Associated enterprises rule: non arm's length intercompany conditions can trigger profit reallocation and taxation under treaty principles. Associated enterprises provision permits inclusion and taxation of profits where enterprises with direct or indirect participation impose commercial or financial conditions that differ from those between independent enterprises; if such non arm's length conditions cause profits not to accrue to an enterprise, those profits may be included in its taxable profits and taxed, reflecting the arm's length allocation principle.
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 rule: non arm's length intercompany conditions can trigger profit reallocation and taxation under treaty principles.
Associated enterprises provision permits inclusion and taxation of profits where enterprises with direct or indirect participation impose commercial or financial conditions that differ from those between independent enterprises; if such non arm's length conditions cause profits not to accrue to an enterprise, those profits may be included in its taxable profits and taxed, reflecting the arm's length allocation principle.
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