New regulations approved by The Upper House of the German Parliament on the application of the arm’s length principle to profit allocations between head office and permanent establishments, which follow the authorized OECD approach (AOA) and is applicable from January 2015.
The PE Regulations are binding on taxpayers, the tax administration and tax courts. They provide detailed rules on the application of the “Authorized OECD Approach” (AOA) and thus should help taxpayers in applying the AOA in practice. The AOA itself has already been enacted with effect from 2013.
