I. In case an entity that is treated as a body corporate for tax purposes is liable as such to tax in a Contracting State, but the income of that entity is taxed in the other Contracting State as income of the participants in that entity, the competent authorities shall take such measures that on the one hand no double taxation remains, but on the other hand it is prevented that merely as a result of application of the Convention income is (partly) not subject to tax.

II. It is understood that if the competent authorities of the Contracting States, by mutual agreement, have reached a solution within the context of the Convention, for cases in which double taxation or double exemption would occur:

a) as a result of the application of paragraph 2 of Article 3 with respect to the interpretation of a term not defined in the Convention; or

b) as a result of differences in qualification (for example of an item of income or of a person), this solution – after publication thereof by both competent authorities – shall also be binding in other similar cases in the application of the provisions of the Convention.

III. Ad Article 1

1. Notwithstanding Article 1, a company which is treated as a vrijgestelde beleggingsinstelling (tax exempt investment institution) according to article 6a Wet op de Vennootschapsbelasting 1969 (Dutch Corporate Income Tax Act 1969) or any identical or substantially similar regime introduced after today shall not be entitled to the benefits of Articles 10, 11, 12, 13, 22 and 23 of the Convention and the corresponding articles of the Protocol.

2. The competent authorities of the Contracting States shall by mutual agreement decide to which extent other specific categories of residents of one of the Contracting States shall not be entitled to the benefits of this Convention.

IV. Ad Article 4

A company shall be regarded to be liable to tax:

(i) in the Netherlands if the company is a resident of the Netherlands for the purposes of the company tax;

(ii) in Kenya if the company has its place of management in Kenya;

provided that the income derived by that company is treated under the tax laws of that State as income of that company.

V. Ad Article 4

An individual living aboard a ship without any real domicile in either of the Contracting States shall be deemed to be a resident of the Contracting State in which the ship has its home harbour.

VI. Ad Article 7

In respect of paragraphs 1 and 2 of Article 7, where an enterprise of a Contracting State sells goods or merchandise or carries on business in the other Contracting State through a permanent establishment situated therein, the profits of that permanent establishment shall not be determined on the basis of the total amount received by the enterprise, but shall be determined only on the basis of that portion of the income of the enterprise that is attributable to the actual activity of the permanent establishment in respect of such sales or business.

Specifically, in the case of contracts for the survey, supply, installation or construction of industrial, commercial or scientific equipment or premises, or of public works, when the enterprise has a permanent establishment, the profits attributable to such permanent establishment shall not be determined on the basis of the total amount of the contract, but shall be determined only on the basis of that part of the contract that is carried out by the permanent establishment in the Contracting State in which the permanent establishment is situated. The profits related to that part of the contract which is carried out by the head office of the enterprise shall be taxable only in the Contracting State of which the enterprise is a resident.

VII. Ad Article 7

In relation to paragraph 1 of Article 7, it is agreed that, if an enterprise of a Contracting State sells goods or merchandise of the same or similar kind as those sold by the permanent establishment, or carries out business activities of the same or similar kind as those carried out by the permanent establishment, the profits of such sales or activities may be attributed to the permanent establishment if it is demonstrated:

a) that these profits are related to the activities of the permanent establishment; and

b) that no sound business reasons exist for not conducting the activities through the permanent establishment.

VIII. Ad Article 7 and 14

Payments received as a consideration for technical services, including studies or surveys of a scientific, geological or technical nature, or for consultancy or supervisory services shall be deemed to be payments to which the provisions of Article 7 or Article 14, as the case may be, apply.

IX. Ad Article 7

The competent authorities of the Contracting States may by mutual agreement adopt a new method of attribution of profits to permanent establishments as developed by the OECD or the UN.

X. Ad Articles 7 and 9

It is understood that the fact that associated enterprises have concluded arrangements, such as cost sharing arrangements or general services agreements, for or based on the allocation of executive, general administrative, technical and commercial expenses, research and development expenses and other similar expenses, is not in itself a condition as meant in paragraph 1 of Article 9.

XI. Ad Article 8

It is understood that the provisions of Article 8 shall also apply to taxes on income levied on the basis of the gross receipts in respect of the carriage of passengers and cargo in international traffic.

XII. Ad Articles 8, 13 and 22

1. For the purposes of Articles 8, 13 and 22 the place of effective management of the aircraft enterprise of Koninklijke Luchtvaartmaatschappij N.V. (KLM N.V.) shall be deemed to be situated in the Netherlands, as long as the Netherlands has an exclusive taxing right with respect to the aircraft enterprise of KLM N.V. under the Agreement between the Government of the Kingdom of the Netherlands and the Government of the French Republic for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital (with Protocol); Paris, 16 March 1973, as amended by the Protocol of the 7th of April 2004.

2. The provision of paragraph 1 of this Article shall also apply if the aircraft enterprise of the existing KLM N.V. is continued fully or substantially by another person.

XIII. Ad Article 10

The provisions of paragraph 3 of Article 10 shall apply as long as, under the provisions of the Income Tax Laws of the Contracting State of which the company that beneficially owns the dividends is a resident, a full tax exemption is applicable to dividends which that company receives from a company which is resident of the other Contracting State.

XIV. Ad Article 10

The determination of the purpose referred to in paragraph 8 of Article 10 shall be based on all facts and circumstances including:

a) the nature and volume of the activities of the company in its country of residence in relation to the nature and volume of the dividends;

b) both the historical and the current ownership of the company; and

c) the business reasons for the company residing in its state of residence including the extent to which the company that beneficially owns the dividends would be entitled to treaty benefits comparable to those afforded by this Convention if it had been a resident of the state of residence of the majority of its shareholders.

The competent authority of the Contracting State which has to grant the benefits shall consult with the competent authority of the other Contracting State before denying the benefits under paragraph 8 of Article 10.

XV. Ad Articles 10, 11 and 12