23 August 1990 Ministerial Correspondence 900514 F - Exempt Interest

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

August 23, 1990

Dear Sirs:

This is in reply to your letter of April 18, 1990 concerning paragraph 3 of Article 11 of the Canada-Poland Income Tax Convention (the "Convention").

In the opening paragraph of your letter, you indicated that interest arising in Canada and paid to a resident of Poland would be exempt from tax in Canada by virtue of paragraph 3 of Article 11 of the Convention if the interest is paid in respect of a loan that is "insured" by the Government of Canada.

This statement is incorrect.  The exemption in the situation which you described would only apply if a loan was insured by the Government of Poland (i.e. "that other state" or "public body of that other state" referred to in paragraph 3 of Article 11).

As you indicated in the telephone conversation of August 9, 1990 (Middleton/19(1)) since  paragraph 3 of Article 11 of the Convention does not have application to your particular situation, there is no need for this Division to address the other queries set out in your letter.

We trust our comments will be of assistance to you.

Yours truly,

for DirectorReorganizations and Non-Resident DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch