- Danish Tax Council Ruling: On March 6, 2025, the Danish Tax Council ruled that a Swiss company’s activities, which included owning inventory in Denmark and receiving limited logistical support, did not establish a permanent establishment (PE) in Denmark under the Denmark-Switzerland tax treaty, as the activities were deemed preparatory and auxiliary.
- Dependent Agent PE Not Applicable: The ruling clarified that the role of a Danish employee providing procurement support did not create a Dependent Agent PE, as the employee had no authority to negotiate or finalize contracts on behalf of the Swiss company, aligning with prior rulings on PE determinations.
- Indian High Court Decision: On February 21, 2025, the High Court of New Delhi ruled that an Indian subsidiary’s installation of equipment for its Finnish parent did not create a PE in India. The court emphasized that the subsidiary operated independently and was not merely an extension of the parent company, rejecting claims of “virtual projection” and “functional integration.”
Source EY
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