Business profits: taxable in resident state unless permanent establishment, with profits attributable to PE as separate enterprise. Business profits are taxable only in the enterprise's Contracting State unless the enterprise operates in the other State through a permanent establishment; only profits attributable to that permanent establishment may be taxed there. Attributed profits are to be computed as if the permanent establishment were a distinct and separate enterprise dealing independently. Deductions for expenses incurred for the permanent establishment are allowed subject to the host State's tax law, but intercompany charges (non reimbursement royalties, fees, commissions, management charges and, except for banks, interest) are not deductible nor treated as profits of the permanent establishment. Apportionment methods customarily used remain permissible if consistent with these principles, and the attribution method should be applied consistently year to year.