Robert Feinschreiber, Margaret Kent

Asia-Pacific Transfer Pricing

• Gebundenes Buch

Produktbeschreibung

An overarching look at transfer pricing regimes in Asia-Pacific countries and what they mean for foreign businesses

A comprehensive guide for companies doing business globally, Asia-Pacific Transfer Pricing Handbook explains the policies and practices that Asia-Pacific countries employ with regards to taxing foreign businesses. The only book that analyzes and guides companies through the often complex transfer pricing rules in place in Asian-Pacific nations, the book explains how authorities in fifteen countries, including ASEAN, India, New Zealand, Japan, and South Korea, tax any company doing business within their borders.

Helping foreign companies to properly price their goods and services for global markets, providing defenses for transfer pricing audits, explaining standards for creating comparables that multijurisdictional tax administrations will accept, explaining documentation requirements and timing issues, and creating awareness about inadvertently becoming a permanent establishment, Asia-Pacific Transfer Pricing Handbook is an essential resource for doing business abroad.
Provides comprehensive, accessible information on transfer pricing in Asia-Pacific countries
Covers fifteen Asia-Pacific countries, including all ASEAN countries, giving readers unparalleled exposure to the different transfer pricing arrangements across the region
Explains how companies doing business abroad should price their goods and services for global markets to remain in accordance with the law

A complete and comprehensive guide to transfer pricing and its implications for firms and accountants operating in the Asia-Pacific region, Asia-Pacific Transfer Pricing Handbook explains everything foreign companies need to know about doing business abroad.

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Produktdetails

• Wiley Corporate F&A .
• Verlag: Wiley & Sons
• 1. Auflage
• Seitenzahl: 720
• Erscheinungstermin: 11. Dezember 2012
• Englisch
• Abmessung: 260mm x 183mm x 42mm
• Gewicht: 1502g
• ISBN-13: 9781118359372
• ISBN-10: 1118359372
• Artikelnr.: 36519777

Autorenporträt

Robert Feinschreiber (Key Biscayne, FL) is an attorney with Feinschreiber and Associates. He has had numerous career highlights (e.g., youngest full-time law professor in the United States when appointed (Wayne State University), age 23; member of the litigation team for the first Asian transfer pricing case (Toyota)). In addition, he is a consultant with the United Nations (Brazil, China, and Russia). Feinschreiber is on the editorial board of Wolters Kluwer - CCH, and Thomson - RIA. He has written over 25 books and is the co-editor of Corporate Business Taxation Monthly (CCH). He speaks at numerous conferences in the United States and Asia. Margaret Kent (Key Biscayne, FL) is an attorney with Feinschreiber and Associates. She focuses on law and international taxation. She has been involved in a number of international transactions (i.e., structured the termination of the $2 billion per year aid from Russia to Cuba; structured transfer pricing in Latin America: Argentina, Chile, Colombia, Costa Rica, and Venezuela). Kent is also the co-editor of Corporate Business Taxation Monthly (CCH).

