Permanent establishment for insurance enterprises clarified; dependent agent collection alone does not create taxing nexus under the treaty. The Agreement clarifies that Latvia's treaties do not currently deem an insurance enterprise to have a permanent establishment in the other State merely by collecting premiums or insuring risks through a dependent agent, though any future inclusion of such a provision in Latvia's treaties may be considered for this Agreement after consultation; it also confirms that paragraph 4 of Article 5 exempts purely preparatory or auxiliary activities from taxation in the other State and that supervisory activities in paragraph 3 do not include services covered by sub paragraph (b) of paragraph 3 of Article 12.
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Provisions expressly mentioned in the judgment/order text.
Permanent establishment for insurance enterprises clarified; dependent agent collection alone does not create taxing nexus under the treaty.
The Agreement clarifies that Latvia's treaties do not currently deem an insurance enterprise to have a permanent establishment in the other State merely by collecting premiums or insuring risks through a dependent agent, though any future inclusion of such a provision in Latvia's treaties may be considered for this Agreement after consultation; it also confirms that paragraph 4 of Article 5 exempts purely preparatory or auxiliary activities from taxation in the other State and that supervisory activities in paragraph 3 do not include services covered by sub paragraph (b) of paragraph 3 of Article 12.
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