in the other Contracting State may be
taxed in that other State.
2. The term "immovable property" shall have the meaning which it has under the law of the
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Contracting State in which the property in question is situated. The term shall in any
case include property accessory to immovable property, livestock and equipment used
in agriculture and forestry, rights to which the provisions of general law respecting
landed property apply, usufruct of immovable property and rights to variable or fixes
payments as consideration for the working of, or the right to work, mineral deposits,
sources and other natural resources; ships, boats and aircraft shall not be regarded as
immovable property.
3. The provisions of paragraph 1 shall apply to income derived from the direct r use in any
other form of immovable property.
4. The provisions of paragraphs a and 3 shall also apply to the income from immovable
property of an enterprise and to income from immovable property used for the
performance of independent personal services.

Article 7

Business profits
1. The profits of an enterprise of a Contracting State shall be taxable only in that State
unless the enterprise carries on business in the other Contracting State through a
permanent establishment situated therein. If the enterprise carries on business as
aforesaid, the profits of the enterprise may be taxed in the other State but only so much
of them as is attributable to (a) that permanent establishment; (b) sales in that other
State of goods or merchandise of the same or similar kind as those sold through that
permanent establishment; or (c) other business activities carried on in that other State
of the same or similar kind, as those effected through that permanent establishment.
2. Subject to the provisions of paragraph 3, where an enterprise of a Contracting State
carries on business in the other Contracting State through a permanent establishment
situated therein, there shall in each Contracting State be attributed to that permanent
establishment the profits which it might be expected to make if it were a distinct and
separate enterprise engaged in tha same or similar activites under the same or similar
conditions and dealing wholly independently with the enterprise of which it is a
permanent establishment.
3. In the determination of the profits of a permanent establishment, there shall be allowed
as deductions expenses which are incured for the purposes of the business of the
permanent establishment including executive and general administrative expenses so
incurred, whether in the State in which the permanent establishment is situated or
elsewhere.
However, no such deduction shall be allowed in respect of amounts, if any, paid
(otherwise than towards reimbursement of actual expenses) by the permanent
establishment to the head office of the enterprise or any of its other offices, by way of
rayalties, fees or other similar payments in retur for the use or patents or other rights, or
by way of commission, for specific services performed or for management, or, except in
hte case of a banking enterprise,, by way of interest on moneys lent to the permanent
establishment. Likewise, no account shall be taken, in the determination of the profits of
a permanent establishment, for amounts charged (otherwise than towards
reimbursement of actual expenses), by the permanent establishment to the head office
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of the enterprise or any of its other offices, by way of royalties, fees or other similar
payments in return for the use of patents or other rights, or by way of commission for
specific services performed or for management, or, except in the case of a banking
enterprise, by way of interest on moneys lent to the head office of the enterprise or any
of its other offices.
4. If the information available to the competent authority is inadequate to determine the
prifits to be attributed to the permanent establishment of an enterprise, nothing in this
Article shall affect the application of any law of that State relating to the determination of
the tax liability of a person by the exercise of a discretion or the making of an estimate
by the competent authority, provided that the law shall be applied, so far as the
information available to the competent authority permits, in accordance with the
principle of this Article.
5. No profits shall be attributed to a permanent establishment by reason of the mere
purchase by that permanent establishment of goods or merschandise for the
enterprise.
6. For the purpose of the preceding paragraphs, the profits to be atributed to the
permanent establisment shall be determined by the same method year unless there is
goood and sufficient reason to the contrary.
7. Where profit include items of income which are dealt with seperately in other Article,
then the provisions onf those Articles shall not be affected by the provisions of this
Article.

Article 8

Shipping and air transport
1. Profits from the operation of ships or aircraft in international traffic by an enterprise of a
Contracting State shall be taxable only in that State.
2. With respect to profits derived by the air transport consortium Scandinavian Airlines
System (SAS) the provisions of paragraph 1 shall apply only to such part of the profits
as corresponds to the participation held in that consortium by AB Aerotransport (ABA),
the Swedich partner of Scandinavian Airlines System (SAS).
3. The provisions of paragraphs a and 2 also apply to profits from the participation in a
pool, a joint business or an international operating agency.

