(1) For the purposes of this Convention, the term "permanent establishment" means a fixed place of business through which the business of an enterprise is wholly or partly carried on.
(2) The term "permanent establishment" includes specially:
- (a) a place of management;
- (b) a branch;
- (c) an office;
- (d) a factory;
- (e) a workshop; and
- (f) a mine, oil or gas well, a quarry or any other place of extraction of natural resource.
(3) The term "permanent establishment" also encompasses:
- (a) a building site, a construction, installation or assembly project, or supervisory activities in connection therewith, but only if such site, project or activities last more than six months;
- (b) the furnishing of services, including consultancy services, by an enterprise through employees or other personnel engaged by the enterprise for such purpose, but only if such activities of that nature continue within a Contracting State (with respect to the same project or a related project) for a period or periods aggregating more than six months in any 12-months period.
(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 or display or delivery of goods belonging to the enterprise;
- (b) the maintenance of a stock of merchandise belonging to the enterprise solely for the purpose of storage, display or delivery;
- (c) the maintenance of a stock of 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 merchandise or of 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 preparatory or auxiliary nature;
- (f) the maintenance of a fixed place of business solely for any combination of the activities mentioned in sub-paragraphs (a) to (e), provided that such activity of the fixed place of business, resulting from the combination of these activities, is of a preparatory or auxiliary nature.
(5) Notwithstanding the provisions of paragraphs (1) and (2), where a person-other than an agent of an independent status to whom paragraph (7) applies-is acting in a Contracting State on behalf of an enterprise of the other Contracting State, that enterprise shall be deemed to have a permanent establishment in that State in respect of any activities which that persons undertakes for the enterprise, if such a person:
- (a) habitually exercises in that first-mentioned State, an authority to conclude contracts in the name of the enterprise, unless his activities are limited to those referred to in paragraph (4), 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; or
- (b) has no such authority, but habitually maintains in that first-mentioned State a stock of goods or merchandise which he regularly delivers goods or merchandise on behalf of the enterprise.
(6) Notwithstanding the provisions of the preceding paragraphs of this Article, an insurance enterprise of a Contracting State shall, except in regard to re-insurance, be deemed to have a permanent establishment in the other Contracting State if it collects premiums in the territory of that other State or insures risks situated therein through a person, other than an agent of an independent status to whom paragraph (7) of this Article applies.
(7) An enterprise of a Contracting State shall not be deemed to have a permanent establishment in a Contracting State merely because it carries on business in that other State through a broker, a general commission agent or any other agent of an independent status, where such persons are acting in the ordinary course of their business. Where, however, the activities of that agent are exercised exclusively or almost exclusively on behalf of that enterprise and if conditions are established or imposed between that enterprise and the agent, in their business and financial relations, which differ from those that would be established between independent enterprises, this person shall not be considered to be an independent agent within the meaning of this paragraph with respect to any such enterprise.
(8) 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.