ARTICLE 5
Permanent Establishment
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 especially:
a) a place of management;
b) a branch;
c) an office;
d) a factory;
e) a workshop;
f) a mine, an oil or gas well, a quarry, or any other
place of extraction of natural resources;
g) a warehouse, in relation to a person providing
storage facilities for others;
h) a farm, plantation or other place where agriculture,
forestry, plantation or related activities are carried on;
i) a store or premises used as a sales outlet;
j) an installation or structure used for the exploration
or exploitation of natural resources, but only if so used for
a period of more than 120 days in any twelve month period;
k) a building site or construction, installation or
assembly project or supervisory activities in connection
therewith, where such site, project or activities (together
with other such sites, projects or activities, if any)
continue for a period of more than 120 days in any twelve
month period;
1) the furnishing of services, other than included
services as defined in Article 12 (Royalties and Fees for
Included Services), within a Contracting state by an
enterprise through employees or other personnel, but only if:
i) activities of that nature continue within that
State for a period or periods aggregating more than 90
days within any twelve-month period; or
ii ) the services are performed within that state for a
related enterprise (within the meaning of paragraph 1 of
Article 9 (Associated Enterprises)).
3. Notwithstanding the preceding provisions of this Article,
the term "permanent establishment" shall be deemed not to include
any one or more of the following:
a) the use of facilities solely for the purpose of
storage, display, or occasional 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 occasional delivery;
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 of
collecting information, for the enterprise;
e) the maintenance of a fixed place of business solely
for the purpose of advertising, for the supply of
information, for scientific research or for other activities
which have a preparatory or auxiliary character, for the
enterprise.
4. Notwithstanding the provisions of paragraphs 1 and 2,
where a person - other than an agent of an independent status to
whom paragraph 5 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
the first-mentioned state if:
a) he has and habitually exercises in the first-
mentioned State an authority to conclude contracts on behalf
of the enterprise, unless his activities are limited to those
mentioned in paragraph 3 which, if exercised through a fixed
place of business, would not make that fixed place of
business a permanent establishment under the provisions of
that paragraph;
b) he has no such authority but habitually maintains in
the first-mentioned state a stock of goods or merchandise
from which he regularly delivers goods or merchandise on
behalf of the enterprise, and some additional activities
conducted in that state on behalf of the enterprise have
contributed to the sale of the goods or merchandise; or
c) he habitually secures orders in the first-mentioned
State, wholly or almost wholly for the enterprise.
5. An enterprise of a Contracting state shall not be deemed
to have a permanent establishment in the other Contracting state
merely because it carries on business in that other 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. However, when the activities
of such an agent are devoted wholly or almost wholly on behalf of
that enterprise and the transactions between the agent and the
enterprise are not made under arm’s-length conditions, he shall
not be considered an agent of independent status within the
meaning of this paragraph.
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.