Permanent establishment rules determine taxable industrial or commercial profits attributable under an arm's length attribution principle.

Taxation is limited to industrial or commercial profits derived through a permanent establishment in the taxing territory; such profits are attributed by treating the establishment as an independent enterprise dealing at arm's length with the head office, and may be estimated reasonably where precise determination is impracticable. Income categories such as rents, royalties, interest, dividends, management charges, remuneration for labour or personal services, and income from ships or aircraft are excluded from "industrial or commercial profits" for attribution purposes.

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