Regulations Governing Application of Agreements for the Avoidance of Double Taxation with Respect to Taxes on Income Article 11

Pursuant to the provisions in association with the term permanent establishment under a DTA, where a permanent establishment is used or maintained solely for the purpose of a specified activity or any combination of specified activities, and for that reason that permanent establishment may be deemed not to be constituted in the territory of the ROC, those specified activities or any combination of specified activities referring in the provisions under such DTA shall be limited to those of a preparatory or auxiliary character.The term “of a preparatory character” mentioned in the preceding paragraph means an activity which is ancillary in nature and is carried out to precede the conducts that constitute the essential and significant part of the business activity of an enterprise as a whole in the territory of the ROC. The term “of an auxiliary character” means a specified activity or any combination of specified activities under a DTA carried on as mentioned in the preceding paragraph that is not a core, essential or significant part of the business activity performed by an enterprise of the other Contracting State within and outside the territory of the ROC as a whole.