Generally, a foreign company will have a Permanent Establishment in the UAE if it possesses a fixed or permanent place within the UAE through which the entity’s business is conducted or if there is an individual who possesses and routinely exercises authority to conduct business in the UAE on behalf of the foreign legal entity.

A fixed place of business shall not be considered a Permanent Establishment if it is solely used for the storage, display, or delivery of goods or merchandise owned by the foreign legal entity or for the execution of preparatory or auxiliary activities. A Permanent Establishment shall not arise if the legal entity that possesses and routinely exercises authority to conduct business in the UAE on behalf of the foreign legal entity operates as an independent agent. When applicable, international agreements should be taken into account when determining the existence of a Permanent Establishment.