Inhaltsangabe

Preface xxi
PART ONE: COUNTRY-BY-COUNTRY ANALYSIS 1
Chapter 1 Introduction 3
Part One: Country-by-Country Analysis 3
Part Two: Advanced Applications 4
Chapter 2 Australia's Risk Assessment Transfer Pricing Approach 7
Introductory Issues 8
Transfer Pricing Reviews 8
Documentation Requirements 10
Preparation of the Documentation File 11
Applying the Arm's Length Principle 13
Simplified Approach to Doing a Benchmarking Study 13
Four Steps for Testing International Transfer Prices 14
Decision Tree 16
How the ATO Scores Risk 16
Scoring the Three Levels 17
Score Graph 18
Outcome of Transfer Pricing Review or Audit 19
Audits Taking Place in Low-Risk Situations 20
Transfer Pricing Review Process 20
Categorizing the Results of the Transfer Pricing Review 21
How the Australian Transfer Pricing Audit Procedure Works 22
Australia's Four-Step Process for Businesses 22
Chapter 3 Profit Attribution for a Dependent
Agent's Permanent Establishment in Australia 25
Permanent Establishment Concepts in Australia 26
Profit Attribution Concepts in Australia 26
The ATO's Operational Approach 26
Determining Functional Analysis for a Permanent Establishment 27
Comparative Analysis for the Permanent Establishment 29
Application of the Resale Price Method 31
Application of the Cost Plus Method 31
Using a Transactional Net Margin Method 32
Using a Profit Split Method 32
Toll Manufacturers 34
Four Examples 35
Notes 47
Chapter 4 Australia's Advance Pricing Arrangement Program 49
Pre-Formal APA Discussions 50
APA Processing Times 51
Unilateral and Bilateral APAs 52
The ATO's APA Work in Process 52
APA Issues and Methods 52
Chapter 5 China Implements Transfer Pricing Procedures 55
Overview 55
Regulations 56
Chapter 1: General Principles 56
Chapter 2: Reporting and Filing of Related Party Transactions 59
Chapter 3: Administration of Contemporaneous Documentation 62
Chapter 4: Transfer Pricing Methods 66
Chapter 5: Transfer Pricing Audits and Adjustments 71
Chapter 6: Administrative Guidance Concerning Advance Pricing Arrangements
78
Chapter 7: Administrative Guidance Concerning Cost Sharing Agreements 87
Chapter 8: Administrative Guidelines Concerning Controlled Foreign
Corporations 91
Chapter 9: Administrative Guidance Concerning Thin Capitalization 93
Chapter 10: Administrative Guidance Concerning General Anti-Avoidance 96
Chapter 11: Corresponding Adjustments and International Negotiations 98
Chapter 12: Legal Responsibility 99
Chapter 13: Supplementary Provisions 101
Notes 102
Chapter 6 Reporting Related Party Transactions in China 105
Form 1-Related Party Relationships 106
Form 2-Summary of Related Party Transactions 109
Form 3-Purchases and Sales 111
Form 4-Services Form 112
Form 5-Intangible Assets 113
Form 6-Fixed Assets 113
Form 7-Financing 114
Form 8-Outbound Investment 115
Form 9-Outbound Payments 118
Notes 119
Chapter 7 Hong Kong Advance Ruling Cases: Taxability of Profits 121
Advance Ruling Process 121
Advance Ruling Case No. 4 122
Advance Ruling Case No. 8 123
Advance Ruling Case No. 9 125
Advance Ruling Case No. 10 126
Advance Ruling Case No. 11 127
Advance Ruling Case No. 12 128
Advance Ruling Case No. 13 130
Advance Ruling Case No. 16 132
Advance Ruling Case No. 19 133
Advance Ruling Case No. 21 134
Advance Ruling Case No. 23 135
Advance Ruling Case No. 26 136
Advance Ruling Case No. 30 137
Advance Ruling Case No. 34 138
Advance Ruling Case No. 35 139
Advance Ruling Case No. 36 140
Advance Ruling Case No. 37 141
Chapter 8 Hong Kong Transfer Pricing Guidelines 143
Double Tax Agreements 143
Arm's Length Principle 143
Associated Enterprises 145
Appropriate Adjustments 146
Inland Revenue Ordinance and Case Law 147
Permanent Establishment Considerations 150
Applying the Arm's Length Principle 151
Four Steps 153
Functional Analysis 153
Comparability Analysis 154
Determining Comparability 155
Functions, Assets, and Risks 155
Contract Terms 157
Economic and Marketing Circumstances 158
Business Strategies 158
Global Price Lists 159
Establishing the Reliability of the Data 160
Transfer Pricing Methodologies 160
Sources of Profi ts and Income 162
Abusive Tax Schemes 163
Transfer Pricing Schemes 164
Transfer Pricing Documentation 166
Intragroup Services Arrangements 169
Deduction of Expenditures Paid for Intragroup Service 170
