Dividends taxation limits protect cross-border shareholders by capping source-state withholding and exempting certain government owners.

Dividends paid by a resident company to a resident beneficial owner in the other Contracting State may be taxed in the recipient's State, while the source State may also tax such dividends subject to a limited withholding charge when the recipient is the beneficial owner. Exemptions apply for government and specified public financial institutions. The Article defines dividends broadly, excludes application where the holding is effectively connected with a permanent establishment or fixed base (invoking other Articles), and bars the other State from taxing company undistributed profits except in stated cases.

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