Chapter II. Treaty provisions concerning the legal status of the United Nations and related intergovernmental organizations

TREATY PROVISIONS CONCERNING THE LEGAL STATUS OF THE UNITED NATIONS AND RELATED INTERGOVERNMENTAL ORGANIZATIONS

1. Treaty provisions concerning the legal status of the United Nations

   1. CONVENTION ON THE PRIVILEGES AND IMMUNITIES OF THE UNITED NATIONS1 APPROVED BY THE GENERAL ASSEMBLY OF THE UNITED NATIONS ON 13 FEBRUARY 1946

      (a) Status of the Convention

      The following States acceded to the Convention on the Privileges and Immunities

      of the United Nations in 1980:2

      Dale of receipt of instrument

      Stale of accession

      Germany, Federal Republic of3 5 November 1980 Seychelles 26 August 1980

      This brought up to 118 the number of States parties to this Convention,

      (b) Decision of 21 November 1980 taken by the Taxation Board of Review of Australia4

      Receipt of pension by former employee of the United Nations — Participation in the United

      Nations Joint Staff Pension Fund — Article V of the Convention on the Privileges and Immunities of the United Nations — International Organisations (Privileges and Immunities) Act 1948 and Regulations — Decision that pension received by taxpayer is not exempt income within the terms of section 23(y) of the Income Tax Assessment Act 1936

      From 1 June 1967 until about 31 July 1972 the taxpayer was employed by the United Nations as a full-time member of its staff in a country outside Australia. During that period he was an official of the United Nations to whom the privileges and immunities prescribed by Article V of the Convention on the Privileges and Immunities of the United Nations ("the Convention"), adopted by the General Assembly of the United Nations on 13 February 1948, applied. Pursuant to Article 21 of the Regulations of the United Nations Joint Staff Pension Fund,5 he was required to become a participant of the Fund and pursuant to Article 25 of these Regulations, he contributed a portion of his salary to the Fund. Upon ceasing to be employed by the United Nations, and being then more than fifty-five years of age, the taxpayer became entitled to be paid an early retirement benefit pursuant to the provisions of Article 30 of those Regulations. During the year of income ended 30 June 1977 pension benefits were credited to the taxpayer's bank account in Australia.

      By the International Organisations (Privileges and Immunities) Act 1948 (Act No. 72 of 1948)6

      approval was given to the accession by Australia to the Convention. The text of the Convention

      was set out in a schedule to the Act, and the Act enabled the Governor-General to make regulations to give effect to the provisions of the Convention. Australia acceded to the Convention on 2 March 1949.

      The International Organisations (Privileges and Immunities) Regulations were made under the International Organisations (Privileges and Immunities) Act 1948 on 16 March 1959 (S.R. 1959, No.20).7 Regulation 3(1) provided: "The United Nations or a person in relation to whom the Convention applies has, in Australia, the privileges and immunities applicable under the Convention to the United Nations or that person, as the case may be".

      Article V of the Convention provides, in paragraph (b) of Section 18, that "Officials of the United Nations shall . . . be exempt from taxation on the salaries and emoluments paid to them by the United Nations". Section 230') of the Income Tax Assessment Act 1936 provides that "the official salary and emoluments of an official of a prescribed organisation of which Australia and one or more other countries are members ... " shall be exempt from income tax.

      The taxpayer objected to the assessment by the Commissioner of Taxation that his pension of $2,600 received from the United Nations was part of his taxable income, and requested the Commissioner to refer the decision to a Board of Review for review. The grounds of the taxpayer's objection were that Section 23(y) of the Income Tax Assessment Act 1936 exempted from income tax the official salary and emoluments of an official of a prescribed organization; that the United Nations was a prescribed organization in accordance with Income Tax Regulations 4AB(1) and 4AB(2); and that his pension of $2,600 received was part of his official salary and emoluments received as an official of the United Nations.

      The decision of the No. 1 Board of Review was given on 21 November 1980. After reviewing the facts of the case and the relevant legislation outlined above, the Board concluded that the taxpayer's pension was not exempt in terms of section 23(y) of the Income Tax Assessment Act 1936. Included in the reasons of the Board for its decision was the following:

      "15. As would be expected participation in the Fund does not follow as a matter of course without a medical examination, except in nominated circumstances which, presumably, did not exempt the taxpayer from such examination. Forfeiture of benefits may arise.

