PROTOCOL

AMENDING THE CONVENTION BETWEEN THE SWISS CONFEDERATION

AND THE UNITED STATES OF AMERICA FOR THE AVOIDANCE OF
DOUBLE TAXATION WITH RESPECT TO TAXES ON INCOME, SIGNED AT
WASHINGTON ON OCTOBER 2, 1996

THE SWISS CONFEDERATION

AND

THE UNITED STATES OF AMERICA

Desiring to conclude a Protocol to amend the Convention between the Swiss

Confederation and the United States of America for the Avoidance of Double
Taxation with respect to Taxes on Income, signed at Washington on October 2, 1996
(hereinafter referred to as the “Convention”),

Have agreed as follows:

Article 1

Paragraph 3 of Article 10 of the Convention shall be deleted and replaced by the

following:

“3. Notwithstanding paragraph 2, dividends may not be taxed in the Contracting State of
which the company paying the dividends is a resident if the beneficial owner of the
dividends is a pension or other retirement arrangement which is a resident of the other
Contracting State, or an individual retirement savings plan set up in, and owned by a
resident of, the other Contracting State, and the competent authorities of the Contracting
States agree that the pension or retirement arrangement, or the individual retirement
savings plan, in a Contracting State generally corresponds to a pension or other
retirement arrangement, or to an individual retirement savings plan, recognized for tax
purposes in the other Contracting State. This paragraph shall not apply if such pension or
retirement arrangement, or such individual retirement savings plan, controls the company
paying the dividend.”

Article 2

Paragraph 6 of Article 25 of the Convention shall be deleted and replaced by the

following paragraphs:

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“6. Where, pursuant to a mutual agreement procedure under this Article, the competent
authorities have endeavored but are unable to reach a complete agreement, the case shall
be resolved through arbitration conducted in the manner prescribed by, and subject to, the
requirements of paragraph 7 and any rules or procedures agreed upon by the Contracting
States if:

a) tax returns have been filed with at least one of the Contracting States with
respect to the taxable years at issue in the case;

b) the case is not a particular case that both competent authorities agree,
before the date on which arbitration proceedings would otherwise have
begun, is not suitable for determination by arbitration; and

c) all concerned persons agree according to provisions of subparagraph d) of

paragraph 7.

An unresolved case shall not, however, be submitted to arbitration if a decision on such

case has already been rendered by a court or administrative tribunal of either Contracting
State.

7. For the purposes of paragraph 6 and this paragraph, the following rules and definitions
shall apply:

a) the term “concerned person” means the presenter of a case to a competent

authority for consideration under this Article and all other persons, if any,
whose tax liability to either Contracting State may be directly affected by
a mutual agreement, arising from that consideration;

b) the “commencement date” for a case is the earliest date on which the
information necessary to undertake substantive consideration for a mutual
agreement has been received by both competent authorities;

c) arbitration proceedings in a case shall begin on the later of:

i) two years after the commencement date of that case, unless both
competent authorities have previously agreed to a different date, and

ii) the earliest date upon which the agreement required by subparagraph d)
has been received by both competent authorities;

d) the concerned person(s), and their authorized representatives or agents,

must agree prior to the beginning of arbitration proceedings not to disclose
to any other person any information received during the course of the
arbitration proceeding from either Contracting State or the arbitration
panel, other than the determination of such panel;

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 e) unless any concerned person does not accept the determination of an
arbitration panel the determination shall constitute a resolution by mutual
agreement under this Article and shall be binding on both Contracting
States with respect to that case only; and

f) for purposes of an arbitration proceeding under paragraph 6 and this

paragraph, the members of the arbitration panel and their staffs shall be
involved “persons or authorities” to whom information may be disclosed
under Article 26 (Exchange of Information) of the Convention.”

Article 3

Article 26 (Exchange of Information) of the Convention shall be deleted and replaced by

the following provisions:

“ARTICLE 26

Exchange of Information

1. The competent authorities of the Contracting States shall exchange such information
as may be relevant for carrying out the provisions of this Convention or to the
administration or enforcement of the domestic laws concerning taxes covered by the
Convention insofar as the taxation thereunder is not contrary to the Convention. The
exchange of information is not restricted by Article 1.

2. Any information received under paragraph 1 by a Contracting State shall be treated as

secret in the same manner as information obtained under the domestic laws of that State
and shall be disclosed only to persons or authorities (including courts and administrative
bodies) involved in the administration, assessment or collection of, the enforcement or
prosecution in respect of, or the determination of appeals in relation to the taxes referred
to in paragraph 1, or the oversight of such functions. Such persons or authorities shall
use the information only for such purposes. They may disclose the information in public
court proceedings or in judicial decisions. Notwithstanding the foregoing, information
received by a Contracting State may be used for other purposes when such information
may be used for such other purposes under the laws of both States and the competent
authority of the requested State authorizes such use.

