Associated enterprises adjustments require inclusion of profits altered by non-arm's length conditions and reciprocal tax relief. Article 9 provides that where enterprises of the Contracting States are linked by control or common participation and conditions between them differ from those between independent enterprises, profits affected by those non-arm's length conditions may be included and taxed in the enterprise to which they would have accrued. If one State taxes such reallocated profits, the other State must make an appropriate adjustment to avoid economic double taxation, with due regard to the Agreement and consultation between competent authorities if necessary.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Associated enterprises adjustments require inclusion of profits altered by non-arm's length conditions and reciprocal tax relief.
Article 9 provides that where enterprises of the Contracting States are linked by control or common participation and conditions between them differ from those between independent enterprises, profits affected by those non-arm's length conditions may be included and taxed in the enterprise to which they would have accrued. If one State taxes such reallocated profits, the other State must make an appropriate adjustment to avoid economic double taxation, with due regard to the Agreement and consultation between competent authorities if necessary.
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