international employment law firm alliance L&E Global

5. Business Presence Issues

a. How the Use of One or More Independent Contractors Creates a Permanent Establishment in Country and the Ramifications

The term “permanent establishment” is defined in the Nordic tax treaty. Permanent establishment means a fixed place of business through which the business of an enterprise is wholly or partly carried on. The term permanent establishment includes especially:

  • a place of management a branch
  • an office
  • a factory
  • a workshop, and
  • a mine, an oil or gas well, a quarry or any other place of extraction of natural resources.

A building site or a construction, installation or assembly project, or activities consisting of planning, supervising, consulting or other auxiliary work by personnel connected with such a project, constitutes a permanent establishment only if the project lasts more than 12 months and is carried out in the same place. When a person is acting in another Nordic country on behalf of an enterprise and he has, and habitually exercises, an authority to conclude contracts in the name of the enterprise, the enterprise shall be deemed to have a permanent establishment, so-called dependent agent. An enterprise shall not be deemed to have a permanent establishment in a Contracting State merely because it carries on business in that State through a broker, general commission agent or any other agent of an independent status, provided that such persons are acting in the ordinary course of their business.

b. How the Employment of One or More Individuals Creates a Permanent Establishment in Country and the Ramifications

In Norway, “permanent establishment” as a kind of “permanent work place” is defined as “the place where you normally perform your work tasks”.

Any questions

Ask our member firm Helmr in Norway