(1) The profits of an enterprise of a Contracting State shall be
taxable only in that Contracting State unless the enterprise
carries on business in the other Contracting State through a
permanent establishment situated therein. If the enterprise carries
on business as aforesaid, the profits of the enterprise may be
taxed in the other Contracting State but only so much of them as is
attributable to that permanent establishment.
(2) Where an enterprise of a Contracting State carries on
business in the other Contracting State through a permanent
establishment situated therein, there shall in each Contracting
State be attributed to that permanent establishment the profits
which it might be expected to make if it were a distinct and
separate enterprise engaged in the same or similar activities under
the same or similar conditions and dealing at arm's length with the
enterprise of which it is a permanent establishment.
(3) In the determination of the profits of a permanent
establishment, there shall be allowed as deductions expenses of the
enterprise (other than expenses which would not be deductible if
the permanent establishment were a separate enterprise) which are
incurred for the purposes of the permanent establishment, including
executive and general administrative expenses so incurred, whether
in the Contracting State in which the permanent establishment is
situated or elsewhere.
(4) In so far as it has been customary in a Contracting
State according to its law to determine the profits to be
attributed to a permanent establishment on the basis of an
apportionment of the total income of the enterprise to its various
parts, nothing in paragraph (2) of this Article shall preclude that
Contracting State from determining the profits to be taxed by such
an apportionment as may be customary; the method of apportionment
adopted shall, however, be such that the result shall be in
accordance with the principles of this Article.
(5) No profits shall be attributed to a permanent
establishment by reason of the mere purchase by that permanent
establishment of goods or merchandise for the enterprise.
(6) For the purposes of the preceding paragraphs, the
profits to be attributed to the permanent establishment shall be
determined by the same method year by year unless there is good and
sufficient reason to the contrary.
(7) Where profits include items which are dealt with
separately in other Articles of this Convention, then the
provisions of those Articles shall not be affected by the
provisions of this Article.
(8) Where profits are attributable to a permanent
establishment situated in a Contracting State of an enterprise of
the other Contracting State and those profits are remitted in whole
or in part out of the first-mentioned State, then the profits so
remitted shall not be subject to any greater charge to tax in the
first-mentioned State than if they had not been so remitted.
(9) Nothing in this Article shall affect any provisions of
the law of either Contracting State regarding the taxation of:
(a) any person who carries on a business of any form of insurance. Provided that if the law in force in either Contracting State at the date of signature of this Convention relating to the taxation of any such person is varied (otherwise than in minor respects so as not to affect its general character), the Contracting Governments shall consult each other with a view to agreeing to such amendment of this sub-paragraph as may be necessary
(b) any income from the alienation of immovable property as defined in paragraph (2) of Article 7 which is situated in that Contracting State or from the alienation of shares in a company incorporated in that Contracting State whose assets consist wholly or mainly of such immovable property situated therein.
