The Attribution of Profits to Permanent Establishments

The Attribution of Profits to Permanent Establishments: The taxation of intra-company dealings
This book compares the tax treatment of cross-border dealings between different parts of the same enterprise in several countries.

Why this book?

The attribution of profits to permanent establishments (PEs) is probably one of the most complex subjects of the international tax arena. The interaction of treaty rules and domestic legislations sometimes leads to unacceptable results such as double taxation or double non-taxation. This book compares the tax treatment of cross-border dealings between different parts of the same enterprise in several countries.

This book is essential reading for anyone dealing with PEs in their daily practice, including tax advisers, tax lawyers, tax authorities and accountants. Academics and students will also benefit from the insights contained in this book.


Sample excerpt, including table of contents

Countries/Jurisdictions covered 

Argentina, Austria, Belgium, Brazil, Canada, Chile, Finland, France, Germany, India, Italy, Mexico, the Netherlands, South Africa, Spain, Switzerland, the United Kingdom, the United States and Venezuela


Part I

The book begins by examining how the dealings between a PE and the enterprise of which it is a part should be treated for tax treaty purposes. An overview of the historical development of Article 7 of the OECD Model Convention is provided, starting with the Draft Conventions prepared by the League of Nations up to the current OECD Model and Commentary, and taking into account the recent OECD Discussion Drafts.

Part II

A comparative survey is presented in which the tax consequences of dealings between different parts of the same enterprise are analyzed on the basis of the domestic law of the countries covered. Four different cases are scrutinized:

  • the transfer of assets (both fixed assets and trading stock);
  • the use of intangibles;
  • the provision of services; and
  • the transfer of funds.
The survey covers 19 countries. A summary of the survey is included at the end of Part II.

Part III

The book concludes by discussing selected issues, such as the application of the PE non-discrimination clause, the effects of EC legislation and possible source taxation in relation to the tax treatment of intra-company dealings.


Juan Angel Becerra, Rijkele Betten, Emidio Cacciapuoti, Alessandro Caridi, Luis J. Durá García, Ronald Evans, Cees Faber, Olivier Ferrari, David Francescucci, Johann Hattingh, Lari Hintsanen, Annamarie James, Angel J. Juarez, Sebastian Löser, Eduardo Meloni, Omar Morales, Helmut Moritz, Wolfgang Oepen, René Offermanns, Ana Carolina Pereira Monguilod, Mario Petriccione, Radhakishan Rawal, Raffaele Russo, Patrick Seroin, Sarig Shalhav and Alexandre Siciliano Borges.