Determining the Amount of Intragroup Charges 171
Services Provided by a Permanent Establishment 173
Notes 174
Chapter 9 Hong Kong Challenges Abusive Tax Schemes 175
Macroeconomic Issues 176
Abusive Tax Schemes 177
Transfer Pricing Schemes 178
Lack of "Economically Significant Functions" 179
How the Hong Kong Government Combats Abusive Tax Schemes 179
Extreme Forms of Tax Abuse 180
Distinguishing Tax Avoidance from Tax Evasion 180
How the Reinvoicing Structure Operates 181
Shifting Intangible Property: The Tax Perspective 182
Notes 184
Chapter 10 Winning Hong Kong's Landmark Transfer Pricing Case 185
Ngai Lik Litigation 185
Hong Kong's Advance Ruling Determinations 186
Hong Kong Issues Transfer Pricing Guidelines 186
Statutory Provisions 187
Determination by the Court of Final Appeal 188
The Commissioner's Determination 188
Determination by the Board of Review 189
Determination by the Court of First Instance 189
Determination by the Court of Appeal 190
The Case before the Court of Final Appeal 191
Deficiencies in the Scheme as to Additional Annual Bulk Discounts Received
by Din Wai Electronics Limited 192
Deficiencies in the Scheme as to Manufacturing Profits 193
Deficiencies in the Scheme as to the Relevant Years of Assessment 196
Are the Scheme and the Tax Benefit Still Viable Bases for Section 61A
Assessments? 196
Is There a "Tax Benefi t" within the Meaning of Section 61A? 197
The Narrower Scheme and the Narrower Tax Benefit 197
Dominant Purpose of the Narrower Scheme 198
Board of Review's Approach 199
Ribeiro's Dominant Purpose of the Narrower Scheme 200
Commissioner's Assessment Power 202
Commissioner's Exercise of the Section 61A(2) Power 202
Board's Approach to the Exercise of the Section 61A(2) Power 203
Disposal of the Appeal 203
Notes 204
Chapter 11 Transfer Pricing Litigation in India 205
Background 205
Transfer Pricing Chronology and Administration 206
Related Parties 207
Transfer Pricing Method Selection in India 208
Contemporaneous Documentation in India 209
Audit Procedures 210
Penalties 211
Appellate Procedures 212
Transfer Pricing Litigation 213
Vodafone: Hutchison Essar Acquisition 215
Notes 215
Chapter 12 PE Issues Impact Indian Transfer Pricing 217
Background 218
Nexus, Effectively Connected Status, and Permanent Establishment 218
Four Fact-Based Permanent Establishment Inquiries 219
Impact of the Morgan Stanley Case 220
Permanent Establishment Transfer Pricing Litigation in India 220
Galileo 221
Hotel Scopevista 222
WorleyParsons 223
KnoWerx Education 223
ICICI Bank 224
Zimmer AG 225
Intergrafica 226
Ranbaxy Laboratories 226
Development Consultants 227
Perfitti 228
Data Software Research 229
SNC Lavalin /Acres Inc. 229
Airport Authority of India 230
Radha Rani Holdings 231
Mashreq Bank PSC 232
Mentor Graphics (Noida) Pvt. Ltd. 232
Millennium Infocom Technologies Ltd. 233
Van Oord ACZ India 233
Tokyo Marine & Fire Insurance Co. Ltd. 234
Western Union Money Transfer 235
Cargo Communities Network 235
Hyundai Heavy Industries 235
E. Gain Pvt. Ltd. 236
Infosys International Activities in New York State 236
Chapter 13 Taxation of Travel Services in India 239
Sabre 240
Galileo 243
Installed Hardwire 245
Notes 245
Chapter 14 Transfer Pricing in Indonesia 247
Historical Background 247
Transfer Pricing Considerations 248
Special Attachment 249
Chapter 15 Japan's Directive on Transfer Pricing Operations 251
Background 251
Regulations and the Examples-How They Differ 252
Operation of the Japanese Transfer Pricing Administrative Guidelines 253
Chapter 1: Defi nitions and Basic Policies 253
Chapter 2: Examination 254
Chapter 3: Points to Note in Calculating Arm's Length Prices 269
Chapter 4: Treatment of Foreign Transferred Income 272
Chapter 5: Advance Pricing Arrangements 274
Notes 288
Chapter 16 Selecting the Arm's Length Price in Japan 289
Background 290
Demonstrating the Selection of Arm's Length Price 290
Selection of the Method of Calculation of Arm's Length Price 290
Case 1: Use of the Comparable Uncontrolled Price Method 291
Case 2: Use of the Resale Price Method 299
Case 3: Use of the Cost Plus Method 301
Case 4: Methods Consistent with the Comparable Uncontrolled Price Method
303
Case 5: Methods Consistent with the Cost Plus Method 307
Case 6: Transactional Net Margin Method 311