Article 9

Associated enterprises
1. Where
(a) an enterprise of a Contracting State participates directly or indirectly in the
management, control or capital of an enterprise of the other Contracting State, or
(b) the same persons participate directly or indirectly in the management, control or
capital of an enterprise of a Contracting State and an enterprise of the other
Contracting State, and in either case conditions are made or imposed between the
two enterprises in their commercial or financial relations which differ from those
which would be made between independent enterprises, then any profits which
would, but for those conditions, have accruedd to one of the enterprises, but, by
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reason of those conditions, have not so accrued, may be included in the profits of
that enterprise and taxed accordingly.
2. Where a Contracting State includes in the profits of an enterprise of that State - and
taxes accordingly - profits on which an enterprise of the other Contracting State has
been charged to tax in that other State and the profits so included are profits which
would have accrued to the enterprise of the first-mentioned State if the conditions made
between the two enterprises had been those which would have been made between
independent enterprises, then that other shall make an appropriate adjustment to tha
amount of the tax charged therein on those profits. In determining such adjustment, due
regard shall be had to the other provisions of this Convention and the competent
authorities of the Contracting States shall if necessary consult each other.

Article 10

Dividends
1. Dividends paid by a company which is a resident of a Contracting State to a resident of
the other Contracting State may be taxed in that other State.
2. However, such dividends may also be taxed in the Contracting State of which the
company paying the dividends is a resident and according to the laws of that State, but
if the recipient is the beneficial owner of the dividends the tax so charged shall not
exceed :
(a) 10 per cent of the gross amount of the devidends if the beneficial owner is a
company (other than a partnership) which holds directly at least 25 per cent of the
capital of the company paying the dividends;
(b) 15 per cent of the gross amount of the dividends in all other cases.

The competent authorities of the Contracting States shall by mutual
agreement settle the mode of application of these limitations.

This paragraph shall not affect the taxation of the company in respect of the
profits the dividends are paid.
3. The term "dividends" as used in this Article means income from shares or other rights,
not being deb-claims, oarticipating in profits, as well as income from other corporate
rights which is subjected to the same taxatin treatment as income from shares by the
laws of the Contracting State of which the company making the distributin is a resident.
4. Norwithstanding the provisions of paragraph 1, dividends paid by a company which is a
resident of Indonesia to a company the extent that the dividends would have been
exempt under Swedish law if both companies had been Swedish companies. This
exemption shall not apply unless.
(a) the profits out of which the dividends are paid have been sbjected to the normal
corporate tax prevailing in Indonesia at the time of signature of this Convention or an
income tax comparable thereto, or
(b) the dividends paid by the company which is a resident of Indonesia consist wholly or
almost wholly of dividends which that company has received, in the year or previous
yers, in respect of shares held by it in a company which is a residemt of a third State
and which would have been exempt from Swedish tax if the shares in respect of
which they are paid had been held directly by the company which is a resident of
Sweden.
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5. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the
dividends, being a resident of a Contracting State, carries on business in the other
Contracting State of which the company paying the dividends is a resident, through a
permanent establishment situated therein, or performs in that other State independent
personal services from a fixed base situated therein, and the holding in respect of which
the dividends are 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.
6. Where a company which is a resident of a Contracting State derives profits or income
from the other Contracting State, that other State may not impose any tax on the
dividends paid by the company, except insofat as such dividends are paid to a resident
of that other State or insofar as the holding in respect of which the dividends are paid is
effectively connected with a permanent establishment or a fixed base situated in that
other State, nor subject the company's undistributed profits to a tax on the company's
undistributed profits, even if the dividends paid or the undistributed profits consist wholly
or partly of profits or income arising in such other State.
7. Notwithstanding any other provisions of this Convention where a company which is a
reisident of a Contracting State has a permanent establishment in the other Contracting
State, the profits of the permanent establishment may be subjected to an additional tax
in that other State in accordance with its law, but the additional tax so charged shall not
exceed 15 per cent of the amount of such profits after deducting therefrom income tax
and other taxes on income imposed thereon in that other State.
8. The provisions of paragraph 7 of this Article shall not affect the application of the
provisions contained in any production sharing contracts an contracts of work (or any
other similar contracts) relating to oil, gas or other mining sector concluded on or before
31 Desember, 1983 by the Government of Indonesia, its instrumentality, its relevant
state oil and gas company or any other entity thereof with a person who is a resident of
Sweden.

