Agreement between the Government of the United States of America and the Government of Canada relating to the Canada Pension Plan

I. General

1. Insofar as they are compatible with the sovereign immunity of the United States and subject to the following paragraphs, the provisions of the Canada Pension Plan and the Regulations made thereunder and in force from time to time shall form part of this agreement.

2. Nothing in this agreement is to be construed as altering the privileges and immunities provided under generally accepted principles of international law or in the treaties and agreements between the two Governments, nor construed to subject the Government of the United States, its establishments, or its employees who are citizens of the United States, solely because of participation in the Canada Pension [Page 487] Plan, to any civil, administrative or penal action provided by the legislation governing the Canada Pension Plan, or any other law.

II. Employment to be covered by the Canada Pension Plan

1. Locally-engaged employees of the Embassy of the United States of America, its constituent Consulates and Consulates General, and of other United States Government civilian establishments in Canada who are not covered by the Civil Service Retirement System or other United States Government-financed pension plan shall be included in the Canada Pension Plan as of the effective date of this agreement, or beginning at a later date to be determined by administrative arrangement.

2. Locally engaged employees of military agencies and establishments of the United States Government, including non-appropriated fund activities at military bases under United States Government control, or locally engaged employees of such non-appropriated fund activities alone, will be included in the Canada Pension Plan in accordance with the terms and conditions of this agreement. Inclusion of employees under this Section shall be effective upon the date agreed upon by the Contracting Parties.

III. Employment to be excluded from the Canada Pension Plan

The following employment in Canada by the Government of the United States of America shall not be included in the Canada Pension Plan:

(a) Persons who are citizens of the United States of America;

(b) Persons who participate in the Civil Service Retirement System or other United States Government-financed pension plan.

IV. Administration of the Canada Pension Plan

1. The Government of the United States of America agrees, with respect to its employees mentioned in Article II and in accordance with the provisions of the Canada Pension Plan and the Regulations made thereunder and in force from time to time:

(a) to make deductions of Canada Pension Plan contributions from their contributory salary and wages but not to deduct Canada Income Tax;

(b) to pay contributions as an employer of such persons, as specified in Article II;

(c) to remit to Canada the said deductions and contributions by check-on the Treasurer of the United States;

(d) in order to eliminate overpayment of contributions by the employee and the employer, which are contrary to United States Government regulations, to make contributions on and deductions from salaries tip to the amount of the contributory earn- [Page 488] ings only; no deductions or contributions will be paid on portions of employee salaries which exceed the maximum contributory earnings;

(e) to make returns in the form provided therefor. Each report will cover amounts paid during the period covered by the report.

The Government of the United States of America will make every reasonable effort to submit required reports promptly. However, no penalty whatever shall at any time be levied for late payment or for failure to remit. Nor shall any penalty be levied for late filing of information return or the late distribution of required form to an employee;

(f) without restricting the generality of the foregoing, to furnish information with respect to such persons as may be relevant for the administration and operation of the Canada Pension Plan;

(g) to provide appropriate self-audit and self-inspection of its accounts and financial records.

2. If the United States Government or any agency establishment or instrumentality thereof should become eligible under the Plan for a refund of contributions made pursuant to this agreement because of erroneous overpayment or other cause, such amounts shall not be refunded during the period that this agreement remains in force, but shall be applied in reduction of future obligations to the Plan of the United States Government or of the agency establishment or instrumentality concerned.

V. Agreement by Canada

Canada agrees to include in pensionable employment by Regulation under the Canada Pension Plan employment in Canada by the Government of the United States of America and the non-appropriated fund activities at the military bases, as stated in Article II, during the currency of this agreement.

VI. Effective date and subsequent amendment

1. This agreement shall come into force¹ and be effective on the first day Of January, nineteen hundred and sixty-seven and subject to observance of the agreements and covenants herein shall remain in force until terminated in accordance with Article VII hereof.

2. This agreement may be amended at any time by mutual consent.

VII. Termination of agreement

Either party may terminate this agreement on the thirty-first (31st) day of December of any year by giving notice in writing to the other party on or before the thirtieth (30th) day of the preceding June.