Permanent establishment: activity exemptions and agency rules determine when foreign business presence triggers local tax presence. The text defines permanent establishment as a fixed place of business including management, branch, office, factory, warehouse, extraction sites and construction projects, and deems provision of services or hire of plant for mineral oil prospecting to constitute a permanent establishment. It sets out specific activity exemptions for preparatory or auxiliary functions (storage, display, stock maintenance, purchasing, information gathering and combinations thereof) as modified by the Multilateral Instrument. Agency rules deem a permanent establishment where a non independent person habitually concludes contracts, maintains stocks for delivery, or secures orders predominantly for the enterprise, while independent agents acting in the ordinary course do not create such status; insurance premium collection through non independent agents also creates a permanent establishment except for reinsurance.
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.
Permanent establishment: activity exemptions and agency rules determine when foreign business presence triggers local tax presence.
The text defines permanent establishment as a fixed place of business including management, branch, office, factory, warehouse, extraction sites and construction projects, and deems provision of services or hire of plant for mineral oil prospecting to constitute a permanent establishment. It sets out specific activity exemptions for preparatory or auxiliary functions (storage, display, stock maintenance, purchasing, information gathering and combinations thereof) as modified by the Multilateral Instrument. Agency rules deem a permanent establishment where a non independent person habitually concludes contracts, maintains stocks for delivery, or secures orders predominantly for the enterprise, while independent agents acting in the ordinary course do not create such status; insurance premium collection through non independent agents also creates a permanent establishment except for reinsurance.
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