Article 11

Interest
1. Interest arisin in a Contracting State and paid to a resident of the other Contracting
State may be taxed in that other State.
2. However, such interest may also be taxed in the Contracting State in which it arises,
and according to the laws of that State, but if tha recipient is the beneficial owner of the
gross amount of the interest. The competent authorities of the Contracting States shall
by mutual agreement settle the mode of application of this limitation.
3. Notwithstanding the provisions of paragraph 2, interest arising in a Contracting State
and derived by the Government of the other Contracting State, including a local
authority thereof, shall be exempt from tax in the first-mentioned Contracting State.
4. The exemption provided for in paragraph 3 shall also apply to interest derived by :
(a) In the case of Indonesia :
(i) the "Bank Indonesia" (the Central Bank of Indonesia), and
(ii) such other financial institution in Indonesia as may be agreed upon from time to
time between the competent authorities of the Contracting States.
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(b) In the case Sweden :
(i)
"Sveriges Riksbank" (the Central Bank of Sweden), "Riksgaldskontoret" (the
National Deb Office) and the Swedish fund for Industrial Cooperation with
Developing Countries ("Swedfund"), and
(ii)
such other financial institution in Sweden as may be agreed upon from time to
time between the competent authorities of the Contracting States.
5. The term "interest" as used in this Article means income from debt-claim 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 government securities and income
from bonds or debentures, including premiums and prizes attaching to such securities,
bonds or debentures.
6. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the
interest, being a resident of a Contracting State, carries on business in the other
Contracting State in which the interest arises, through a permanent establishment
situated therein, or performs in that other State 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 (a) such permanent establishment or fixed base, or with (b)
business activities referred to under (c) of paragraph 1 of Article 7.
In such cases the provisions of Article 7 or Article 14, as the case may be, shall apply.
7. Interest shall be deemend to arise in a Contracting State when the payer is that State
itself, a local authority or a resident of that State. Where, howeyer, the person paying
the interest, whether he is a resident of a Contracting State or not, has in a Contracting
State a permanet 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 deemend to
arise in the State in which the permanent establishment or fixed base is situated.
8. Where, by reason of a special relatinship 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 Contracting State, dua regard being had to the other provisions of this
Convention.

Article 12

Royalties
1. Royalties 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 royalties may also be taxed in the Contracting State in which they arise,
and according to the laws of that State, but if the recipient is the beneficial owner of the
royalties the tax so charged shall not exceed 15 per cent of the gross amount of
royalties referred to in sub-paragraph (a) of paragraph 3, and 10 per cent of the gross
amount of royalties referred to in sub-paragraph (b) of paragraph 3.
3. The term "royalties" as used in this Article means payments of any kind received as a
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consideration :
(a) for the use of, or the right to use, any copyrights of literary, article or scientific work
including cinematograph film and films or tapes for radio or television broadcasting,
any patent, trade mark, design or model, plan, secret formula or process; and
(b) 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 State, carries on business in the other
Conctracting State in which the royalties arise, through a permanent establishment
situated therein, or performs in that other State independent personal services from a
fixed base situated therein, and the right or property in respect of which the royalties are
paid is effectively connected with (a) such permanent establishment or fixed base, or
with (b) business activities referred to under (c) of paragraph 1 of Article 7. In such
cases the provisions of Article 7 or Article 14, as the case may be, ,shall apply.
5. Royalties shall be deemend to arise in a Contracting State when the payer is that State
itself, a local authority, or a resident of that State. Where, however, the person payinh
the royalties, whether he is a resident of a Contracting State or not, has in a Contracting
State a permanent establishment or a fixed base in connection with which the liability to
pay the royalties was incurred, and such royalties are borne by such permanent
establisment or fixed base, then such royalties shall be deemend to arise in the State in
which the permanent establishment or fixed base is situated.
6. 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 or the royalties, having
regard to the use, right or information 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 anly to the
payments shall remain taxable according to the other provisions of this Convention.

