1490 INTERNATIONAL AGREEMENTS OTHER THAN TREATIES [52 STAT. March 31, 1938 Arrangement between the United States of America and Sweden for E. A. S. No. 1211 relieffrom double income tax on shipping profits. Effected by exchange of notes, signed March 31, 1938. The Secretary of State (Hull) to the Swedish Minister (Bostrom) DEPARTMENT OF STATE, Washington, March 31, 1938. Arrangement with Sweden for reciprocal relief from double in- come tax on shipping profits. 49 Stat. 1715,1717. 26 U. S. C., Supp. II, i 211, 231 (e). SIR: In order to insure that American shipping will continue to enjoy the benefits of tax exemption which have been in effect in Sweden pursuant to the exchange of notes commencing with the Swedish Legation's notes of January 27, 1922, and February 24, 1922,1 I have the honor to inform you that, on condition of reciprocity, corporations, including maritime shipping companies, organized in Sweden, the vessels of which, documented under the laws of Sweden, call at ports in the United States of America either to load or to unload cargo, or to em- bark or to land passengers, shall be exempted by the Government of the United States of America from the payment of taxes on income or profits derived exclusively from the operation of such vessels. In consequence thereof, Sweden is held to have satisfied the equiva- lent exemption provisions of Sections 212 (b) and 231 (e) of the Rev- enue Act of 1936 and the provisions for taxation of the income of cor- porations contained in said Act shall in no case be applied to cor- porations, including maritime shipping companies, organized in Sweden. This exemption shall apply even though a Swedish corporation or company has an agency or a branch office in the United States, pro- vided that the activities of the agency or branch office are limited to the direct operation of vessels. By "maritime shipping companies", shall be understood companies which are managed by an "owner" of vessels, the term "owner" including charterers. Income or profits derived from the operation of vessels shall also include income or profits derived from the sale in the United States of steamship tickets issued by a Swedish corporation or company. The same exemption from taxation shall, on condition of reciprocity, likewise be enjoyed by subjects of Sweden, not residents in the United States of America, for income which consists exclusively of earnings derived from the operation of a vessel, or vessels, documented under the laws of Sweden. ' Notes not printed.
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