Australian Tax Treaties

Taipei Agreement  

AGREEMENT BETWEEN THE AUSTRALIAN COMMERCE AND INDUSTRY OFFICE AND THE TAIPEI ECONOMIC AND CULTURAL OFFICE CONCERNING THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME  

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ARTICLE 5   Permanent establishment  

1.    
For the purposes of this Agreement, the term " permanent establishment " , in relation to an enterprise, means a fixed place of business through which the business of the 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) an agricultural, pastoral or forestry property;

(h) a building site or construction, installation or assembly project which exists for more than 6 months; and

(i) the furnishing of services, including consultancy services in a territory by an enterprise of the other territory through employees or other personnel engaged by the enterprise for such purpose, but only where those activities (for the same or a connected project) within the first-mentioned territory continue for a period or periods aggregating more than 120 days within any twelve month period.

3.    
An enterprise shall not be deemed to have a permanent establishment merely by reason of:

(a) the use of facilities solely for the purpose of storage, display or delivery of goods or merchandise belonging to the enterprise; or

(b) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of storage, display or delivery; or

(c) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of processing by another enterprise; or

(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; or

(e) the maintenance of a fixed place of business solely for the purpose of activities which have a preparatory or auxiliary character for the enterprise, such as advertising or scientific research.

4.    
An enterprise shall be deemed to have a permanent establishment in a territory and to carry on business through that permanent establishment if:

(a) it carries on supervisory activities in that territory for more than 6 months in connection with a building site, or a construction, installation or assembly project, which is being undertaken in that territory; or

(b) substantial equipment is being used in that territory by, for or under contract with, the enterprise where that use continues for more than 3 months.

5.    
A person acting in a territory on behalf of an enterprise of the other territory - other than an agent of an independent status to whom paragraph 6 applies - shall be deemed to be a permanent establishment of that enterprise in the first-mentioned territory if:

(a) the person has, and habitually exercises in that territory, an authority to conclude contracts on behalf of the enterprise, unless the person ' s activities are limited to the purchase of goods or merchandise for the enterprise; or

(b) in so acting, the person manufactures or processes in that territory for the enterprise goods or merchandise belonging to the enterprise.

6.    
An enterprise of a territory shall not be deemed to have a permanent establishment in the other territory merely because it carries on business in that other territory through a person who is a broker, general commission agent or any other agent of an independent status and is acting in the ordinary course of the person ' s business as such a broker or agent.

7.    
The fact that a company which is a resident of a territory controls or is controlled by a company which is a resident of the other territory, or which carries on business in that other territory (whether through a permanent establishment or otherwise), shall not of itself make either company a permanent establishment of the other.

8.    
The principles set forth in the preceding paragraphs of this Article shall be applied in determining for the purposes of paragraph 5 of Article 11 and paragraph 5 of Article 12 whether an enterprise, not being an enterprise of either territory, has a permanent establishment in a territory.