Although a non-resident enterprise may not have a permanent
establishment in the United Kingdom in accordance with the normal
definitions, a person who is a dependent agent of the enterprise
may create a permanent establishment. A dependent agent may be an
individual or a company, but such an agent must have authority, and
habitually exercise such authority, to conclude contracts in the
name of the enterprise. Such contracts must relate to operations
which constitute the proper business of the enterprise, for example
contracts for sale in the case of a merchanting business.
An independent agent, such as a broker or general commission
agent, cannot constitute a permanent establishment of a
non-resident enterprise if he is independent of that enterprise
both legally and economically and acts for the enterprise in the
normal course of his business. However, a commission agent who
sells goods on behalf of an enterprise and has, and habitually
exercises, an authority to conclude contracts, may be acting
outside the ordinary course of his business and therefore be a
permanent establishment of the enterprise.