Case 7: Contribution Profi t Split Method 316
Case 8: Residual Profi t Split Method 320
Case 9: Adjustment for Differences 323
Notes 325
Chapter 17 Applying Japanese Intangible Transfer Pricing Methods 327
Case 10: Intangibles Created by R&D and Marketing Activities 328
Case 11: Distribution Channels and Quality Control Know-How 333
Case 12: Know-How Accumulation through Human Resource Business Activities
335
Case 13: Contributions to Create, Maintain, and Develop Intangible
Properties 339
Case 14: A Company Bearing only the Cost of Creation of the Intangible
Properties 341
Case 15: Intangible Properties for Employees on Loan 343
Chapter 18 Japanese Profi t Split Transfer Pricing Methods 345
Case 16: Applying the Profi t Split Method to a Series of Foreign-Related
Transactions 346
Case 17: Excluding Transactions from the Profit Split Method 349Contents
xiii
Case 18: Calculation of the Profi t to Be Split 352
Case 19: Differences in Labor Costs Impact the Residual Profit Split Method
358
Case 20: Treatment of Market Fluctuations 361
Case 21: Calculation of Basic Profi t 364
Case 22: Factors for Splitting the Residual Profit 367
Chapter 19 Japanese Guidelines Address Diverse Transfer Pricing Issues 373
Case 23: Determining Whether Services Provide Commercial Value 373
Case 24: Multiple-Year Considerations 377
Case 25: Establishing the Target Profit Margin 380
Case 26: Critical Assumptions 384
Chapter 20 Malaysia Advance Ruling Guidelines 387
General Facets of the Advance Ruling Procedure in Malaysia 388
Binding Nature of an Advance Ruling 388
Scope of the Advance Ruling Request 389
Circumstances in Which Malaysia Tax Authorities Will Not Issue an Advance
Ruling 390
Circumstances in Which the DGIR Can Decline to Issue an Advance Ruling 391
Notice Requirements 392
Advance Ruling Application Procedure 392
Advance Ruling Application Form 393
Information Request Requirement 394
Issuance of the Advance Ruling 394
Advance Ruling Finality and Disclosure 395
The DGIR Can Withdraw the Advance Ruling 396
Situations in Which the Advance Ruling Ceases to Apply 396
Fee Structure 397
Internal Procedure 397
Notes 397
Chapter 21 Malaysia Transfer Pricing Guidelines 401
Introductory Provisions 401
Malaysian Transfer Pricing Procedure 402
Application of the Arm's Length Principle 403
Malaysia's Transfer Pricing Regime 403
Comparability and Transfer Pricing 404
Transfer Pricing Alternatives 407
Comparable Uncontrolled Price Transfer Pricing Method 407
Resale Price Transfer Pricing Method 409
Cost Plus Transfer Pricing Method 411
Additional Transfer Pricing Methods 413
Profit Split Transfer Pricing Method 414
Residual Analysis Example 415
Transactional Net Margin Method 418
Intangible Property 419
Transfer Pricing Services Regulations 420
Documentation 421
Malaysia Issues Advance Rulings Guidelines 423
General Facts about of the Advance Ruling Procedure in Malaysia 423
Binding Nature of an Advance Ruling 424
Scope of the Advance Ruling Request 425
Advance Ruling Application Procedure 427
Advance Ruling Application Form 428
Information Request Requirement 429
Issuance of the Advance Ruling 429
Advance Ruling Finality and Disclosure 431
The DGIR Can Withdraw the Advance Ruling 431
Situations in Which the Advance Ruling Ceases to Apply 432
Fee Structure 432
Internal Procedure 433
Notes 433
Chapter 22 New Zealand Transfer Pricing Developments 439
New Zealand Transfer Pricing Guidelines 440
Initial Developments 440
Arm's Length Principle and the Pricing Methods 441
Basics of the Transfer of Intangible Property 442
Profit Split Method and the Joint Ownership of Intangible Property 443
Profit Split Method 444
Residual Profit Split Analysis 444
Transactional Net Margin Method 445
Market Penetration Techniques 445
Australia's Four-Step Process to Ascertain the Arm's Length Approach 446
Documentation 446
Documentation and the Burden of Proof Rule 447
Inland Revenue Seeks to Ascertain the Risks to the Revenue 447
Retention of Records 448
Transfer Pricing in Countries without a Double Tax Agreement 449
Intangible Property Audits 450
Trade Intangibles and Marketing Intangibles 450
Ascertaining the Arm's Length Amount for Intangible Property 451
Ascertaining the Ownership of Intangible Property 451
Factors in Ascertaining the Nature of Intangible Property 452