Article 13

Capital gains
1. Gains derived by a resident of a Contracting State from the alienation of immovable
property referred to in Article 6 and situated in the other Conctrating State may be taxed
in that other State.
2. Gains from the alienation of movable property forming part of the business property of a
permanent establishment which an enterprise of a Contracting State has in resident of
a Contracting State in the other Contracting State for the purpose of performing
independent personal services, including such gains from the alienation of such a
permanent establisment (alone or with the whole enterprise) or of such fixed base, may
be taxed in that other State.
3. Gains derived by a resident of Contracting State from the alienation of ships or aircraft
operated in international traffic or movable property pertaining to the operation of such
ships or aircraft, shall be taxable anly in that State.
With respect to gains derived by the Swedish, Danish and Norwegian air transport
consortium Scandinavian Airlines System (SAS), the provisions of this paragraph shall
apply anly to such portion of the gains as corresponds to the participation held in that
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consortium by AB Aerotransport (ABA), the Swedish partnert of Scandinavian Airlines
System (SAS).
4. Gains from the alienation of any property other than that referred to in the preceding
paragraphs shall be taxable only in the Contracting State of which the alienator is a
resident.
5. In the case of an indvidual who has been a resident of a Contracting State and who has
become a resident of the other Contracting State, the provisions of paragraph 4 shall
not affect the right of the first-mentioned State to tax gainds from the alienation of any
property derived by such an individual at any time during the ten years next following
the date on which the individual has ceased to be a resident of the first-mentioned
State.

Article 14

Independent personal services
1. Income derived by an individual who is a resident of a Contracting State in respect of
professional services or other activities of an independent character may be taxed in
that State. Such income may also be taxed in the other Contracting State if :
(a) the individual is present in that other State for a period or periodes exceeding in the
aggregate 90 days within any perod of 12 months, but only so much thereof as is
attributable to services performed in that other State, or
(b) he individual has a fixed base regularly available to hil in that other State e of
performing his activities, but only so much therof as is attributable to that fixed base.
2. The term "professional services" includes especially independent scientific, literary,
artistic, educational or teaching activities as well as the independent activities of
physicians, lawyers, engineers, architects, dentists and accountants.

Article 15

Dependent personal services
1. Subject to the provisions of Article 16, 18, 19 an d21, salaries, wages andd other similar
remuneration derived by a resident of a Contracting State in respect of an employment
shall be taxable anly in that State unless the employment is so exercised, such
remuneration as is derived therefrom may be taxed in that other State.
2. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a
Contracting State in respect of an emploment exercised in the other Contracting State
shall be taxable only in the first-mentioned State if :
(a) the recipient is present in the other State for a period or periods not exceeding in the
aggregate 183 days within any period of 12 months; and
(b) the remuneration is paid by, or on behalf of, an employer who is not a resident of the
other State; and
(c) the remuneration is not borne by a permanet establishment or a fixed base which
the employer has in the other State.
3. Notwithstanding the preceding provisions of this Article remuneration derived in respect
of an employment exercised aboard a ship or aircraft operated in international traffic by
an enterprise of a Contrating State, may be taxed in that State. Where a resident of
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Sweden derives remuneration in respect of an emploment exercised aboard an aircraft
operated in international traffic by the air transport consortium Scandinavian Airlines
System (SAS), such remuneration shall be taxable only in Sweden.

