things attached to land or permanently fastened to anything attached to land.
Apart from defining the meaning of immovable property according
to the respective laws of each Side, it is specifically provided in paragraph 2 of Article 6 that certain assets and rights must always be regarded as immovable property. These assets and rights include property accessory to immovable property, livestock and equipment used in agriculture and forestry, and rights to
which the provisions of general laws in respect of real estate apply. ships and aircraft shall never be regarded as immovable property.
The term “property accessory to immovable property” does not mean
a simple storage in or in connection with immovable property, but refers to a component part of an essential function of the immovable property, such as an
air-conditioning system or elevator of a building.
Paragraphs 1 and 3 of Article 6 also apply to income derived by an
enterprise from immovable property. According to the rules set out above, income derived by an enterprise of One Side from immovable property situated in the Other Side may be taxed in that Other Side, regardless of whether it has a permanent establishment in that Other Side, whether the immovable property is part of that permanent establishment, or whether the income is derived through
that permanent establishment.
Allocation of taxing rights
Business profits refer to profits derived by an enterprise from its
Under the provisions of paragraph
of Article 7, that Side (i.e.
Side has no right to tax) unless the enterprise carries on business in the Side through a permanent establishment situated therein, in which case
attributable to that permanent establishment.