1.Explain the royalty article structure as per the OECD Model Versus the UN Model and deviations from the OECD Model in many tax treaties to keep taxation in the source country

2. Soka Ltd, is a company resident and carrying on activities in Egypt. Soka Ltd is a Permanent Establishment of XYZ Co which is resident in State A. The following facts are provided by your clients:

• Under the tax laws of Egypt, the standard corporate income tax rate is 22.5% for sale of unlisted shares at the EGX.
• Soka Ltd is listed in the EGX.
• There is a DTT concluded between Egypt and State A. The tax treaty between Egypt and State A is identical to the OECD Model.

As a tax advisor, you are required to advise Soka Ltd on the following. Please provide detailed explanation to the client on what are the steps you have followed to reach this conclusion.

• What is the tax treatment of the CG realized from sale of Soka Ltd shares, please refer to the DTT paragraphs.
• In the event of Capital loss, what would be the tax treatment?