Following many years of tense diplomatic relations, the UK yesterday signed its first ever double taxation convention with the Great Socialist People's Libyan Arab Jamahiriya. The convention was signed by Foreign Office minister of state, Bill Rammell, and the Libyan secretary for European affairs, Abdulatti al-Obidi. The treaty follows the OECD Model Double Taxation Convention. With one exception, the convention includes the complete elimination of source-country withholding taxes on dividends, interest and royalty payments. It will enter into force once both countries have completed their legislative procedures. Rammell said: 'This double taxation convention will bring benefits to British business in Libya and Libyan investors in the UK - benefits in terms of certainty, clarity and transparency and reducing tax compliance burdens.' The UK has a large network of double taxation conventions, covering more than 100 countries. They aim to eliminate double taxation of income or gains arising in one country and paid to residents of the other country.