Here are the recent cases where the courts have considered whether or not Article 9 Associated Enterprise or it’s equivalent can be used as a “charging section” for TP in domestic legislation:
It should be noted that some countries like Australia and France have domestic tax provisions that entitle them to use Article 9 as a “tax charging provision”. But these need to be studied carefully.
Article 9 seeks to determine how profits should be divided between the associated enterprises, and taxed in the respective treaty countries according to their domestic laws. Klaus Vogel states: “…a tax treaty neither generates a tax claim that does not otherwise exist under domestic law nor expands the scope or alters the type of an existing claim, e.g. as with respect to the type of income or property…The extent to which a State levies taxes within the boundaries drawn by DTCs is determined exclusively by its own domestic law…”