Associated enterprises: profits adjusted to reflect arm's length conditions and reciprocal tax adjustment by contracting states.

Where enterprises of the Contracting States are related through participation in management, control or capital, or common persons, and conditions between them differ from those between independent enterprises, profits that would have accrued under independent-entity conditions may be included and taxed in the affected enterprise. If one State taxes such adjusted profits that have also been charged to tax in the other State, that other State shall make an appropriate tax adjustment, with regard to the Convention and after consultation between the competent authorities.

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