The Double Taxation Relief (Taxes on Income) (Norway) Order 2000

Arictle 24 TRANSMEDIAN LINE OIL AND GAS FIELDS

(1) The provisions of this Article shall apply notwithstanding any other provisions of this Convention where the Governments of the two Contracting States have entered into an Agreement relating to the joint exploitation of a field which extends across the dividing line and that Agreement expressly provides for the application of these provisions.

(2) Irrespective of where the production installations for a field are located, a Contracting State may, subject to paragraph (3) of this Article, tax, in accordance with the laws of that State, profits from the exploitation of the field which arise to a licensee of that State and shall not tax any such profits which arise to a licensee of the other Contracting State.

(3) For the purposes of the application of the laws of a Contracting State relating to the taxation of profits arising from the exploitation of the field, a licensee shall be treated as having lifted over the production life of the field so much of the total production of that field as is attributed to that licensee under the final apportionment of the field made in accordance with an Agreement as mentioned in paragraph (1) of this Article. However, in any accounting period or chargeable period a licensee may be charged to tax only on the profits from the oil (including gas and other hydrocarbons) lifted in that or earlier periods by the licensee and on any compensation receivable by the licensee for underliftings in that or earlier periods.

(4) A Contracting State may tax gains realised on the disposal of and charge capital taxes in respect of, installations and equipment used for the joint exploitation of the field which are owned, wholly or partly, by a licensee of that State, regardless of the side of the dividing line between the two States on which the installations and equipment are situated. Where such assets are owned partly by a licensee of that State and partly by a licensee of the other Contracting State each State may tax its own licensees in respect of such part only of the gains, or charge capital taxes on such part only of the cost or value of the assets, as is proportionate to the interest of its licensees in those assets. However, a Contracting State shall not tax gains realised on the disposal of, or charge capital taxes in respect of, such assets as are wholly owned by a licensee of the other Contracting State.

(5) Any profits or gains derived, or any capital owned, by a person in his capacity as the Unit Operator for the field shall be taxable only in the Contracting State of which that Unit Operator is a licensee.

(6) In this Article:

(a) the term “licensee” means, in the case of the United Kingdom, any person who is a licensee as defined in section 12 (1) of the Oil Taxation Act 1975, or is a party to an agreement or arrangement referred to in paragraph 5(1) of Schedule 3 to the Oil Taxation Act 1975, and in the case of Norway, any person who holds a production licence granted by the Government of Norway for the field in question, or such person who has with the approval of the Government of Norway all or any of the licensee’s rights, interests and obligations in connection with that field;

(b) the term “field” means any petroleum reservoir or reservoirs;

(c) the term “dividing line” means the dividing line established by the Agreement between the Governments of the two Contracting States relating to the Delimitation of the Continental Shelf between the two Countries signed at London on 10th March 1965 and the Protocol thereto signed at Oslo on 22nd December 1978 and any further Protocol thereto.