Page 43 - UUBO Deal Academy 2020 - Materials

Concerns for PE Funds:

Action 7 – Permanent Establishment

▪ The OECD has proposed a broadening of the scope of what constitutes a

permanent establishment (pe) for treaty purposes

• Dependent agency pe has been broadened in scope;

• Independent agency pe has been narrowed in scope

▪ PE managers should expect greater scrutiny of their activities by source country

tax authorities, which may be considered to be local value creation and

therefore deemed taxable

▪ Action 7 has been widely adopted by OECD and IF members including Nigeria

(In addition to signing the MLI, S. 3 FA 2020 amends the source rules in S.13 of

CITA)

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