Terms and Conditions of the Intangible Property Transfer 453
Valuing Intangible Property 454
Non-Owner's Marketing Activities 454
Applying the Profi t Split Method to Intangible Property 455
Intangible Property Planning 456
Chapter 23 Philippine Transfer Pricing Regulations 457
Scope of the Philippine Provisions 458
Philippine-Specific Provisions 458
Chapter 24 Singapore Implements Advance
Pricing Arrangement Procedure 461
Objectives of the Supplementary Circular 462
What the Supplementary Circular Provides 462
Minimum Information Requirements 462
Considerations for Accepting the APA 463
Pre-Filing APA Process 464
Formal APA Submission Procedures 466
APA Review and Negotiations: Considerations and Requirements 467
APA Roll-Back 468
Discontinuation of the APA Process 469
Nonsubmission of the APA Application 469
Insuffi cient Level of Support during the APA Process 470
Absence of Communication 470
Effective Date 471
Notes 471
Chapter 25 Singapore Transfer Pricing Consultation Process 475
Background 475
Objectives of the Transfer Pricing Consultation 476
Issuance of the Transfer Pricing Questionnaire 476
Transfer Pricing Consultation 477
Transfer Pricing Questionnaire 478
Notes 480
Chapter 26 Singapore Transfer Pricing Guidelines 481
Key Concepts and Arm's Length Principles 482
Three-Step Approach 483
Comparison of Economically Signifi cant Functions 483
Comparable Uncontrolled Price Method 484
Transfer Pricing Method Selection 484
Transfer Pricing Documentation 488
Mutual Agreement Procedures 490
Advance Pricing Agreements 491
Comments 491
Notes 491
Chapter 27 Singapore Transfer Pricing Guidelines for Related Party Loans
and Services 493
Transfer Pricing Guidelines for Related Party Loans 494
Two Loan Categories 494
Facts and Circumstances to Determine Comparability Analysis 496
Transfer Pricing Guidelines for Related Party Services 497
Direct Charging versus Indirect Charging of Services 499
Ascertaining the Arm's Length Fee 500
Routine Services and the 5% Markup 500
Cost Pooling Contracts 503
Strict Cost Pass-through 504
Documentation 505
Notes 506
Chapter 28 South Korea Transfer Pricing 507
Background 507
Related Party Transfer Pricing Relationships in Korea 508
Computation of Indirect Ownership 509
Economic Interest and Control 509
Transfer Pricing Method Alternatives 510
Information Requests and Documents 512
Transfer Pricing Audits 514
Permanent Establishment, Competent Authority, and Advance Pricing
Agreements 515
Thin Capitalization and Tax Havens 515
Applying the "Most Reasonable Method" Standard to Determine Arm's Length
Price 516
Underpayments and Overpayments 517
Selecting Transfer Pricing Methods 517
Reporting Methods for Determining Arm's Length Price 518
Advance Pricing Arrangements 518
Sanctions Imposed on Failure to Comply with the Data Request 520
Penalties 520
Thin Capitalization Rules 521
Debt under an Arm's Length Situation 522
Anti-Tax Haven Rules 522
Scope of the "Tax Haven" Jurisdiction 523
Computation of the Reserved Income Distributed Amount 524
Gift Tax on Property Located Outside Korea 524
Mutual Agreement Procedure 525
International Tax Cooperation 525
Note 526
Chapter 29 Sri Lanka Transfer Pricing 527
Associated Undertakings 528
Arm's Length Price 528
Documentation 529
Threshold for Applying Sri Lanka Transfer Pricing 529
Advance Pricing Agreements 530
Burden of Proof 530
Implementation 530
Annex 1: Test of Control-Associated Undertaking 530
Annex 2: Arm's Length Pricing Methodologies 531
Annex 3: Appropriate Pricing Methodology-Factors to Consider 536
Annex 4: Comparability of an Uncontrolled Transaction-Factors to Consider
536
Annex 5: Prescribed Documentation 537
Suggested Supporting Documents 538
Chapter 30 Taiwan Transfer Pricing 539
Enactment of the Transfer Pricing Statute 539
Transfer Pricing Regulations 540
Chapter 31 Thailand Transfer Pricing 547
Transfer Pricing Booklet 548
Part 1: Tax Legislation Impacting Transfer Pricing 548
Revenue Department of Thailand Departmental Instruction Paw 113/2545 549
Part 2: Methodologies in Calculating Market Price 554
Part 3: Process in Establishing the Market Price 554
Process of Establishing the Market Price 556
Guidelines on the Determination of Market Price 557
Chapter 32 Vietnam Transfer Pricing 559
