Vietnam GDT deems subsidiary of multinational a dependent agent PE

A recent ruling from the Vietnam GDT has deemed that the Vietnam subsidiary of a multinational company is actually a PE of the foreign parent. As a result, the revenue share that the subsidiary pays to the foreign parent cannot be exempt from Vietnam withholding tax under the DTA Vietnam has with the country of residence of that parent. The GDT reignites an interpretation that was made famous by the Italian Supreme Court in the Philip Morris case. The consequences for tax planning in Vietnam might be far-reaching.

This Analysis includes the following points:

• Agency PE
• Philip Morris revisited?
• What may be the impact of OL No. 2065 in Vietnam?