3. In no case shall the provisions of paragraphs 1 and 2 be construed so as to impose on a

Contracting State the obligation:

a) to carry out administrative measures at variance with the laws and

administrative practice of that or of the other Contracting State;

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 b) to supply information which is not obtainable under the laws or in the
normal course of the administration of that or of the other Contracting
State;

c) to supply information which would disclose any trade, business, industrial,

commercial or professional secret or trade process, or information the
disclosure of which would be contrary to public policy (ordre public).

4. If information is requested by a Contracting State in accordance with this Article, the

other Contracting State shall use its information gathering measures to obtain the
requested information, even though that other State may not need such information for its
own tax purposes. The obligation contained in the preceding sentence is subject to the
limitations of paragraph 3 but in no case shall such limitations be construed to permit a
Contracting State to decline to supply information solely because it has no domestic use.

5. In no case shall the provisions of paragraph 3 be construed to permit a Contracting

State to decline to supply information solely because the information is held by a bank,
other financial institution, nominee or person acting in an agency or a fiduciary capacity
or because it relates to ownership interests in a person. In order to obtain such
information, the tax authorities of the requested Contracting State, if necessary to comply
with its obligations under this paragraph, shall have the power to enforce the disclosure
of information covered by this paragraph, notwithstanding paragraph 3 or any contrary
provisions in its domestic laws.”

Article 4

Paragraph 10 of the Protocol to the Convention shall be deleted and replaced by the
following new paragraph 10.

“10. With reference to Article 26 (Exchange of Information)

a) It is understood that the competent authority of a Contracting State shall

provide the following information to the competent authority of the requested State when
making a request for information under Article 26 of the Convention:

i) information sufficient to identify the person under examination or investigation

(typically, name and, to the extent known, address, account number or similar
identifying information);

ii) the period of time for which the information is requested;

iii) a statement of the information sought including its nature and the form in
which the requesting State wishes to receive the information from the requested
State;

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 iv) the tax purpose for which the information is sought; and

v) the name and, to the extent known, the address of any person believed to be in
possession of the requested information.

b) The purpose of referring to information that may be relevant is intended to provide for
exchange of information in tax matters to the widest possible extent without allowing the
Contracting States to engage in “fishing expeditions” or to request information that is
unlikely to be relevant to the tax affairs of a given taxpayer. While paragraph 10(a)
contains important procedural requirements that are intended to ensure that fishing
expeditions do not occur, subparagraphs (i) through (v) of paragraph 10(a) nevertheless
are to be interpreted in order not to frustrate effective exchange of information.

c) If specifically requested by the competent authority of a Contracting State, the

competent authority of the other Contracting State shall provide information under
Article 26 of the Convention in the form of authenticated copies of unedited original
documents (including books, papers, statements, records, accounts, and writings).

d) Although Article 26 of the Convention does not restrict the possible methods for
exchanging information, it shall not commit a Contracting State to exchange information
on an automatic or spontaneous basis. The Contracting States expect to provide
information to one another necessary for carrying out the provisions of the Convention.

e) It is understood that in the case of an exchange of information under Article 26 of the

Convention, the administrative procedural rules regarding a taxpayer’s rights (such as the
right to be notified or the right to appeal) provided for in the requested State remain
applicable before the information is exchanged with the requesting State. It is further
understood that these rules are intended to provide the taxpayer a fair procedure and not
to prevent or unduly delay the exchange of information process.”

Article 5

1. This Protocol shall be subject to ratification in accordance with the applicable

procedures of each Contracting State and instruments of ratification shall be exchanged
as soon as possible.

2. This Protocol shall enter into force upon the exchange of instruments of ratification.
Its provisions shall have effect:

a) in respect of tax withheld at source, for amounts paid or credited on or after the
first January of the year following the entry into force of this Protocol;

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 b) in respect of Articles 3 and 4 of this Protocol, to requests made on or after the
date of entry into force of this Protocol:

i) regarding information described in paragraph 5 of Article 26 of the

Convention, to information that relates to any date beginning on or after the date
of signature of this Protocol, and

ii) in all other cases, to information that relates to taxable periods

beginning on or after the first January of the year following the date of signature of this
Protocol.

c) in respect of paragraphs 6 and 7 of Article 25 of the Convention, with respect

to

i) cases that are under consideration by the competent authorities as of the

date on which this Protocol enters into force, and

ii) cases that come under such consideration after that time,

and the commencement date for a case described in clause i) of this subparagraph shall
be the date on which this Protocol enters into force.

