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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.

ARTICLE 5

Permanent Establishment

(1) For the purpose of the present Convention, the term "permanent establishment" implies a fixed place of business through which the business of an enterprise carries out either partly or wholly.

(2) The expression "permanent establishment" notably includes:

  • (a) a place of management;
  • (b) a branch;
  • (c) an office;
  • (d) a factory;
  • (e) a workshop;
  • (f) a mine, a quarry or any other place of extraction of natural resources;
  • (g) a construction or an assembly site whose duration exceeds six months.

(3) The term “permanent establishment” shall be deemed not to include:

  • (a) the fixed place of business used solely for the purpose of storage, display or delivery of merchandise belonging to the enterprise;
  • (b) the maintenance of merchandise belonging to the enterprise stored solely for the purpose of storage or display;
  • (c) the maintenance of merchandise belonging to an enterprise is stored solely for the purpose of processing by another enterprise;
  • (d) the maintenance of a fixed place of business used solely for the purpose of purchasing merchandise or collecting information for the enterprise;
  • (e) the maintenance of a fixed place of business is used by the enterprise solely for the purpose of advertising, supplying information, scientific research or of carrying on, for the enterprise, similar activities of a preparatory or auxiliary character.

(4) A person other than an agent enjoying an independent status referred in paragraph (5) who acts in one of the Contracting States on account of an enterprise of the other Contracting State shall be deemed to be constituting a permanent establishment in the enterprise in the first State if he habitually exercises in that State powers to conclude contracts under the name of the enterprise, unless the activity of such person is not limited to the purchase of merchandise for the enterprise.

(5) An enterprise shall not be deemed 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 of an independent status, provided that such persons are acting in the ordinary course of their business.

(6) 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.