      "16. Because participation in the Fund is not conferred automatically it is a misnomer to speak of a person such as the taxpayer getting as a 'package' an emolument which includes a salary and pension benefits (at the conclusion of employment or on the happening of nominated events).

      "17. Although the word 'emolument' in some contexts may comprehend a pension payable after employment has ceased, the Convention aforesaid and the legislation and subordinate legislation, so also the regulations and rules of the United Nations Joint Staff Pension Fund all tend to the construction that an emolument relates to a monetary benefit payable to one who is presently serving the United Nations (or a member organization of the said Fund) and conversely that a pension relates to a monetary payment to that person (or his widow or dependant) after his contributory service has been brought to an end by death, disability or other qualifying retirement. Furthermore, as the Fund is held by the United Nations on behalf of the participants and of the beneficiaries of the Fund the Fund is not the property of the United Nations, but rather it holds as trustee. Accordingly, payments from the Fund to a pensioner are not payments from the assets of the United Nations even though such payments come from a fund which is held by the United Nations.

      "18. Thus it follows that the taxpayer as a former official of the United Nations cannot bring the subject pension within the opening words of sec. 23(y) of the Income Tax Assessment Act viz. 'the official salary and emoluments of an official' even though the former employer was comprehended by the words next ensuing in sec. 23(y) viz., 'of a prescribed organization of which Australia', etc. (Case M90, 80 Australian Tax Cases 648, at page 652)".

      The taxpayer's objection was accordingly disallowed.

   2. AGREEMENTS RELATING TO MEETINGS AND INSTALLATIONS

      (a) Third supplemental agreement between the United Nations and the United States of America regarding the Headquarters of the United Nations.8 Signed at New York on 10 December 1980

      The United Nations and the United States of America:

      Considering that the space available within the Headquarters District, as defined in annex 1

      of the Agreement regarding the Headquarters of the United Nations signed at Lake Success on 26

      June 1947, that referred to in the Supplemental Agreement of 9 February 1966 as amended by the Exchange of Notes of 8 December 1966, and that referred to in the Second Supplemental Agreement of 28 August 1969 are inadequate and it has become necessary for units of the Secretariat of the United Nations to be provided with other premises outside the areas so delineated;

      Considering that, for this purpose, the United Nations has acquired leases of certain additional office space;

      Considering that it is desirable that, with respect to those premises, the United Nations, officials of the United Nations and representatives of the Members of the United Nations be accorded the necessary privileges and immunities as envisaged in Article 105 of the Charter of the United Nations and in the Headquarters Agreement; and

      Desiring to conclude a Third Supplemental Agreement in accordance with Section 1 (a) of the Headquarters Agreement, in order to include those premises within the Headquarters District.

      Have agreed as follows:

      Article I

      The Headquarters District within the meaning of Section 1 (a) of the Agreement between the United States of America and the United Nations regarding the Headquarters of the United Nations, signed at Lake Success on 26 June 1947, shall include, in addition to the area defined in annex 1 to that Agreement, the premises described in the annexes of this Supplemental Agreement. The first part of the annexes shows newly added premises whereas the second part indicates the state of United Nations occupancy in premises already covered by previous Supplemental Agreements.

      Article II

      The Secretary-General of the United Nations shall notify the Permanent Representative of the United States of America to the United Nations immediately should any of the premises referred to in article I and described in the annexes or any part of such premises, cease to be used by the United Nations. Such premises, or such part thereof, shall cease to be a part of the Headquarters District from the date of such notification.

      Article III

      This Third Supplemental Agreement shall enter into force upon its signature.

      IN WITNESS WHEREOF the respective representatives have signed this Supplemental Agreement.

      DONE in duplicate, in the English language, at New York this tenth day of December 1980.

      (b) Agreement between the United Nations and the Republic of Austria regarding the Headquarters of the United Nations Industrial Development Organization. Signed at New York on 13 April 1967

      Exchange of letters between the United Nations and Austria constituting a Supplemental Agreement to the above-mentioned Agreement relating to the turnover tax system (value added tax system).9 Vienna and New York, 24 April 1980

      Vienna, 24 April 1980

      Excellency,

      I have the honour to refer to the Agreement between the...