Done at ________ in duplicate, in the German and English languages, the two texts
having equal authenticity, this ______ day of ________.

FOR THE SWISS CONFEDERATION: FOR THE UNITED STATES OF AMERICA:

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Notes to Be Appended to Protocol

Excellency,

I have the honor to refer to the Protocol (the “Protocol”) signed today between the Swiss
Confederation and the United States of America amending the Convention for the
Avoidance of Double Taxation with Respect to Taxes on Income, signed at Washington
on October 2, 1996, (the “Convention”), and to propose on behalf of the Government of
[the United States/Switzerland] the following:

1. In respect of any case where the competent authorities have endeavored but are unable
to reach an agreement under Article 25 of the Convention regarding the application of the
Convention, binding arbitration shall be used to determine such application, unless the
competent authorities agree that the particular case is not suitable for determination by
arbitration. If an arbitration proceeding under paragraph 6 of Article 25 commences (the
Proceeding), the following rules and procedures shall apply.

a) The Proceeding shall be conducted in the manner prescribed by, and subject to
the requirements of, paragraphs 6 and 7 of Article 25 and these rules and
procedures, as completed by any other rules and procedures agreed upon by the
competent authorities pursuant to subparagraph q) below.

b) The determination reached by an arbitration panel in the Proceeding shall be

limited to a determination regarding the amount of income, expense or tax
reportable to the Contracting States.

c) Notwithstanding the initiation of the Proceeding, the competent authorities may

reach a mutual agreement to resolve a case and terminate the Proceeding.
Correspondingly, a concerned person may withdraw a request for the competent
authorities to engage in the Mutual Agreement Procedure (and thereby terminate
the Proceeding) at any time.

d) The requirements of subparagraph d) of paragraph 7 of Article 25 shall be met

when the competent authorities have each received from each concerned person a
statement agreeing that the concerned person and each person acting on the
concerned person's behalf shall not disclose to any other person any information
received during the course of the Proceeding from either Contracting State or the
arbitration panel, other than the determination of the Proceeding. A concerned
person that has the legal authority to bind any other concerned person(s) on this
matter may do so in a comprehensive statement.

e) Each Contracting State shall have 90 days from the date on which the
Proceeding begins to send a written communication to the other Contracting State
appointing one member of the arbitration panel. The members appointed shall not
be employees of the tax administration of the Contracting State which appoints
them. Within 60 days of the date on which the second such communication is
sent, the two members appointed by the Contracting States shall appoint a third

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member, who shall serve as Chair of the panel. If the members appointed by the
Contracting States fail to agree upon the third member, these members shall be
regarded as dismissed and each Contracting State shall appoint a new member of
the panel within 30 days of the dismissal of the original members. The competent
authorities shall develop a non-exclusive list of individuals with familiarity in
international tax matters who may potentially serve as the Chair of the panel. In
any case, the Chair shall not be a citizen or resident of either Contracting State.

f) The arbitration panel may adopt any procedures necessary for the conduct of its
business, provided that the procedures are not inconsistent with any provision of
Article 25.

g) Each of the Contracting States shall be permitted to submit, within 60 days of

the appointment of the Chair of the arbitration panel, a Proposed Resolution
describing the proposed disposition of the specific monetary amounts of income,
expense or taxation at issue in the case, and a supporting Position Paper, for
consideration by the arbitration panel. Copies of the Proposed Resolution and
supporting Position Paper shall be provided by the panel to the other Contracting
State on the date on which the later of the submissions is submitted to the panel.
In the event that only one Contracting State submits a Proposed Resolution within
the allotted time, then that Proposed Resolution shall be deemed to be the
determination of the panel in that case and the Proceeding shall be terminated.
Each of the Contracting States may, if it so desires, submit a Reply Submission to
the panel within 120 days of the appointment of its Chair, to address any points
raised by the Proposed Resolution or Position Paper submitted by the other
Contracting State. Additional information may be submitted to the arbitration
panel only at its request, and copies of the panel's request and the Contracting
State's response shall be provided to the other Contracting State on the date on
which the request or the response is submitted. Except for logistical matters such
as those identified in subparagraphs l), n) and o) below, all communications from
the Contracting States to the arbitration panel, and vice versa, shall take place
only through written communications between the designated competent
authorities and the Chair of the panel.

h) The presenter of the case to the competent authority of a Contracting State shall
be permitted to submit, within 90 days of the appointment of the Chair of the
arbitration panel, a Position Paper for consideration by the arbitration panel.
Copies of the Position Paper shall be provided by the panel to the Contracting
States on the date on which the later of the submissions of the Contracting States
is submitted to the panel.

i) The arbitration panel shall deliver a determination in writing to the Contracting

States within six months of the appointment of its Chair. The panel shall adopt as
its determination one of the Proposed Resolutions submitted by the Contracting
States.

