ARTICLE 5
Permanent Establishment
(1) In context of this Convention, the expression "permanent establishment" means an established office from where the activities of the undertaking are carried out, partly or wholly.
(2) The expression "permanent establishment" covers, especially:
- (a) a place of management;
- (b) a branch office;
- (c) a permanent establishment;
- (d) a manufacturing place;
- (e) a workshop; and
- (f) a mine, oil or gas reserves, a quarry or any other place of exploitation of natural resources.
(3) A construction activity or assembly is considered a permanent establishment provided its duration exceeds twelve-months.
(4) Notwithstanding the preceding provisions of this Article, the term "permanent establishment" shall be deemed not to include:
- (a) the use of facilities solely for the purpose of storage, display or delivery of goods or merchandise belonging to the enterprise;
- (b) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of storage, display or delivery of goods;
- (c) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of processing by another enterprise;
- (d) the maintenance of a fixed place of business solely for the purpose of purchasing goods or merchandise or collecting information, for the enterprise;
- (e) the maintenance of a fixed place of business solely for the purpose of carrying on, for the enterprise, any other activity of a preparatory or auxiliary character;
- (f) the maintenance of a fixed place of business used solely for any combination of activities mentioned from sub-paragraphs (a) to (e), provided that the overall activity of the fixed place of business resulting from this combination maintains its preparatory or auxiliary character.
(5) Notwithstanding the provisions of paragraphs (1) and (2), when a person-other than an agent enjoying an independent status to which paragraph (6) shall apply-acts on behalf of an enterprise and has and habitually exercises, in a Contracting State the authority to conclude contracts on behalf of that enterprise then that enterprise shall be considered as a 'permanent establishment' in that Contracting State in respect of any activities which that person undertakes for the enterprise, unless the activities of such person are limited to those mentioned in paragraph (4) and which, if exercised through a fixed place of business, would not make this fixed place of business a permanent establishment under the provisions of that paragraph.
(6) An enterprise shall not be considered to have a permanent establishment in a Contracting State merely because it carries on business in that State through a broker, general commission agent or any other agent enjoying independent status, provided that these persons act in the ordinary course of their business.
(7) The fact that a company which is a resident of a Contracting State controls or is controlled by a company which is a resident of the other Contracting State, or which carries on business in that other State (whether through a permanent establishment or otherwise), shall not of itself constitute either company a permanent establishment of the other.