Article 16

Directors ' fees and remuneration or top-level managerial officials
1. Directors' fees and other similar payments derived by a resident of a Contracting State
in his capacity as a member of the board of directors or a similar organ of a company
which is a resident of the other Contracting State may be taxed in that other State.
2. Salarires, wages and other similar remuneration derived by a resident of a Contracting
State in his capasity as an official in a top-level managerial position of a company which
is a resident of the other Contracting State may be taxed in that other State.

Article 17

ARTISTES AND SPORTSMEN
1. Notwithstanding the provisions of Article 14 dan 15, income derived by a resident of a
Contracting State as an entertainer, such as a theatre, motion picture, radio or television
artiste, or a musician, or as a sportsman, from his personal activities as such exercised
in the other Contracting State, may be taxed in that other State.
2. Where income in respect of personal activities exercised by an entertainer or a
sportsman in his capasity as such accrues not to the entertainer or sportsman himself
but to another person, that income may, notwithstanding the provisions of Article 7, 14
and 15, be taxed in the Contracting State in which the activities od the entertainer or
sportsman are exercised.
3. Notwithstanding the provisions of paragraph 1 and 2 income derived by an artiste or
sportsman from his personal activities as such shall be exempt from tax in the
Contracting State in which these activities are exercised within the framework of a visit
which is substantially supported by the other Contracting State, a local authority or
public institution thereof.

Article 19

Government service
1. (a) Remuneration, other than a pension, paid by a Contracting State or a local authority
thereof to an individual in respect of services rendered to that State or authority shall
be taxable anly in that State.

(b) However, such remuneration shall be taxable only in the other Contracting State if
the services are rendered in that State ant the individual is a resident of that State
who :
(i) is a national of that State; or
(ii) did not become a resident of that State solely for the purpose of rendering the
services.
2. (a) Any pension paid by, or out of funds created by, a Contracting State or a local
authority thereof to an individual in respect of services rendered to that State or
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authority shall be taxable only in that State.

(b) However, such pension shall be taxable only in the other Contracting State if the
individual is a resident of, and a national of, that State.
3. The provisions of Articles 15, 16 and 18 shall apply to remuneration and pensions in
respect of services rendered in connection with a business carried on by a Contracting
State or a local authority thereof.

article 20

Students

Payments which a student or business apprentice who is or was immediately before
visiting a Contracting State a resident of the other Contracting State and who is present in
the first-mentioned State solely for the purpose of his education or training receives for the
purpose of his maintenance, education or training shall not be taxed in that State, provided
that such payments arise from sources outside that State.

Article 21

Teachers and researchers

A professor, teacher or researcher who makes a temporary visit to a Contracting
State for a period not exceeding two years solely for the purpose of teaching or conducting
research at a university, college, school or other accredited educational institution, and who
is, or immediately before such visit was, a resident of the other Contracting State shall be
taxable only in that other State in respect of remuneration for such teaching or research,
provided he is subject to tax in that State in respect of such remuneration.

Article 22

Other income

Items of income of a resident of a Contracting State wich are not expressly
mentioned in tha foregoing Articles of this Convention shall be taxable only in that State
except that, if such income is derived from sourcess within the other Contracting State, it
may also be taxed in that other State.

