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Note: This Treaty may be impacted by the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS (MLI). MLI impact on Tax Treaties is available with the Orbitax International Tax Research & Compliance Expert.


Business Profits

(1) The profits of an enterprise of a Contracting State shall be taxable only in that State unless the enterprise initiates an activity in the other Contracting State through a permanent establishment. If the enterprise initiates a business as mentioned, the profits of the enterprise shall be subject to tax in the other State but only so much of it as is attributable to that permanent establishment.

(2) Subject to the provisions of paragraph (3) of this Article, when an enterprise in a Contracting State initiates an activity in the other Contracting State through a permanent establishment, then there shall be attributed t such permanent establishment, the profits that might have been earned if it had been a distinct and separate enterprise, engaged in the same or similar activities under the same or similar conditions and dealing wholly and independently with the enterprise of which it is a permanent establishment.

(3) Insofar as it has been customary in a Contracting State to determine the profits to be attributed to a permanent establishment on the basis of an apportionment of the total profits of the enterprise to its various parts, there is nothing to preclude that Contracting State from determining the profits to be taxed on the basis of such customary apportionment and the method adopted shall be in conformity with the principles contained in this Article.

(4) No profit may be attributed to a permanent establishment merely because it purchases goods for the enterprise.

(5) For the purposes of the preceding paragraphs of this Article, the profits that may be attributable to a permanent establishment shall be determined every year by the same method unless there is a good and sufficient reason to proceed otherwise.

(6) Where profits include items of income that have been dealt with separately in the other Articles of this Convention, the provisions of those Articles shall not be affected by the provisions of this Article.