Permanent establishment rules clarified: insurance enterprise PE deeming applies only if reciprocal treaty changes are adopted. The Agreed Note clarifies that no deeming rule currently treats an insurance enterprise as having a permanent establishment merely by collecting premiums or insuring risks via a dependent agent; should Latvia later adopt such a deeming provision in any tax treaty, the competent authorities will consult on applying it to this Agreement. It further explains that paragraph 4 of Article 5 covers activities of a preparatory or auxiliary character to avoid taxation, and that supervisory activities in paragraph 3 of Article 5 exclude services specified under sub paragraph (b) of paragraph 3 of Article 12.
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Permanent establishment rules clarified: insurance enterprise PE deeming applies only if reciprocal treaty changes are adopted.
The Agreed Note clarifies that no deeming rule currently treats an insurance enterprise as having a permanent establishment merely by collecting premiums or insuring risks via a dependent agent; should Latvia later adopt such a deeming provision in any tax treaty, the competent authorities will consult on applying it to this Agreement. It further explains that paragraph 4 of Article 5 covers activities of a preparatory or auxiliary character to avoid taxation, and that supervisory activities in paragraph 3 of Article 5 exclude services specified under sub paragraph (b) of paragraph 3 of Article 12.
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