Article 23

Elimination of double taxation
1. (a) Where a resident of a Contracting State derives income which, under the laws of
the Contracting State and in accordance with the provisions of this Convention, may
be taxed in that other State, the first-mentioned State shall allow-subject to the
provisions of the law in the first-mentioned State concerning credit for foreign tax (as
it may be amended from time to time without changing the general principle hereof)
- as a deduction from the tax on the income of that resident, an amount equal to the
tax paid on the income in that other State.
(b) Notwithstanding the provisions of subparagraph this paragraph, where a resident of
Sweden derives profits, income or gains which, in accordance with the provisions of
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Article 7 or Article or paragraph 2 of Article 13 may be taxed in Indonesia, Sweden
shall exempt such profits, income or gains from tax provided that the principal part of
the profits, income or gains arises from independent personal services or business
activities, other than the management of securities and other similar property carried
on in Indonesia. This exemption shall not apply unless the profits, income or gains
have been subjected to the normal tax prevailing in Indonesia at he time of
signature of this Convention or a tax comparable thereto.
(c) Where a resident of Sweden derives income which, in accordance with the
provisions of paragraphs 1 and 2 of Article 19, shall be taxable only in Indonesia or
profits, income or gains which, in accordance with the provisions of subparagraph
(b) of this paragraph, shall be exempt from Swedish tax, Sweden may, when
determining the graduated rate of Swedish tax, take into account the income which
shall be taxable only in Indonesia or the profits, income or gains which shall be
exempt from Swedish tax, respectively.
2. For the purpose of paragraph 1 (a), when calculating the deduction from Swedish tax,
tax paid in Indonesia shall be deemed to include the amount of Indonesian tax which
would have been payable if the Indonesian tax had not been exempted or reduced in
accordance with the provisions on special incentive measures under Indonesian Law
No. 1 of 1967.

Article 24

Non-discrimination
1. Nationals of a Concracting State shall not be subjected in the other Contracting State to
any taxation or any requirement connected therewith, which is other or more
burdensome than the taxation and connected requirements to which nationals of that
other State in the same circumstances are or may be subjected. This provision shall,
notwithstanding the provisions of Article 1 also apply to persons who are not residents
of one or both of the Contracting States.
2. The taxation on a permanent establishment which an enterprise of a Contracting State
has in the other Contracting State shall not be less favourably levied in that other State
than the taxation levied on enterprises of that other State carrying on the same
activities.

This provision shall not be construed as obliging a Contracting State to grant to
residents of the other Contracting State any personal allowances, reliefs and reductions
for taxation purposes on account of civil status or family resposibilities which it grants to
its own residents.
3. Excepts where the provisions of paragraph of paragraph 1 of Article 9 paragraph 8 of
Article 11, or paragraph 6 of Article 12, apply interest, royalties and other disbursements
paid by an enterprise of a Contracting State to a resident of the other Contracting State
shall, for the purpose of determining the taxable profits of such enterprise, be deductible
under the same conditions as if they had been paid to a resident of the first-mentioned
State.
4. Enterprises of a Contracting State, the capital of which is wholly or partlly owned or
controlled, directly or indirectly, by one or more resident of the other Contracting State,
shall not be subjected in the first-mentioned State to any taxation or any requirement
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connected therewith which is other or more burdensome than the taxation and
connected requirements to which other similar enterprise of the first-mentioned State
are or may be subjected.
5. Nothing contained in this Article shall be construed as to prevent either Contracting
State from limited to its nationals the enjoyment of tax incentives and any tax of a
preferential nature designed in pursuance of its programme of economic development.
6. In this Article the term "taxation" means taxes which are the subject of this Convention.

Article 25

Mutual agreement procedure
1. Where a person considers that the actions of one or both of the Contracting States
result of will result for him in taxation not in accordance with the provisions of this
Convention, he may, irrespective of the remedies provided by the domestic law of those
States, present his care to the competent authority of the Contracting State of which he
is a resident or if his case somess under paragraph 1 of Article 24, to that of the
Contracting States of which he is a national, The case must be presented within theree
years from the first notification of the action resulting in taxation not in accordance with
the provisions of the Convention.
2. The competent authority shall endeavour, if the objection appears to it to be justified
and if it is not itself able to arrive at a satisfactory solution, to resolve the case by mutual
agreement with the compotent outhority of the other Contracting State, with a view to
the avoidance of taxation which is not in accordance with the Convention. Any
agreement reached shall be implemented notwithstanding any time limits in the
domestic law ot the Contracting States.
3. The competent authorities of the Contracting States sahll endeavour to resolve by
mutual agreement any difficulties or doubts arising as to the interpretation or application
of thee Convention, They may also consult together for the elimination of double
taxation in cases not provided for in the Convention.
4. The competent authorities of the Contracting States may communicate with each other
directly for the purpose of reaching an agreement in the sense of the preceding
paragraphs.

