Royalties tax limitation: source State withholding limited when beneficial owner resides in the other Contracting State.

Royalties under the Montenegro DTAA may be taxed in the recipient's State of residence and also in the source State with a limited withholding tax when the beneficial owner is resident in the other Contracting State; competent authorities determine application. "Royalties" includes payments for use of copyrights, industrial property, equipment and technical information. The limitation does not apply when royalties are effectively connected to a permanent establishment or fixed base in the source State, in which case rules on business profits or independent personal services apply. Royalties are sourced to the payer's residence or to the State of the payer's permanent establishment when borne by it. Special relationships require arm's-length adjustment, leaving excess amounts taxable under domestic law.

---

---

---