(1) Subject to subsection (2), this Chapter shall apply to a payment, being interest or royalties, made -
(a) by either -
(i) a company resident in the State, or
(ii) a company not so resident which carries on a trade in the State through a permanent establishment if, in relation to the trade the interest gives, or as the case may be the royalties give, rise to a deduction under section 81 or 97 or relief under Part 8,
(b) to or for the benefit of -
(i) where subparagraph (ii) does not apply, a company which -
(I) is the beneficial owner of the interest, or as the case may be the royalties, and
(II) is, by virtue of the law of a Member State other than the State, resident for the purposes of tax in such a Member State,
or
(ii) a permanent establishment -
(I) which is situated in a Member State (in this subparagraph referred to as the 'first Member State') other than the State,
(II) which is treated as the beneficial owner of the interest, or as the case may be the royalties, and
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