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68A Stat. 207; Ante, p. 630. 26 USC 611636.

PUBLIC LAW 91-172-DEC. 30, 1969

[83 STAT.

SEC. 505. CONTINENTAL SHELF AREAS. (a) IN GENERAL.—Subchapter I of chapter 1 (relating to natur 1 resources) is amended by adding after part IV (added by section 5m of this Act) the following new part: "PART V—CONTINENTAL S H E L F AREAS "Sec. 638. Continental shelf areas. "SEC. 638. CONTINENTAL SHELF AREAS.

"For purposes of applying the provisions of this chapter (includiriff 8o'lfat^1s4r'' sections 861(a)(3) and 862(a)(3) in the case of the performance of 26 USC 861", 862. persoual services) with respect to mines, oil and gas wells, and other natural deposits— "United "(1) the term 'United States' when used in a geographical States." sense includes the seabed and subsoil of those submarme areas which are adjacent to the territorial waters of the United States and over which the United States has exclusive rights, in accordance with international law, with respect to the exploration and exploitation of natural resources; and "Foreign " (2) the terms 'foreign country' and 'possession of the United country." States' when used in a geographical sense include the seabed and " P o s s e s s i o n of the United subsoil of those submarine areas which are adjacent to the terriStates." torial waters of the foreign country or such possession and over which the foreign country (or the United States in case of such possession) has exclusive rights, in accordance with international law, with respect to the exploration and exploitation of natural resources, but this paragraph shall apply in the case of a foreign country only if it exercises, directly or indirectly, taxing jurisdiction with respect to such exploration or exploitation. No foreign country shall, by reason of the application of this section, be treated as a country contiguous to the United States." 68A Stat. 357; 80 Stat. 1553.

(b) SOURCE OF INCOME FOR WITHHOLDING OF TAX.—Section 1441

(relating to withholding of tax on nonresident aliens) is amended by adding at the end thereof the following new subsection: "(f) CONTINENTAL SHELF AREAS.— "For sources of income derived from, or for services performed with respect to, the exploration or exploitation of natural resources on submarine areas adjacent to the territorial waters of the United States, see section 638." (c) CLERICAL AMENDMENT.—The table of parts for subchapter I of

chapter 1 is amended by adding at the end thereof the following new item: "Part V. Continental shelf areas." SEC. 506. FOREIGN TAX CREDIT WITH RESPECT TO CERTAIN FOREIGN MINERAL INCOME. (a) LIMITATION ON AMOUNT OF FOREIGN TAXES ALLOWED.—Section 68A Stat. 285; 80 Stat. 1569.

901 (relating to taxes of foreign countries and possessions of the United States) is amended— (1) by r e d e s i ^ a t i n g subsection (e) as subsection (f),and (2) by inserting after subsection (d) the following new subsection: " (e) FOREIGN TAXES ON MINERAL INCOME.— " (1) REDUCTION I N AMOUNT ALLOWED.—Notwithstanding sub-

section (b), the amount of any income, war profits, and excess profits taxes paid or accrued during the taxable year to any foreign country or possession of the United States with respect to foreigii

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