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j) The determination of the arbitration panel shall pertain to the application of the
Convention in a particular case, and shall be binding on the Contracting States.
The determination of the panel shall not state a rationale. It shall have no
precedential value.

k) As provided in subparagraph e) of paragraph 7 of Article 25, the determination

of an arbitration panel shall constitute a resolution by mutual agreement under
Article 25. Each concerned person must, within 30 days of receiving the
determination of the panel from the competent authority to which the case was
first presented, advise that competent authority whether that concerned person
accepts the determination of the panel. In the event the case is in litigation, each
concerned person who is a party to the litigation must also advise, within the same
time frame, the relevant court of its acceptance of the determination of the panel
as the resolution by mutual agreement and withdraw from the consideration of the
court the issues resolved through the Proceeding. If any concerned person fails to
so advise the relevant competent authority and relevant court within this time
frame, the determination of the panel shall be considered not to have been
accepted in that case. Where the determination of the panel is not accepted, the
case may not subsequently be the subject of a Proceeding.

l) Any meeting(s) of the arbitration panel shall be in facilities provided by the

Contracting State whose competent authority initiated the mutual agreement
proceedings in the case.

m) The treatment of any associated interest or penalties is outside the scope of the
Proceeding and shall be determined by applicable domestic law of the Contracting
State(s) concerned.

n) No information relating to the Proceeding (including the panel's determination)

may be disclosed by the members of the arbitration panel or their staffs or by
either competent authority, except as permitted by the Convention and the
domestic laws of the Contracting States. In addition, all material prepared in the
course of, or relating to, the Proceeding shall be considered to be information
exchanged between the Contracting States. All members of the arbitration panel
and their staffs must agree in statements sent to each of the Contracting States in
confirmation of their appointment to the arbitration panel to abide by and be
subject to the confidentiality and nondisclosure provisions of Article 26
(Exchange of Information) of the Convention and the applicable domestic laws of
the Contracting States. In the event those provisions conflict, the most restrictive
condition shall apply.

o) The fees and expenses shall be borne equally by the Contracting States. In
general, the fees of members of the arbitration panel shall be set at the fixed
amount of $2,000 (two thousand United States dollars) per day or the equivalent
amount in Swiss francs, subject to modification by the competent authorities. In
general, the expenses of members of the arbitration panel shall be set in

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 accordance with the International Centre for Settlement of Investment Disputes
(ICSID) Schedule of Fees for arbitrators (as in effect on the date on which the
arbitration proceedings begin), subject to modification by the competent
authorities. Any fees for language translation shall also be borne equally by the
Contracting States. Meeting facilities, related resources, financial management,
other logistical support, and general administrative coordination of the Proceeding
shall be provided, at its own cost, by the Contracting State whose competent
authority initiated the mutual agreement proceedings in the case. Any other costs
shall be borne by the Contracting State that incurs them.

p) For purposes of paragraphs 6 and 7 of Article 25 and this paragraph, each

competent authority shall confirm in writing to the other competent authority and
to the concerned person(s) the date of its receipt of the information necessary to
undertake substantive consideration for a mutual agreement. Such information
shall be submitted to the competent authorities under relevant internal rules and
procedures of each of the Contracting States. However, this information shall not
be considered received until both competent authorities have received copies of
all materials submitted to either Contracting State by the concerned person(s) in
connection with the mutual agreement procedure.

q) The competent authorities of the Contracting States may complete the above
rules and procedures as necessary to more effectively implement the intent of
paragraph 6 of Article 25 to eliminate double taxation.

2. It is understood that paragraph 5 of Article 26 of the Convention does not preclude a

Contracting State from invoking paragraph 3 of Article 26 to refuse to supply information
held by a bank, financial institution, a person acting in an agency or fiduciary capacity or
information relating to ownership interests. However, such refusal must be based on
reasons unrelated to the person’s status as a bank, financial institution, agent, fiduciary,
nominee, or the fact that the information relates to ownership interests. For instance, a
legal representative acting for a client may be acting in an agency capacity but for any
information protected as a confidential communication between attorneys, solicitors or
other admitted legal representatives and their clients, paragraph 3 of Article 26 continues
to provide a possible basis for declining to supply the information.

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If the above proposal is acceptable to your Government, I further propose that this Note and
your reply Note reflecting such acceptance shall constitute an agreement between our two
Governments that shall enter into force on the date of entry into force of the Protocol and
shall be annexed to the Convention as Annex A thereto and shall therefore be an integral part
of the Convention.

Please accept, Excellency, the assurance of my highest consideration.

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