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.
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HBW 4125-U3 David R. Senecal (613) 957-2074
August 31, 1990
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This is in reply to your letter of July 31, 1990, wherein, pursuant to paragraph 3 of Article XXVI of the Canada-U.S. Income Tax Convention (1980), you seek to clarify the application of the said Convention with respect to income an artiste resident in one Contracting State receives that is based upon the sale of records, tapes, etc. which were recorded during a live performance in the other Contracting State.
The issue is whether the nature of that portion of the performer's income based on the sale, rental, or licensing of the records or tapes is considered to be royalty income governed by the provisions of Article XII (Royalties) of the Convention or personal service income which is subject to the provisions of Article XVI (Artistes and Athletes).
In order to resolve this issue, we concur with your proposal that we enter into the following competent authority agreement with respect to Articles XII and XVI of the Convention:
Where an artiste resident in one Contracting State records a performance in the other Contracting State, has a copyrightable interest in the recording, and receives consideration for the right to use the recording based on the sale or public playing of such recording, then such consideration shall be governed by Article XII (Royalties).
Your letter of July 31, 1990 and our response contained in this letter together constitute a competent authority agreement in accordance with paragraph 3 of Article XXVI of the Convention.
Yours sincerely,
Acting Director Provincial and International Relations Division
no. 3-83 File copy Sequence file Author's copy Chrono file(2) Reading file
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