Article 26

Exchange of information
1. The competent authorities of the Contracting States shall exchange such information as
is necessary for carring out the provisions of this Convention or of the domestic laws of
the Contracting States concerning taxes covered by the Convention, insofar as the
taxation thereunder is not contrary to the convention. The exchange of information is not
restricted by Article a. Any information received by a Contracting State shall be treated
as secret in the same manner as information obtained under the domestic laws of that
State and shall be disclosed only to persons or authorities (including courta and
administrative bodies) involved in the assessment or collection of, the enforcement or
prosecution in respect of, or the determination of appeals in relation to, the taxes
covered by the Convention. Such persons or authorities shall use the information only
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for such purpose. They may disclose the information in public court proceedings or in
judicial decisions.
2. In no case shall the provisions of paragraph 1 be construed so as to impose on a
Contracting State the obligation :
(a) to caary out administrative measures at variance with the laws and administrative
practice of that or of the other Conctrating State;
(b) to supply information which is not obtainable under the laws or in the normal course
of the administration of that or of the other Contracting State;
(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 (ordre public).

Article 27

Miscellaneous rules

The provisions of this Convention shall not be construed to restrict in any manner
any exclusion, exmption, deduction, credit, or other allowance now or hereafter accorded :
by the laws of a Contracting State in the determination of the tax imposed by that State, or
(a) by any orher special arrangement on taxation in connection with the economic or
technical cooperation between the Contracting States.

Article 28

Diplomatic agent and consular officers

Nothing in this convention shall affect the fiscal privileges of diplomatic agents or
consular officers under the general rules of international law or under the provisions of
special agreements.

Article 29

Entry into force
1. This Convention shall be ratified and the instruments of ratification shall be exchanged
at Stockholm as soon as possible.
2. The Convention shall enter into force upon the exchange of instruments of ratification
and its provisions shall have effect in respect of income derived on or after the first day
of January of the year next following that of the entry into force of the Convention.

Article 30

Termination

This Convention shall remain in force until terminated by a Contracting State. Either
Contracting State may terminate the Convention, through diplomatic channels, by giving
written noties of termination at least six months before the end of any calendar year after
the expiration of a period of five years from the date of its entry into force. In such case, the
Convention shall cease to have effect in respect of income derived on or after the first day
of January of the year next following that in which the notice of termination is given.
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IN WITNESS the undersigned being duly authorized thereto have signed the
present Convention and have affixed thereto their seals.

DONE at Jakarta this 28th day of February '89 in duplicate in the English language.

for the Republic of Indonesia

For the Kingdom of Sweden

PROTOCOL

At the moment of signing the Convention beween the Republic of Indonesia and the
Kingdom of Sweden for the Avoidance of Double Taxation and the Prevention of Fiscal
Evasion with respect to taxes on Income, the undersigned have agreed that the following
provision shall form an integral part of the Convention.

To Article 24

Paragraph 3 of Article 24 shall not prevent a Contracting State from applying
regulations in its domestic laws determining the debt to equity ratio of enterprises of that
State for the purpose of determining the deductibility of the interest paid by those
enterprises.

In witness whereof the undersigned being duly authorized thereto have signed the
present Protocol and have affixed thereto their seals.

Done at Jakarta this 28th day of February '89 in duplicate in the English language.

For the Republic or Indonesia

For the Kingdom of Sweden
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Keputusan Presiden Nomor 19 Tahun 1989 tentang PENGESAHAN CONVENTION BETWEEN THE REPUBLIC OF INDONESIA AND THE KINGDOM SWEDEN FOR THE AVOIDANCE DOUBLE AND THE PREVENTATION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME, BESERTA PROTOKOLNYA

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