Expansive View of Related Party Ownership 560
Transfer Pricing Methods 560
Documentation Requirements 561
Compliance Considerations 561
PART TWO: ADVANCED APPLICATIONS 565
Chapter 33 Services Transfer Pricing in Hong Kong and in Singapore 567
Services Transfer Pricing in Hong Kong and in Singapore: Basic Comparison
567
Hong Kong Services Transfer Pricing Methods 568
Shareholder Activity and Stewardship Functions 569
Financial Services Audit Example 570
Deduction of Expenditures Paid for Intragroup Services 570
"Objective Commercial Explanation" Standard 571
Determining the Amount of Intragroup Charges 572
Services Provided by a Permanent Establishment 573
Scope of Activities for Related Party Services in Singapore 574
Singapore Transfer Pricing Services Guidelines 575
Direct Charging versus Indirect Charging of Services 576
Ascertaining the Arm's Length Fee 577
Routine Services and the 5% Markup in Singapore 577
Cost Pooling Contracts 580
Cost Pooling versus Pass-Through Allocation Alternatives 582
Documentation 583
Notes 583
Chapter 34 Permanent Establishment Parameters: Hong Kong versus India 585
General Permanent Establishment Considerations 586
Permanent Establishment Considerations in India 586
Permanent Establishment Considerations in Hong Kong 588
Chapter 35 Pacific Tax Administrators Coordinate Transfer Pricing
Documentation 591
Background 591
PATA Provisions 593
Three Operative Principles 594
Specifi c Mandatory Documentation 596
Notes 603
Chapter 36 Shared Services and Cost Pooling Arrangements in the United
States and Singapore 605
Historical Background 606
Explanation of the Shared Services Arrangement Provisions 606
Shared Services Arrangements 608
Services Cost Method Examples 611
Singapore Shared Services Arrangements 620
Notes 622
Chapter 37 South Korea-Japan Bilateral Investment Treaty 623
Background 623
U.S. Involvement in BITS 624
Arbitration 624
ICSID Arbitration 624
Treaty Shopping within the Bilateral Investment Treaty Context 625
Tax Provisions within the Korea-Japan Bilateral Investment Treaty 626
Chapter 38 China-Taiwan Trade 629
Taiwan and China: A History Lesson 629
Economic Considerations 630
One-China Policy 630
Economic Cooperation Framework Agreement 631
Tax Considerations 632
Choice of Transfer Pricing Method 633
Functional Analysis 634
Analysis of the Production Activities 634
Fact Pattern 635
Accounting and Tax Operations 635
Permanent Establishment 636
Taiwanese-Chinese Electronics Company 636
Transactional Profi t Split Method Criteria 637
Most Appropriate Transfer Pricing Method 637
Allocation Key System 637
Strong Correlation Standard 638
Selecting among Allocation Keys 638
APA Process 640
Notes 640
Chapter 39 Malaysia-Singapore Allocation Keys 643
Importance of Allocation Keys 643
Selection of the Real Estate Leasing Example 644
When the Transactional Profit Split Method Is the "Most Applicable"
Transfer Pricing Method 644
Specialized Services 645
Applying the Transactional Profit Split Method 646
Four Allocation Keys Categories 647
Key Functions 647
Selecting Potential Allocation Keys 648
Residential Condominium Leasing Example 648
Residential Condominium Database 650
Selecting among Allocation Keys 650
"Strong Correlation" Standard 651
Allocation Keys 652
Transfer Pricing Strategies 656
Corporate Tax Strategy 657
Malaysia's Tax Strategy 657
Notes 658
Chapter 40 Permanent Establishment Parameters 659
OECD's Permanent Establishment Provisions 660
Consequences of Permanent Establishment Status 660
Consequences of a Permanent Establishment to Business 661
Transfer Pricing and Permanent Establishment 661
Overall Tax Considerations 662
Potential for the Imposition of Two Levels of Taxation 662
OECD Approach to Determine Permanent Establishment 663
Hong Kong Applies the OECD Permanent Establishment Provisions 663
How Hong Kong Applies the Permanent Establishment Provisions 664
Common Law Permanent Establishment Criteria 665
Direct Activities 665
Agency Relationships 666
Shareholder Activities in Subsidiaries' Locations 667
Presence of Personnel Shifts among Entities 668
Entirety of the Operations 668
Declining Businesses 668
"Preparatory to" and "Auxiliary from" Exemptions 669
Time Spent 669
Will the OECD Approach Prevail? 669
Notes 670
About the Authors 671
Index 673