Common use of A and B Clause in Contracts

A and B. The use of facilities for the purpose of delivery will not be considered a permanent establishment provided that these facilities are not used as sales-outlets in the Contracting State where these facilities are situated. The maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of delivery will not be considered a permanent provided that these goods or merchandise are not sold in the Contracting State where the stock is situated. VII. Ad. Article 7 1. The term “business profits” includes, but is not limited to, income derived from manufacturing, mercantile, banking, insurance, from the operation of inland transportation, the furnishing of services and the rental of tangible personal movable property. Such a term does not include the performance of personal services by an individual either as an employee or an independent capacity. 2. The business profits derived by an enterprise of a Contracting State from the exportation of merchandise to the other Contracting State shall not be taxed in that other Contracting State. Where export contracts include other activities carried on through a permanent establishment in the other Contracting State profits derived from such activities shall be taxed in the other Contracting State in accordance with this Article. VIII. Ad Article a) The taxable base shall be calculated in accordance with the internal legislation of each Contracting State along the lines of the principles contained in this paragraph. b) The term “expenses which are incurred for the purposes of the permanent establishment” provided for in this paragraph, means the expenses directly connected with the activity of the permanent establishment. IX. Ad Article 10 X. Ad. Article 26 XI. Ad. Article 26, paragraph 2 XII. In case the Kingdom of Saudi Arabia introduces an income tax applicable to its nationals who are resident in the Kingdom of Saudi Arabia, or the existing tax will be modified accordingly, then the two Contracting States shall enter into negotiations in order to introduce in the Convention an Article on non-discrimination.